Condo Owners’ future in doubt
By Sylvia L. Oliande
SIMI VALLEY – When Zella and Quincy Bullock bought two units in the then-new Le Parc condominium complex in 1985, they saw the homes as investments for their retirement.
They rented out both units then moved into one of the
condos in 1993 while leasing the other for $1,095 a month.
Then the Northridge Earthquake hit, shaking their
home, but not quite their dreams. But the plans for their retirement eventually
did fall apart when thecomplex's homeowners association became embroiled in a
costly court battle with the contractor hired to make earthquake repairs.
Now the Bullocks and the other owners of 264 Le Pare
condos each face a $26,300 assessment to pay a $6.7 million defamation and
breach-of-contract suit won last year by ZM Construction against the Simi
Valley LePare Homeowners Association.
"We were trying to have some vacation time, and
now I can't even make the bills,"said Zella, 82. "My biggest fear is,
what is going to happen here? We haven't got anything. They're taking our
homes, they're taking everything."
D. Darren Zuzow, president of ZM, says he sympathizes
with residents, but felt he had to defend himself against the association,
which he claimed was telling subcontractors and insurance companies that his
company did shoddy work in making earthquake repairs.
He lost his business and sued the association to
recoup his actual construction costs and the money lost when his client list
dried up. Also, since he did not file bankruptcy, he is still liable for the
company's debts.
Zuzow said he is entitled to collect the entire
$26,300 court-ordered assessment from each homeowner up front to satisfy
thejudgment. Instead, he has asked for a $166-a-month assessment. This is in
addition to the approximately $150 per monthin homeowner fees paid to cover
utilities, insurance and other complex expenses.
"I didn't want them to lose their homes, which
would certainly have happened if l'd collected the judgment up front," he
said. "I certainly wanted to get what's owed me, butI didn't want to do to
them what they did to me.
The Le Parc Community Association, thepanel that
replaced the Simi Valley Le PareHomeowners Association, is now contemplating a settlement offer from
Zuzow.
Under the offer, individual owners would pay $330 a
month in fees over 30 years. Zuzow would receive $220, and the remainder would
be kept by the association to pay utilities and other expenses.
To the condo owners, some of whom bought their units
after the judgment and found out later that they were liable for the
assessment, Zuzow's offer has done little to alleviate their concerns.
By their calculrtions, the debt would grow to $21
million by the end of the payment penod because of interest.
"You might as well say $100 billion," Said Ferenc Gutai, president of the LeParc
Community Association. Gutai said that during that time, the $110 a month designated for utilities would
not leave anything for emergencies
suchas roof repairs and equipment replacement. It costs $4,500 a month to pay the utilities and
maintain the grounds.
Because of major cuts in maintenance services this
year, the homeowners have had to clean the common grounds themselves. While the
units facing the main road into thecomplex have been kept up, the doors and
stair railings on units in the back are falling jnto disrepair, according to
the owners.
A court-appointed receiver for ZM has been collecting
homeowner fees to satisfy the judgment, but the bills have been paid only
sporadically. The association is now two months behind in utility payments and
the gas company has threatened to shut off all common gas lines on Aug. 1.
Also, the association was trying tocome up with $6,100
on Friday, to pay a fire insurance premium.
"This is a day-to-day existence,"Gutai said.
"I'm working with companies to buy as much time as I can.
And when two boilers broke down last month, leaving 30
families without hot water, Gutai had to take up a collection to have them
fixed.
Residents said they are also troubled that the
proposed settle-ment provides no limit to their liability; if one unit refuses
to pay the assessment would be divided amongthe ones who can or will.
But Zurow said the association would be responsible
for rmaking the $330-per-unit payment and it would be up to the board to
determine how it was collected from owners.
"lf they
really feel there are people out there who can't pay it, then they can
determine what needs to be cut and how to make it up so that they don't have to,"
he said. "I want the decision to be in their hands."
At a recent association meetmg, the condo owners were
polled on how they want to proceed.
They have the option of negotiating with ZM, appealing the judgment, or
walking away and filing bankruptcy individually.
The results of that poll are expected this week.
Meanwhile the residents have setup a fund, called the
Community Association Rescue Effort, hoping to raise the $ 15,000 needed by
July19 to continue its legal battle.