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HomeMy WebLinkAboutCity Council Item No. 07CITY OF LADE , LSIIYOP--,,E DREAM EXTREME. REPORT TO CITY COUNCIL TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: ROBERT A. BRADY CITY MANAGER DATE: JUNE 28, 2011 SUBJECT: ENGAGEMENT FOR LEGAL SERVICES FOR MINING ISSUES WITH LAW FIRM OF HARRISON TEMBLODOR HUNGERFORD & JOHNSON Background On May 12, 2011, a public hearing was held by the State Mining and Geology Board (SMGB) regarding whether the City of Lake Elsinore should retain its status as lead agency with respect to the enforcement of the California Surface Mining and Reclamation Act (SMARA). With respect to the process conducted by the SMGB, the City retained the services of attorney Mark Harrison, a recognized expert in mining laws and regulations. At the time Mr. Harrison was retained, he was a partner in the firm of Diepenbrock Harrison. Discussion Mr. Harrison recently left the Diepenbrock law firm and is now a partner in the firm of Harrison Temblodor Hungerford & Johnson. Mr. Harrison has requested that the City Council formally approve retaining him through his new firm. Mr. Harrison has prepared and submitted the attached engagement letter which terms are similar to the original legal services agreement. Fiscal Impact It is anticipated that the majority of costs incurred under the proposed contract will be reimbursed to the City through the cost recovery program under the City's SMARA administration and mining regulations (LEMC Chapter 14.04). The City Attorney has included $25,000 for services by special mining counsel as part of the City Attorney budget. AGENDA ITEM NO. 7 Page 1 of 9 Engagement for Legal Services June 28, 2011 Page 2 Recommendation It is recommended that the City Council authorize the City Manager to accept and approve the attached Terms of Engagement with the law firm of Harrison Temblodor Hungerford & Johnson. Prepared by: Barbara Leibold City Attorney Approved by: Robert A. Bradyt City Manager// ATTACHMENTS 1. Terms of Engagement letter with Harrison Temblodor Hungerford & Johnson Page 2 of 9 HARRISON ` TEMBLADOR TMi"'"G `AND G HUNGERFOR€} nRATllL RRL RESOURCES &JOHNSON Standard Terms of Engagement for Legal Services This statement sets forth the standard terms of engagement for Harrison, Temblador, Hungerford & Johnson LLP as your lawyers. Unless modified in writing by mutual agreement, these terms will be an integral part of our agreement to work with you. Therefore, we ask that you review this statement carefully and contact us promptly if you have any questions. We suggest that you retain this statement in your file. The Scope of Our Work You should have a clear understanding of the legal services we will provide. Any questions that you have should be dealt with promptly. We will at all times act on your behalf to the best of our ability. Any expressions on our part concerning the outcome of your legal matters are expressions of our best professional judgment, but are not guarantees. Such opinions are necessarily limited by our knowledge of the facts and are based on the state of the law at the time they are expressed. Who Will Provide the Legal Services Customarily, each client of the firm is served by a principal attorney contact. The principal attorney should be someone in whom you have confidence and with whom you enjoy working. You are free to request a change of principal attorney at any time. Subject to the supervisory role of the principal attorney, your work, or parts of it, may be performed by other lawyers and legal assistants in the firm. Such delegation may be for the purpose of involving lawyers or legal assistants with special expertise in a given area or for the purpose of providing services on the most efficient and timely basis. Whenever practicable, we will advise you of the names of those attorneys and legal assistants who work on your matters. How Fees Will Be Set In determining the amount to be charged for the legal services we provide to you, we will consider: • The time and effort required, the novelty and complexity of the issues presented, and the skill required to perform the legal services promptly • The fees customarily charged in the community for similar services and the value of the services to you • The amount of money or value of property involved and the results obtained • The time constraints imposed by you as our client and other circumstances, such as an emergency closing, the need for injunctive relief from court, or substantial disruption of other office business • The experience, reputations, and expertise of the lawyers performing the services • The extent to which office procedures and systems have produced a high quality product efficiently Among these factors, the time and effort required are typically weighed most heavily. We will keep records of time we devote to your work, including conferences (both in person and over the telephone), negotiations, factual and legal research and analysis, document preparation and revision, travel on your behalf, and other related matters. We record our time in units of tenths of an hour. The hourly rates of our lawyers and legal assistants have an important bearing on the fees we charge. We are often requested to estimate the amount of fees and costs likely to be incurred in connection with a particular matter. Whenever possible, we will furnish such an estimate based upon our professional judgment, but always with a clear understanding that it is not a maximum or fixed fee quotation. The ultimate cost frequently is more or less than the amount estimated. Page 3 of 9 For certain well-defined services we may quote a flat fee. It is our policy not to accept representations on a flat fee basis except in such defined-services areas or pursuant to a special arrangement tailored to the needs of a particular client. In all such situations, the flat fee arrangement will be expressed in a