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00334C - MONTE VISTA HOTEL FRANK MILLER SETTLEMENT
Frank Miller et al - • Settlement Agr re Monte Vista Hotel (Part 1) AGREEMENT #334C R940, 7-20-94 SETTLEMENT AGREEMENT The parties to this settlement agreement ( "Agreement") are the COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, a public body corporate and politic (the "Agency" ) , and Mr. Frank Miller, Mr. John Miller and Mrs. Madelyn Miller (the "Millers") , individuals. RECITALS A. On or about August 9 , 1988, the Agency and the Millers entered into that certain Lease/Purchase of Property agreement under which the Agency agreed to purchase certain real property from the Millers located in the City of Palm Springs, State of California, and commonly described as the Monte Vista Hotel . B. In or about March, 1993 , a dispute arose between the Agency, on the one hand, and the Millers, on the other hand, with respect to the rights, duties and obligations of the parties under the Lease/Purchase of Property agreement. C. Thereafter, on or about March 19 , 1993 , the Millers filed an action against the Agency, entitled Frank Miller, etc. , et al . v Community Redevelopment Agency of the City of Palm Springs . etc . , et al . , Riverside County Superior Court Case No. I-69228 seeking specific performance and injunctive relief (the "lawsuit" ) . D. On or about June 14, 1993 , the Superior Court issued a preliminary injunction in favor of the Millers and against the Agency. On June 24, 1993 , the Agency duly perfected an appeal, F82\268\014084-0001\2103768.1 07/14/94 -1- entitled Frank Miller, etc. , et al . v. Community Redevelopment Agency of the City of Palm Springs, etc. , et al, Fourth Appellate District Case No. E-012986 (the "appeal" ) . . E. The parties now desire to settle the lawsuit and appeal, and to resolve all disputes between them with respect to the Monte Vista Hotel, and to facilitate the acquisition of such hotel by the Agency from the Millers. AGREEMENT NOW THEREFORE, in consideration of the above recitals and the mutual promises and covenants hereafter set forth, the parties hereto agree as follows : 1 . Agency to Acquire Monte Vista Hotel from Millers . Upon the execution of this Agreement, the parties shall execute and enter into that certain "Agreement for Purchase and Sale of Real Property and Escrow Instructions, " in the form attached hereto as Exhibit "A, " by which the Agency shall acquire the Monte Vista Hotel from the Millers for a total cash purchase price of $1, 500, 000 . 00, under the terms, conditions, and escrow instructions set forth therein. The Agency hereby reaffirms the terms of the Lease/Purchase of Property agreement providing that the Agency is acquiring the Monte Vista Hotel under threat of condemnation. 2 . Dismissal of the Lawsuit. Upon the execution of this Agreement, the Millers shall execute and cause to be delivered to legal counsel for the Agency FS2\268\014084-0001\2103768.1 07/14/94 -2- a request to dismiss the lawsuit, with prejudice, in the form attached hereto as Exhibit "B. " Legal counsel for the Agency shall be authorized to file the request for dismissal upon the close of escrow as specified in Exhibit "A" above. The request for dismissal shall not be filed unless and until said escrow closes . It is further understood and agreed that, in dismissing the action with prejudice, the Agency and the Millers shall each bear their own respective costs and attorneys' fees. 3 . Stipulation for Dismissal of the Appeal . Upon the execution of this Agreement, the parties shall execute and cause to be delivered to legal counsel for the Agency a stipulation to dismiss the appeal, with prejudice, in the form attached hereto as Exhibit "C. " Legal counsel for the Agency shall be authorized to file the stipulation upon the close of escrow as specified in Exhibit "A" above. It is further understood and agreed that, in dismissing the appeal with prejudice, the Agency and the Millers shall each bear their own respective costs and attorneys' fees . 4 . General Release. Upon execution of this Agreement, the Millers shall execute and deliver to legal counsel for the Agency a General Release in the form attached hereto as Exhibit "D. " In executing the General Release, it is understood and agreed that the release shall not become effective until after the close of escrow as specified in AS2\268\014084-0001\2103768.1 (17114/94 -3- Exhibit "A" above, and it is further understood and agreed that the General Release, by its terms, shall not apply to the obligations of the Agency or the Millers under this Agreement. 5 . Miscellaneous . (a) This Agreement and the attached Exhibit "A, " "B, " "C, " and "D" constitute the entire Agreement between the parties pertaining to the subject matter hereof, and the final, complete and exclusive expression of the terms and conditions of their Agreement. Any and all prior agreements, representations, negotiations, and undertakings made by the parties, oral or written, express or implied, are hereby superseded and merged herein. (b) This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns. No party to this Agreement may assign its rights or obligations hereunder without the prior written consent of the other party. (c) In the event that legal proceedings are commenced to enforce any of the provisions of this Agreement or any rights existing hereunder, in addition to any damages which may be claimed, the prevailing party shall be entitled to an award of the costs and attorneys' fees incurred by it in connection with the prosecution or defense of such action. FS2\268\014084-0001\2103768.1 07/14/94 -4- (d) No failure or delay on the part of either party of this Agreement in enforcing any of the provisions of this Agreement or in exercising any rights existing hereunder shall operate as a waiver of such provisions or rights, or be deemed to affect an amendment or modification of this Agreement. (e) This Agreement shall be governed and construed in accordance with the laws of the State of California. (f) This Agreement may be executed in counterparts, which together shall constitute a single agreement, and each of which shall be an original for all purposes. Executed as of the dates indicated below. ATTEST: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic By A'p7s stant Secretary ChaiYman DATED: 7--- 1994 —JORT MILLER DATED: 7 1 Ff . 1994 � �/f/l/ "� ✓��� iG�� �j FRANK MILLER �w DATED: l " / 1994 MADELYN MILLER F52\268\014084-0001\2103768.1 07/14/94 -S- BY Is'Y �aE COMMUNITY MMUNITY .Y RES. Jyp, APPROVED AS TO FORM: RUTAN & TUCKER By": ��i, C� 1✓✓GEC^ J William � Wynder, Esq. , Agency Counsel CRANDALL & TRAVER By: 41111�A #14�� Lynn randall, Esq. , Attorneys for the Millers FS2\268\014094-0001\2103768.1 07/14/94 -(- EXHIBIT "A" AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY AND ESCROW INSTRUCTIONS Escrow No. Date of Opening of Escrow 1994 To: Coastal Counties Escrow ( "Escrow Holder") 700 East Tahquitz Canyon Way Palm Springs, California 92262 Attention: Escrow Officer Telephone: (619) 778-2588 THIS AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY AND ESCROW INSTRUCTIONS (this "Agreement" ) is made this day of 1994, by and between FRANK and MADELINE MILLER, husband and wife, and JOHN MILLER (collectively, "Seller" ) , and the COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic ( "Buyer" ) . R E C I T A L S : A. Seller is the owner of that certain real property located in the City of Palm Springs, County of Riverside, State of California, commonly known as 414 North Palm Canyon Drive and more particularly described in Exhibit "A" attached hereto and by this reference incorporated herein (the "Land" ) , together with all improvements now or hereafter constructed thereon, including, but not limited to, the improvements known as the Monte Vista Hotel and five (5) commercial storefront properties ( "Improvements") and all easements, licenses and interests appurtenant thereto. The Land, Improvements, appurtenant easements, licenses, interests and Intangible Property are collectively referred to herein as the "Real Property" . B. Seller and Buyer previously entered into that certain agreement entitled Lease/Purchase of Property dated August 9, 1988 ( "Lease/Purchase Agreement" ) , pursuant to which, among other things, Seller agreed to sell the Property to Buyer. C. Buyer has determined that the public interest and necessity require it to acquire the Property and, accordingly, Buyer has negotiated the Lease/Purchase Agreement with Seller for the purchase of the Property, but has done so with the intention that, if such negotiations are not sucessful, it would have taken EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 1 OF 9 PAGES F82\383\014084-0006\2103583.2 07/14/94 the steps necessary to acquire the Property by the exercise of its statutory powers of eminent domain. D. Seller and Buyer desire to enter into this Agreement to clarify the terms and conditions for the sale of the Property. NOW, THEREFORE, the parties hereto agree as follows : TERMS AND CONDITIONS 1. PURCHASE AND SALE OF PROPERTY. Subject to all of the terms and conditions hereinafter set forth, Buyer hereby agrees to purchase from Seller, and Seller agrees to sell to Buyer the following (all of which is hereinafter referred to as the "Property") : 1 . 1 Seller' s fee title interest in and to the Real Property; and 1.2 Seller' s interest in all furniture, personal property, machinery, apparatus and equipment owned by Seller and currently used in the operation, repair and maintenance of the Real Property and located on the Real Property as of the Close of Escrow, as such term is hereinafter defined, ( "Personal Property") . 2 . OPENING OF ESCROW. Within one (1) business day after the execution of this Agreement by Seller, the parties shall open an escrow ( "Escrow" ) with the Escrow Holder by causing an executed copy of this Agreement to be deposited with Escrow Holder. Escrow shall be deemed open on the date that Seller delivers this executed Agreement to Escrow Holder. 3 . PAYMENT OF PURCHASE PRICE. 3 . 1 Amount of Purchase Price. The purchase price for the Property will be ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1, 500, 000 . 00) ( "Purchase Price") . 3 .2 Payment of Purchase Price. On the day preceding Close of Escrow, Buyer shall deposit with Escrow Holder in "good funds" payable to Seller or order the Purchase Price. "Good funds" shall mean a wire transfer of funds, cashier' s or certified check drawn on or issued by the offices of a financial institution located in the State of California, or cash. 4 . ADDITIONAL FUNDS AND DOCUMENTS REQUIRED FROM BUYER AND SELLER. 4 . 1 Buyer. Buyer agrees that on or before 12 : 00 noon on the date preceding the Closing Date, Buyer will deposit with Escrow EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 2 OF 9 PAGES F52\383\014084-0006\2103583.2 07/14/94 Holder all additional funds and/or documents (executed and acknowledged, if appropriate) which are necessary to comply with the terms of this Agreement. 4 .2 Seller. Seller agrees that on or before 12 : 00 noon on the day preceding the Closing Date, Seller will deposit with Escrow Holder an executed and recordable grant deed ( "Grant Deed" ) conveying the Property to Buyer, an executed bill of sale conveying the Personal Property to Buyer, together with such funds and other items and instruments as may be necessary in order for the Escrow Holder to comply with this Agreement. Escrow Holder will cause the Grant Deed to be recorded when (but in no event after the date specified in Section 5 .1 below) it can issue the Title Policy in the form described in Section 6 below, and holds for the account of Seller the items described above to be delivered to Seller through Escrow, less costs, expenses and disbursements chargeable to Seller pursuant to the terms hereof. 