MICHAEL COONS/The Acorn Oak Park Condominiums in Calabasas

Local contractor ECC has been awarded a $6.85 million verdict following a battle over disputed earthquake repairs at a Calabasas condominium complex.

The construction company performed the work for the Oak Park Calabasas Condominium Association and later sued the homeowners for fraud and breach of contract.

"Problems arose, money wasn’t being paid on a timely basis, ECC completed their work anyway and maintained that they were owed about $2.5 million, which was never paid," said ECC lawyer Aaron Booth.

Total repairs at the 268-unit complex on Park Granada surpassed $6 million, Booth said.

Lawyers for the homeowners plan to appeal the penalty, which could swell considerably if the court decides to award punitive damages.

During the regular trial which began last December, the Oak Park association complained to the jury that ECC billed the homeowners for jobs it never performed and that the construction company conducted its business in a "less than workmanlike" fashion.

The repairs to roofing, stucco and condominium interiors began in August 1994 following the Northridge earthquake and reportedly were finished by April the following year, but by July 1995 the dispute between the construction company and the home- owners reached an impasse and went to court.

"They reneged on the deal and knew that as early as January 1995, but nevertheless watched my client out there with his subcontractors and his trailers doing the work under the agreement," said David Lira, also an ECC attorney.

Lira said condo owners failed to pay ECC $582,000 in retention fees, among other costs. He said the jury verdict will cost the homeowners $4.1 million for breach of contract, $1.1 million for fraud and $1.5 for failure to pay retention, which is an amount customers are allowed to withhold pending completion of work.

According to Booth, "The jury also found that Oak Park acted with malice and oppression, which means there will be another hearing on punitive damages."

The trial’s punitive phase begins May 30 in Los Angeles Superior Court.

The lawyer for the condominium homeonwers said it was ECC that acted fraudulently by creating unnecessary invoices while the repairs were underway.

"The work that was agreed to was never worth more than $4 million," said Craig Rossell, the Oak Park attorney. "They brought in supplemental invoices with fake back-ups to those invoices and the jury has decided that they should be paid for that."

Attorneys for Oak Park condo owners also complained ECC overcharged the homeowners’ insurance company, State Farm.

"They created invoices for work not done, like a $450,000 carpet invoice for work not done so that they could have the additional insurance funds directed toward that," Rossell said.

The homeowners’ association reportedly received $3.7 million in insurance payments and another $1.5 million in a small business loan to pay for the repairs, but Rossell said that as more insurance money became available, ECC began inflating its workload.

"The crux of our complaint was that when ECC and [principal] Robert Selan learned that more insurance monies were coming to the association from the earthquake carrier than had been originally expected, Selan created fake invoices for work never done to try to recover that money himself," Rossell told The Acorn.

Rossell said Oak Park won a separate decision on appeal in which ECC tried unsuccessfully to foreclose on the homeowners through the issuance of a mechanic’s lien.

In siding with the homeowners, the court ruled ECC could not prove the completion of its work, Rossell said.

Lira said the homeowners, not ECC, are on the hot seat.

"We’re not finished yet," said the contractor attorney. "It’s a real bad situation for them, but I gave them multiple opportunities to sit down with me and settle this before the trial and I was met with a cold shoulder."