Terra not firma at Terraces

Dennis Webb
GSPI News Editor

GLENWOOD SPRINGS – The Terrace Condominiums Homeowners Association has gone to court over building cracks and other problems that have developed within their homes.

The association last week sued developer Jay Harkins, along with the builder and two engineering firms involved with the condominium project.

The lawsuit comes after independent engineering reports to the city government suggested that soil and engineering flaws are contributing to a rash of structural problems within the condos.

These include troubles opening and closing doors and windows, and cracks in walls, ceilings and foundations in at least three multi-family units of the 12 in the project.

The suit was filed in Garfield District Court and names developer Jay Harkins and The Terrace Group, the company under which he developed the units. It also names him for his role as architect on the project.

Also named are CTL-Thompson Inc., a geotechnical engineering firm; York Engineering Services Inc., a structural engineering firm; Wendy Amann of York Engineering; Marcal Construction; and Marc Wagner of Marcal Construction.

The suit asks the defendants to adequately repair the condominiums, and seeks reimbursement for housing rental, storage and cleaning costs during repair; and for “annoyance, discomfort, inconvenience, and aggravation” resulting from the problems. The suit seeks actual and triple damages, attorney fees and other costs.

The homeowners’ lawsuit also contends that the problems have harmed the property values of their condos.

The Terrace Condominiums are located on a slope at the eastern base of Red Mountain in Glenwood Springs.

The suit alleges that the defendants should have known the project area contains “soils presenting special or peculiar dangers in the construction of such a project.”

It specifically contends that soaking soils and using improper construction techniques could result in compression, compaction and consolidation of the soils, risking the structural integrity of the buildings. The project should have been designed and built in a way that addressed these factors, the suit contends.

It also said the defendants knew construction on those soil types “constituted an inherently dangerous activity, but failed to disclose the same” to condo buyers.

Of the defendants, only representatives of York Engineering and Marcal Construction could be reached for comment Thursday.

Jerry York, director of engineering for York Engineering, said he wasn’t aware of the lawsuit, but did know about problems at the Terrace Condominiums.

“I understand they’ve had some settling because of some water buildup underneath the foundations,” he said.

He said he doesn’t believe York Engineering, as the structural engineer, is responsible for the settling.

“It’s a soils problem, it’s not a structural problem,” he said.

He said he understands that CTL-Thompson has “been out constantly working on the problem,” strengthening the soils “to get them back to what they should be.”

He said he’s never talked to homeowners at the condos.

“Our client is the architect,” he said.

Marc Wagner of Marcal Construction also hadn’t been served papers on the suit as of Thursday. He said he knew of the problems with the foundation settling at the condos, but never received complaints from the developer, the homeowners or the city.

“We haven’t been notified or brought into it at all,” he said.

He said Marcal was involved only with above-ground construction. Harkins separately sub-contracted earthwork, underground utilities and related site work.

“There haven’t been any complaints on our stuff,” Wagner said.

He was disappointed to be named in the suit.

“I guess they go after everybody they can,” he said.

City building officials first received complaints about the condos last August. Although problems were discovered by engineering consultants, the city determined the buildings remained safe to occupy.

The Terrace Group also obtained a repair permit and began evaluating courses of action. Harkins has previously said the group was “working diligently” to remedy the problem.

City building official Russell Grance has said some residents might have to move while structural and cosmetic problems are repaired, most likely at the developer’s expense.

Scott Sullan, part of the Greenwood Village law firm that is representing the homeowners association, said the group tried to avoid filing a lawsuit.

“The homeowners met with the builder and tried to give the builder a chance to do the right thing, and it didn’t work out,” he said.

“One of those buildings is in danger of being unlivable. It’s a bad situation over there,” Sullan added.

The suit alleges that when problems were called to the attention of the defendants, they assured the association the damages weren’t caused by substantial defects, and would be repaired. The association contends that the defendants concealed the truth of the situation.

The suit also alleges that Harkins and the Terrace Group misrepresented the condition of the project while marketing it.

Harkins and Terrace Group controlled the homeowners association until January, the plaintiffs say.

Given that control, and the other roles Harkins and the Terrace Group played in the project, they had a fiduciary duty to homeowners, a duty to act in good faith, and a duty to abide by the Colorado Common Interest Ownership Act’s provisions governing commonly owned residential communities, the suit contends.

The suit also alleges that the Terrace Group obtained development/construction approval from the city for 100 units, but built 104. City officials could not be reached for comment on that allegation.

Contact Dennis Webb: 945-8515, ext. 516

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