5 . CLOSING DATE: TIME OF ESSENCE. 5 . 1 Closing Date. Escrow shall close on or before August 1, 1994 ( "Closing Date") . The terms "the Close of Escrow" , and/or the "Closing" are used herein to mean the time Seller' s Grant Deed is filed of record by the Escrow Holder in the Office of the County Recorder of Riverside County, California. 5 .2 Time of Essence. Buyer and Seller specifically understands that time is of the essence and Buyer and Seller specifically agrees to strictly comply and perform its obligations herein in the time and manner specified and waives any and all rights to claim such compliance by mere substantial compliance with the terms of this Agreement. 6 . TITLE POLICY. When Escrow Holder holds for Buyer the Grant Deed in favor of Buyer executed and acknowledged by Seller covering the Property, Escrow Holder shall cause to be issued and delivered to Buyer and Seller as of the Closing a C.L.T.A. standard coverage policy of title insurance ( "Title Policy") , or, upon Buyer' s request therefor, an ALTA extended coverage policy of title insurance, issued by Orange Coast Title Company of Riverside ( "Title Company" ) , with liability in the amount of One Million Fifty Thousand Dollars ($1, 050, 000 . 00) , covering the Property and showing title vested in Buyer free of encumbrances, except: (a) All nondelinquent general and special real property taxes and assessments for the current fiscal year. (b) Exceptions A, D, 1, 2 , and 3 as shown on that certain Preliminary Title Report No. R-131369-6 issued by EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 3 OF 9 PAGES FS2\383\014084-0006\2103583.2 07/14/94 Title Company dated as of June 28, 1994, previously approved by Buyer (the "Preliminary Title Report" ) . (c) The standard printed exceptions and exclusions contained in the CLTA or ALTA form policy. (d) Any exceptions created or consented to by Buyer, including without limitation, any exceptions arising by reason of Buyer' s possession of or entry on the Property. 7. CONDITIONS PRECEDENT TO CLOSE OF ESCROW. 7. 1 Conditions to Buyer' s Obligations. The obligations of Buyer under this Agreement shall be subject to the satisfaction or written waiver, in whole or in part, by Buyer of each of the following conditions precedent: (a) Title Company will issue the Title Policy as required by Section 6 of this Agreement insuring title to the Property vested in Buyer or other vestee designated by Buyer for vesting purposes only. (b) Escrow Holder holds and will deliver to Buyer the instruments and funds, if any, accruing to Buyer pursuant to this Agreement. 7.2 Conditions to Seller' s Obligations. The obligations of Seller under this Agreement shall be subject to the satisfaction or written waiver, in whole or in part, by Seller of each of the following conditions precedent: (a) Escrow Holder holds and will deliver to Seller the instruments and funds accruing to Seller pursuant to this Agreement. 8 . ESCROW PROVISIONS . 8 . 1 Escrow Instructions . This Agreement, when signed by Buyer and Seller, shall also constitute escrow instructions to Escrow Holder, and such instructions shall consist of the provisions of Sections 1 through 8, inclusive, and Section 12 . The terms and conditions of this Agreement not set forth in the preceding sections are additional matters for the information of Escrow Holder, but about which Escrow Holder need not be concerned. If required by Escrow Holder, Buyer and Seller agree to execute Escrow Holder' s standard escrow instructions, provided that the same are consistent with and do not conflict with the provisions of this Agreement. In the event of any such conflict, the provisions of this Agreement shall prevail . 8 .2 General Escrow Provisions . Escrow Holder shall deliver the Title Policy to the Buyer and instruct the Riverside County EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 4 OF 9 PAGES FS2\383\014084-0"\2103583.2 07/14/94 Recorder to mail the Grant Deed to Buyer at the address set forth in Section 12 . 3 after recordation. All funds received in this Escrow shall be deposited in one or more general escrow accounts of the Escrow Holder with any bank doing business in Orange, Los Angeles or Riverside Counties, California, and may be disbursed to any other general escrow account or accounts . All disbursements shall be made by Escrow Holder' s check. This Agreement and any modifications, amendments, or supplements thereto may be executed in counterparts and shall be valid and binding as if all of the parties' signatures were on one document . 8 .3 Payment of Real Property Taxes . All delinquent general and special real property taxes for periods after September 1, 1988 shall be paid by Buyer. 8 .4 Payment of Costs. Buyer shall pay all costs in connection with the escrow, including, but not limited to, the Escrow fee, documentary transfer taxes, premium charges for the Title Policy, and the charge for drawing the Grant Deed. 8 .5 Termination and Cancellation of Escrow. If Escrow fails to close as provided above, Escrow shall terminate automatically without further action by Escrow Holder or any party, and Escrow Holder is instructed to return all funds and documents then in Escrow to the respective depositor of the same with Escrow Holder. Cancellation of Escrow, as provided herein, shall be without prejudice to whatever legal rights Buyer or Seller may have against each other arising from the Escrow or this Agreement. 8 . 6 Information Report. Escrow Holder shall file and Buyer and Seller agree to cooperate with Escrow Holder and with each other in completing any report ( "Information Report" ) and/or other information required to be delivered to the Internal Revenue Service pursuant to Internal Revenue Code Section 6045 (e) regarding the real estate sales transaction contemplated by this Agreement, including without limitation, Internal Revenue Service Form 1099-B as such may be hereinafter modified or amended by the Internal Revenue Service, or as may be required pursuant to any regulation now or hereinafter promulgated by the Treasury Department with respect thereto. Buyer and Seller also agree that Buyer and Seller, their respective employees and attorneys, and escrow Holder and its employees, may disclose to the Internal Revenue Service, whether pursuant to such Information Report or otherwise, any information regarding this Agreement or the transactions contemplated herein as such party reasonably deems to be required to be disclosed to the Internal Revenue Service by such party pursuant to Internal Revenue Code Section 6045 (e) , and further agree that neither Buyer nor Seller shall seek to hold any such party liable for the disclosure to the Internal Revenue Service of any such information. 9 . BROKERAGE COMMISSIONS . EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 5 OF 9 PAGES PS2083\0140840006\2103583.2 97/14/94 Each party agrees to indemnify and hold the other harmless from and against all liabilities, costs, damages and expenses, including, without limitation, attorneys' fees, resulting from any claims or fees or commissions, based upon agreements by it, if any, to pay a broker' s commission and/or finder' s fee. 10 . REPRESENTATIONS AND WARRANTIES. 10 .1 Authority. Each party to this Agreement represents and warrants to the other that said party has the legal power, right and authority to enter into this Agreement and to consummate the transactions contemplated hereby. 10 .2 No Violation. Each party further represents and warrants that the execution and delivery of this Agreement, the incurrence of the obligations set forth herein, the consummation of the transactions herein contemplated, the compliance with the terms of this Agreement do not conflict with and will not result in the material breach of any terms, conditions or provisions of, or constitute a default under any bond, note or other evidence of indebtedness or any contract, indenture, mortgage, deed of trust, loan, partnership agreement, lease or other agreement to which said party is bound nor any judgment, order, writ injunction order or decree issued against or imposed upon said party. 10 .3 As-Is . Buyer hereby acknowledges that, except for the represenations and warranties specifically set forth herein or in the Lease/Purchase Agreement, Buyer is acquiring the Property in its "As-Is" condition. 11. POSSESSION. Possession of the Property shall be delivered to Buyer as of Close of Escrow. 12 . MISCELLANEOUS. 12 . 1 Assignment. Buyer shall not have the right to assign this Agreement or any interest or right hereunder or under the Escrow without the prior written consent of Seller, which consent may not be unreasonably withheld. Regardless of Seller' s consent, Buyer shall not be relieved of its responsibility and liability under this Agreement as a result of such assignment. Subject to the foregoing, this Agreement shall be binding upon and shall inure to the benefit of Buyer and Seller and their respective heirs, personal representatives, successors and assigns. 12 .2 Attorneys' Fees . In any action between the parties hereto seeking enforcement of any of the terms and provisions of this Agreement or the Escrow, the prevailing party in such action shall be entitled, to have and to recover from the other party its reasonable attorney' s fees and other reasonable expenses in EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 6 OF 9 PAGES F52\383\0140840006\2103583.2 07/14/94 connection with such action or proceeding, in addition to its recoverable court costs. 12 .3 Notices. Any notice which either party may desire to give to the other party or to the Escrow Holder must be in writing and may be given by personal delivery or by mailing the same by registered or certified mail, return receipt requested, to the party to whom the notice is directed at the address of such party hereinafter set forth, or such other address and to such other persons as the parties may hereafter designate: To Buyer: Community Redevelopment Agency of the City of Palm Springs, California P.O. Box 2743 3200 E. Tahquitz Canyon Way Palm Springs, CA 92263 Attn: Executive Director Copy To: Rutan & Tucker 611 Anton Boulevard Suite 1400 Costa Mesa, CA 92626 Attn: David J. Aleshire, Esq. Agency Counsel To Seller: Frank and Madeline Miller John Miller 457 North Palm Canyon Drive, No. 4 Palm Springs, CA. 92262 Copy To: Crandall & Traver 43-645 Monterey Ave. , Suite D Palm Desert, CA 92260 Attn: Lynn D. Crandall, Esq. 12 .4 Interpretation• Governing Law. This Agreement shall be construed according to its fair meaning and as if prepared by both parties hereto. This Agreement shall be construed in accordance with the laws of the State of California in effect at the time of the execution of this Agreement. Titles and captions are for convenience only and shall not constitute a portion of this Agreement . As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the other wherever and whenever the context so dictates. 12 .5 No Waiver. No delay or omission by either party hereto in exercising any right or power accruing upon the compliance or failure of performance by the other party hereto under the provisions of this Agreement shall impair any such right or power or be construed to be a waiver thereof. A waiver by either party hereto of a breach of any of the covenants, conditions or EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 7 OF 9 PAGES F52\383\014084-0006\2103583.2 07/14/94 agreements hereof to be performed by the other party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions hereof. 12 . 6 Modifications. Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made by, written instrument or endorsement thereon and in each such instance executed on behalf of each party hereto. 