Condo Residents Seek $7.7 Million From Developer : Courts: Suit alleges that the building is poorly constructed, noisy and leaks when it rains. Defense concedes some flaws but says owners expected too much.

At first David Shultz was merely annoyed.

When his upstairs neighbor walked around, the pots in his kitchen rattled and it sounded as though she might drop through the ceiling. He could even hear her use the facilities more clearly than he cared to. Aggravating, but not alarming.

Then, about 1 1/2 years ago, water laden with construction chemicals seeped through the garage roof onto his wife’s car, ruining the paint job. Not long after, parquet floors in Shultz’s ground-level condominium separated and swelled up to four inches. One day he discovered that sections of bathroom flooring did not have the materials required to prevent fire from spreading between units.

By then, Shultz was unnerved.

But Shultz, a real estate broker and property manager who moved into the Pasadena condominium complex in late 1989, wasn’t the only one at 515 S. Orange Grove Blvd. with such problems.

He is one of 16 owners who paid $600,000 to $1 million for their condos and who have taken their case to Pasadena Superior Court. They are seeking $7.7 million in damages from Orange Grove Partners, a corporation established by developer Victor Illig and his wife, Evangeline, to build and market the units.

The defense concedes that the building has needed repeated repairs, but says the work sought by homeowners is excessive.

Ray Judson, homeowners association president, testified during the trial that he has had to replace his entire living room, dining room and den ceilings because of water damage. A section of his dining room is cracking again and Judson believes it too will cave in.

Marion Moule, 82, said persistent leaks during rainy seasons have forced her to place buckets in strategic locations to catch dripping water, and to cover her carpet with plastic.

In all, residents in seven of the 16 units have reported significant water leaks. Almost uniformly, residents complain about excessive noise and faulty air-conditioning and heating systems.

Moule said her daily routine consists of walking in stocking feet, brushing her teeth in the guest bedroom, flushing toilets only during the day and using her oven to warm the kitchen in the morning--all so she won’t disturb her neighbors.

Many of the residents are elderly people who moved into the condos from large single-family homes, seeking a simpler life that still afforded a measure of luxury. Shultz, 57, is the youngest homeowner. Five widows in their 70s and 80s live in the complex.

“We really thought we were going to get the ultimate,� said Ray Judson, 67, a civil engineer. Instead, he insists, they got “nothing but problems. Nothing but problems.�

The homeowners association filed a suit in September, 1992.

Judson said he and the other homeowners, who have spent more than $500,000 on the suit, originally just hoped to have the nagging problems end.

To prepare the suit, residents hired architectural, structural and mechanical engineers to root out evidence that their problems were not being corrected. According to the homeowners, the experts found worse--poor engineering and shoddy construction. The result, they say, is an unsafe building. “That’s when this thing suddenly escalated,� Judson said.

The suit charges that many of the 150 steel tie-downs, which are supposed to help fasten the building from the roof to the foundation, are missing or were installed improperly. Homeowners also complain that the complex’s walls were not assembled according to seismic specifications, and could collapse in a large earthquake.

The Illigs declined to discuss the lawsuit, but their lawyer, Bruce Gridley, agreed that the building is not watertight and that dripping and buckling plagued several homeowners. Gridley maintains, however, that leaks were being repaired right up until the lawsuit was filed, when they were halted at the homeowners’ request.

Gridley denies the building is unsafe and said that homeowners’ structural complaints, such as missing steel tie-downs, are misleading. He said that as is typically the case, the condominium’s builders anticipated this type of construction problem and compensated by installing more than are necessary.

Saying that the building’s structural components meet safety requirements, Gridley added: “When a building is not performing structurally, you know it. The walls are cracked, the flat surfaces would be sagging, and the walls would be leaning. Even after the recent earthquake that isn’t the case.�

According to Gridley, the trial was triggered more out of the homeowners’ disillusionment with living in the close quarters of a condo complex.

“I think these people have been disappointed because I don’t think they’ve fully understood what that meant,� Gridley said.