Developer Settles Lawsuit for $3 Million

The city and two of its insurance carriers have agreed to pay a developer $3 million to settle a lawsuit alleging that the city prevented people from moving into an apartment building even though construction was complete.

Assistant City Atty. Robert Wheeler said Friday that the settlement is one of the biggest the city has paid.

Transpacific Realty Ventures Inc. of Los Angeles sued Santa Ana in 1994 alleging that the city failed to issue a “certificate of occupancy” that would have allowed tenants to move into the downtown Bristol House Apartments on French and 4th streets in 1992.

A certificate was issued in 1994, and the 200-unit building now is occupied. But Transpacific alleged that it was owed about $8 million to cover lost rent and vandalism while the building was unoccupied.

After a closed session Thursday, city officials agreed to pay $1 million from the general fund to settle the case, Wheeler said.

The two insurance carriers, which will pay $1 million each, may seek reimbursement from the city, Wheeler said, but “we hope that doesn’t happen.”

The city had argued that the developer never asked for a final inspection and that the building had code violations, including a swimming pool that leaked into the garage area.