12 . 7 Severability. If any term, provision, condition or covenant of this Agreement or the application thereof to any party or circumstances shall, to any extent, be held invalid or unenforceable, the remainder of this instrument, or the application of such term, provisions, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. 12 . 8 Merger of Prior Agreements and Understandings. The Lease/Purchase Agreement, this Agreement and other documents incorporated herein by reference contain the entire understanding between the parties relating to the transaction contemplated hereby and all prior to contemporaneous agreements, understandings, representations and statements, oral or written, are merged herein and shall be of no further force or effect. 12 .9 Covenants to Survive Escrow. The covenants and agreements contained herein shall survive the Close of Escrow and, subject to the limitations on assignment contained in Section 12 . 1 above, shall be binding upon and inure to the benefit of the parties hereto and their representatives, heirs, successors and assigns . 12 . 10 No Withholding Because Non-Foreign Seller. Seller represents and warrants to Buyer that Seller is not, and as of the Close of Escrow will not be, a foreign person within the meaning of Internal Revenue Code Section 1445 or an out-of-state seller under California Revenue and Tax Code Section 18805 and that it will deliver to Buyer on or before the Close of Escrow a non-foreign affidavit on Escrow Holder' s standard form pursuant to Internal Revenue Code Section 1445 (b) (2) and the Regulations promulgated thereunder and a California Form 590-RE. 12 . 11 Time is of the Essence. Time is hereby expressly made - of the essence of this Agreement. 12 . 12 Execution in Counterpart. This Agreement may be executed in several counterparts, and all so executed shall constitute one agreement binding on all parties hereto, notwithstanding that all parties are not signatories to the original or the same counterpart. EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 8 OF 9 PAGES FS2\383\014084-0006\2103583.2 07114/94 IN WITNESS WHEREOF, the parties hereto have executed this Agreement of Purchase and Sale of Real Property and Escrow Instructions as of the date set forth above. FRANK MILLER MADELINE MILLER JOHN MILLER "Seller" ATTEST: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic By: By: Assistant Secretary Chairman APPROVED AS TO FORM: RUTAN & TUCKER David J. Aleshire, Esq. Agency Counsel "Buyer" EXHIBIT "A" TO SETTLEMENT AGREEMENT PAGE 9 OF 9 PAGES FS2\383\014084-0006\2103583.2 07/14/94 a,1U11 LU J4 IIVII 111JL V1I I1 I 0111111Q0 IIU, 11V. Vl.1JLJLLVI I V� M ORRNGE COR5T TITLE CO . W(rr+o .714-370-2132 JudkC4 9 :11 No .007 P .05 Ox&r No. R-131369-6 The land referred ro in this Report is situated in the State of California, O;xmty of Riverside and is described as follows: Lot 4 and the Northerly 25 feet of the Westerly 145.5 feet of Lot 5, Block 24 of Palm Springs, in the aamty of Riverside, State of G&Iifornia, to shown by ft an file in Book 9, Page 432, of Maps, Records of San Diego Oounty, California. EXCEPTTN3 therefrom the westerly 10.00 feat of the Northerly 100.00 feet of lot 4 of Block 24, as granted to the City of Palm Springs, by deed rworded September 26, 1966, as Instrument No. 95406, of Official Records. Nam, Address and Teleph*of ARomey(s) Veatow for Uss of Court clerk Ony WILLIAM W. WYNDER Rutan & Tucker 611 Anton Blvd. , Ste. 1400 Costa Mesa, CA 92626-1998 (714) 641-5100 84753 Attorney(s)for..C,R,,A,,,,OF,,F�> ............&VPERIQR.....COURT OF CALIFORNIA,COUNTY OF.RI V ERS Z.D.E.............. (SUPERIOR,MUNICIPAL,or JUSTICE) ...................DESERT..JUDICIAL..D.ISxRICT................................ (Name of Municipal to Justice court District or of branch court,it any) Plaintiff(s): FRAM( MILLER, JOHN MILLER CASENUMBER I 69228 and MADELYN MILLER, REQUEST FOR DISMISSAL TYPE OF ACTION Defendants(s): COMMUNITY REDEVELOPMENT EJ Personal Injury,Property Damage and Wrongful DeatR AGENCY OF THE CITY OF PALM p Motor vehicle ® Other SPRINGS, a public corporation, ED Domestic Relations O Eminent Domain ® Other: (Specify).SPECIFIC—PERFORMANCE.... (Abbreviated Title) TO THE CLERK: Please dismiss this action as follows (Check applicable boxes.) 1. ® With prejudice O Without prejudice 2 ® Entire action O complaint only ED Petition only ED Cross-complaint only Q Other:(Specify)8 CRANDALL & TRAVER Dated:. July._r......1.99A................... *if dismrssai requested is of specified parties wry, of speohed Attorney(s)for Plaintiffs causes of achon any or of spsafisd mss-compiaints any. so LYNN D. CRANDALL state and identify the parties.Causes of action or Cfoss- mpwintrs to be dismissed. (Type or print attorney(s)name(s)) TO THE CLERK: Consent to the above dismissal is hereby given.0a Dated:.............................................. swNman a cross-comwaint(or Response(Marriage)seeking amrma- Attorney(s)for We relief) is on fie, the ahomey(s) for the aoss-Complainant (respondeno must sign this consent When required by ccp Will).(2)or(5). (Type or print attorney(s)name(s)) (To be completed by clerk) [Z] Dismissal entered as requested on.......................................................................................... [:D Dismissal entered on...............................as to only ...........................................I.................. M Dismissal not entered as requested for the following reason(s), and attorney(s)notified on Clerk Dated......................................................... By. ,Deputy Form Mooted by Rule 992 of CCP 591.eto.; 3 The JUdiaal council of camomis REQUEST FOR DISMISSAL Cal.RUlea of court. Revised EffeCtrye Jay 1.1972 EXHIBIT nBn Rule 12M 1 EXHIBIT "C" 2 COURT OF APPEAL - STATE OF CALIFORNIA 3 FOURTH APPELLATE DISTRICT 4 DIVISION TWO 5 6 7 FRANK MILLER, JOHN MILLER & ) E-012986 MADELYN MILLER, ) 8 ) Riverside County Superior Plaintiffs/Respondents, ) Court Case No. I-69228 9 ) VS. ) (Honorable Robert G. Taylor, 10 ) Presiding Judge) COMMUNITY REDEVELOPMENT AGENCY ) 11 OF THE CITY OF PALM SPRINGS, ) 12 Defendant/Appellant. ) 13 14 15 STIPULATION & ORDER DISMISSING APPEAL 16 [California Rule of Court No. 19 (b) ] 17 18 19 20 RUTAN & TUCKER 21 William W. Wynder 611 Anton Boulevard, Suite 1400 22 Costa Mesa, Ca 92628-1950 23 (714) 641-5100 & (619) 323-8211 24 Attorneys for Defendant/Appellant COMMUNITY REDEVELOPMENT AGENCY OF 25 THE CITY OF PALM SPRINGS 26 27 28 EXHIBIT "C" TO SETTLEMENT AGREEMENT FS2\268\014084-0065\2103785.1 07/14/94 1 The parties hereto, through their respective counsel of 2 record herein, stipulate as follows: 3 A. On or about June 10, 1994, the parties filed with this 4 Court a stipulation extending the time in which to file the 5 Opening Brief in this action; 6 B. The stated purpose for such stipulation was to allow 7 the parties to continue negotiations to settle this appeal; 8 C. The parties have now concluded their settlement 9 negotiations, which will result in a resolution of the pending 10 appeal in the underlying civil action from which the appeal arose; 11 and 12 D. Accordingly, the parties request that this Court enter 13 an order dismissing this appeal, with prejudice, with both parties 14 bearing their own costs and attorneys' fees on appeal . 15 16 Dated: July _, 1994 RUTAN & TUCKER WILLIAM W. WYNDER 17 18 By: 19 William W. Wynder Attorneys for 20 Defendant/Appellant COMMUNITY REDEVELOPMENT 21 AGENCY OF THE CITY OF PALM SPRINGS 22 23 Dated: July 1994 CRANDALL & TRAVER LYNN D. CRANDALL 24 25 By: 26 Lynn D. Crandall Attorneys for 27 Plaintiffs/Respondents FRANK MILLER, JOHN MILLER 28 & MADELYN MILLER FS2\268\0140840065\2103785.1 07/14/94 1 1 ORDER 2 The Court, having read and considered the Stipulation of the 3 parties above, and good cause appearing therefore, hereby orders 4 that the appeal herein be dismissed, with prejudice, with both 5 sides to bear their own respective costs and attorneys, fees on 6 appeal. The Court further orders that remittitur be issued 7 forthwith. 8 9 Dated: July _, 1994 10 Presiding Justice 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 FS2\268\014084-0065\2103785.1 07/14/94 2 EXHIBIT "D" GENERAL RELEASE A. Parties. The parties to this General Release (the "Release") are Mr. Frank Miller and Mrs . Madelyn Miller, individuals and husband and wife, Mr. John Miller, an individual, and the Community Redevelopment Agency of the City of Palm Springs, a public entity corporate and politic (the "Agency") . B. Definitions. For purposes of this release: 1. The "lawsuit" means and refers to that certain action entitled Frank Miller, etc. , et al . v. Community Redevelopment Agency of the City of Palm Springs , etc. , et al . , Riverside County Superior Court Case No. I-69228 . 2 . The "appeal" means and refers to that certain appeal entitled Frank Miller, etc. , et al. v. Community Redevelopment Agency of the City of Palm Springs , etc. , et al . , Fourth Appellate District Case No. E-012986 . 3 . "Related parties" includes, where applicable, each and all of the party' s past, present and future elected officials, directors, officers, agents, employees, representatives, and attorneys, and all persons acting by, through, under or in concert with such party, or any or all of such persons. EXHIBIT "D" TO SETTLEMENT AGREEMENT PAGE 1 OF 6 PAGES C. Releases. 1. Frank Miller. For a valuable consideration the receipt and adequacy of which are hereby acknowledged, Frank Miller, on behalf of himself and on behalf of his related parties, does hereby fully release and forever discharge the Agency and its respective related parties, and each of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liabilities, claims, demands, damages, losses, costs or expenses, of any nature whatsoever, known or unknown, fixed or contingent, that Frank Miller now has or may hereafter have against any of such parties or related parties, and each of them, by reason of any matter, cause or thing whatsoever, from the beginning of time to the date hereof, arising out of, based upon or relating to the lawsuit, and the appeal, as well as any matters, causes or things whatsoever that were or could have been in any way raised in the lawsuit . 2 . Mrs. Madelyn Miller. For a valuable consideration receipt and adequacy of which are hereby acknowledged, Mrs. Madelyn Miller, on behalf of herself and on behalf of her related parties, does hereby fully release and forever discharge the Agency and its respective related parties, and each of them, of and from any and all manner of actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liabilities, claims, demands, damages, losses, costs or expenses, of any nature EXHIBIT "D" TO SETTLEMENT AGREEMENT PAGE 2 OF 6 PAGES • �► whatsoever, known or unknown, fixed or contingent, that Mrs. Madelyn Miller now has or may hereafter have against any. such parties or related parties, and each of them, by reason of any matter, cause or thing whatsoever, from the beginning of time to the date hereof, arising out of, based upon or relating to the lawsuit and the appeal, as well*p11AXyasiatters, causes of things whatsoever that were or could have been in any way raised in the lawsuit. 