$22M Pacific Palisades spec home had 143 defects, power couple says in lawsuit

Matthew and Kathy Barrett are suing Malibu's Jaman Properties, claiming developer ignored repairs; the land once belonged to the Reagans

Sep.September 04, 2018 05:00 PM
Ronald and Nancy Reagan, and Michael Manheim of Jaman Properties. The Pacific Palisades spec home pictured, which Matthew and Kathy Barrett bought last year, is on property that once belonged to the Reagans. (Credit: A Bird’s Eye/Getty Images)

A Los Angeles power couple is suing a Malibu developer over what they call serious defects to the $22 million Pacific Palisades spec home purchased last year. The property resides on land once owned by Ronald and Nancy Reagan, before he was elected president.

The spec home owners, Matthew and Kathy Barrett, claim developer Jaman Properties and its contractors agreed to fix 143 defects shortly after closing escrow on the property at 1669 San Onofre Drive.

The couple — Matthew co-founded Santa Monica-based investment manager Glendon Capital — allege that Jaman and its contractors concealed “serious construction defects” at the property prior to  purchase, and that the repairs still have not been made. The Barretts claim they would not have bought the home if they knew the extent of its issues.

The suit was filed last month in Los Angeles County Superior Court. The couple alleges breach of contract, fraudulent concealment and negligence.

Jaman’s attorney, Dennis Ellman of Los Angeles-based Greenberg Glusker, called the complaint “completely without merit. Jaman Properties has addressed and continues to be ready to address any and all legitimate issues the buyers may have with the property,” Ellman said. “As prior buyers of Jaman Properties will confirm, Jaman develops wonderful homes and stands behind their work.”

The 10,000-square-foot home is built on a hillside property once owned by the Reagans. The family — Ronald Reagan was California governor from 1967 to 1975 — lived in a fairly modest mid-century home.

Jaman, which developed the new home, installed the wet bar from Reagan’s old home and incorporated other tributes to the 40th  president. The six-bedroom house includes a 2,000-bottle wine cellar and a powder room lined with 25,000 hand-applied peacock feathers.

Jaman agreed to repair the defects in the house within two weeks of closing escrow and agreed to pay $3,000 for every day those repairs were not made. The Barretts claim the company missed that deadline and coerced them into extending it.

The Barretts point out five major “misrepresentations and omissions” about the property. Jaman claimed that it installed a rain tank system prior to closing escrow, then later “admitted” that it wasn’t code compliant and would have to be replaced.

A retaining wall in the backyard was also defective, so Jaman’s contractors allegedly rushed the job to meet its repair deadline. Remediation took six months.

In the lawsuit, the Barretts also claimed Jaman lied about repairs made to part of the foundation damaged during installation.

The Barretts say that Jaman misrepresented the quality of the 300-foot driveway prior to sale. The area was said to be built on compact soil atop bedrock, but it actually on top of “loose fill,” the suit alleges. The concrete driveway slabs “began to wobble, crack, and settle unevenly” a few months after closing, the couple contend. But Jaman claims that because the the driveway was built on solid ground, the Barretts had no reason to add it to their repairs list.

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