letter, setting forth both the amount of the fee and the scope of the services to be provided. In appropriate circumstances, Harrison, Temblador, Hungerford & Johnson LLP will provide legal services on a contingent fee basis. Any such contingent fee arrangement must be reflected in a written contingent fee agreement. Out-of-pocket Expenses We typically incur, and pay on behalf of our clients, a variety of out-of-pocket costs arising in connection with legal services. These include charges made by government agencies and service vendors as well as clerical charges. Whenever such costs are incurred, we will carefully itemize and bill them. Typical of such costs are long distance telephone charges; messenger, courier, express delivery charges and certain other postage; telecopy and telex charges; printing and reproduction costs; filing fees; deposition and transcript costs; witness fees; travel expenses; charges made by outside experts and consultants, including accountants, appraisers and other legal counsel (unless arrangements for direct billing have been made); computerized research charges; and charges for automated document production (word processing). We incur outside costs as agents for our clients and incur internal expenses on behalf of our clients, who agree that these costs will always be paid on a regular basis. The firm routinely incurs matter specific out-of-pocket expenses for the benefit of clients and for which reimbursements will be charged. The firm's out-of-pocket expense rates may be adjusted from time to time to reflect matter specific changes in cost levels experienced. Photocopy Costs: Photocopies are billed to clients at the rate of $0.20 per page Facsimile Costs: Outgoing facsimile (FAX) services are billed at the rate of $1.00 per page. (The firm does not bill its clients for incoming facsimile services.) Telephone Costs: Telephone tolls billed to clients will vary with the destination and duration of the call. The firm's rates are set to allow it to recover the costs of providing this service, and generally include long distance tolls, taxes and other costs incidental to collection and processing telephone toll information. Legal Research Costs: Legal research charges billed to clients vary with the type of database accessed and the time required. The firm's rates are set to allow it to recover the costs of providing this service to clients, and generally include tolls, taxes, database access charges and certain other costs incidental to collecting and processing legal research cost information. Postage/Delivery Service Costs: Postage and delivery service, for other than regular letter correspondence, are billed to clients at the rates charged by the various carriers. Outside Messenger Costs: Outside messenger services utilized are billed to clients at the rates charged by the messenger services. Retainer and Trust Agreements New clients of the firm are commonly asked to deposit a retainer with the firm. The retainer is charged for fees and costs as our legal services are provided. Regular statements will be furnished to you for purposes of restoring the retainer deposit may be held against the last bill, the conclusion of our legal representation or at such time as the deposit is unnecessary or is appropriately reduced, the remaining balance or an appropriate part of it will be returned to you. If the retainer deposit provides insufficient funds to cover current expenses and fees, it may have to be increased. Deposits that are received to cover specific items will be disbursed as provided in our agreement with you, and you will be notified from time to time of the amounts applied or withdrawn. Any amount remaining after disbursement will be returned to you. All trust deposits we receive from you, including retainers, will be placed in a trust account for your benefit. By law, your Page 4 of 9 deposit must be placed in a pooled account if it is not expected to earn a net return, taking into consideration the size and anticipated duration of the deposit and the transaction costs. Other trust deposits will also be placed in the pooled account unless you request a segregated account. By law, interest earned on the pooled account is payable to a charitable foundation established by the State Supreme Court. Interest earned on a segregated trust account will be added to the deposit for your benefit and will be includable in your taxable income. Termination You may terminate our representation at any time, with or without cause, by notifying us. If such termination occurs, your papers and property will be returned to you promptly. Our own files pertaining to the case will be retained. Your termination of our services will not alter your responsibility for payment of legal services rendered and out-of-pocket costs incurred before termination and in connection with an orderly transition of the matter. We are subject to the State Code of Professional Responsibility, which lists several types of conduct or circumstances that require or allow us to withdraw from representing a client, including nonpayment of fees or costs, misrepresentation or failure to disclose material facts, action contrary to our advice, and conflict of interest with another client. Client acknowledges and agrees that should client fail to pay our fees and costs when due, the firm shall be entitled to withdraw from the representation pursuant to the Code of Professional Responsibility, and that client further agrees not to contest such withdrawal. We try to identify in advance and discuss with our clients any situation that may lead to our withdrawal, and if withdrawal ever becomes necessary, we immediately give the client written notice of our withdrawal. Errors and Omissions Insurance This law firm maintains errors and omissions insurance coverage applicable to professional services Billing Arrangements and Terms of Payment We will bill you on a regular basis, normally each