Hideaway Hills homeowners sue state, Meade County

Hideaway Hills homeowners have joined in a lawsuit to sue the state and Meade County along with countless others because their homes were built over an abandoned gypsum mine. Courtesy photo

STURGIS — Negligence is just one of a laundry list of charges leveled in a lawsuit against government agencies and individuals involved in the sale and development of a housing subdivision in Meade County that was built over an old gypsum mine.

The alleged negligence tops 14 specific counts included in a suit John M. Fitzgerald plans to file this week in Fourth Circuit Court in Sturgis.

Fitzgerald said he filed the suit on behalf of the Hideaway Hills subdivision homeowners Tuesday, but it was rejected on a technicality. He said it would be refiled on Wednesday.

The suit seeks more than $35 million in compensatory damages, $40 million in exemplary damages, and “such other relief as the court deems equitable.”

And, it specifically asks for a trial by jury.

“The people really just want some justice,” Fitzgerald said.

Lori Erickson Kiehn joined with more than 120 of her Hideaway Hills’ neighbors in the lawsuit which names the state of South Dakota, Meade County and countless others as defendants.

“I’m just simply trying to recover my loss and my expenses that I’ve incurred since this happened,” Kiehn said of joining in the suit.

A sinkhole opened up next to Kiehn’s driveway on East Daisy Drive on the evening of Monday, April 27.

She and her fiancé were evacuated from their home and for the past month have lived in a travel trailer, only recently finding a home to rent all during the COVID-19 global pandemic.

Kiehn has said she will never be able to return to her home because it is not safe. And she and her neighbors are still in disbelief that cavers found a void under their homes the size of a football field.

Fitzgerald, attorney for the residents of Hideaway Hills, has compiled an exhaustive list of agencies and individuals whom he contends knew about both surface and underground mining on the site of the housing development.

He asserts in the complaint that the placement of homes, roads and the use of heavy machinery in the construction of the subdivision placed a heavy load on a fragile structure.

“Any conceivable and correct construction of a subdivision on top of a gypsum mine or the decision to do so would require a specific standard of care not demonstrated by any of the defendants,” he wrote.

Fitzgerald uses the phase “specific standard” of care as opposed to a “general standard” of care for purposes of a statute of limitations.

State law provides that a 10-year statute of limitations applies only to actions under a general standard of care.

“Building on top of a gypsum mine would require a specific rather than general standard of care. Further, no statute bars the Plaintiffs claims of negligence, when a defendant is guilty of fraud, fraudulent concealment, fraudulent misrepresentations, or willful or wanton misconduct,” he wrote.

Within the lawsuit, Fitzgerald reveals a smoking gun of sorts in the form of a note he said was shared with contractors and realtors prior to the building of homes on the site.

Fitzgerald said it was a half-hearted attempt by the developers to warn contractors and realtors that they were buying and eventually selling a piece of real estate that possibly had zero value and which possibly presented a high risk of death or serious bodily injury to the eventual owners.

The warning, he said, consisted of a simple piece of paper which stated:

“The BUYERS acknowledge that they have been made aware that the property being purchased hereunder, along with the adjoining property, was once mined on the surface and underground for gypsum. The SELLER is unaware as to the exact date that the underground mining ceased but believes it was sometime in the 1950’s. The surface of the property was reclaimed to meet the requirements of the State of South Dakota after the surface mining operation was completed. The SELLER IS not making any warranty, express or implied, concerning any subsurface conditions that may exist on the property being purchased by the BUYER herein. It will be the BUYER’S responsibility to remediate any subsurface conditions that exist on the property including but not limited to, fissures or cavities that may be as a result of these mining operations. The BUYER has accepted the (illegible) subsurface of the property in an “as is” condition, without any warranty by the SELLER.”

Fitzgerald said attorney Aaron Eiesland posted the note on social media.

“We are going to make a request of him to send it to us,” Fitzgerald said.

Apparently, Eiesland represented a crane company in the early 2000s which was never paid for lifting a piece of equipment out of a partial collapse on land in the subdivision.

Fitzgerald also said that neither the developers, the Meade County Commissioners, contractors, the respective title companies, engineers, real estate agents nor the surveyor believed this piece of paper should have been recorded in the Register of Deeds Office.

The 14 specific counts included in the lawsuit include: Negligence; Breach of Warranty of Title; Willful or Wanton Misconduct; Failure To Warn By A Licensed Realtors; Failure to Warn by a Licensed Attorney; Breach of Warranty Of A Professional License to Practice Law; Failure of Professional Engineering Companies to Warn Purchaser Residents of the Risk of Human Safety and Occupation; Breach of Warranty By A Professional Civil Engineering Company; Failure of Meade County Governmental Authority to Provide Express Warnings of the Hazards of Habitability of Homes in the Hideaway Hills Subdivision; and Breach of Governmental Warranty.

Following are the people named in the lawsuit brought by Hideaway Hills homeowners: The State of South Dakota, The South Dakota Housing Development Authority, Meade County, Wayne Gutzmer, Carl Bruch, Curt Nupen, Jim Schroeder, and Dean Wink - all commissioners on the Meade County Commission at the time plats of the Hideaway Hills Subdivision were approved, Rod Bradley, Doreen Creed, Talbot Wieczorek, Ted Seaman and Rich Liggett, - all current seated commissioners on the Meade County Commission, Kirk Chaffee - Meade County Equalization Director at the time the Hideaway Hills Subdivision was platted, High Plains Title Service, Inc., Meade County Title Company, Black Hills Title, Inc. Pennington Title Company, First American Title Company, Dakota Title, Stewart Title Company, Renner and Sperlich Engineering Company, Sperlich Consulting, Longbranch Civil Engineering, Kale McNaboe - an employee of Sperlich Consulting and Longbranch Civil Engineering,  John Ogdon - an employee of Sperlich Consulting who prepared and represented the Hideaway Hills plat to the Meade County Commission, Teton Coalition, Raymond, Larry and Adelaide Fuss - the original developers of the subdivision, Keith and Linda Kuchenbecker - co-developers of Hideaway Hills Subdivision, The Real Estate Group, Ronald and Vivian Sjodin – real estate agents who worked for The Real Estate Group, Foust Construction and Niel Foust, Harvey Homes and Ed Harvey, Canyon Construction Company, G & P Builders, Inc., Triple J Construction Corp., Gerald Fines - owner and registered agent of Triple J Construction, Melvin Lamke - a professional surveyor,  The Black Hills Council of Local Governments, Estes Campbell Law Firm, Doyle Estes, and attorney Dale Hansen.

So why list current members of the Meade County Commission who have worked to help the homeowners?

“We have reason to believe there are people on the current commission who knew about it,” Fitzgerald said of the mine under the homes.

And documents show for certain that individuals on the county commission in 2006 knew about the mine and did nothing about it, he said.

The underground mine operated until at least the 1970s and many people in the Black Hawk area, where the Hideaway Hills subdivision is located, knew about it, Fitzgerald said.

“The developers knew it was there and they made the contractors aware,” he said. “We’re still working to fill in some gaps, but it doesn’t appear to have been a surprise to anyone except for the people who live there and have houses there. It seems like they were the only ones who didn’t know.”

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