Date Set for Wrongful-Death Trial in Collapse of Home in Quake

VAN NUYS —  A set of lawsuits asking $20 million in damages from the sellers of a hillside house that collapsed and killed a Sherman Oaks couple during the Northridge earthquake is scheduled for trial Feb. 7.

The wrongful-death suits, which will be tried in Van Nuys Superior Court, were filed in 1994 and 1995 by the parents and estates of Marc Yobs, the house’s owner, and Karen Osterholt, his live-in companion.

Yobs, 32, a rising executive at a film production company, and Osterholt, a 30-year-old receptionist at Mark Goodson Productions, were killed when the stilt-supported house at 3855 Sherwood Place collapsed on them and slid down the hill on which it was built.

The defendants are the house’s previous owners, a group of investors led by Los Angeles lawyer Lawrence R. Gordon, and Fred Sands Realtors and two Sands agents involved in the home’s sale to Yobs in late December 1991 for $400,000.

The suits charge that the defendants failed to notify Yobs that two earlier prospective buyers had pulled out of purchase agreements after private inspections identified significant defects in the structure. State law requires sellers of houses to disclose to buyers any facts that materially affect the value or desirability of the property.

Fred Sands Realtors has denied liability, contending that its agents gave Yobs an engineering report commissioned by the sellers that “warned of a hazard to the hillside property in the event of a 5.0 earthquake.”

Alexander Robertson IV, the lawyer representing the Yobs family, countered that a more recent report given Marc Yobs by a Sands agent characterized the house as sound.

Yobs was not informed, the lawsuits contend, that the two earlier prospective buyers had canceled escrow agreements after having the house inspected. Those cancellations took place within 60 days of Yobs’ purchase.

In the first instance, the suits contend, a young executive named Jeffrey Malmberg commissioned an engineering study that identified a serious deformation in the house’s foundation. As a result of the study, Malmberg pulled out of the purchase in late October 1991.

In the second, prospective buyers Bong Nae Lee and William Bodiford canceled an escrow agreement less than two weeks before Yobs bought the house, according to the lawsuits. Bodiford also wrote a letter to a Sands agent stating that unstable soil and other geological factors presented “an unacceptably high risk of loss of property and life” and warned of “inadequate structural integrity to protect against reasonably foreseeable earthquake activity.”

Two of the lawsuits, filed by Henry L. and Margaret A. Yobs, the parents of Marc Yobs, seek $10 million in damages. Two filed by Gerald Osterholt and Eileen Waldrop, the parents of Karen Osterholt, also seek $10 million.

For a time, the two families were embroiled in a lawsuit over Marc Yobs’ $300,000 life insurance policy, and the Osterholt family’s entitlement to a share of it. The parties subsequently agreed to split the proceeds from the policy, Robertson said.