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Home My WebLink About5/15/2002 - STAFF REPORTS (8) DATE: May 15, 2002 ',-TO: City Council FROM: Al Smoot, Executive Director -Airports TOLLING AGREEMENT TO DISMISS WITHOUT PREJUDICE AN ACTION FILED BY CITY AGAINST SABO & GREEN, ONE OF THE BOND COUNSEL FIRMS INVOLVED IN THE 1991 ASSISTED LIVING CENTER BOND ISSUE RECOMMENDATION: It is recommended that the Council approve the attached Tolling Agreement,which would dismiss without prejudice the action the City filed against Sabo & Green. SUMMARY: The attached Tolling Agreement would dismiss the action the City filed against Sabo & Green without prejudice, while preserving the City's right to pursue the bond counsel firms if the negotiations of the successor underwriter, PaineWebber, fail and the City is faced with potential liability. BACKGROUND: The attached Tolling Agreement would dismiss the action the City filed against Sabo & Green without prejudice. They are one of the bond counsel firms involved in the 1991 Assisted Living Center bond issue which is under investigation by the IRS. According to Urb Schreiner of Burke, Williams &Sorensen, who is assigned to this issue and wrote the Tolling Agreement, it looks like the IRS problem will be solved by PaineWebber, the successor underwriter. In the event that PaineWebber's negotiations with the IRS fail and the City is faced with potential liability,this Tolling Agreement preserves the City's right to pursue the bond counsel firms. f Allen . Smoot, A.A.E. Executive Director-Airports City Manager—� Attachments: 1. Tolling Agreement 2. Minute Order TOLLING AGREEMENT This Tolling Agreement (the "Agreement") is made between City of Palm Springs ("Plaintiff'), on the one hand, and the law firm of Sabo & Green, a professional corporation, its partners, employees and agents, Charles R. Green and Timothy J. Sabo ("Defendants") on the other hand (collectively the City and Defendants are the "Parties"). The effective date of the Agreement is 2002. Recitals A. Plaintiff alleges certain claims against Defendants for professional negligence and breach of contract relating to legal work,performed by Defendants on behalf of Plaintiff. B. On November 20, 2001, Plaintiff filed an action against Defendants for damages allegedly arising from said claims in the Superior Court County of Riverside (Case No. INCO25971) (the"action"). C. The Agreement is solely for the benefit of the parties to the Agreement expressly identified and no others. No person or entity that is not a party to the Agreement shall have the right, standing or authority to invoke its terms, benefits, or obligations without the express written consent of all parties to the Agreement. Terms 1. In consideration of Plaintiff dismissing without prejudice the action against Defendants, the parties to this Agreement hereby agree that all statutes of limitations on any alleged claims of any kind or nature of Plaintiff against Defendants shall toll through and including the Termination Date (as defined below). It is agreed that Defendants shall not claim any defense to any claim of Plaintiff based upon the passage of time from November 20, 2001 through the Termination Date. The tolling set forth herein shall apply prospectively from the date of November 20, 2001 and shall not operate to revive,renew, or extend any claim or claims which would otherwise be barred by any statutes of limitation or by related defenses as of the date of November 20, 2001. 2. As used herein, the term "Termination Date" means the earlier of (a) the completion of the Audit and issuance of such letter by the IRS,or(b) 30 days after a party to the Agreement gives written notice to the other party of an election to terminate the Agreement. Written notice from the party terminating the Agreement shall be delivered, by facsimile and either by personal service or by a nationally recognized courier service with a receipt, to the other party's counsel, at such counsel's addresses as follows: To: LAW FIRM Douglas M. Butz, Esq. Alan D. Leeth,Esq. _ Butz Dunn DeSantis&Bingham 101 West Broadway,Ste. 1700 San Diego, California 92101 IRV#20064 V2 1 y�z To: PLAINTIFF Urban J. Schreiner, Esq. Gary W. Park, Esq. Sunny K. Soltani, Esq. Burke, Williams &Sorensen, LLP 18301 Von Karman Ave., Suite 1050 Irvine, California 92612 3. The Agreement shall be deemed to have been drafted by both parties, and shall not be construed against any party on the premise that a specific party drafted the Agreement. 4. In any action to enforce the Agreement or for its breach, the prevailing party shall be entitled to recover reasonable attorney's fees and costs. 5. The Agreement is confidential and shall not be disclosed to any person or entity by any party to the Agreement, or their counsel, except as necessary to establish whether a claim or defense falls within the Agreement. 