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HomeMy WebLinkAboutPardee Homes & Attorney, City & City Attorney Joint Defense Agreement 07-15-15 JOINT DEFENSE AGREEMENT This JOINT DEFENSE AGREEMENT ("Agreement") is made and effective this 15th day of July, 2015 ("Effective Date"), by and among the CITY OF LAKE ELSINORE, a California Municipal Corporation ("City"), and the City's attorneys LEIBOLD, MCCLENDON & MANN, APC, on the one hand, and PARDEE HOMES, a California Corporation ("Pardee"), and Pardee's attorneys O'NEIL, LLP, and JACKSON, DeMARCO, TIDUS & PECKENPAUGH, APC, on the other hand (collectively, "Parties", and individually, "Party"). RECITALS WHEREAS, the Western Riverside Council of Governments ("WRCOG") has commenced enforcement proceedings and investigations (the "Action") against the City in connection with a dispute over the City's collection of Transportation Uniform Mitigation Fees ("TUMF') related to development occurring within the Cottonwood Hills (aka Canyon Hills) Specific Plan area as designated in the July 9, 1990, development agreement with Pardee- Grossman/ Cottonwood Canyon, a general partnership organized and existing under the laws of the State of California, including all amendments and any Memorandums of Understanding thereto (the "Pardee Agreement"). Pardee, Richmond American Homes of Maryland, Inc., a Maryland corporation, and Pulte Home Corporation, a Michigan corporation, are the current successors in interest to the Pardee Agreement and developers within the Canyon Hills Specific Plan area defined therein. WHEREAS, the above-referenced Action has resulted in the City having to consent to a Memorandum of Agreement ("MOA") in which City and WRCOG will engage in a voluntary non-binding arbitration (the "Arbitration"). Pardee is neither a party to the MOA, nor the Arbitration, and is not bound by, nor involved in either. The MOA, among other things, provides that at the conclusion of the non-binding arbitration, either the City or WRCOG may elect to file an action in Superior Court seeking a declaration, among other things, as to whether the development occurring within the Cottonwood Hills (aka Canyon Hills) Specific Plan area is exempt from TUMF (the "Future Litigation"). Because Pardee's project, a residential development project, is in the Canyon Hills development, Pardee is an interested party in such Future Litigation. WHEREAS, the City and Pardee share some common interests with respect to their defenses of the Action and Future Litigation. The Parties' attorneys believe that, from time to time, the City's and Pardee's mutual interests in the Action and Future Litigation will be best served by a sharing of information including, but not limited to, documents, mental impressions, memoranda, reports, attorney work product, and other confidential or privileged information. Such information, when shared between the Members under this Agreement, is referred to herein as "Defense Materials". WHEREAS, the Parties desire to separately pursue the City's and Pardee's mutual interests without waiving any privilege, including the attorney-client privilege and attorney work product doctrine. WHEREAS, the City and Pardee have considered both the advantages and disadvantages of this Agreement, and acknowledge that the provisions of this Agreement do not override the 1 obligation of their respective attorneys to represent them zealously and to preserve and protect client confidences and secrets. AGREEMENT Based upon the foregoing recitals, which are true and correct and incorporated herein by reference, and in consideration of the mutual promises of the Parties, it is hereby agreed as follows: 1. Confidentiality of Defense Materials. A. In anticipation of and in defense of the Action and Future Litigation, the Parties may exchange or disclose Defense Materials in furtherance of the City's and Pardee's common interests. Defense Materials shall be used by the Parties solely for the preparation of the City's and Pardee's respective defenses. Neither the Defense Materials nor the information contained therein may be used for any other purpose. Defense Materials may be provided to consultants, investigators, experts, and other persons solely for the purpose of furthering the City's and Pardee's mutual interests in the Action and Future Litigation. All such persons shall be specifically notified by the Party disclosing the Defense Materials that the Defense Materials and the information contained therein are confidential, subject to the terms of this Agreement and, as applicable, privileged. B. Unless expressly stated in writing to the contrary, all communications between the Parties concerning the Action and Future Litigation are confidential and are protected from disclosure to any entity or individual who is not a party to this Agreement ("Third