Home Buyers Unaware of Slide Studies

A subdivision where an unstable hillside is threatening 30 houses was built on land previously damaged by two large landslides--a fact known to developers and city officials, but not to home buyers.

The place where geologists 20 years ago documented those landslides was later converted into lots for more than a dozen houses, and the unstable hill now poses a new threat to more homes.

Records filed with the city also document uneven bedrock and potentially unstable geology and show that many residential lots and slopes had to be rebuilt after the site endured years of neglect when the original builder went bankrupt.

What ultimately emerged from this disarray was marketed as the Fieldstone Collection at Vista Royale, a product of the late 1980s housing boom in Orange County and one of several now experiencing geological problems.

At Vista Royale, officials have known for more than two years of serious problems at the top of a hillside that has moved as much as nine inches in the last year and has begun buckling pavement and cracking houses and swimming pools.

Joan Gladstone, a spokeswoman for the developer of Vista Royale, said confidential mediation sessions are underway and the firm is not allowed to comment on the slope defects in the project history.

More than a dozen lawsuits have been filed by homeowners, most complaining of improper actions by the developer. Court records show that the city last year had grown impatient with a lack of action by the developer.

“At this time, any casual observer can determine that there is substantial movement of the slope,” Kirk Nakamura, an attorney for the city, wrote to developers in 1998.

“Our experts have found a real potential for a sudden landslide in the future,” he said.

But the project was approved in the 1980s based on assurances, now suspect, that a huge earthen buttress could hold the hill in place and keep homeowners safe. The area was fortified by 1986.

City officials in Orange say they are responsible only for reviewing technical reports that are required of developers, not for doing the work themselves.

The closed mediation sessions were ordered by Orange County Superior Court Judge Robert E. Thomas.

Earlier this week, Thomas ordered that an Anaheim reservoir next to Vista Royale be drained in response to concern from homeowners that it may pose a greater danger if the hill collapses.

Gladstone said the developer of Vista Royale, 396 Investment Co. of Newport Beach, also known as the Fieldstone Co., was not the original landowner and site grader and did not develop the entire site.

That work was done in the early 1980s by former Orange County developer Gerald F. Goeden, whose firm went bankrupt in 1984. Goeden, who faced criminal charges for fraud and illegal diversion of money in the aftermath of the bankruptcy, was acquitted in 1989.

Homeowners said they had never been told of the previous landslides, although developers have contended they are not required to disclose soil conditions that have been fixed.

“We were certainly not told we were in a slide area,” said Gretchen Bereiter. “You would think they would have told you.”