month, for both fees and disbursements. You agree to make payment within 30 days of receiving our statement. Unpaid fees and disbursements accrue interest at the rate (non-compounded) of 0.833 percent per month (10% per annum) from the beginning of the month in which they become overdue. (Where fees and disbursements are regularly paid out of a retainer deposit, no interest will be charged.) We will give you prompt notice if your account becomes delinquent. You agree to bring the account or the retainer deposit current. If the delinquency continues and you do not arrange satisfactory payment terms, we will withdraw from the representation and pursue collection of your account. You agree to pay the costs of collecting the debt, including court costs, filing fees, and a reasonable attorney's fee. File Retention Unless we are authorized by you to release the file (including your papers and property) in this matter to you or to destroy it sooner, your file shall be retained by this firm for the five years following the date the matter is closed (unless our client in this matter is a minor, in which case the file shall be retained for five years past the closing date or until our client reaches majority, whichever is longer). Following the retention of your file for this period of time, we will notify you of our intention to destroy the file unless we receive instructions from you to forward the file to you. We will, of course, see that any destruction of the file is accomplished by suitable means, to assure against the disclosure of any client confidences or secrets that are in the file. Your Right to Arbitrate If you disagree with the amount of our fee, please take up the question with your principal attorney contact or with the firm's executive committee. Typically, such disagreements are resolved to the satisfaction of both sides with little inconvenience or formality. In the event of a fee dispute that is not readily resolved, you have the right to request arbitration under supervision of the State Bar Association, and we agree to participate fully in that process. Page 5 of 9 Page 6 of 9 MINING LAND USE NATURAL RESOURCES 400 CAPITOL MALL SUITE 1800 SACRAMENTO, CA 95814 TEL 916.492.5086 FAX 916.446.4535 W W W. H T HJ LA W. C OM June 6, 2011 Barbara Leibold Leibold McClendon & Mann, P.C. 23422 Mill Creek Drive, Suite 105 Laguna Hills, CA 92653 Re: Terms of Engagement Dear Ms. Leibold: I am pleased to inform you that our law practice is currently reorganizing. Effective May 16, 2011, myself and other of the attorneys comprising the mining, natural resources and land use group at Diepenbrock Harrison commenced practice under a new firm, known as Harrison, Temblador, Hungerford & Johnson LLP. The new firm will provide the same range of legal services and expertise currently given to the City of Lake Elsinore, and the attorneys assisting the City, myself and Sean Hungerford, are within the new firm as well. Thus, from a practical standpoint this change will have little effect on our representation of the City with respect to the State Mining and Geology Board's current proceedings. We have appreciated working for the City and would like to continue to do so in the future. To formalize this relationship, it is necessary, however, that we provide the City with this new fee and client services agreement. Our scope of work will remain the same as before, and includes our assistance to develop a strategy to address the issues raised by the Board, and other hearing preparations. Therefore, this letter constitutes the written fee agreement ("Agreement") that California law requires attorneys to have with their clients. This Agreement contains certain terms and conditions which are set forth in the accompanying materials, entitled "Standard Terms of Engagement for Legal Services." These terms are incorporated herein by this reference, and set forth important terms and conditions upon which our services will be provided. This Agreement will not take effect until you or another authorized representative of the City return a duplicate original of it as described below. Our current billing rates for legal personnel range from $125 to $500 per hour. These rates are subject to change from time to time, and are generally adjusted effective as of January 1 of each year. My current billing rate is $500 per hour. I will be assisted by Sean Hungerford, (00321023;1) Page 7 of 9 whose basic billing rate is $350 per hour. Other attorneys who assist me may have lower basic billing rates. Our rates will be subject to a 10 percent discount, as is our custom for representing public entity clients. All work assignments will be made, where possible, in a way that maximizes our legal effectiveness and time efficiency and minimizes your legal expenses. Our goal is to provide quality legal services in a cost-effective fashion. If you have any questions concerning a billing statement, we will be pleased to discuss them with you. We will also provide any additional explanation of our work that may be required. It is essential that you advise us promptly if you do have questions or concerns regarding the billings. This enables us to resolve any difficulties as quickly as possible. This also avoids any interference with our continuing attorney-client relationship. Although we have set forth the terms of our representation in the form of a letter, you should understand that the Agreement set forth in this letter is a binding legal contract. If the Agreement meets with your approval, please sign both copies of this letter. Return one of the signed copies to me. Keep the second signed copy for your records. Thank you very much for having engaged this firm to provide legal services. We welcome the opportunity to work with you. Very truly yours, HARRISON, TEMBLADOR, HUNGERFORD & JOHNSON LLP A Limited Liability Partnership By Mark D. Harrison MDH/111 Enclosures {00321023;1} Page 8 of 9 {00321023;1} Page 9 of 9