3 . John Miller. For a valuable consideration the receipt and adequacy of which are hereby acknowledged, John Miller, on behalf of himself and on behalf of his related parties, does hereby fully release and forever discharge the Agency and its respective related parties, and each of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liabilities, claims, demands, damages, losses, costs or expenses, of any nature whatsoever, known or unknown, fixed or contingent, that John Miller now has or may hereafter have against any of such parties or related parties, and each of them, by reason of any matter, cause or thing whatsoever, from the beginning of time to the date hereof, including any claims arising out of, based upon or relating to the lawsuit, and the appeal, as well as any matters, causes of things whatsoever that were or could have been in any way raised in the lawsuit. EXHIBIT "D" TO SETTLEMENT AGREEMENT PAGE 3 OF 6 PAGES D. Waiver of Unknown Claims. The undersigned acknowledges that they have been advised by legal counsel and are familiar with the provisions of California Civil Code § 1542, which provides as follows: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR. " The undersigned, being aware of this section, hereby expressly waive and relinquish all rights and benefits they may have thereunder, as well as any other statutes or common law principles of similar effect. E. Warranty Against Prior Assignment. The undersigned represent and warrant that they have not assigned or transferred any interest in any claim which they may have against the persons which they release under the terms of this Release, or any of them, and the undersigned agree to indemnify and hold such persons, and each of them, harmless from any liabilities, claims, demands, damages, costs, expenses and attorneys' fees incurred by such persons, or any of them, as a result of any person asserting any such assignment or transfer, or any rights, or claims under such assignment or transfer. It is the intention of the parties that this indemnity does not require a payment as a EXHIBIT "D" TO SETTLEMENT AGREEMENT PAGE 4 OF 6 PAGES condition precedent to recovery hereunder by any indemnified person. F. Construction and Interpretation. This Release and the rights and obligations of the parties hereunder shall be governed by, and construed and interpreted in all respects in accordance with, the laws of the State of California. Without limiting the generality of the foregoing, the masculine gender includes the feminine and neuter; the singular number includes the plural and the plural number includes the singular; and the term "person" includes a corporation or other entity, as well as a natural person. G. Attorneys' Fees. The undersigned parties each agree that should legal proceedings be commenced concerning any provision of this Release or relative to the subject matter hereof, in addition to any damages which may be claimed, the prevailing party shall be entitled to an award of the costs and attorneys' fees incurred by it in connection with the prosecution or defense of such action. H. Execution. Each of the undersigned parties understands and agrees that the execution of this Release shall not constitute or be construed as an admission of any liability to, or of the validity of any claim whatsoever by, the persons which it releases, or any of them. EXHIBIT "D" TO SETTLEMENT AGREEMENT PAGE 5 OF 6 PAGES I. Counterparts. This Release may be executed in one or more counterparts, which together shall constitute a single agreement, and each of which shall be an original for all purposes . This Release is executed by the parties on the dates and at the places indicated below. Mr. Frank Miller Date: At: Mrs. Madelyn Miller Date: At: Mr. John Miller Date: At : APPROVED AS TO FORM: CRANDALL & TRAVER By: Lynn D. Crandall Attorneys for Mr. Frank Miller, Mrs. Madelyn Miller and Mr. John Miller EXHIBIT "D" TO SETTLEMENT AGREEMENT PAGE 6 OF 6 PAGES arm rsr•xutAN & TUCKER ; 4-20-94 ;11:38AM RUTAN & TUCKER- 61932563204 2 T.N]T.Y TV.lI sL'� wR CQWRJ OF 103r. l U. Vr �ta%t V3lititl. 44Vgi3 WX Rti xJ XZS1WE TITLE: DATE fi DEPT. NUMBER FRANK MILLER, et al. v. COMMUNITY REDEVELOPMENT 4/19/94 200 I-69228 AGENCY OF THE CITY OF PALK SPRINGS COUNSEL.: REPORTER: L. Crandall W. Wynder None PRo"WING: TENTATIVE DECISION AFTER COURT TRIAL (Submitted 3/l/94) The Court, having considered the submitted matter, rules as follows: Judgment for plaintiffs. Specific performance of the subject agreement is GRANTED. plaintiffs to recover costs of suit. DISCUSSION 1 NAt=2 of the Case This is an equitable action for specific performance. Plaintiffs seek specific .performance of that certain agreement between .plaintiffs and the Community Redevelopment Agency of the City of Palm Springs entitled: "Lease/Purchase of Property's dated, August 9 , 1988 (herein, "the Agreement") . The Agreement is Exhibit 17 in evidence. By the terms of the Agreement,...the Community Redevelopment Agency was to lease the subject property (the Monte Vista Hotell for a period not to exceed five years,. and then purchase the property from plaintiffs for a price of $1,500,000. At trial, the Community Redevelopment Agency was referred to as "the City" for convenience only. The Court will do likewise in this ruling. However, it is noted that the City of Palm Springs is not a party to this action and the use of the term "City" is not intended to infer any legal liability on the part of the City of palm Springs herein. 2. Facts The Court finds the following facts; 1. At all material times, plaintiffs (brothers) were the owners of the Monte Vista Hotel in Palm Springs (herein, the subject property) . 2. At all material times, the subject property was part of a redevelopment project area known as the Central Business District project area. The City desired to purchase the property. for the purpose of including it in a redevelopment project which involved combinincj• the property with, other parcels for development. (Testimony of Ken Feenstra) . 3 . Prior to entering into the Agreement, the City and plaintiffs had been .in negotiations relative to a potential purchase by the City of the subject property. Throughout these negotiations plaintiffs required at all times a substantial down payment. (Testimony of John Miller and Ken Feenstra) . The Court finds that the only circumstances under which 1 SENT BY�RUTAN & TUCKER 4-20-94 ;11:40AM ; RUPAN & TUCKER- 6193256329;# 3 plaintiffs would have been willing to take back a security interest in the property (i.e. , a deed of trust) was if they received a substantial down payment in the neighborhood of $600,000. 4. The City was not willing to pay a large down payment because the City lacked sufficient funds, and did not have a buyer then ready to purchase the property from the City. An earlier prospective buyer, Mr. croman, no longer had the financial backing to purchase and develop the property at that time. Thus, the City needed to delay the date at which it would be obligated to make the actual cash payment of the purchase price so as to provide time to find a new interested party. (Testimony of Ken Feenstra) . 5. The original concept of utilizing a "lease/purchase" agreement was that of Ken Feenstra, then the Director of the Community Redevelopment Agency. (Testimony of Ken Feenstra) . 6. On behalf of the City, Mr. Feenstra's intent was to "lock in the price" in order to avoid the impact of the then continuing rise of property values. His idea was to take possession of the property while exploring the potential of developing the property in combination with other parcels within the redevelopment project area. It was determined by the City that 5 years would provide adequate time to explore these possibilities. (Testimony of Ken Feenstra) . 7. There were never any discussions that plaintiffs' remedies in the event of a default by the City would be restricted to taking the property back. None of the parties intended to create a "disguised security device." (Testimony of Ken Feenstra) . e. The mutual intent of both parties was that the City would lease the property for a period not to exceed 5 years, and then purchase the property; the payment of said purchase price to occur no later than 280 days prior to expiration of the 5 years. (Testimony of John Miller and Ken Feenstra; Exhibit 31) . 9. In prior negotiations, there had never been a discussion of a purchase without a substantial down payment. However, by the time the Agreement was entered into, the plaintiffs had been advised by their tax consultant not to take a large down payment due to adverse tax consequences. (Deposition of John Miller; Deposition of Frank Miller) . Consequently, at the time of the agreement, the plaintiffs did not desire a large down payment in any event. Rather, they were willing to wait until the city was ready to pay the full purchase price at a date not to exceed 5 years from the date of the Agreement. As constructed, the purchase/sale would be an all cash transaction. Further, since the property was being sold "under threat of condemnation" certain tax advantages would apply to the receipt of the purchase price at such time as it was paid. (Testimony of John Miller) . 10. The Agreement called for lease payments of $120,000 per year payable $10,000 per month. (Exhibit 17) . This figure represented an 8% return on the value of the property. (Testimony of Ken Feenstra) . it was stipulated at trial that the Fair Market Value of the property as of the date of the agreeihent was $1,500,000. 11. No part of the lease payments went toward the purchase price. (Testimony of Ken Feenstra) . The purchase price was $1,500,000 (a figure equal to the then fair market value of the property) . 2 .nua w auIeI & IUUTIK , 4 20 94 ,11.41AM , RUTAN & TUCKER- 6193256329:# 4 12. The Agreement further obligated the City to purchase the property and pay the $1,500,00o purchase price no later than 180 days prior to the expiration of the lease. (Exhibit 17). The Court finds that the City was obligated to purchase the property as of August 8, 1988 (the date of the Agreement) but was not required to pay the purchase price until 180 days prior to the expiration of the lease term, which expiration date could not exceed August 8, 1993. However, the City had the option to terminate the lease term and pay the purchase price at any time prior to that date. (Exhibit 17) . 13. The Agreement further gave the City possession of the premises during the lease term and required the City to pay all related expenses (insurance, taxes, etc. ) . It further assigned all existing leases to the City. (Exhibit 17) . 14. Pursuant to the Agreement, the City would receive title to the property upon paying the cash sum of $1,500,000. The Court finds that title was 31Qt retained by plaintiffs as "security" for the City's performance of its obligations under the Agreement. The "purpose" of the Agreement (which supports this findings) is further discussed below. 15. on March 4, 1993, the City by letter of that same date gave notice of its intent to terminate the Agreement herein. (Exhibit 43) . It was in this letter that the City, for the first time in this transaction, referred to the Agreement as a "land sales agreement" . That term had not been used by either party prior to the city's letter. The city subsequently gave notice of Its intent to surrender the premises on April 3, 1993. (Exhibit 44) . 16. It was stipulated at trial that the fair market value of the subject property as of commencement of trial was $810,000 - 835,000. The court finds that the fair market value of the subject property as of August 8, 1993 (being five years from the date of the Agreement) was between $810,000 and $835,000. 