Fault Lines in Law Leave Homes on Shaky Ground

Land that has passed inspection can still prove unstable for homeowners.

August 11, 2002, LA Times


By EVAN HALPER, TIMES STAFF WRITER

When Ron Muranaka paid $564,000 for a stucco Colonial in Yorba Linda with dramatic views of the Chino Hills, he was vaguely aware that the area was earthquake-prone. But so was the rest of California, he figured. Seven years later, his yard cracked apart. Then the driveway split. The living room walls separated and door frames warped.

But all that paled next to what happened early one summer morning in 1999: With a roar, much of the backyard slid 40 feet down a cliff.  Geologists hired by Muranaka and his wife, Dawn, reported grim news: The Whittier fault system, which their real estate agent had told them was miles from their house, actually ran right beneath it. The land was shifting constantly, trapping water beneath the foundation and undermining the property.

"The dirt underneath us is totally unstable," said Dawn Muranaka. "We're terrified."

Owners of at least two dozen other houses in Yorba Linda's Bryant Ranch development are in the same predicament. Their plight illustrates the limitations of the Alquist-Priolo Act, the 30-year-old state law intended to prevent construction atop active earthquake faults. When Bryant Ranch was being planned in the late 1970s, geologists hired by the developers warned that an active fault line ran through parts of some neighborhoods. The developers hired new geologists, who declared the faults inactive. That allowed more homes to be squeezed onto the hillsides than otherwise would have been permitted. It was all perfectly legal. Those familiar with the Alquist-Priolo Act say it's a common pattern: When one geologist says not to build, developers find another to tell them to go right ahead.

"I don't know why so many developers work so hard to make the faults disappear, but they do," said J. David Rogers, whose firm, Geolith in Pleasant Hill, has reviewed hundreds of geological reports for California cities. One of the most notorious examples occurred in the Bay Area city of Pleasanton in the late 1980s. Detailed federal and state maps showed that the Calaveras fault ran through a 258-acre site where 80 homes were proposed. The presence of the fault was confirmed by the first geologist hired by the developers.

Then another expert was brought in. He reached a different conclusion: that the 110-mile-long fault hopped over the project site, stopping just south of the property and picking up again beyond the northern boundary. State officials expressed concern about the finding, and the U.S. Geological Survey offered to help locate the fault lines. Pleasanton officials declined the assistance, and the development was approved. The homes have not suffered fault damage. City officials say they followed the law to the letter.

Critics say that is the problem: The Alquist-Priolo Act relies on developers and their hired experts to assess seismic risks, and on local officials to ensure that everything is aboveboard. Some cities thoroughly review geologists' reports, but others lack the interest or the expertise. Yorba Linda officials acknowledge that their review of the Bryant Ranch project was limited.

"That's for the developer to do," said Roy Stephenson, who was city engineer when the subdivisions were approved. "We assume the developer wouldn't want to submit false reports. That could just bring them trouble later on." Earlier this year, 80 Bryant Ranch homeowners collected a $6-million settlement from the developers and subcontractors after a six-year court battle. The Muranakas and several others are pursuing a separate lawsuit against the city of Yorba Linda.

The developers say the damage to the Bryant Ranch homes is unrelated to the Whittier fault system. They blame bad landscaping, El Nino rains, over-watering of lawns and ill-advised pool installations. "No one we have consulted has said this damage is being caused by faults," said Bob Carlson, an attorney for Brighton Homes of Orange County, one of the companies that developed Bryant Ranch. The homeowners say doubters are welcome to stop by the next time the fault shudders.

Steve Patterson lives with his wife in a five-bedroom Bryant Ranch house they bought in 1990 for $584,500. Patterson woke up one morning in the summer of 1999 to find that a large section of his backyard had disappeared. It is now at the bottom of a 50-foot cliff, along with a fence he had installed days before. "The city should have investigated this," Patterson said of the conflicting geological findings. "There were reports that said not to build."

