Councilman a Target of Upcoming Trial in Condo Owners’ Suit : Court: Larry Zarian, an investor in Glen Valley units, is among defendants in a $15-million action that alleges shoddy construction.

A $15-million lawsuit alleging that City Councilman Larry Zarian and his business partners knowingly sold poorly built condominiums is scheduled to begin trial later this month, five years after it was filed by a group of dissatisfied homeowners.

The Superior Court case, which names numerous defendants including contractors and a group of New York investors that briefly owned the property, alleges flaws ranging from leaking pipes and faulty electrical systems to walls so thin that conversations are easily overheard.

Zarian, a 12-year Glendale council member and real estate investor who is currently running for his fourth term, said his involvement in the project was limited to a $350,000 investment.

“I have been investing in real estate in this city since I was 20,” Zarian said. “There isn’t an amount of money that would convince me to sell my reputation or do something illegal.”

Signs of decay are evident throughout Glen Valley Condominiums, a 95-unit complex on Montrose Avenue, and residents describe their lives there as plagued by daily frustration.

“When I give my daughter a bath, I can only fill up the tub so far because it overflows into the apartment downstairs,” said Mary Michailov who, with husband Michael, was one of the first buyers to move into the complex in 1989.

“You name the construction defect and we have it,” Michailov continued. “This building should never have been built.”

Inside the units, plaster peels from walls that according to the suit have suffered water damage from constantly leaking pipes. Outside, rainwater seeps under doors and into living rooms because walkways are incorrectly sloped, court documents said.

During the recent storms, some residents had to shield their homes with sandbags and bricks.

Dwight Clark, president of the Glen Valley Homeowners Assn., said he had to install padding and carpet on his bedroom wall because he could clearly hear conversations taking place in the adjoining unit.

He said he also had to move his daughter from her first-floor bedroom to a loft for fear that peeling plaster from the ceiling might fall on her during the night.

“It’s a mess from top to bottom,” said Clark.

Most homeowners at the complex are senior citizens or first-time buyers who said they paid between $110,000 and $190,000 for the units. Some had looked forward to moving from their “starter home” in a few years.

But because the building is so riddled with problems, many said they are unable to sell unless they take a huge financial loss.

Some residents said they are astounded that the project passed city inspection.

But Kerry Morford, assistant director of the Public Works Department, which includes building inspection, said the system cannot catch all flaws.

“When the inspectors go out to a construction site, their job is to make sure the minimum building codes are being met,” said Morford. “There may be some things that constitute poor workmanship that they (the homeowners) are calling construction defects, even though they may have met the minimum code.”

According to court records, Zarian was a one-third investor in the project. His partners were Vahe and Haerik Hovsepian, with whom he has collaborated on other real estate ventures. Also named as a defendant in the suit is Varooj Hovsepian, head of Sepian Construction Co., which built the condos.

Construction of Glen Valley was completed in April, 1989. But, according to the suit, it did not take long for those moving in to discover problems with the building and to become frustrated at what they said was the sellers’ lack of response.

The homeowner association filed suit in Glendale Superior Court in February, 1990, less than a year after the condominiums were put on the market.

Among the allegations raised in the suit were that inferior construction materials were used, the complex failed to meet numerous city building codes and that the sellers knew the buildings were defective.

Lee Barker, an attorney representing the homeowners, said evidence will be presented at trial showing that Zarian was actively involved in the sale of the condominiums, attended sales meetings and monitored the sales.

Zarian maintains he was only a passive investor.

“I am not a developer and I was not the developer of this project,” Zarian said. “I was brought in as an investor in a partnership, with an understanding by the other two partners that they would be the developers of the property.”

“As far as the day-to-day workings of the construction,” he said, “I had no say, nor did I ever have any contact with any building inspectors.”

He said he is being sued “because everybody associated with the project is being sued,” and the homeowners are trying to use his status as a public official to draw attention to their case.

Attorneys with the Los Angeles law firm Booth, Mitchell & Strange, who represent Glen Mont Investments, the partnership under which Zarian and the Hovsepians built the condominiums, did not return repeated calls. The Hovsepians also could not be reached.

Because there are 16 law firms involved in the case, many of whom represent subcontractors who worked on the project, the trial has been transferred out of Glendale and to a more spacious Superior Court Division in the Mid-Wilshire District.

The trial could begin this week, and the case could take two to three months to be resolved.

Some homeowners said they hope that their living conditions will finally improve if they are victorious in court with a $15-million settlement.

“The reason we’re asking for such a high amount in this case is that we’ve actually got to fix this stuff,” Clark said.

“All we’re trying to do is prove these problems exist and that they should be fixed so we can go on with our lives.”