3. Was the At =.qnh an "rn¢tall +• *and Sa' e Contract?" This is the main issue in the case. The Court finds the Agreement is not an installment land sale contract. Rather, the Court finds it is an agreement whereby the City leased the property for a period not to exceed 5 years, followed by a purchase of the property for the cash sum of $1,500,00o. The issue is significant because case law establishes that if the Agreement is, in fact, an installment land sale contract, then it will be treated as a "disguised security device. " As such, it would not be subject to specific performance. Rather, it would be subject to the anti-deficiency provisions of Code of Civil Procedure 580b thereby limiting plaintiff to recovery of the property (the "security") in the event of default by the purchaser. Venable v. Harmon (1965) 233 Cal.App.2d 297, On the other hand, if it is a "marketing contract" (such as is a deposit receipt contract) , then it is specifically enforceable. During trial, counsel for both parties alluded to the "duck test" in' determining the nature of the Agreement. That is to say, if it looks like a duck and quacks like a duck, then it must be a duck. The City argues that the Agreement has all the earmarkings (feathermarkings?) of an installment land sale contract, to wit: possession by the buyer; title retained by the 3 SENT BY•RUTAN & TUCKER ; 4-20-94 ;11:43AM RUTAN & TUCKER- 6193256329;# 5 seller; frequent regularpayments period of • time (exceeding one year) ,- current expenses to be paid by the seller; and the deed to be delivered upon completion of the contract without further financing. See: C.E.B. , Ca7ifQrDia Eea1 Property Remedieg Practice, Sec. 4.29 (1982) . Plaintiff argues to the contrary that as they relate to this agreement, each of these factors are completely consistent with the separate lease and purchase aspects of the transaction and are in accord with the intent of the parties. Neither counsel assert that the "duck test" is a recognized part of our common law, but rather, as a practical matter, is suggestive of how "obvious" the nature of the agreement is. The court is not persuaded that the character of the Agreement is so obvious. If it were, this ruling would be much shorter. Rather, the Court is prompted to ask: What if it looks like a duck, but honks like a goose? Is it then "guck"? A Moose?" What? As noted, possession by the "lessee" is consistent with a lease. However, it is also consistent with an installment land sale contract, if you change the word "lessee" to "buyer. " The same is true about title being retained by the "landlord"/"owner;" as is the payment of ongoing expenses (such as found in a triple net lease vs, a buyer's paying of insurance, taxes, etc. under an installment land sale contract) . Why do these same factors appear to defendant to so obviously show a land sale contract; and simultaneously, appear to plaintiffs to so obviously show a simple lease combined with an agreement to later purchase? The answer appears to lie in the different analysis utilized by each side. Defendant argues the test is a "functional analysis" w- that is, if the elements of an installment land sale contract are present, it thereby operates as one and, regardless of the Ra figs' mutual' intent, must therefore be one. Plaintiff argues the test is one of "intent" . Thus, if the parties intended to create a lease and then a purchase of the property, and the Agreement says that is what it is, then that is how the transaction must be characterized. Defendant counters that a "bright line" test is created by Civil Code Section 2985 which calls an installment land contract a "real property sales contract" and defines it as an agreement to convey title on satisfaction of Specified conditions that "does not require conveyance of title within one year from the date of formation of the contract." The problem with this is that it would lminatg Dmy analysis and totally disregard the intent of the parties. As noted in the above-referenced C.E.B. treatise, this definition adds to the confusion on this issue because: such "definition could include a marketing contract that does not require closing within one year, even though the parties have no intention that the marketing contract function as a security device." Cal. R a� Aron r t s Remedies PracricP, supra, page 126. Rather, the authors state the test is one of "intent:" "In distinguishing between a purchase agreement and an installment land contract, courts consider the intent of the parties as manifested by their conduct. Venable v. Harmon, supra. This standard requires analysis of the facts of the particular transaction to discern the 4 SENT BY•RUTAN & TUCKER ; 4-20-94 ;11:44AM RUTAN & TUCKER- 6193256329;# 6 purpose of the contract." Cal Real properties Remiies practice, id. The leading case on this issue is Venable v E(A=J Mor (1965) 233 Cal.App.2d 297. The rule laid down by the Venable court is found in one paragraph which reads as follows: "Although there seems to be no clear-cut test for determining when an ernest money contract becomes a security device, the test should be one of intent, which may be evidenced by such factors as the length of time the contract is to run, change in possession of the property, the number of installments to be made under the contract, the per cent payable under the contract contrasted to other financing methods which may be involved. " Venable, Xd. , pager 300-301 (emphasis added) . From the above it appears the analysis must be made on a case-by-case basis. Further, there is no "clear cut test. " No single factor is dispositive. Rather, what is required is an "analysis of the facts of the particular transaction to discern the purpose of the contract." Cal. Real PrQPertiQs Remedies Practice, supra. The Agreement in this case called for a lease followed by an eventual payment of a cash purchase price relative to the purchase/sale of the property. The Court is mindful that under certain facts, the courts have found transactions involving "lease/options" to constitute installment land sale contracts. See: Beeler v American Trust Q. (1944) 24 Cal.2d 1. However, it certainly cannot be said that all "lease/options" are installment land sale contracts. The Beeler case is discussed and distinguished below. Rather, as stated above, one must look at the "purpose of the contract." The purpose of the agreement in this case must be discerned from reviewing not only the terms of the Agreement itself, but the surrounding facts and conduct of the parties as well. To begin with, it is clear the City wanted to acquire the property for its redevelopment purposes. however, it was not able to pay cash for the property because of its own financial difficulties. The City's desire to acquire the property was in conflict with its inability to pay for itl Further, it wanted the flexibility to sell the property without delay at such time as it found the right developer to develop the combined parcels waking up the redevelopment project area. Thus, due to circumstances relating solely to the City's then financial condition, contrasted with its redevelopment goals, the City to came up with a creative solution to the problem. It would lease the property from plaintiffs to give the City time to explore the possibilities of finding a developer/buyer. Five years was determined to be sufficient. However, it could at any time prior thereto elect to open escrow and pay the purchase price so as to facilitate a subsequent sale to a developer. The Court observes that immediate possession would give the city the standing of a landlord with regard to the commercial leases so it could vacate tenants in an expedited manner, even pending close of escrow. A lease would afford this kind of control to the City. Thus, the lease served a bona fide purpose: To give the City control of the property while it explored the possibilities of development. The City could at any time pay the cash purchase price and take title to the property 5 Prw1 61 MIAN & iUGKrK 4 20-94 ,11.46AM RUTAN & TUCK Ry 6193256329;# 7 as under any other "marketing agreement." The fact that the lease allowed the City to determine (within 5 years) just when it would choose to pay the purchase price does not destroy the bona fides of the lease. Further, the lease payments computed on the basis of an 8% return on the value of the property does no offense to the notion of a lease. Although the testimony (deposition as well as at trial) was somewhat equivocal as to whether the lease payments were tied to value of the property as opposed to being a reduction from the 9% interest rate earlier agreed upon, it is clear that these payments were truly consideration for the occupancy by the City of the property during the lease term. That is to say, the dollar figure can be Justified by a variety ways, but the "purpose" of the payments was as rent under the' lease. Further, none of the lease payments went toward the purchase price of $1,500,000. The actual sale was to be an all cash transaction. The purchase price was $11500,000 on August 8, 1988 and it would be the same even if the City did not close escrow until August 8, 1993. Title was not being held "as securitylt for the promise to make "installment" payments. The sale portion of the Agreement was all cash, with title to be transferred simultaneously with payment of the purchase price. The rental payments support the finding of a lease, not an installment land sale contract. True, contrary to the normal deposit -receipt contract, close of escrow in this case could be deferred for up to five years. However, even here, it is important to note that the City could, at its election, have terminated the lease and purchased the property within days of having entered the Agreement. This was not a "five year" payment plan. it could have been a "five day" term. It was at all times within the control of the City as to when it would pay the cash price ,and take title. Thus, we do not have an agreement to pay installments over a fixed long term period so as to pay all or even a portion of the purchase price. These facts distinguish this case from Venable, supra. The Venable court noted that a contract for the sale of land in return for "installment payments," with title to be retained by the vendor until all of a large part of the purchase price is paid" serves the function of a security device similar to a mortgage. Thus, it is proper to impose the anti-deficiency provisions under CCp 580b. Here, title was not retained as security for payment of any part of the purchase price, The Court finds the payments here were rent, and not payments toward the purchase price, nor interest thereon. Further, the plaintiffs did = want to take back a deed of trust without a substantial down payment (see findings above) . If plaintiffs had been willing to sell the property for no money down and take back a $1,500,000 note secured by deed of trust, then there would have been no reason not to structure the transaction in that manner. It is clear that neither plaintiffs, nor the City, intended the transaction to constitute a no money down "sale. " From the above, the Court finds that the "purpose" of the agreement and the "intent" of the parties was to facilitate a present lease of the property in order to give the City the flexibility to deal with the property pending its search for a developer and, at the same time, comply with the plaintiff's desire to effect an all-cash sale. Thus, although the purpose for creating a lease was certainly "related" to ultimately facilitating a purchase/sale of 6 SENT BY:RUTAN & TUCKER 4-20-94 ;11:47AM RUTAN & TUCKER- 6193256329;* 8 the property, it was still ill a lease with a valid Purpose. To construe the agreement as an installment land sale contract under these facts would be contrary to the mutual expressed intent of the parties. This is not merely a "subjective" intent, but the expressed intent based on the surrounding facts And the conduct of the parties. Reeler, supra, is distinguished on its facts. There the bank had made various loans to the prior owner of the property in the aggregate amount of approximately $74,000. The owner sold the property to Beeler who assumed the obligations to the bank. when he could not pay off the loans, Beeler re- negotiated with the Bank. The bank agreed to a discount