* Labeled Quake-Prone

Planning for the Bryant Ranch development--high on jagged ridges above the Riverside Freeway in north Orange County--began in 1978, when the land was controlled by the Campeau Corp. of Canada and John Wertin, a local real estate tycoon.
The historic ranch was carved out of the massive Rancho Canon de Santa Ana by John Bixby in 1875. His daughter, Susanna Bixby Bryant, took over the cattle and citrus grove operations in 1911 and later added a large botanical garden in memory of her father. Her descendants managed the property until they decided to sell it for development. Campeau and Wertin merged to form CW Associates and in early 1982 hired a former assistant city manager of Yorba Linda, Brian Johnson, to oversee development of the land.

A major obstacle loomed. In 1980, about a quarter of the 3,300-acre ranch was declared an active earthquake zone under the Alquist-Priolo Act. The law had been passed after the San Fernando Earthquake of Feb. 9, 1971, killed 65 people and caused more than $500 million in damage. Much of the destruction resulted from "surface ruptures," which occur when fault movements deep underground tear gashes in the Earth's surface. This is one of many kinds of earthquake damage, but geologists say it is the easiest to prevent because areas prone to surface ruptures are readily identified. The Alquist-Priolo Act sought to stop construction of houses and offices in such places. State maps show generally where the main branch of a fault runs. It's up to developers and their geological consultants to locate the dozens of active, secondary branches and "threads" that run underground in all directions. The act prohibits building homes within 50 feet of them.

Early drafts of the law provided for rigorous state oversight of development in active earthquake zones and strict guidelines for determining whether a site was safe for building. Real estate interests lobbied hard against those provisions. Geologists also objected, complaining that the law would leave them vulnerable to lawsuits. Legislators removed the tough oversight language.

In the case of Bryant Ranch, the state maps show that the Whittier Fault passes through Yorba Linda as it runs 25 miles from Corona to the Los Angeles Basin. State studies project that a 7.4-magnitude quake is possible on the fault within the next few decades. In the mid-1980s, the Bryant Ranch developers hired Leighton & Associates of Irvine to map the neighborhood where Ron and Dawn Muranaka's home sits.

The firm determined that an active fault ran through that parcel and at least four others were in the area. It advised building fewer homes, with construction kept a safe distance from the fault lines. The discovery affected a proposed subdivision of 50 homes. The 3,300-acre site has 1,700 homes in several neighborhoods, each developed separately.

"The fault crossed right along the ridge just south of [the Muranakas'] house," said Eldon Gath, a geologist with Leighton who is regarded as an expert on the Whittier Fault system. "Then we found another fault there we were concerned about." Campeau had withdrawn from the project by then, selling the ranch to a partnership controlled by Wertin and George Argyros, now the U.S. ambassador to Spain. The new partnership kept Leighton on for a while. Then the firm was fired.

"That had never happened to me before," Gath said. "To be involved with a project all of the way up through design and then be told, 'You're out of here'--that's pretty stunning. "Maybe they thought we were too conservative," he said. "It costs money to be that conservative. Some people would rather take a risk."

Another group of geologists with a now-defunct firm, Soil and Testing Engineers, took over from Leighton and concluded, after their own investigation, that half a dozen more homes could safely be built on the tract. A similar pattern played out with a different cast of consultants in the other neighborhoods on the ranch. At least 18 additional homes were built against the advice of geologists and are now cracking. "Builders can keep buying, buying, buying reports until they find someone who doesn't see it, or someone whose ethics are compromised," said Patrick Abbott, a professor of geology at San Diego State University and author of a widely used textbook on natural disasters. "I remember a developer telling me he had six studies all saying don't build. But, he said, 'The seventh one said we can build, and that's what we are going to use.' "

Argyros and David Ball, the principal developers for Bryant Ranch, declined to be interviewed. Soil and Testing Engineers has long since gone out of business. Efforts to reach the geologist who wrote the company's report were unsuccessful. It was up to the city of Yorba Linda to review the geologist's findings.

Jim Slosson, who oversaw the Alquist-Priolo program as California's state geologist in the late 1970s, said many cities don't have the resources to spot-check the work done on site. A thorough review would involve boring holes in the ground to test the engineers' findings. That rarely happens."There are all kinds of tricks being used to get around that law," Slosson said. "It's easy."

