Council Gives Up Fight to Block Warner Ridge : Woodland Hills: The massive commercial project will be built despite neighbors’ bitter opposition.

Defeated by adverse court rulings, the Los Angeles City Council on Wednesday abandoned efforts to block construction of a large commercial project on Warner Ridge in Woodland Hills, surrendering in a battle that may haunt city planning.

The council voted 11 to 2 to allow construction of a 690,000-square-foot commercial project and 125 condominiums on the 21.5-acre site, despite bitter opposition from neighbors and their representative, Councilwoman Joy Picus. The only votes against the settlement came from Councilman Joel Wachs and Picus, who continued to attack the project.

Under the settlement, the developers agreed to accept building permits instead of the $100 million in damages they had sued the city for. The developers will not only be given permission to build the project but won exemptions from as much as $25 million in various city fees they would otherwise have had to pay, such as traffic mitigation and arts fees.

Witnessed by a bevy of attorneys, the agreement was read into the record before Superior Court Judge R. William Schoettler, who helped mediate the settlement.

The lawsuit alleged that the council, led by Picus, illegally changed the zoning of the Warner Ridge site in 1990 to block the project, despite the designation of the site for commercial use in the Community Plan.

Although the agreement will settle the lawsuit, the suit’s reverberations have shaken the city’s planning foundation.

A Court of Appeal ruling in the case, which supported the developers, may have established that the zoning on as many as 8,000 parcels in the city is illegally at odds with the applicable community plans. The Warner Ridge litigation also inspired at least one similar lawsuit against the city by another disappointed Woodland Hills developer, this one for $2.5 million.

Council President John Ferraro said Wednesday in the wake of the city’s decision to give up the Warner Ridge fight that the experience should teach the council to be more cautious in seeking to block development.

“We’re going to have to be more respectful of the law and of property owners’ rights,” said Councilman Hal Bernson, another council negotiator. “And we can’t allow ourselves to be run by the homeowners and those who cry the loudest.”

Meanwhile, Picus angrily decried the settlement, accusing her colleagues of caving in to the “greedy developers and Eastern banks” who, she said, were behind the Warner Ridge project.

The victor in the settlement was Warner Ridge Associates, a partnership composed of Johnson-Wax Development Co. and the Spound Cos. that owns the site.

“I’m going to build some buildings now,” said developer Jack Spound. Spound said he is negotiating with a prospective tenant, which has signaled a desire to rent most of what Spound is allowed to build. He declined to name the prospect.

Robert Gross, president of the Woodland Hills Homeowners Organization, said he was outraged by the council’s decision. His group led opposition to the project, charging that it would dump 6,000 additional auto trips onto local streets each day.

Nor was Gross conceding defeat Wednesday. “The fat lady hasn’t sung yet,” he said, noting that his organization may file suit to overturn the settlement.

However, Carlyle Hall, a land-use attorney who has represented homeowners, predicted it will be difficult to challenge the settlement. According to Ferraro, Hall was instrumental in helping persuade lawmakers that the city was bound to lose if it continued the fight by appealing to higher courts. “He had credibility with a certain group of council members who might not choose to believe me when I told them our case wasn’t good,” Ferraro said.

Other sources close to the litigation also credited Ferraro and attorney Richard Riordan, a city recreation and parks commissioner with political ties to Mayor Tom Bradley, with helping get the wheels going toward a settlement last week.

In recent weeks, two court rulings knocked the legs from under the city’s defenses in the litigation.

The first was by the state Court of Appeal, which held Dec. 31 that the city had acted illegally by zoning the site for 65 single-family houses when the Community Plan designated the land for commercial development. The council should have obeyed the dictates of its Community Plan, the court said.

Within a week, Superior Court Judge Kathryn Doi Todd ruled that the city had deprived the Warner Ridge owners of all economically viable use of their property.

Todd’s ruling meant that the only remaining legal squabble would be over the amount of damages the city owed.

The estimates ranged from $15 million to $50 million, depending on whether the city wanted to give the developer some commercial development rights or none at all--and essentially end up buying the property from the partnership.

Additionally, Todd in recent private pretrial conferences indicated that she was astonished at the city’s seeming inability to put together a coherent case on the damages issue, according to sources familiar with those proceedings.

“We didn’t have much of a hand being dealt to us,” said Ferraro of the court decisions. “And we’re not in such a very good financial position that we can afford a multimillion-dollar judgment against us.” Thus, he said, it was reasonable to settle the case.