but refused to carry the loans any longer. The bank then suggested it take the property back by deed and "lease" the property back to Beeler for 1 year at a rental of $3,000 per year with an option to purchase for $6q,000 (the negotiated amount to retire the loans) . The Court found the Bank "insisted" on this procedure. Beeler sued to have the deed to the bank declared a mortgage. The court quoted lengthy passages of trial testimony showing the actual "intent" of the parties was to create a form of "refinancing." Further, the court found a substantial discrepancy between the fair market value of the property ($135,000) and the option price ($60,000) . The court noted the option price was approximately the same as the negotiated amount earlier agreed upon to retire the loan. The court also noted a substantial discrepancy between the fair rental value ($7,500) and the "rent" of $3,000 (which was the equivalent of 5% interest on $60,000) . The court found each discrepancy was a "strong circumstance" showing the deed was intended to operate as a mortgage. Thus, Beeler is distinguished in that there was a prior creditor/debtor relationship; the action was to declare a "deed" a mortgage (although the transaction did involve a lease/option) ; and there was substantial testimony (as well as "surrounding facts") showing an "intent" to "refinance" existing loans as opposed to a bona fide lease with an option. Defendant cites the Beeler case for the proposition that the determination of the character of an agreement is not based on "intent" but Is determined strictly on how the agreement "functions" (i.e. , the "functional analysis") . This is clearly a misinterpretation of the holding. Without question, the test is one of "intent." The Beeler court held (quoting partially from ChgpmaB v Hicks, 41 Cal, App. 158, at 162-163) : "The intention of th uartie�t govern, and it matters not what particular form the transaction may take. if the deed is made for the purpose of securing payment of a debt, it is a mortgage, no matter how strong the language of the deed or any instrument accompanying it may be. '" 24 Cal.2d at page 20 (emphasis added) . Defendant's reliance on Coast Bank v Hind@ hou (1964) 61 Cal.2d 311, is also misplaced. There, the bank made several unsecured loans to the then property owners. The owners then signed and agreement not to transfer or encumber the property. The owners then sold the property to Minderhout. The bank sued to foreclose on an "equitable mortgage." The court held the agreement constituted an equitable mortgage stating that every agreement where the party: "sufficiently indicates an intention to make some particular property, real or personal, or fund, therein 7 SENT BY:RUTAN & TUCKER ; 4-20-94 ;11:49AM RUTAN & TUCKERR 6193256329;# 9 described Videntified, a security foredebt or other obligation . creates an equitable lien upon the property . . . " 61 Cal.sd at page 313-314 (emphasis added) . The Minderhout case court clearly followed years of case precedent in applying an "intent" test to determine the nature of the agreement. case law does not support the creation of a "functional analysis" test. The test is now, and always has been, a test of the "intent" of the parties. The courts do not disregard intent; rather, they strive to discern what that intent is and implement it. True, in determining the intent, the courts will look to the operative provisions and effect of the agreement. However, the courts will also look at the surrounding facts to determine what was attempted to be accomplished by (i.e. , the "purpose of") the agreement. At all times, the courts work to discern intent in order to determine the nature of the agreement. Under the circumstances in this case, it would violate the parties "intent" to find this Agreement an "installment land sale contract. " One may apply the factors set for in Venable, supra in light of these facts: (a) Length gf_time of the contract. There was no "long term" fixed period of payments, no set length of time during which "installments" were to be paid. The payment of the purchase price could have occurred at any time, at the option of the City. Thus, this was not an agreement to pay "installments" for 5 years; this was an all-cash transaction. This tends to show a "marketing agreement." (b) Chancre in possession. In light of the purpose of the Agreement and the surrounding facts, possession by the city was consistent with the lease aspect of the Agreement as was the payment of recurring and ongoing expenses. (c) 'ng number of installments to be made. No part of the rental payments went toward purchase. These were not "installments." Rather, the full purchase price would still have to be paid once escrow was opened, tending to show a "marketing agreement." Further, as noted above, there was no set number of "installments." The City could have elected to cease the rent payments at any time. ' The Agreement was clearly not an installment land sale contract. (d) The percentage payable under the contract. There was no evidence of what percentage was then being received on financed transactions. However as noted above, here the amount of the rent, representing a fair return on the value of the property, was consistent with a lease. The Court finds this was not an installment land sale contract. A. Was the consideration AdeUate? The Agreement to purchase was entered into on August 8, 1988. The obligation to purchase the property arose an that date. The timing of the actual payment could be deferred for up to approximately 5 years. However, as observed above, it could also have occurred 5 days after entering into the Agreement. it is well settled that adequacy of consideration is determined as of the date of entering into the Agreement. The stipulation of the 8 SINP BY:WAN & TUCKER ; 4-20-04 ;11:51AM ; RUTAN & TUCKER 6193256329;#10 parties is that the fo market value equaled the A, 00,000 purchase price. The fact that the City, at its option, could delay payment does not change the operative date for determining adequacy of consideration. The Court finds the consideration was adequate. 5. Conclusion For the above reasons, the Court finds the Agreement was not an installment land sale contract, but was a lease/purohase agreement. Either party may request a statement of decision as to any issues not addressed above. If there is no request, this ruling will constitute the statement of decision. A brief comment on the lawyering in this case. Both side were extremely well represented. without detracting in any from the excellent work by plaintiff's counsel, the Court wishes to acknowledge the professional skill and ingenuity of the city's counsel in presenting the City's position in this case. Although the Court has ultimately disagreed with that position, it was, nevertheless, presented with the utmost skill and professionalism. The excellent lawyering on both sides of this case should not go unmentioned. The Court finds plaintiffs are entitled to specific performance. Counsel for plaintiff to prepare formal judgment. ROBERT G. TAYLOR ,/ RA CAL ATTYS SUB. LIST M. Martinez JUDGE CLERK MINUTES OF THE SUPERIOR COURT 9 SENT BY:RUTAN & TUCKER ; 4-20-94 ;11:51AM RUTAN & TUCKER- 6193256329411 CLERK'S CERTIFICATE OF MAILING (original copy, duly executed, must be attached to original document at time of filing) (Unsigned copy must accompany document being mailed) I, Clerk, Superior Court of California, for the County of Riverside, do hereby certify that I am not a party to the within action or proceeding; that on the 19th day of April, 1994, I served a copy of the paper to which this certificate is attached, to wit: Minute Order dated 04-19-94 Case Number: I-69228 accompanied by an unsigned copy of the certificate, by depositing said copy enclosed in a sealed envelope with postage thereon fully prepaid, in the United States Post Office mail box at the City of Palm Springs, California, addressed as follows: Lynn D. Crandall William W. Wynder CRANDALL & TRAVER RUTAN & TUCKER 43-645 Monterey Avenue 611 Anton Boulevard Suite D Suite 1400 Palm Desert CA 92260 Costa Mesa CA 92626-1998 Clerk Superior Court Dated: April 19, 1994 By: , Deputy M. Martinez CLERK'S CERTIFICATE OF MAILING Frank Miller, et al-General Release re Monte Vista Hotel Litigation (Part 2 re Exh A) AGREEMENT #334C GENERAL RELEASE R940, 7-20-94 A. Parties . The parties to this General Release (the "Release") are Mr. Frank Miller and Mrs . Madelyn Miller, individuals and husband and wife, Mr. John Miller, an individual, and the Community Redevelopment Agency of the City of Palm Springs, a public entity corporate and politic (the "Agency") . B. Definitions . For purposes of this release: 1. The "lawsuit" means and refers to that certain action entitled Frank Miller, etc. , et al . V. Communit Redevelopment Agency of the City of Palm Springs etc et al . , Riverside County Superior Court Case No. I-69228 . 2 . The "appeal" means and refers to that certain appeal entitled Frank Miller, etc. , et al . v Community Redevelopment Agency of the City of Palm Springs etc et al . , Fourth Appellate District Case No. E-012986 . 3 . "Related parties" includes, where applicable, each and all of the party' s past, present and future elected officials, directors, officers, agents, employees, representatives, and attorneys, and all persons acting by, through, under or in concert with such party, or any or all of such persons . C. Releases. 1. Frank Miller. For a valuable consideration the receipt and adequacy of which are hereby acknowledged, Frank Miller, on behalf of himself PAGE 1 OF 6 PAGES and on behalf of his related parties, does hereby fully release and forever discharge the Agency and its respective related parties, and each of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liabilities, claims, demands, damages, losses, costs or expenses, of any nature whatsoever, known or unknown, fixed or contingent, that Frank Miller now has or may hereafter have against any of such parties or related parties, and each of them, by reason of any matter, cause or thing whatsoever, from the beginning of time to the date hereof, arising out of, based upon or relating to the lawsuit, and the appeal, as well as any matters, causes or things whatsoever that were or could have been in any way raised in the lawsuit . 2 . Mrs . Madelyn Miller. For a valuable consideration receipt and adequacy of which are hereby acknowledged, Mrs. Madelyn Miller, on behalf of herself and on behalf of her related parties, does hereby fully release and forever discharge the Agency and its respective related parties, and each of them, of and from any and all manner of actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liabilities, claims, demands, damages, losses, costs or expenses, of any nature whatsoever, known or unknown, fixed or contingent, that Mrs. Madelyn Miller now has or may hereafter have against any such parties or related parties, and each of them, by reason of any matter, cause or thing whatsoever, from the beginning of time to the date hereof, arising out of, based upon or relating to the PAGE 2 OF 6 PAGES lawsuit and the appeal, as well as any matters, causes of things whatsoever that were or could have been in any way raised in the lawsuit . 