John Jackson and his wife are among the migratory throng who, in the 1990s, fled the earthquakes, mudslides, fires, rampant crime, recession, underfunded schools and astronomical real estate costs of California for the greener pastures of boomtown Colorado Springs.
Moving here from Sacramento in June 1988, the Jacksons, both of whom are disabled -- he from military service in 1976, she with a heart condition -- invested their modest life savings in a rustic, 36-year-old house in the Sherwood Forest area just outside Divide.
Three years later, that greener pasture has become a bad dream straight out of Kafka. While still in Sacramento just prior to purchase, the Jacksons had the house inspected by inspectors from the Veterans Administration (who provided John with a guaranteed home loan) and from Virginia-based U.S. Inspect. Though both gave the house a thumbs-up, the house suffered from an array of hidden -- possibly concealed, unreported -- problems.
Within six months of moving in, the Jacksons found themselves sliding into a money pit that, barring a miraculous 180-degree turnaround, is about to leave them broke, bankrupt, homeless, devoid of legal counsel and totally screwed.
On April 3, their house -- purchased in 1998 for $128,000 -- was deemed uninhabitable and assessed at a negative $22,500. Last week, their lawyer, William Hurn, stopped representing them because they've depleted the $7,500 retainer. On Tuesday, the Teller County court foreclosed their house and ordered it sold at auction in May.
A number of people with ties to the real-estate industry -- Marianne Grier, president of the Pikes Peak Foreclosure Prevention Partnership among them -- have been scrambling for months without success to help the Jacksons stave off disaster.
"What we have here is a classic case of the little guy getting screwed," said Grier in a call to the Independent.
"It's a lousy mess," agreed John Clemente, who was the Jackson's realtor in the 1998 sale but has been going to bat for the couple the entire three years since.
"They got a raw deal all around -- from the person who sold them the house, from the inspectors, from the insurers, from the mortgage company -- even from their own lawyer, who took what remained of their money without doing diddly for them."
The floodgates open
The wheels began falling off for the Jacksons in January 1999 when, in short order, the well system failed and the gas furnace caught fire, leaving the Jacksons without heat and running water.
Neither disaster is unusual for a rustic, 36-year-old house. The Jacksons, though, allege that the previous owner, Nancy Singleton, knew about the problems and failed to disclose them prior to their purchase.
When the furnace caught fire one night, Divide Fire and Rescue ordered it permanently shut off and turned off gas to the house, leaving the Jacksons without heat and gas at the height of winter.
Technicians from Colorado Heating and Cooling found that the furnace violated code in a half-dozen ways, including faulty wiring and improper duct work and flu piping, but the Jacksons' house insurance company, America Home Shield, refused to pay for a new furnace, claiming it wasn't covered.
It wasn't until October 1999, when certified master inspector Stirling West concluded that the insurers were, indeed liable, that the furnace was replaced.
In the meantime, the well system failed. Woodland Pump and Supply Company told the Jacksons that they'd serviced the pump motor for Singleton and informed her that the entire system was in need of repair, but she'd declined having them done.
These problems, however, were only the tip of a huge iceberg. Further problems surfaced in rapid-fire fashion.
The Jacksons discovered that the north wall of the house's workshop sways three to four inches in the wind. Closer inspection revealed that the north wall does not touch the ground, and that the walls don't rest on and aren't attached to a foundation.
Checking into why the floor of their upstairs living room bounces when walked on, the Jacksons found that it consists only of plywood resting on eight-inch logs spaced four feet apart.
In March of 1999, Jackson called in Paul Bryant of Front Range Engineering (now Colorado Engineering) to investigate these problems. Bryant's report noted that the west end of the house was in danger of collapse and should not be inhabited at times of high wind or heavy snow. The problems, he wrote, should have been noted by prior inspections.
Then, in June, John Jackson discovered the existence of a June 17, 1996 engineering report done by Weinert Engineering noting most of the above structural problems.
Jackson learned that Century 21, the realtor representing the owner from whom Singleton purchased the house, failed the house based on that Weinert report, and that Mrs. Singleton purchased the house "as is" -- none of which, he says, she disclosed in her seller disclaimer.
Until the retainer runs dry
In May 1999, the Jacksons hired Woodland Park attorney Bill Hurn, taking out a second mortgage on their home to pay the $7,500 retainer fee he required.
They asked Hurn to get them out of the contract with Singleton and their mortgage company, Chase Manhattan Mortgage Corporation. They also asked him to sue Singleton and her realtor, We Dilts, for failure to disclose known problems, the Veterans Administration and U.S. Inspect for malfeasance, and the owners of the house prior to Singleton, who built and remodeled much of the house without the benefit of a county building permit.
It wasn't until a year-and-a-half later that Hurn informed the Jacksons that he knows Dilts personally and therefore declined to sue her, and that he declined to sue the VA because "their pockets are too deep."
The Jacksons allege that Hurn failed to accomplish anything they retained him to do. Last week, he removed himself from the Jacksons' case because the retainer has run dry.
"They weren't treated right"
According to Michael Gorham of the Colorado Real Estate Commission, Singleton's realtor and John Lindvay, the U.S. Inspect inspector, are under investigation for possible fraud, and Jackson has filed a complaint against Hurn with the Colorado Bar Association.
Hurn failed to return numerous calls to his office asking for comment.
The Jacksons, meanwhile, are three weeks away from being out on the street. They cannot afford to hire another lawyer, and the Teller County court foreclosed on them Tuesday.
As noted by Clemente, "This will screw the Jacksons' credit forever. They'll never get another VA loan. They're even going to have trouble renting. This just isn't right."
"There's a moral here," added Grier. "Never leave anything open to trust. Don't rely on the integrity of the inspector. Ask the seller point-black, face-to-face, if every problem has been disclosed. If the seller says it has and it hasn't, you have grounds for a lawsuit."
"I think the Jacksons have grounds for a lawsuit, absolutely," added Clemente. "They weren't treated right."