Settlement in Condo Project Under Fire

Tempers are flaring in Westwood over the ethics of a $550,000-plus settlement that a homeowners group has accepted in exchange for allowing a developer to proceed with a high-rise condo project on Wilshire Boulevard.

Under the settlement, developer Richard Weintraub agreed to pay the 42-year-old Westwood Homeowners Assn. $275,000 over five years to hire a security service to patrol the neighborhood. Weintraub also agreed to contribute to a $275,000 legal fund.

The deal was signed this month by Weintraub and association President Richard Agay. Weintraub also paid Agay $10,000 for his legal work.

Payments from developers for trees, speed bumps and other mitigations have become common in recent decades as savvy, affluent homeowners battle developers over building heights, liquor licenses and other issues.

But the Westwood agreement goes a step further, into what critics say is uncharted terrain by establishing the legal fund, which Agay said he intends to use to hire attorneys to challenge future developments.

Among those criticizing the pact are Councilman Jack Weiss, who represents the area; several Westwood residents and association board members; and Weintraub himself.

Saying he had been “strong-armed” by Agay, Weintraub said the deal has the “potential to destroy 40 years of credibility” of the homeowners association by sending the message that the homeowners are for sale.

“It sets a very bad and ugly precedent,” said Weintraub, who has begun to question the legality of parts of the agreement.

The City Council approved Weintraub’s plans to develop one of the last vacant parcels on Wilshire Boulevard, but the homeowners sued in March to reverse those approvals.

The legal challenge threatened to derail Weintraub’s financing, board members said.

Weintraub and Agay disagree over who approached whom about a settlement, but eventually the talk turned to money.

Under the settlement, a copy of which was obtained by The Times, Agay and two other current board members will have veto power over how the legal fund is spent.

The $275,000 legal fund actually, $250,000 plus interest -- has been deposited temporarily into what Agay calls his “attorney trust account.” Several months from now, it is to be transferred to the association’s account.