3 . John Miller. For a valuable consideration the receipt and adequacy of which are hereby acknowledged, John Miller, on behalf of himself and on behalf of his related parties, does hereby fully release and forever discharge the Agency and its respective related parties, and each of them, of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, debts, liens, contracts, agreements, promises, liabilities, claims, demands, damages, losses, costs or expenses, of any nature whatsoever, known or unknown, fixed or contingent, that John Miller now has or may hereafter have against any of such parties or related parties, and each of them, by reason of any matter, cause or thing whatsoever, from the beginning of time to the date hereof, including any claims arising out of, based upon or relating to the lawsuit, and the appeal, as well as any matters, causes of things whatsoever that were or could have been in any way raised in the lawsuit . D. Waiver of Unknown Claims. The undersigned acknowledges that they have been advised by legal counsel and are familiar with the provisions of California Civil Code § 1542 , which provides as follows : "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING PAGE 3 OF 6 PAGES THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR. " The undersigned, being aware of this section, hereby expressly waive and relinquish all rights and benefits they may have thereunder, as well as any other statutes or common law principles of similar effect. E. Warranty Against Prior Assignment. The undersigned represent and warrant that they have not assigned or transferred any interest in any claim which they may have against the persons which they release under the terms of this Release, or any of them, and the undersigned agree to indemnify and hold such persons, and each of them, harmless from any liabilities, claims, demands, damages, costs, expenses and attorneys' fees incurred by such persons, or any of them, as a result of any person asserting any such assignment or transfer, or any rights, or claims under such assignment or transfer. It is the intention of the parties that this indemnity does not require a payment as a condition precedent to recovery hereunder by any indemnified person. F. Construction and Interpretation. This Release and the rights and obligations of the parties hereunder shall be governed by, and construed and interpreted in all respects in accordance with, the laws of the State of California. Without limiting the generality of the foregoing, the masculine gender includes the feminine and neuter; the singular number includes the plural and the plural number includes the PAGE 4 OF 6 PAGES r singular; and the term "person" includes a corporation or other entity, as well as a natural person. G. Attorneys' Fees . The undersigned parties each agree that should legal proceedings be commenced concerning any provision of this Release or relative to the subject matter hereof, in addition to any damages which may be claimed, the prevailing party shall be entitled to an award of the costs and attorneys' fees incurred by it in connection with the prosecution or defense of such action. H. Execution. Each of the undersigned parties understands and agrees that the execution of this Release shall not constitute or be construed as an admission of any liability to, or of the validity of any claim whatsoever by, the persons which it releases, or any of them. I . Counterparts . This Release may be executed in one or more counterparts, which together shall constitute a single agreement, and each of which shall be an original for all purposes . This Release is executed by the parties on the dates and at the places indicated below. Mr. Frank Miller Date: 7— , Mrs . Madelyn Miller Date: —• "�� .— i PAGE 5 OF 6 PAGES M — John Miller 1 / �� n >_ Date: 1 f � W APPROVED AS TO FORM: CRANDALL & TRAVEER By: zi /&===- Lynn Crandall Attorneys for Mr. Frank Miller, Mrs . Madelyn Miller and Mr. John Miller PAGE 6 OF 6 PAGES Frank Miller, et al - Sale/ Purch - Monte Vista Hotel (Part 3 refer Exh D) AGREEMENT #334C R940, 7-20-94 AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY AND ESCROW INSTRUCTIONS Escrow No. Date of Opening of Escrow 1994 To: Coastal Counties Escrow ( "Escrow Holder") 700 East Tahquitz Canyon Way Palm Springs, California 92262 Attention: Escrow Officer Telephone: (619) 778-2588 THIS AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY AND ESCROW INSTRUCTIONS (this "Agreement" ) is made this �)C)` day of 10"LL , 1994, by and between FRANK and MADELINE MILLER, hush nd aAa wife, and JOHN MILLER (collectively, "Seller") , and the COMMUNIT REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic ( "Buyer") . R E C I T A L S : A. Seller is the owner of that certain real property located in the City of Palm Springs, County of Riverside, State of California, commonly known as 414 North Palm Canyon Drive and more particularly described in Exhibit "A" attached hereto and by this reference incorporated herein (the "Land" ) , together with all improvements now or hereafter constructed thereon, including, but not limited to, the improvements known as the Monte Vista Hotel and five (5) commercial storefront properties ( "Improvements" ) and all easements, licenses and interests appurtenant thereto. The Land, Improvements, appurtenant easements, licenses, interests and Intangible Property are collectively referred to herein as the "Real Property" . B. Seller and Buyer previously entered into that certain agreement entitled Lease/Purchase of Property dated August 9 , 1988 ( "Lease/Purchase Agreement") , pursuant to which, among other things, Seller agreed to sell the Property to Buyer. C. Buyer has determined that the public interest and necessity require it to acquire the Property and, accordingly, Buyer has negotiated the Lease/Purchase Agreement with Seller for the purchase of the Property, but has done so with the intention that, if such negotiations are not sucessful, it would have taken the steps necessary to acquire the Property by the exercise of its statutory powers of eminent domain. PAGE 1 OF 9 PAGES FS2\383\014084-0006\2103583.2 07/14/94 D. Seller and Buyer desire to enter into this Agreement to clarify the terms and conditions for the sale of the Property. NOW, THEREFORE, the parties hereto agree as follows : TERMS AND CONDITIONS 1 . PURCHASE AND SALE OF PROPERTY. Subject to all of the terms and conditions hereinafter set forth, Buyer hereby agrees to purchase from Seller, and Seller agrees to sell to Buyer the following (all of which is hereinafter referred to as the "Property" ) : 1 . 1 Seller' s fee title interest in and to the Real Property; and 1.2 Seller' s interest in all furniture, personal property, machinery, apparatus and equipment owned by Seller and currently used in the operation, repair and maintenance of the Real Property and located on the Real Property as of the Close of Escrow, as such term is hereinafter defined, ( "Personal Property" ) . 2 . OPENING OF ESCROW. Within one (1) business day after the execution of this Agreement by Seller, the parties shall open an escrow ( "Escrow" ) with the Escrow Holder by causing an executed copy of this Agreement to be deposited with Escrow Holder. Escrow shall be deemed open on the date that Seller delivers this executed Agreement to Escrow Holder. 3 . PAYMENT OF PURCHASE PRICE. 3 . 1 Amount of Purchase Price. The purchase price for the Property will be ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1, 500, 000 . 00) ( "Purchase Price") . 3 .2 Payment of Purchase Price. On the day preceding Close of Escrow, Buyer shall deposit with Escrow Holder in "good funds" payable to Seller or order the Purchase Price. "Good funds" shall mean a wire transfer of funds, cashier' s or certified check drawn on or issued by the offices of a financial institution located in the State of California, or cash. 4 . ADDITIONAL FUNDS AND DOCUMENTS REQUIRED FROM BUYER AND SELLER. 4 . 1 Buyer. Buyer agrees that on or before 12 : 00 noon on the date preceding the Closing Date, Buyer will deposit with Escrow Holder all additional funds and/or documents (executed and acknowledged, if appropriate) which are necessary to comply with the terms of this Agreement . PAGE 2 OF 9 PAGES FS2\383\014084-0006\2103583.2 07/14/94 4 .2 Seller. Seller agrees that on or before 12 : 00 noon on the day preceding the Closing Date, Seller will deposit with Escrow Holder an executed and recordable grant deed ( "Grant Deed" ) conveying the Property to Buyer, an executed bill of sale conveying the Personal Property to Buyer, together with such funds and other items and instruments as may be necessary in order for the Escrow Holder to comply with this Agreement . Escrow Holder will cause the Grant Deed to be recorded when (but in no event after the date specified in Section 5 . 1 below) it can issue the Title Policy in the form described in Section 6 below, and holds for the account of Seller the items described above to be delivered to Seller through Escrow, less costs, expenses and disbursements chargeable to Seller pursuant to the terms hereof. 5 . CLOSING DATE; TIME OF ESSENCE. 5 . 1 Closing Date. Escrow shall close on or before August 1, 1994 ( "Closing Date" ) . The terms "the Close of Escrow" , and/or the "Closing" are used herein to mean the time Seller' s Grant Deed is filed of record by the Escrow Holder in the Office of the County Recorder of Riverside County, California. 5 .2 Time of Essence. Buyer and Seller specifically understands that time is of the essence and Buyer and Seller specifically agrees to strictly comply and perform its obligations, herein in the time and manner specified and waives any and all rights to claim such compliance by mere substantial compliance with the terms of this Agreement . 6 . TITLE POLICY. When Escrow Holder holds for Buyer the Grant Deed in favor of Buyer executed and acknowledged by Seller covering the Property, Escrow Holder shall cause to be issued and delivered to Buyer and Seller as of the Closing a C.L.T.A. standard coverage policy of title insurance ( "Title Policy" ) , or, upon Buyer' s request therefor, an ALTA extended coverage policy of title insurance, issued by Orange Coast Title Company of Riverside ( "Title Company" ) , with liability in the amount of One Million Fifty Thousand Dollars ($1, 050, 000 . 00) , covering the Property and showing title vested in Buyer free of encumbrances, except : (a) All nondelinquent general and special real property taxes and assessments for the current fiscal year. (b) Exceptions A, D, 1, 2, and 3 as shown on that certain Preliminary Title Report No. R-131369-6 issued by Title Company dated as of June 28, 1994, previously approved by Buyer (the "Preliminary Title Report") . (c) The standard printed exceptions and exclusions contained in the CLTA or ALTA form policy. PAGE 3 OF 9 PAGES FS2\383\014084-0006\2103583.2 97/14/94 (d) Any exceptions created or consented to by Buyer, including without limitation, any exceptions arising by reason of Buyer' s possession of or entry on the Property. 7 . CONDITIONS PRECEDENT TO CLOSE OF ESCROW. 7 . 1 Conditions to Buyer' s Obligations . The obligations of Buyer under this Agreement shall be subject to the satisfaction or written waiver, in whole or in part, by Buyer of each of the following conditions precedent: (a) Title Company will issue the Title Policy as required by Section 6 of this Agreement insuring title to the Property vested in Buyer or other vestee designated by Buyer for vesting purposes only. (b) Escrow Holder holds and will deliver to Buyer the instruments and funds, if any, accruing to Buyer pursuant to this Agreement. 7 .2 Conditions to Seller' s Obligations. The obligations of Seller under this Agreement shall be subject to the satisfaction or written waiver, in whole or in part, by Seller of each of the following conditions precedent: (a) Escrow Holder holds and will deliver to Seller the instruments and funds accruing to Seller pursuant to this Agreement. 8 . ESCROW PROVISIONS . 8 . 