Peter Baston, a middle-aged consultant with intense blue eyes, hauls out a box of corroded pipes to illustrate what's wrong with the plumbing under Villa de la Paz, the quiet adobe condo complex near the intersection of Agua Fria and Henry Lynch roads.

"It's like a paper bag: Whenever you rip a part of it, it starts to deteriorate," Baston says, running his hand along a wide gash in the blue plastic pipe. Aluminum shines brightly through, a recipe for almost immediate corrosion.

"This entire plumbing system is imploding," Baston says. "Every home that has this piping needs to be retrofitted."

The pipe is called Kitec, a once-ubiquitous material that's since been taken off the market for its propensity to disintegrate, and it's what Villa de la Paz residents have for plumbing. In the years Baston and his wife, Lilli Segre, have lived here, they've seen water mains and pipes burst and break with abandon. They've watched residents pay thousands of dollars out-of-pocket to patch moldy walls and repair water damage.

And despite the rash of class-action lawsuits that have required Kitec's manufacturer, Ipex Inc., and contractors who installed it to reimburse residents and re-plumb entire communities—a Nevada court ordered one builder to pay $27 million—residents of Villa de la Paz haven't seen a dime. Yet.

But the problems at Villa de la Paz go beyond bad plumbing. Baston and others allege that the shoddy construction—crumbling adobe, poor drainage and no vapor barriers—also stems from work done by unlicensed and uninsured contractors hired by the developer, Gil A Ortiz Sr.
Outside a few isolated plumbing leaks, the Kitec under Villa de la Paz didn't cause too much trouble until January 2008, when resident Sharon Potter got slapped with a 60,000-gallon water bill. The homeowners' association footed the $13,000 bill to repair the plumbing, but Potter's problems weren't over.

In the six years she's lived there, Potter says she's had at least 10 leaks in the master suite alone, and the pipes in her exterior walls keep freezing.

"It's an absolute nightmare," Potter says. "I bought this house pre-retirement, and now it's almost worthless. I still owe money on it, [and] I can't sell it."

Another resident, Ingrid Froehlich, has lived here for just over three years—but because of the plumbing problems, she has yet to actually use her master bedroom. In Froehlich's case, leaks turned to mold and water damage—problems that according to a recent court filing still haven't been corrected.

"Whatever they did, I have to do over because the whole construction is lousy," Froehlich tells SFR.

According to Froehlich's attorney, Merit Bennett, the development hired people who weren't licensed to do the work. Subsequently, residents are stuck with the repair bills. In Froehlich's case, not even the new-condo warranty was honored.

So far, Froehlich is the only Villa de la Paz resident to sue. In her Dec. 2009 complaint, filed in Santa Fe's 1st Judicial District Court, Froehlich seeks reimbursement and damages for the alleged breach of contract, negligent construction and fraud by Ortiz and his contractors. (Neither Ortiz nor his attorney could be reached for comment.)

Ortiz' company and at least two subcontractors Ortiz used "did not have an active State of New Mexico contractor's license," the complaint reads.

Worse, one of the original primary contractors, Shenandoah Custom Homes, had ended its involvement in Villa de la Paz in 2003—but according to Joe Boies, then the president of the now-bankrupt company, Ortiz continued to renew contracts under Shenandoah's name until 2008. Boies, who built more than half of the units at Villa de la Paz, says he didn't sue at the time because he expected a larger suit from the residents.

"I was supposed to be an equal partner, not only in the liability but also in the profit," Boies tells SFR.

Ultimately, Boies took legal action to seal his withdrawal from Villa de la Paz.

"[U]nder no circumstances," he later wrote to Segre, did Ortiz have any right to use the Shenandoah name after that. "Any use of Shenandoah's name or business license by…Gil Ortiz is totally fraudulent," Boies wrote.

After he realized the extent of the problem, Baston conducted a pro bono audit on the contracting, permitting and plumbing issues at Villa de la Paz. When it was complete, residents took their concerns to the city, urging former City Attorney Frank Katz to act on their behalf.

"If the city would help us challenge the developer's insurance, we could get [the plumbing] fixed," Segre says. But, she says, "We ran into this brick wall. The city said, 'You're on your own.'"

According to Mike Purdy, the director of inspections and enforcement for the City of Santa Fe, Kitec was perfectly acceptable within the city's plumbing code.

"We approved it," Purdy tells SFR. "If there was defective materials, it's out of our hands, really. It has to go back to the manufacturer."

And as far as the contractors go, permitting and licensing fall under the state's jurisdiction, not the city's. (The state Construction Industries Division, which is responsible for building permits and contractors' licenses, did not respond to SFR's request for comment.)

"The city's role relates to inspections," Geno Zamora, the current city attorney, says. "It doesn't have authority on the licensing side."

Inspections, of course, aren't always perfect.

"We're all human, and people miss things," Purdy says. "But there's also things that happened after the building is occupied, so it's hard to determine who's at fault after the fact," he adds. "The time to catch it is during the construction."

As a comparison, Zamora says litigation-wise the city can't just sue every unsafe driver passing through its streets. So in the case of Villa de la Paz, he says, "These claims are the subject of private lawsuits, and the city doesn't represent private individuals in their private claims."

For now, it sounds like tough luck for Villa de la Paz. But to Baston, the city has bigger problems.

"Here we are in 2010, with computers and oversight and permits and management and…this?" Baston is incredulous. He worries, too, about "putting huge amounts of water into a system that's leaky as hell"—blasphemy to a man born and raised in arid sub-Saharan Africa. He shakes his head, throwing the pipes back into the plastic box until he needs them for another demo.

He and Segre have a cozy, tastefully decorated house, and they say they love the neighborhood. But in the end, he says, "Some of these homes should never have been built."