A Santa Monica Realtor and his wife have reached a final agreement with the Santa Monica City Attorney’s Office to pay one of their former tenants and the city $200,000, the city’s largest-ever settlement regarding alleged tenant harassment.

Realtor Stacey Valnes and his wife Megan are the owners of a four-unit rental property on Colorado Avenue in Santa Monica.

The settlement comes after the city sued the Valnes couple in Santa Monica Superior Court in June 2007. The lawsuit alleged that shortly after purchasing the property, the couple induced 82-year-old tenant Winifred Goodman to vacate her longtime rent-controlled apartment on the false premise that she had to vacate due to an impending owner-occupancy, deputy city attorney Adam Radinsky said.

At the time Goodman vacated, there was no impending owner-occupancy at the property, the lawsuit alleged. Believing that she had to leave, Goodman relocated to Simi Valley and only later learned that she had been deceived, Radinsky said.

The lawsuit alleged that shortly after Goodman vacated her apartment, the Valneses re-rented the unit to a new tenant for $2,400 a month. Goodman had been paying $529 per month.

Santa Monica law prohibits landlords from inducing rent-controlled tenants to vacate their homes through “fraud, intimidation or coercion.”

Goodman later got her own attorney and filed a separate lawsuit against the Valneses. The two cases were consolidated for trial.

The case was scheduled to go to trial this month.

Under the terms of the settlement, the Valneses paid Goodman $160,000 and paid the city $40,000, which is to be used in its Consumer Protection fund, Radinsky said. The fund is used to maximize voluntary compliance with state and local consumer protection and tenant protection laws in Santa Monica by educating landlords and tenants of their rights and responsibilities.

“This case is a cautionary tale for that small group of landlords who would consider using deception or intimidation to get their tenants to leave,” said Radinsky.