1 Escrow Instructions . This Agreement, when signed by Buyer and Seller, shall also constitute escrow instructions to Escrow Holder, and such instructions shall consist of the provisions of Sections 1 through 8, inclusive, and Section 12 . The terms and conditions of this Agreement not set forth in the preceding sections are additional matters for the information of Escrow Holder, but about which Escrow Holder need not be concerned. If required by Escrow Holder, Buyer and Seller agree to execute Escrow Holder' s standard escrow instructions, provided that the same are consistent with and do not conflict with the provisions of this Agreement. In the event of any such conflict, the provisions of this Agreement shall prevail. 8 .2 General Escrow Provisions. Escrow Holder shall deliver the Title Policy to the Buyer and instruct the Riverside County Recorder to mail the Grant Deed to Buyer at the address set forth in Section 12 .3 after recordation. All funds received in this Escrow shall be deposited in one or more general escrow accounts of the Escrow Holder with any bank doing business in Orange, Los Angeles or Riverside Counties, California, and may be disbursed to any other general escrow account or accounts . All disbursements shall be made by Escrow Holder' s check. This Agreement and any modifications, amendments, or supplements thereto may be executed PAGE 4 OF 9 PAGES PS2\383\014084-0006\2103583.2 07/14/94 in counterparts and shall be valid and binding as if all of the parties' signatures were on one document. 8 . 3 Payment of Real Property Taxes . All delinquent general and special real property taxes for periods after September 1, 1988 shall be paid by Buyer. 8 . 4 Payment of Costs. Buyer shall pay all costs in connection with the escrow, including, but not limited to, the Escrow fee, documentary transfer taxes, premium charges for the Title Policy, and the charge for drawing the Grant Deed. 8 . 5 Termination and Cancellation of Escrow. If Escrow fails to close as provided above, Escrow shall terminate automatically without further action by Escrow Holder or any party, and Escrow Holder is instructed to return all funds and documents then in Escrow to the respective depositor of the same with Escrow Holder. Cancellation of Escrow, as provided herein, shall be without prejudice to whatever legal rights Buyer or Seller may have against each other arising from the Escrow or this Agreement. 8 . 6 Information Report. Escrow Holder shall file and Buyer and Seller agree to cooperate with Escrow Holder and with each other in completing any report ( "Information Report" ) and/or other information required to be delivered to the Internal Revenue Service pursuant to Internal Revenue Code Section 6045 (e) regarding the real estate sales transaction contemplated by this Agreement, including without limitation, Internal Revenue Service Form 1099-3 as such may be hereinafter modified or amended by the Internal Revenue Service, or as may be required pursuant to any regulation now or hereinafter promulgated by the Treasury Department with respect thereto. Buyer and Seller also agree that Buyer and Seller, their respective employees and attorneys, and escrow Holder and its employees, may disclose to the Internal Revenue Service, whether pursuant to such Information Report or otherwise, any information regarding this Agreement or the transactions contemplated herein as such party reasonably deems to be required to be disclosed to the Internal Revenue Service by such party pursuant to Internal Revenue Code Section 6045 (e) , and further agree that neither Buyer nor Seller shall seek to hold any such party liable for the disclosure to the Internal Revenue Service of any such information. 9 . BROKERAGE COMMISSIONS . Each party agrees to indemnify and hold the other harmless from and against all liabilities, costs, damages and expenses, including, without limitation, attorneys' fees, resulting from any claims or fees or commissions, based upon agreements by it, if any, to pay a broker' s commission and/or finder' s fee. PAGE 5 OF 9 PAGES FS2\383\014084-0006\2103583.2 97/14/94 10 . REPRESENTATIONS AND WARRANTIES . 10 . 1 Authority. Each party to this Agreement represents and warrants to the other that said party has the legal power, right and authority to enter into this Agreement and to consummate the transactions contemplated hereby. 10 .2 No Violation. Each party further represents and warrants that the execution and delivery of this Agreement, the incurrence of the obligations set forth herein, the consummation of the transactions herein contemplated, the compliance with the terms of this Agreement do not conflict with and will not result in the material breach of any terms, conditions or provisions of, or constitute a default under any bond, note or other evidence of indebtedness or any contract, indenture, mortgage, deed of trust, loan, partnership agreement, lease or other agreement to which said party is bound nor any judgment, order, writ injunction order or decree issued against or imposed upon said party. 10 .3 As-Is . Buyer hereby acknowledges that, except for the represenations and warranties specifically set forth herein or in the Lease/Purchase Agreement, Buyer is acquiring the Property in its "As-Is" condition. 11. POSSESSION. Possession of the Property shall be delivered to Buyer as of Close of Escrow. 12 . MISCELLANEOUS . 12 . 1 Assignment. Buyer shall not have the right to assign this Agreement or any interest or right hereunder or under the Escrow without the prior written consent of Seller, which consent may not be unreasonably withheld. Regardless of Seller' s consent, Buyer shall not be relieved of its responsibility and liability under this Agreement as a result of such assignment . Subject to the foregoing, this Agreement shall be binding upon and shall inure to the benefit of Buyer and Seller and their respective heirs, personal representatives, successors and assigns. 12 .2 Attorneys' Fees . In any action between the parties hereto seeking enforcement of any of the terms and provisions of this Agreement or the Escrow, the prevailing party in such action shall be entitled, to have and to recover from the other party its reasonable attorney' s fees and other reasonable expenses in connection with such action or proceeding, in addition to its recoverable court costs . 12 .3 Notices. Any notice which either party may desire to give to the other party or to the Escrow Holder must be in writing and may be given by personal delivery or by mailing the same by registered or certified mail, return receipt requested, to the party to whom the notice is directed at the address of such party PAGE 6 OF 9 PAGES FS2\383\014084-0006\2103583.2 07/14/94 hereinafter set forth, or such other address and to such other persons as the parties may hereafter designate: To Buyer: Community Redevelopment Agency of the City of Palm Springs, California P.O. Box 2743 3200 E. Tahquitz Canyon Way Palm Springs, CA 92263 Attn: Executive Director Copy To: Rutan & Tucker 611 Anton Boulevard Suite 1400 Costa Mesa, CA 92626 Attn: David J. Aleshire, Esq. Agency Counsel To Seller: Frank and Madeline Miller John Miller 457 North Palm Canyon Drive, No. 4 Palm Springs, CA. 92262 Copy To: Crandall & Traver 43-645 Monterey Ave. , Suite D Palm Desert, CA 92260 Attn: Lynn D. Crandall, Esq. 12 .4 Interpretation: Governing Law. This Agreement shall be construed according to its fair meaning and as if prepared by both parties hereto. This Agreement shall be construed in accordance with the laws of the State of California in effect at the time of the execution of this Agreement. Titles and captions are for convenience only and shall not constitute a portion of this Agreement . As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the other wherever and whenever the context so dictates . 12 .5 No Waiver. No delay or omission by either party hereto in exercising any right or power accruing upon the compliance or failure of performance by the other party hereto under the provisions of this Agreement shall impair any such right or power or be construed to be a waiver thereof . A waiver by either party hereto of a breach of any of the covenants, conditions or agreements hereof to be performed by the other party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions hereof. 12 . 6 Modifications . Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made by written instrument or endorsement thereon and in each such instance executed on behalf of each party hereto. PAGE 7 OF 9 PAGES FS2\383\014084-0006\2103583.2 07/14/94 12 . 7 Severability. If any term, provision, condition or covenant of this Agreement or the application thereof to any party or circumstances shall, to any extent, be held invalid or unenforceable, the remainder of this instrument, or the application of such term, provisions, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. 12 . 8 Merger of Prior Agreements and Understandings . The Lease/Purchase Agreement, this Agreement and other documents incorporated herein by reference contain the entire understanding between the parties relating to the transaction contemplated hereby and all prior to contemporaneous agreements, understandings , representations and statements, oral or written, are merged herein and shall be of no further force or effect. 12 .9 Covenants to Survive Escrow. The covenants and agreements contained herein shall survive the Close of Escrow and, subject to the limitations on assignment contained in Section 12 . 1 above, shall be binding upon and inure to the benefit of the parties hereto and their representatives, heirs, successors and assigns . 12 . 10 No Withholding Because Non-Foreign Seller. Seller represents and warrants to Buyer that Seller is not, and as of the Close of Escrow will not be, a foreign person within the meaning of Internal Revenue Code Section 1445 or an out-of-state seller under California Revenue and Tax Code Section 18805 and that it will deliver to Buyer on or before the Close of Escrow a non-foreign affidavit on Escrow Holder' s standard form pursuant to Internal Revenue Code Section 1445 (b) (2) and the Regulations promulgated thereunder and a California Form 590-RE. 12 . 11 Time is of the Essence. Time is hereby expressly made of the essence of this Agreement. 12 . 12 Execution in Counterpart. This Agreement may be executed in several counterparts, and all so executed shall constitute one agreement binding on all parties hereto, notwithstanding that all parties are not signatories to the original or the same counterpart. IN WITNESS WHEREOF, the parties hereto have executed this Agreement of Purchase and Sale of Real Property and Escrow Instructions as of the date set forth above. Alt- FRANK MILLER (Signatures continued on next page. ] PAGE 8 OF 9 PAGES PS2\383\014084-0006\2103583.2 07/14/94 �✓ MADELINE MILLER �0II�N MILLER "Seller" ATTEST: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic s- 13 ( 1 A4 0,stant Secretary Chaifrmah APPROVED AS TO FORM: RUTAN & TUCKER�4L,% L1� Cf r/pd lx e David J�--Aleshire, Esq. Agency Counsel "Buyer" INPPROVE© BY THE COMMUNITY REDEV. "Y BY RES. NO, PAGE 9 OF 9 PAGES P52\383\014084-0006\2103583.2 07/14/94 Nl U1 0--0-.1, " .111 n 1.11',._,-,,- . n, , . , .. ,. `I` .- ,. UII LV 04 IIUN 11,JL `/l1 JI I lIL,1 JI II LIIUU 11(1 .11. UI..JLJULUI ~ G2RMGE COR5T TITLE CO . -0-(o .714-370-2132 Jun WJ4 3 : 11 M0 .007 P .05 ottier No. R-131369-6 E}9U13rr "An The land referz-ed co in this Report is situated in the State of California, oauity of Riverside and is described as follows: Lot 4 and the Northerly 25 feet of the Westerly 145.5 feet of Lot 5, Block 24 of Palm springs, in the oamty of Riverside, State of Dil.ifornia, ie shown by Mnp on file in Book 9, Page 432, of Maps, Records of San Diego County, California. EtCEPTIM therefrom the westerly 10.00 feet of the Northerly 100,00 feet of Lot 4 of Block 24, as granted to the City of balm Springs, by deed recorded September 26, 1966, as Inetrunent No. 95406, of Official Records.