Facts

In May 2009, defendant Lee M. Chao purchased an undeveloped lot on Mount Soledad in La Jolla and began excavating the property for future development of a single-family residence in June 2009. During the course of the excavation, two upslope homeowners complained about cracking of site improvements on their property. An initial investigation by Chao's civil engineer suggested wet fill soils on the upslope properties as the cause.

Plaintiff Ihor A. Lys purchased the property directly upslope of Chao's property in January 2010. Over time, he noticed increased movement of his rear yard resulting in, among other things, cracking of patio, exterior site walls, and interior and exterior house walls. Inclinometers installed in his rear yard confirmed that the slope was shifting west toward the Chao property at approximately 42 feet below ground.

PLAINTIFF'S CONTENTIONS:
Plaintiff contended that Chao, by excavating his property without providing adequate temporary or permanent shoring, destabilized the slope.

DEFENDANT'S CONTENTIONS:
Defendant contended that the damage to plaintiff's site improvements resulted from wet fill soils on Plaintiff's property rather than the Chao excavation. Defendant also contended that Plaintiff purchased the property at a discount with knowledge of the soils conditions.

Result

The case settled two weeks before trial. Defendant agreed to pay Plaintiff policy limits of $1.4 million, to transfer his property (in which he invested approximately $1 million) to Plaintiff free and clear, and to assign his rights to Plaintiff to pursue litigation against third parties.

Other Information

FILING DATE: July 18, 2011.