The judgment is the biggest monetary verdict ever awarded in a developer-versus-city case in the state of Utah, according to Mark Larsen, of the Salt Lake City-based law firm of Larsen Christensen & Rico, which represented Tooele Associates.
“I am not surprised by the verdict,” said Drew Hall, managing partner for Tooele Associates. “The evidence presented supported the verdict. I hope the city is now willing to create a new agreement with the same terms and conditions as the original agreement so we can get on with the development of Overlake.”The eight member jury sat for six days listening to testimony and arguments from attorneys from both sides, and took less than two days to come back with the verdict. They found that Tooele City had slowed or refused final inspections, misapplied the city’s own public improvement ordinances, refused to accept completed improvements, required standards not found in the original 1997 development agreement, refused applications for new subdivisions, refused to renew the development agreement, and refused to approve assignments of the development agreement to Perry Homes, a company that wanted to partner with Tooele Associates and build homes in Overlake.
As a result of the city’s actions in violation of the development agreement, the jury awarded Tooele Associates $5 million in losses incurred from 2003 to 2009 and another $17.5 million in future losses from 2003 until 2017, the year when the renewed development agreement would have expired.
The city was awarded $1.8 million for Tooele Associates failure to complete public improvements in Overlake and $70,000 for Tooele Associates failure to pay for water used to irrigate the Overlake Golf Course.
The balance between the two awards leaves the city owing $20.7 million to Tooele Associates. The city also spent roughly $3.5 million on legal fees over the course of the 10-year-old lawsuit, according to Tooele City Mayor Patrick Dunlavy.
“We obviously are disappointed with the verdict,” said Dunlavy. “This lawsuit was brought against the city by the developer, and I believe the city and its attorneys defended the city very well.”
The city council has a special closed session scheduled to discuss the lawsuit on Wednesday night at 7 p.m. at City Hall.
“We have to look at all of our options and consult with legal counsel about how to proceed,” Dunlavy said, when asked about the possibility of an appeal. “Whatever we do must protect the interest of the community.”
How the city will come up with $20.7 million was a question Dunlavy said he was not prepared to answer at this time.
“My understanding is that there are still a few motions and procedural steps in this case, as there are in all civil cases, that need to be finished before the judge issues a final judgment,” Dunlavy said.
Prior to the judge making final judgment in the case, the city may make motions that could result in the reward being lowered, or possibly the entire verdict being set aside, said Mike Johnson, a Tooele City Council member and an attorney.
“This judgment will not stand up,” said Johnson. “There is a good chance that Judge Skanchy [the 3rd District court judge who presided over the case] or an appellate court will toss out or reduce the award.”
In 1997, when Tooele Associates signed an annexation and development agreement with then Tooele City Mayor Bud Pendleton, the city was in the middle of a home building and real estate boom. Permits for single-family homes in the city in 1997 reached 640 — seven times greater than the number of permits issued just two years earlier. Amid concerns about this rapid growth, Pendleton lost his bid for re-election at the primary level and Charlie Roberts, whose campaign featured ads touting “responsible growth,” took office in 1998. Roberts was re-elected to a second term in the 2001 election. In 2002, Tooele Associates filed its lawsuit, claiming the city’s anti-growth policies had caused development in Overlake to essentially come to a halt.
Roberts said as a city council member he voted in favor of the Overlake development agreement.
“I was not opposed to growth, and in the time I served as mayor the city nearly doubled in size,” Roberts said. “Including the first phases of Overlake.”
Dunlavy inherited the lawsuit, but said he doesn’t blame Roberts for it.
“I do not blame Charlie Roberts for the suit or the expenses,” Dunlavy said. “I believe that he — like I am — was only concerned about protecting the community.”
Twice since becoming mayor, Dunlavy said he sat down with Drew Hall, managing partner of Tooele Associates, and tried to work out an agreement outside of court. Dunlavy said the talks broke down over the length of the renewed agreement.
Hall said the verdict simply allows him to do what he wanted to do all along: complete Overlake according to the intent of the original agreement.
With only 700 of 7,500 homes completed, Overlake has a long way to go.
“I have nothing against the people of Tooele,” said Hall, who grew up in the small town of Carnation, Wash., and completed several development projects in the Seattle area before moving to Salt Lake City. “My disagreement has been with government officials. I hope as result of the verdict they will do some soul-searching. I am interested in seeing how the city responds to the verdict.”
Bruce Baird, an attorney who worked on the case on behalf of Tooele Associates, said the jury reached a logical conclusion given the arguments they heard.
“Their verdict is very clear,” Baird said. “Cities are not above the law. They must honor their agreements, and treat developers fairly.”
Tim Gillie: tgillie@tooeletranscript.com
samwoodruff@msn.com wrote on Monday, Jun 29 at 09:34 AM
"...Bruce Baird, the city's outside legal counsel, tells them that he will..."
Tooele City's outside legal counsel is led by George Haley and Chris Hogle of Holme Roberts & Owen, LLP.
Bruce Baird is co-counsel for Tooele Associates.
Here is some information for you. Charlie Roberts changed the personnel policy regarding the appointment of department heads at Tooele City, in about the second year of his first term. It now requires only the Mayor to decide who is a department head and who isn't. No council input is required in the hiring or firing process. During the Roberts' administration, he replaced EVERY department head he could. The Recorder and Attorney have contracts with the City Council. Charlie's parting comments were that 'all the right people are in place'. Meaning the appointed officials that he appointed. How arrogant is that. The end result of this type of policy is what we now have at Tooele City Hall. Department heads spending more time keeping their jobs than actually doing their jobs. It is the job of department heads to notify the administration of errors, wrong doings, and other things that will cause litigation and a waste of taxpayer dollars. When this was done with Roberts, those people were no longer on his 'team', working towards a common goal.
