Developers Knew of Landslide Risk, Lawsuit Contends

Developers of a subdivision where four homes tumbled down a hillside in March were warned a decade ago about building on unstable ancient landslides but produced their own geological reports that persuaded county officials to let the project proceed, documents show.

Six landslides--places where layers of the earth once slipped--were identified in 1985 on a 900-acre tract where Hon Development proposed building more than 1,500 houses. Hon was told by its geological consultant that the stability levels of the six landslide areas were “generally less than acceptable,” according to newly obtained documents, and that large parts of the parcel were “probably unstable.”

But ultimately, the consultant and the developer believed that by excavating and buttressing the uneven slopes and redistributing 4 million cubic yards of earth, they could fortify the area and build safely, according to geological studies filed with the county.

Work on the Niguel Summit development commenced in 1986 but was halted that same year when residents of an existing condominium complex downhill from the development complained of cracking walls and buckling roads. But once more, Hon and its geological consultant, Leighton and Associates of Irvine, conducted a study and produced reports that persuaded the county that the tract could still be developed safely.

The problem on the hill, however, turned out to be what some experts working for the homeowners now say is a seventh old landslide that reactivated. On March 19, it upended condominiums and sent houses crashing into the ravine--11 years after developers had concluded they had solved the problem.

“Obviously, they were wrong,” said Kenneth Kasdan, an Irvine attorney representing 26 homeowners who are suing the developer and others for the lost value of their houses located near those that were destroyed. The homes are valued at $500,000 or more.

According to more than 3,000 pages of records related to Niguel Summit, the early stages of construction were stormy:

* Development repeatedly was halted after complaints of mudslides, slope washouts, erosion and dust.

* Grading was interrupted nearly 40 times in two years over concerns that work was not done correctly and did not follow detailed plans filed with the county.

* Permits were blocked--temporarily--when the slope behind the houses on Via Estoril showed signs of failing in 1986 and 1987.

County Defends Process

County officials said the process worked properly: The landowner has the burden of hiring the experts to show the project can be safely and legally built.

Hon officials did not return phone calls to comment for this story. In a previous interview, Robert Smart, Hon vice president for finance, said the company is primarily interested in fixing the crumbling slope and settling with homeowners who have been displaced.

But charges of impropriety have been leveled in civil suits by homeowners and by owners of condominiums that also were damaged in the March 19 landslide.

“Builders do shop for their own geotechnical engineers,” said Thomas E. Miller, a Newport Beach construction defects expert and attorney for the 41 condominium owners, half of whom have been evacuated from their homes. “We’ve even seen where builders have shopped around various soil engineers until they get the answer they want.”

An official with Leighton and Associates said no professional geological firm would provide a developer with misleading information.

“Knowing the state of the art at the time, the standard of care that was adhered to is what any other geotechnical firm consulting at the time would have done,” said Frederick Gebhardt, director of risk management for the firm. “It’s one of those unknowns that comes back and bites you.”

Though not risk-free, building above ancient landslides is generally accepted by experts if the landslides have been stabilized or removed by excavation.

But attorney Kasdan said the homeowners were not told about the old landslide activity when they were given subdivision reports at the time of their home purchases starting in the late 1980s.

“The documents given to them indicate a geological report was prepared. But they were not aware there were landslides in the area,” he said.

When Hon proposed Niguel Summit in 1985, county officials were trying to monitor nearly 10,000 new houses being built each year, most in South County.

Maps and plans had identified the six previous landslides around Niguel Summit. Hon proposed building over portions of four of them. And county geologists agreed--though hesitantly at times--that those areas could be developed safely. Two other landslide areas were at the edge of the site. They were left undeveloped.

Once the earthmoving began, complaints started pouring in. Retaining ponds in the hills overflowed and caused mudslides that blocked Crown Valley Parkway. Blasting rocked area residents. Dust and noise were aggravating to residents. Leaders of the unincorporated area that would become Laguna Niguel in 1989 questioned whether the county could adequately police developers.

Thomas F. Riley, then the 5th District supervisor, stepped into the fracas. In 1986, the usually pro-development supervisor accused development firm owner Barry Hon of putting him in a politically uncomfortable position.

