Baldwin Co., Subcontractor Settle Lawsuit
Newport Beach developer Baldwin Co. will pay $3.7 million to settle a $9-million claim by a disgruntled subcontractor who had placed a lien against the Emerald Bay luxury estate of company co-owner James Baldwin.
The settlement with Agoura Hills grading contractor Paul Ebensteiner was approved Thursday in U.S. Bankruptcy Court in Santa Barbara. The impact of the settlement on Baldwin Co.’s financial resources is unclear.
Baldwin filed a Chapter 11 bankruptcy petition in July and currently is operating with a $15-million credit line provided by a group that includes three of the company’s largest creditors.
The settlement ends a bitter suit that had pitted Ebensteiner against longtime personal friend James Baldwin and his brother, Alfred.
The brothers own Baldwin Co. and Ebensteiner did most of the grading at their 800-acre Portola Hills master-planned development in south Orange County. The contractor extended the Baldwin Co. millions of dollars of credit when the developer started running short of cash in the early 1990s.
Ebensteiner obtained personal loan guarantees from the Baldwin brothers, which allowed him to file a lien against James Baldwin’s personal residence last year. Ebensteiner’s suit contended that Baldwin Co. and the Baldwin brothers refused to pay his company for work done at Portola Hills and other Baldwin Co. developments.
In a counter-suit, the Baldwins contended that Ebensteiner & Co. had failed to do work required under contracts with Baldwin Co. and that Paul Ebensteiner had conspired with a former Baldwin executive to submit inflated bills.
The settlement, said Alfred Baldwin, ends all of that.
Separately, Baldwin confirmed Thursday that his company is trying to sell 160 lots in its Summit development in Anaheim Hills as well as 50 lots at a large development in Calabasas to help raise cash.
As Baldwin Co. develops a bankruptcy recovery plan, which is scheduled to be filed in court at the end of March, everything the company owns will be evaluated for its ability to generate cash, Baldwin said. In all, the Baldwins control about 5,000 acres of Southern California residential land through Baldwin Co. and several other businesses not involved in the bankruptcy.