City Government cannot be run like an LDS Ward - where one person makes the decisions and everybody else follows. Differing opinions need to be listended to and fostered, weighed and considered. Not looked upon as cancerous and wrong. Local government has no place for the self righteous arrogance that is behind this law suit and the one with Grantsville. Painting your own version of 'the real truth', all the while ignoring the facts, will continue to cause problems and waste taxpayer money. I for one, believe that public officials should be prudent in their decisions, put aside their egos by not attempting to leave a 'legacy', and make decisions that are well founded, researched, and in the long term interest of Tooele City taxpayers.
PS Stand up and be counted, reveal yourself, or sit down and shut up!
Revenge? Seeking a council seat? A little defensive aren't we? This is a posting for comments regarding the lawsuit between Drew Hall and Tooele City, not on elections. His comments are based on first hand knowledge from the beginnings of this dispute, not on personal vendetta's.
I notice he is not the only person here making comments, yet he is the only one personally attacked.
At least you stated one "real truth"..."much of this was Charlie Roberts fault", but if actions need to be "justified" they are usually NOT integruous.
As for the rest of your comments, if your comments held any weight you would have revealed yourself.
As for the lawsuit...since I am a city employee, I cannot comment at this time. I have my own insight and opinions, which must remain with me at this time. I do, however, commend the employees who work for Tooele City in our offices, parks and public works for the work they do. I also commend the department heads that DO strive for integrity in their work. I also wish our current Mayor the best, as he is shouldering the responsibilities of a prior administration.
As a life long resident of Tooele City, I too am a taxpayer; I shop as much as I can in this city and support our local businesses; and I serve my community outside the city offices. I want to see my tax dollars spent on services, not put into the pockets of outside attorney's for a lawsuit that can be amicably settled. It's time for some peace and rest from this turmoil. Our residents deserve the quality of life promised to them in the "Greatest City in Utah".
Didn't you run for election and lose last time, overwhelmingly? And were you not fired from you position as the former finance director of the city! Your reply comes at a ironic time. Seems to me like you may have found your only chance to win a city council seat this time...
Also, why don't tell everyone why you were let go as the city's finance director, oh wait, you will lie about this as well...
You do have a point, much of this was Charlie Roberts fault, but the city was justified in defending this lawsuit.
I love how you preach for mass resignatios, It seems as if this is the only way you may get revenge for your terminiation a the city...
The truth hurts, you couldn't be elected through the normal process, so now you have to stoop to all time lows to try, classy guy. And this is the type of "clean politics" you say you will bring...
Just remember TAXPAYERS, Sam Woodruff has a vendetta against the city and this is his only chance to get revenge, doesn't sound like a person I want representing my best interests!
The really ridiculus thing about it all - get this - another closed door session where Bruce Baird, the city's outside legal counsel, tells them that he will do whatever they want him to as far as an appeal goes, just keep paying him $50 - $100,000 per month. Roger Baker and the entire City Council, which is dominated by Steve Pruden and Mike Johnson offer the same self righteous opinion, 'We have done nothing wrong, therefore it is the best interest of the taxpayers to keep fighting this'. I say discontinue the closed door sessions and open them up to the public and accept differing opinions and insights. Otherwise, we have the same people giving their same faulty opinions.
Yes, mass resignations would now be the best thing possible for Tooele City Residents. That is the only way a new accord can be struck and we can move forward. Roger Baker is still employed by Tooele City, he resides in Erda where none of this affects him, and he should have already been terminated. We need to settle for nothing less than a total house cleaning at Tooele City.
FYI -- I spoke in a City Council meeting in the fall of 2004, almost a full 5 years and $2 million dollars ago, and told the City Council that they had been deceived by Charlie Roberts and that they were going to lose this lawsuit and the RDA lawsuit with Grantsville. This is a bunch of egotistical, self-righteous morons who have been elected and re-elected to our city council. It is time for immediate changes to be made. Otherwise, the same people will continue to make the same narrow minded decisions.
Taxpayers unite - call for mass resignations.
A large percentage of government employees are smug, condescending and believe they can do no wrong. If the city officials would have stepped up to the plate, admitted they had handled the situations improperly and simply taken care of what they were supposed to do the thing would not have drug out for so long and cost the taxpayers so much money. All Drew Hall has wanted is to move his project forward, but none of the city officials were willing to step forward and stop thumping their chests and resolve the issue before it cost the taxpayers a mint. This is the kind of thing that needs to happen more often when government officials are incompetent and drop the ball. The government needs to assume the cost for hardship and difficulties they cause. It's unfortunate that taxpayers will probably end up footing the bill and attorneys will come out smelling like a rose, but in the end these officials need to be held accountable and be terminated from employment. Nobody cuts any private entrepreneurs any slack when they goof up-they end up going out of business, lose alot of money, assets, etc.. Why should we cut public officials slack for messing up and losing the hard-earned tax dollars of the citizens they govern? Somebody needs to give officials and employees in the public sector a wake-up call and send the message that incompetence won't be tolerated by taxpayers. Taxpayers work too hard and sacrifice too much to simply watch their money go by the wayside. Something has got to change in our country on every level or the whole place will be broke and taxpayers rich and poor alike will be scrambling for tablescraps while politicians and welfare recipients are living the good life.
I call upon all of them to resign their positions for getting the City into this mess in the first place, and then continuing with this case without being realistic about their chances. They dropped $3.5 million of our dollars into a losing case. They think they are above the law and they think we are too ignorant to recognize their ineptitude and corruptness. I am sick and tired of these guys.