“The stream of complaints . . . has had an effect on your reputation in the community and has put me in a very difficult position and left me looking as if I cannot control the developers of my own district,” Riley wrote Hon.

Riley called for greater cooperation “so we can return this development project to normal.”

Documents show that the developer was forced to stop work in 1986 because of the apparent seventh landslide, which was blamed for damaging the Crown Cove condominiums at the bottom of the slope. The project was delayed for much of the next year.

The Leighton firm designed a series of thick, deep concrete pilings that they believed would buttress the bottom of the hill against further movement from the top, the documents say.

Seventh Landslide

Other geologists retained by attorneys representing the homeowners say Leighton’s plan wasn’t sound. The pilings may have worked, but the geologists say they weren’t sunk deeply enough and weren’t grounded in bedrock--a charge Leighton officials deny. Leighton also disputes that last month’s slope failure resulted from a seventh ancient landslide. However, they declined to explain why the slope failed.

“There is no ancient landslide out there,” Gebhardt from Leighton said, referring to the site behind Via Estoril.

The homeowners’ geologists disagree.

“Way back when, the land moved, and now it wants to move again,” said Awtar Singh of the Los Angeles firm Lockwood-Singh, working for condominium owners displaced by the landslide. “It wants to move in the same place [it moved before]. It’s not unusual.”

Geologist Ralph Jeffrey, researching the hillside for the Niguel Summit Homeowners Assn. agreed, saying the ancient slide, like the current failure, is in the underground Monterey formation, a notoriously weak geological structure.

“It’s a formation prone to landslides throughout Southern California,” Jeffrey said.

At Niguel Summit, Hon and its contractors added and moved dirt to create terraced building pads so that nearly every lot was afforded glorious coastal vistas.

“Land becomes fairly scarce and the choice land is gone,” said Miller, the condo owners’ attorney. “So the more the developers can fill in the canyons with fill soils and build more building platforms, the more money they can make.”

Geologists said they can never be absolutely certain of the stability of land. Even if they detect an old, potentially active slide, they can’t say for sure if, let alone when, it could fail. None of the other six landslide sites have shown signs of instability.

“There are a lot of risks evident in building any hillside development in California,” said Gebhardt of Leighton. “We try to reduce those risks to as small as possible. We have to weigh the pressures of deadlines against the analysis that we’re doing.”

And at some point, a developer and local regulators have to use their best judgment, geologist Singh said.

“Science goes only so far. . . . These errors are made sometimes,” Singh said.

The Leighton firm pioneered the practice of making landslide-prone areas safe for building and has been helping develop Southern California for 40 years, said Gebhardt. However, the firm has never had a problem of the magnitude of the Niguel Summit collapse, he said.

“No one likes to see things like this,” Gebhardt said. “It grieves us that a project we worked on has an impact on families and dreams. It is not our intent to impose this trauma on anyone.”

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STILL SLIDING

Four houses and five condominiums were destroyed, others are doomed and 30 households have been evacuated after the March landslides in Laguna Niguel. Around the upscale development are at least six more ancient landslides that experts believe have been stabilized. Geologists continue to monitor the slope, which is moving between 3 inches and a foot each day, depending on the rain.

TIMELINE

1979-1980: Crown Cove condominiumss built

1980-1986: No reported signs of distress in the condos

Summer 1986: Slope graded for 1,529-home Niguel Summit project by Hon Development and several homebuilders, including J.M. Peters.

Late 1986: Extensive grading is undertaken on the hillsides and ridge tops, a Crown Cove retaining wall leans, roads buckle and condo owners begin reporting cracks. Work was halted by county.

1987: After a series of reports by Hon’s geotechnical firm urging resumption of construction, building resumes

1988: Homeowners begin moving in on Via Estoril, just up the hill from Crown Cove

1992: More buckling reported by condo owners

1994: Condo owners sue Niguel Summit developers

1996: Several homeowners on Via Estoril report stress damage; sue developers

Dec. 1997: Five homes and five condos evacuated

March 1998: Slope fails, homes slide down hill, five condos are upended

April 1998: Slope moving about 3 inches a day

Source: Crown Cove Homeowners Assn., reports by Leighton & Associates, county records.