Party")by the joint-defense privilege, the attorney-client privilege, and the work product doctrine. The Party in receipt of any Defense Materials shall not disclose the Defense Materials or any of the information therein to any Third Party without the prior written consent of the Party who disclosed the Defense Materials in the first instance. Such consent may be obtained in writing from that Party's attorney. C. Any unauthorized disclosure of Defense Materials to any Third Party shall be subject to a joint defense privilege by the other Parties to this Agreement and shall not constitute a waiver of any otherwise available privilege. Any Party shall have the right to seek injunctive relief to prevent a threatened disclosure of confidential materials produced pursuant to this Agreement, if such disclosure would violate the terms of this Agreement. All Parties agree that there is no adequate remedy at law for a disclosure in violation of this Agreement. D. If another person or entity requests or demands, by subpoena or otherwise, any Defense Materials, the Party from whom such material is requested or demanded shall immediately notify the other Parties. In addition, the Party from whom Defense Materials are requested or demanded shall, prior to production of the Defense Materials, assert all applicable rights and privileges and shall take all reasonable steps to assure that all other Parties have an opportunity to assert all applicable rights and privileges, prior to production. E. The City and Pardee acknowledge that information known to one of them need not be shared with the other, and that each is entitled to communicate and share information with the other as that Party sees fit. 2 F. To the extent that any of the Parties communicated with each other concerning the defense of the Action prior to the Effective Date, such communication and any other correspondence, exchanges or disclosures among the Parties have been made to further the common defense of the Action and in full expectation that all such communications would remain confidential and protected from unauthorized disclosure, and such communications now constitute Defense Materials subject to the terms of this Agreement. 2. Defense of City in Future Litigation A. Pardee shall defend (with counsel as provided herein or otherwise acceptable to the City), the City, its officials, officers, employees, or agents from claims related to the past and future collection of TUMF as may be asserted by WRCOG in the Future Litigation against the City. This obligation only applies to a Superior Court action in which the City is a defendant or a real party in interest in Future Litigation brought by WRCOG involving whether any TUMF fee shall have or could be applied to lots in Pardee's project. B. Counsel for the City shall be Barbara Leibold and David Mann of Leibold McClendon & Mann, P.C. (the "City Attorney") or any other attorney mutually agreeable to Pardee and the City. Its attorneys' fees and costs in defending the Future Litigation brought by WRCOG shall be reimbursed by Pardee as follows: (i) defense obligation to start when Future Litigation is commenced; (ii) a separate billing file for litigation shall be opened by the City Attorney; (iii) the hourly rate shall be the same hourly rate charged to the City as of the date legal services are provided; which as of the Effective Date is $208.10 for Barbara Leibold and for David Mann; (iv) the time shall be billed in 0.1 hour increments; (v) attorneys' fees and costs shall be invoiced monthly with a summary statement to Pardee redacted to preserve confidential information; and, (vii) no cost in excess of $500.00 shall be incurred without Pardee's prior written approval. Notwithstanding the foregoing, Pardee's reimbursement shall be conditioned upon the City's cooperation with Pardee in the Future Litigation, including, but not limited to, the City's agreement to support Pardee's position and to maintain that TUMF is not due in connection with past or future obligations for the Cottonwood Hills (aka Canyon Hills) Specific Plan area. C. Counsel for Pardee and the City Attorney for the City shall reasonably cooperate with each other in connection with their respective investigations and the Future Litigation. City and City Attorney shall provide Pardee, its consultants, investigators, experts, and counsel, access to the City's public files and documents upon request during normal business hours. D. Each Party shall communicate promptly to the other Party any offers received from WRCOG for the settlement of the Action and Future Litigation. City shall secure Pardee's consent to any settlement. Pardee shall secure the City's consent to any settlement. Such consent shall not be unreasonably withheld by either Party. 