* Officials Accused

Bryant Ranch homeowners contend that Yorba Linda's government, at best, had been lax in its oversight and, at worst, had engaged in self-dealing.  They point out that Johnson, the former assistant city manager, went to work for the developer less than a year after leaving his city position--a violation of state lobbying laws. Johnson, now based in Dana Point, refused to comment. "We had former employees of the city acting as representatives for developers," said Barbara Kiley, a former Yorba Linda councilwoman. "There were no checks and balances." In addition, City Atty. Leonard Hampel oversaw the approval process for Bryant Ranch while working for Argyros at another real estate company in Orange County.

Hampel disclosed his connection to Argyros in a letter he sent to then-City Manager Arthur Simonian, who ruled that Hampel need not recuse himself. Simonian later left the city's employ after an outside auditor found that he had awarded unauthorized raises to himself and colleagues on the city payroll. Kiley and other council members said they learned only years later that Hampel had been working for Argyros. "I had no idea," said former Mayor Gene Wisner. "He never recused himself."

City meeting minutes also show that Yorba Linda officials accommodated the developers' wish to downplay the seismic hazards at Bryant Ranch. Johnson asked the Planning Commission in 1982 for permission to delete the term "active earthquake zone" from disclosure documents to be given to prospective home buyers in the neighborhood where the Muranakas now live. He expressed concern that such a designation would be too "stark" and might frighten off buyers.

The commission obliged, and said home buyers could be told that they were moving into a "potentially active" earthquake zone--a description that applies to nearly all of California. When the City Council approved the project in 1987, it sanctioned the "potentially active" language. Disclosure has consistently been a problem with the earthquake law. State studies show that many homeowners living in Alquist-Priolo zones have no idea what that means.

In some cases, the homeowners have been told that the so-called earthquake special study zones are the safest places to be, because scientists have studied the areas and certified them as safe. A 1991 State Department of Conservation report on the law said that the risk of buying a house in an earthquake zone is "typically understated and not even known about" by purchasers. That conclusion remains valid today, said the report's author, Robert Reitherman. "Some people think being in the zone means there is no earthquake hazard," he said.

* Financial Effects

For Hans Spitz, who lives across the valley from the Muranakas in a neighborhood called Brighton Ridge, the "potentially active" disclosure simply stated the obvious for any California real estate purchase. He didn't realize, he says, that he was actually in an area of elevated risk when he bought his luxury six-bedroom house in December 1989.

Today, a giant crack runs down the wall in the master bedroom of the Spitz home on La Fiesta. One side of the living room is four inches lower than the other. The floor between the kitchen and dining room has a deep gap an inch wide, and the cabinets have become detached from the wall. The foundation has been warped by shifts and tremors. Spitz paid $609,000 for the house. City officials valued it at $160,000 in their most recent assessment. "We have to suffer," Spitz said, whose mortgage payment is $3,400 a month. "We cannot refinance or anything with the house in this condition."

A few blocks away, on Avenida de Marcia, Tim and Lucy Pham can't open most of the doors and windows in their home because the frames are warped. Large cracks are visible everywhere: through a marble mantel, across the ceiling, in some Roman columns installed along the walls. The wallpaper is torn in spots. "I called them many times," Lucy Pham said of developer Brighton Homes. "They said I would have to sign a paper saying I wouldn't sue them if I wanted to get the house fixed."

The Phams refused to sign and instead joined Spitz and 79 other property owners in a lawsuit that was settled several months ago. The Spitzes and Phams have been offered $60,000 each out of the $6-million settlement pool. The families rejected the money and have hired a new lawyer in an attempt to get a larger piece of the settlement. The Muranakas say they have spent $260,000 on lawyers, engineers and other consultants in their quest to get out and get compensated. The bills ate up all but $12,000 of a separate settlement they reached with the developers and subcontractors last month. The Muranakas and their neighbors still have a suit pending against the city.

Real estate agents have told the couple that the house is close to worthless. Dawn Muranaka says she lives in fear that the entire hillside will collapse before this is all settled. "They need to buy our house back and pay the attorneys fees," she said. "They can't just fix a few things and walk away. No one will buy this house after the problems we discovered. The city should condemn it and not let anyone live here again."

 

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