Tilting-condos suit settled

After seven years, the saga of Seattle's leaning condos of Lakeview Boulevard East is coming to an end. The six owners who lost their homes to a Jan. 3, 1997, landslide finally settled their lawsuit against the city for a total of $125,000 on Monday.

The owners hope to use the money soon to demolish the leaning condos, which can be seen from Interstate 5. Since the houses were evacuated in 1997 they have become hangouts for destructive homeless youth and dumping grounds for old furniture and garbage.

Meanwhile, the owners continued to pay their mortgages and taxes as they fought the city all the way to the state Supreme Court, which earlier this year ordered the case to a jury trial. In fact, the owners saw property taxes increase this year, as King County boosted the assessed value of their uninhabitable buildings by at least $4,100 each.

"It's a shocker to me," said Bob Ferguson, co-owner of the condo at 1515 Lakeview Boulevard E., about the settlement. After the city fought the owners so hard for so long, Ferguson was surprised to see the city's offer.

"It allows both parties to be assured of a known outcome," said Kathryn Harper, spokeswoman for the city's law department, explaining the city's willingness to settle. "Frequently, it's a business decision."

Ferguson hopes the agreement will mark the end of an ordeal that he compares to a very expensive dull toothache.

"If I could have foreseen what would happen, I would not have gone down this path. I would have declared bankruptcy," he said.

For Ferguson and his partner, Doug Taylor, it all started in 1991 when they bought the condominium with views of Lake Union for $289,000. Six years later, torrential rain and snow swept into Seattle during the holiday season.

At 6 a.m. on Jan. 3, the earth moved and the three condos — at 1515, 1517 and 1519 Lakeview Boulevard E. — slid. The 1519 unit, owned by Frank and Penny Fukui, slipped the most, about 4 feet downward and tilted toward a steep hill leading down to Eastlake Avenue East.

The city ordered the residents to evacuate, and the lawsuits ensued.

Their homeowners' insurance did not cover landslide damage. The developer settled with the owners for a total of $190,000. But that money was plowed back into the owners' attorney fees, security costs and studies of what went wrong.

The owners wanted to sue the architects and builders of the condos but found that they were protected by a statute of limitations that expired two months before the fateful landslide.

The owners sued the city, arguing it should not have permitted the condos. The owners also said the city's drainage system contributed to the landslide.

The city denied any culpability and fought the case up to the state Supreme Court. Meanwhile, the owners solicited bids to rebuild their properties. The lowest bid came in at $1.8 million, Ferguson said.

While the condos sat vacant, homeless youth climbed, clawed and crow-barred their way into the buildings. They sprayed profane graffiti, broke windows and built fires. During a visit to the properties last week, beer cans, condoms and old furniture littered the yards — despite the owners having spent countless hours and an estimated $20,000 on security.

The six owners, who together make up the 1515-1519 Lakeview Boulevard Condominium Association, hope to demolish and remove the buildings for $125,000. Then they hope to sell the one-acre lot for upward of $400,000. That would allow them to pay down their mortgages.

Ferguson believes the owners would have prevailed in a trial and possibly have won as much as $1 million. But he was also confident the city would appeal and the case would drag on for several more years. He doesn't understand why the city would spend so much time and money, particularly when it has faced severe budget crunches the past two years.

Harper declined to explain the city's reasoning. "It wouldn't be prudent to try the case before or after (the settlement) in the press. It isn't appropriate to try to respond," she said.

Bob Young: 206-464-2174 or byoung@seattletimes.com