6. The parties agree that neither this Agreement, its terms nor its existence shall be used adversely to any party to the Agreement, except to enforce its terms. 7. The Agreement may be signed in counterparts, each of which, when fully executed, shall constitute the Agreement. 8. The Agreement is the entire agreement among the parties. In executing the Agreement, neither party is relying on or acting on any promise, inducement, or agreement not expressed in the Agreement. 9. The Agreement is controlled by the law of California. IN WITNESS WHEREOF, the parties have entered into this tolling agreement as of the date first above written. SABO &GREEN, a Professional Corporation DATED: By: DATED: �'�� b By: CHARLES R. GREEN DATED: By: TIMOTHY J. SABO atv#20064 v2 2 ��3 FROM GREEN de BORTNOWSKY QUINT' 'LLA Calabas (WED) 4. 10' 02 8: 1' 'T. 8:14/NO. 4862516706 P 2 To: PLAINTIFF Urban J. Schreiner,Esq. Gary W.Park,Esq. ' Sunny K. Soltani,Esq. Burke, Williams&Sorensen, LLP 18301 Von Karman Ave.,Suite 1050 Irvine,California 92612 3. The Agreement shall be deemed to have been drafted by both parties, and shall not be construed against any party on the premise that a specific party drafted the Agreement. 4. In any action to enforce the Agreement or for its breach, the prevailing party shall be entitled to recover reasonable attorney's fees and costs. S. The Agreement is confidential and shall not be disclosed to any person or entity by any party to the Agreement,or their counsel, except as necessary to establish whether a claim or defense falls within the Agreement. 6. The parties agree that neither this Agreement, its terms nor its existence shall be used adversely to any party to the Agreement, except to enforce its terms. 7. The Agreement may be signed in counterparts, each of which, when fully executed, shall constitute the Agreement. S. The Agreement is the entire agreement among the parties. In executing the Agreement, neither party is relying on or acting on any promise, inducement, or agreement not expressed in the Agreement. 9. The Agreement is controlled by the law of California. IN WITNESS WHEREOF, the parties have entered into this tolling agreement as of the date fast above written. SABO &GREEN,a Professional Corporation DATED: By: L-C) DATED: By: CHART ES R. GREEN DATED. By: _ TIMOTHY J.SABO atvr2sas4v2 2 >]4-OB-02 10:08 From-LEWIS, D'AMATO. BRISBOIS t, BISGARD LLP 909885318T T-704 P IO/il F-539 To: PLAINTIFF Urban J. Schreiner,Esq. Gary W. Park, Esq. Sunny K. Soltani, Esq, Burke,Williams & Sorensen, LLP 18301 Von Kaman Ave., Suite 1050 Irvine, California 92612 3. The Agreement shall be deemed to have been drafted by both parties, and shall not be construed against any party on the premise that a specific party drafted the Agreement. 4. In any action to enforce the Agreement or for its breach, the prevailing party shall be entitled to recover reasonable attorney's fees and costs. 5. The Agreement is confidential and shall not be disclosed to any person or entity by any patty to the Agreement, or their counsel, except as necessary to establish whether a claim or defense falls within the Agreement. 6. The parties agree that neither this Agreement, its terms nor its existence shall be used adversely to any party to the Agreement,except to enforce its terms. 7_ The Agreement may be signed in counterparts, each of which, when fully executed, shall constitute the Agreement. 8. The Agreement is the entire agreement among the parties. In executing the Agreement, neither party is relying an or acting on any promise, inducement, or agreement not expressed in the Agreement. 9_ The Agreement is controlled by the law of California. IN WITNESS WHEREOF, the parties have entered into this tolling agreement as of the date first above written. SABO &GREEN, a Professional Corporation DATED: By: DATED: By: CIJARL S R- GREEN DATED: �'-tl- 0 By: TIMOTHY I- YABO IRV 02W64 v2 2 APPROVED AS TO FORM: u BLITZ DUNN DeSANTIS &BINGHAM DATED: By: DOUGLAS M. BUTZ ALAN D. LEETH Attorneys for Defendants SABO &GREEN, a Professional Corporation, Charles R. Green and Timothy J. Sabo u CITY OF PALM SPRINGS DATED: By: �-4 ` 4� THOMAS M.KANARR DAVID H. READY APPROVED AS TO FORM: BURKE,WILLIAMS &SORENSEN,LLP L q DATED: I a� By: Lr.. .. URBAN J. SC INER GARY W. PARK SUNNY K. SOLTANI Attorneys for Plaintiff CITY OF PALM SPRINGS IRV#20064 t2 3 MINUTE ORDER NO. APPROVING THE TOLLING AGREEMENT TO DISMISS WITHOUT PREJUDICE AN ACTION FILED BY CITY AGAINST SABO & GREEN. --------------- I HEREBY CERTIFY that this Minute Order, approving the Tolling Agreement to dismiss without prejudice an action filed by the City of Palm Springs against Sabo & Green, one of the bond counsel firms involved in the 1991 Assisted Living Center Bond Issue, was adopted by the City Council of the City of Palm Springs, California, in a meeting thereof held on the 151h day of May 2002. PATRICIA A. SANDERS City Clerk