3. Confidentiality of this Agreement. This Agreement shall be privileged from discovery and inadmissible as evidence in any legal proceedings brought against the Parties or any of them and this Agreement shall not be disclosed to any Third Party except where necessary to enforce the terms of this Agreement or to comply with a court order. 3 4. No Admission of Liability or Waiver. This Agreement is not an admission of liability or fault of any Party in reference to any alleged or asserted facts, legal contentions and occurrences that are now or might be alleged with respect to any threatened or asserted claims associated with or in any way related to the Action, Arbitration or Future Litigation. Neither this Agreement, nor any information contained in or submitted under this Agreement, nor any action taken by any Party pursuant to this Agreement shall constitute, be interpreted, construed, or used as evidence of any admission of liability, law, or fact, waiver of any right or defense, nor as an estoppel, against any Party by any other Party or by any Third Party. The Parties further acknowledge that all future discussions between the Parties concerning the resolution of the Action, Arbitration or Future Litigation shall be considered settlement discussions protected under California Evidence Code section 1152, except for public hearings and/or public documents regarding the Action, Arbitration or Future Litigation. 5. No Third Party Beneficiary. Except as specifically provided herein, nothing in this Agreement shall waive, release, or otherwise affect any right, claim, defense, interest, or cause of action that any Party may have with respect to any Third Party. This Agreement is not intended for the benefit of any Third Party and shall not be enforceable by any party who is not a Party. 6. No Creation of Attorney-Client Relationship. Nothing in this Agreement is intended to create an attorney-client relationship between any attorney and anyone other than the Party who is a client of that attorney. The fact that an attorney has entered into or agreed to be bound by this Agreement shall not in any way preclude that attorney from advocating any interest of the Party who is his or her client that may be adverse to any other Party, and shall not be used as a basis for seeking to disqualify any counsel from representing the Party who is a client of that attorney in any proceeding. It is further understood that the obligations of this Agreement might, in the future, create a potential or actual conflict of interest such that one Party shall not be able to cross-examine another Party in this Action or in other proceedings through the use of Defense Materials, unless such materials were also obtained from independent sources not subject to this Agreement, and even though cross-examination through the use of such Defense Materials may be in the Party's interest. The rights and obligations under this paragraph shall survive the termination of this Agreement and shall continue to bind each Party after that Party's withdrawal from this Agreement or dismissal from the Action or other proceedings, and after termination of this Agreement. 7. No Joint Venture. This Agreement does not form a joint venture or partnership by or among the Parties. 8. Amendment. No part of this Agreement may be modified, altered, amended, waived, or changed without the express written consent of the Parties hereto. 9. Notice. All notices under this Agreement must be in writing. Notice is given either (i) when delivered in person to the person or company intended named below, or (ii) when sent via reputable overnight courier (such as Federal Express), addressed by name and addressed to the party or persons intended, as follows, until such time as a party gives notice of a change of address in accordance with the terms of this section: 4 Pardee CRY Attn: Christopher J. Hallman Attn: City Manager General Counsel, Pardee Homes Lake Elsinore City Hall c/o TRI Pointe Group 130 South Main Street 19450 Jamboree Road., Suite 300 Lake Elsinore, CA 92530 Irvine, CA 92612 Phone: (951) 674-3124 Phone: (949) 438-1451 Fax: (951) 674-2392 Fax: (949) 438-1401 Mike Taylor, Division President Inland Empire/Orange County 35050 Canyon Hills Road Lake Elsinore, CA 92532 Phone: (951) 246-2218 Fax: (951) 246-2155 Pardee's Attorneys City Attorney Attn: Michael L. Tidus, Esq. Attn: Barbara Leibold, Esq. Jackson, DeMarco, Tidus Leibold, McClendon & Mann, APC & Peckenpaugh, APC 9841 Irvine Center Drive, Suite 230 2030 Main Street, Suite 1200 Irvine, CA 92618 Irvine, CA 92614 Phone: (949) 585-6300 Phone: (949) 752-8585 Fax: (949) 585-6305 Fax: (949) 752-0597 10. Assignment. This Agreement shall not be assigned by either Party, either in whole or in part, without the prior written consent of the non-assigning Party. Any assignment or purported assignment of this Agreement without the prior written consent of the non-assigning Party will be deemed void and of no force or effect. 