Going Downhill: Now Condo Owners Below Slide Area Sue

A sixth group of homeowners--those in undamaged homes at the bottom of a hill that collapsed in March--filed suit Wednesday against the developers and builders of homes on the hilltop.

Meanwhile, the owners of condominiums that were damaged or destroyed at the bottom of the hill demanded $15 million from developers.

The new class-action lawsuit was filed in Orange County Superior Court by homeowners in the Charter Terrace subdivision, at the base of the slope that collapsed, toppling four houses in the Niguel Summit project.

Although the Charter Terrace owners in Wednesday’s suit sustained no damage, their attorney, Thomas E. Miller, said they may not be able to sell their properties.

“Because of the enlargement of the slide on that slope, our experts have advised us that these people have suffered substantial ‘stigma’ damage,” Miller said.

Miller also represents owners of units at the Crown Cove condominium complex, which is next to Charter Terrace and also is downhill from Niguel Summit. Half of the 41 condos are empty, and many have been damaged or destroyed.

In a meeting with a mediator in the case on Tuesday, the condo owners demanded $15 million from Hon Development, home builder Capital Pacific Holdings and other developers to pay for rebuilding and recovery.

The hillside has been unstable for at least 10 years and began moving dramatically after December’s initial El Nino storms, prompting evacuations. On March 19, the slope dropped 50 feet, destroying two hilltop houses and upending several condos.

So far, 30 houses and condos have been evacuated, but not all homeowners have estimated damage caused by the unstable land.

“It’s difficult to calculate the emotional distress of living in a neighborhood where they’re fearful the neighborhood is literally going to come apart,” said attorney Kenneth Kasdan, who represents one group of 30 homeowners who so far have suffered no damage but are worried about the future.

Attorneys for Capital Pacific said in legal documents that the flurry of lawsuits has left them “dazed and confused,” and that they will ask a judge to strike class-action claims partly because of the difficulty of calculating emotional distress.

Kasdan said the builder’s attempt to dismiss class-action claims represents a denial that homeowners have suffered damage because of the failed slope.

“That’s certainly not a step toward resolution of the homeowners’ claims,” he said. “They’re trying to cut out the other people in the tract.”

An attorney for Capital Pacific refused to comment Wednesday. A hearing on the motion is scheduled for next Thursday.