Five years after foundation problems in Rancho Murieta South homes built by Reynen & Bardis became public knowledge, the first homeowner lawsuit against the developer is headed for trial next week.

The first four homeowners scheduled to have their case heard in Sacramento County Superior Court July 7 are 70 or older, which entitles them to preference under California procedural code, according to the lawsuit filed last year by the law firm of Anderson & Kriger. The lawsuit seeks over $1 million in damages and more than $100,000 in investigative expenses for the four homeowners.

Anderson & Kriger represents 41 homeowners whose homes experienced cracked walls and foundations due to expansive soil.  See the suit here.

“We are working to try to settle all 41 homes as part of this trial process, and we’ve some success in doing that,” said Clayton Anderson, the law firm's managing partner and lead attorney, in a recent telephone interview. “If there’s a trial, we anticipate Reynen & Bardis will be found liable for the negligent construction and the negligent repairs.”

Homeowners declined to be interviewed in advance of the trial, following their lawyers’ direction.

Michele McCormick, spokesperson for Reynen & Bardis, said the company doesn't care to talk about pending litigation, adding, "They hope that people are aware of all the things they've done to try to do their best for all the people in the area over the years."

Among the problems cited in the lawsuit are “continuous shifting movement of surface and sub-grade soils, drywall cracks, leaking showers/tubs, stucco cracks, inadequate site drainage, flooring failures, cracks in concrete slabs, defective plumbing.”  

The homeowners banded together to take legal action after Reynen & Bardis ended efforts to fix the homes in fall of 2007, saying funding had run out. A company official quoted in a Sacramento Bee article in February 2008 said Reynen & Bardis had spent $28 million buying back 52 homes and more than $3 million on remediation work. The problems affected more than 100 homes in the second phase of development on the South, which began in 2000.

Remedial measures included adding drainage systems around the homes and installing piers to anchor the foundations to the ground.

“What the developer tried to do in terms of improving drainage and repairing the slabs, if done correctly, with proper supervision and proper design, is exactly what needed to be done. … Both of those were done negligently,” Anderson said. “Those repairs have pretty uniformly failed, to one extent or another out there.”

The lawsuit acknowledges Reynen & Bardis’ efforts, noting, “The defendants have in many cases attempted repairs … without success.”

In addition to the Reynen & Bardis entities named in the suit, there are unnamed defendants -- general contractors, subcontractors, architects, engineers and others. In all, Anderson estimated there are more than 30 defendants involved in settlement negotiations, adding, “Behind the scenes there’s all kinds of insurance companies.”

John Reynen and Christo Bardis, principals in the financially troubled company, have filed for bankruptcy as individuals, Anderson said, and other Reynen & Bardis business entities, including a limited partnership that appears in the suit as Rancho Murieta 205, are not involved. 

“Basically, bankruptcy doesn’t really have much effect on our ability to negotiate and get compensation,” he said.    

From the archives:

• South developer Reynen & Bardis is addressing foundation problems in 17 houses (January 12, 2004)
  
• South developer Reynen & Bardis now studying 32 homes for possible foundation problems (January 28, 2004)
• After addressing dozens of cracked homes, builder tells homeowners to seek warranty coverage instead (November 18, 2007)