11. Interpretation. The Parties hereto have negotiated this Agreement at arm's length and have been advised by their respective attorneys, and no provision contained herein shall be construed against any Party. 12. Authority to Execute. The individuals executing this Agreement each represent and warrant that they have the legal power, right and actual authority to bind their respective Parties to the terms and conditions hereof. 13. Counterparts. The Parties may execute duplicate originals (counterparts) of the Agreement or any other documents that they are required to sign or furnish pursuant to the Agreement. 14. Severability. If any provision of this Agreement is found invalid or unenforceable, the balance of this Agreement shall remain in full force and effect. 15. Term. This Agreement shall terminate as to all Parties on the date on which the earlier of the following events occurs: entry of final judgment in the Action and any Future Litigation; dismissal of all causes of action as to all Parties in the Action and any Future 5 Litigation; settlement of the Action and any Future Litigation as to each and every Party (the "Termination Date"). Any Party may terminate this Agreement effective upon written notice of termination to all other Parties. After termination, the Parties shall continue to preserve the confidentiality of all Defense Materials and this Agreement, in the manner set forth herein. 16. Entire Agreement. As of the Effective Date, no other agreements, express or implied, have been made by the parties to this Agreement concerning the subject matter herein. All prior and contemporaneous conversations, negotiations and possible or alleged agreements concerning the subject matter herein are merged and integrated in this Agreement. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date. CITY OF LAKE ELSINORE LEIBOLD McCLENDON & MANN, APC, A CALIFORNIA MUNICIPAL XyBarbara ttorney CORPORATION By: Grant Yates Leibold, Esq. City Manager City Attorney ATTEST: By: Susan Domen City Clerk PARDEE HOMES JACKSON, DEMARCO, TIDUS A CALIFORNIA CORPORATION & PECKENPAUGH, APC, Pardee's Attorneys By: Mike Taylor By: Michael L. Tidus, Esq. Division President O'NEIL, LLP, Pardee's Attorneys Christopher J. Hallman By: John P. Yeager, Esq. General Counsel 6 Litigation; settlement of the Action and any Future Litigation as to each and every Party (the "Termination Date"). Any Party may terminate this Agreement effective upon written notice of termination to all other Parties. After termination, the Parties shall continue to preserve the confidentiality of all Defense Materials and this Agreement, in the manner set forth herein. 16. Entire Agreement. As of the Effective Date, no other agreements, express or implied, have been made by the parties to this Agreement concerning the subject matter herein. All prior and contemporaneous conversations, negotiations and possible or alleged agreements concerning the subject matter herein are merged and integrated in this Agreement. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date. CITY OF LAKE ELSINORE LEIBOLD McCLENDON& MANN, APC, A CALIFORNIA MUNICIPAL City Attorney CORPORATION By: Grant Yates By: Barbara Leibold, Esq. City Manager City Attorney ATTEST: By: Susan Domen City Clerk PARDEE HOMES JACKSON, DEMARCO, TIDUS A CALIFORNIA CORPORATION & PECKENPAUGH, APC, Pardee's Attorneys By: Mike Taylor By: Michael L. Tidus, Esq. Division President O'NEIL, LLP, Pardee's Attorneys roph ( � By: John P. Yeager, Esq. eneral Co el 6 Litigation; settlement of the Action and any Future Litigation as to each and every Party (the "Termination Date"). Any Party may terminate this Agreement effective upon written notice of termination to all other Parties. After termination, the Parties shall continue to preserve the confidentiality of all Defense Materials and this Agreement, in the manner set forth herein. 16. Entire Agreement. As of the Effective Date, no other agreements, express or implied, have been made by the parties to this Agreement concerning the subject matter herein. All prior and contemporaneous conversations, negotiations and possible or alleged agreements concerning the subject matter herein are merged and integrated in this Agreement. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date. CITY OF LAKE ELSINORE LEIBOLD McCLENDON &MANN, APC, A CALIFORNIA MUNICIPAL City Attorney CORVORRATION By: Gr t ates By: Barbara Leibold, Esq. City Midager City Attorney ATTEST: By: Susan Domen City Clerk PARDEE HOMES JACKSON, DEMARCO, TIDUS A CALIFORNIA CORPORATION & PECKENPAUGH, APC, Pardee's Attorneys By: Mike Taylor : Michael L. Tidus, Esq. Division President O'NEIL, LLP, Pardee's Attorneys Christopher J. Hallman By: J hn P. ager, Esq. General Counsel 6