2005 RES R-166-05 - Laserfiche WebLink

Browse Search

�XHIBfT°R" SETTLEMENT AGREEMENT AND RELEASE PARTIES: The parties to this Settlement Agreement and Release (the "Agreement") are the City of Colton (the "City"), the Redevelopment Agency for the City of Colton (the "Agency"), and Colton Non -Profit Housing, Inc. ("Colton Non -Profit"). The City, Agency and Colton Non - Profit are referred to herein, collectively, as the "Parties." 2. RECITALS: This Agreement is made with reference to the following facts: 2.1 Colton Non -Profit is a non-profit 501(c)(3) corporation and is the owner of the real property and all improvements thereon (including, without limitation, a 101 -unit apartment complex), located at 510 North La Cadena Avenue, City of Colton, County of San Bernardino. State of California ("Colton Palms"). 2.2 In or about 1999, Colton Non -Profit and the Agency brought an action against Turner Construction and Valerio Dewalt Tran Associates, Inc., seeking damages for breach of contract and negligence as a result of various construction defects at Colton Palms (the "'turner Litigation"). On or about February 20, 2003, a settlement was reached in the Turner Litigation pursuant to which Turner Construction paid Colton Non -Profit and the Agency $5.5 million (the "Turner Settlement Funds"). Thereafter, the 'Turner Settlement Funds were deposited into an interest bearing client trust account of the law firm of Best Best & Krieger LLP (`BB&K"). Through the Effective Date of this Settlement Agreement as set forth in Section 3 below, the Turner Settlement Funds have earned interest in the amount of approximately $155,000 (the "'Turner Settlement Earned Interest"). 2.3 A dispute has arisen between the City and the Agency, on the one hand, and Colton Non -Profit, on the other hand, with respect to, inter alia, (1) ownership and control of Colton Palms, and (2) ownership of the Turner Settlement Funds and the Turner Settlement Earned Interest. On April 5, 2004, the Agency and the City tiled an action against Colton Non - Profit in the Superior Court of the State of California, County of San Bernardino (the "Court"), entitled Redevelolnnent Agency.rirr the City of Colton v. Colton Non -Profit Senior Housing, Inc., Case No. SCV SS 114148 (the "Agency's Action"). The complaint the ("Complaint") alleged, inter (ilia, that Colton Non -Profit's reletting of vacant traits at Colton Palms constituted waste and sought a temporary restraining order enjoining Colton Non -Profit from leasing any vacant units at Colton Palms (the "'FRO"), which was later entered by the Court. Colton Non -Profit tiled an answer to the Complaint on May 6, 2004 (the "Answer') generally denying all allegations made in the Complaint. On July 13, 2004, the Agency tiled an amended complaint (the "Amended Complaint") asserting an additional claim for breach of contract and seeking specific pertormance of iLs purported right to purchase Colton Palms pursuant to an option provision in the Disposition and Development Agreement dated July 18, 1989. On August 12, 2004, Colton Non -Profit filed an answer to the Amended Complaint contesting all allegations made therein (the "Amended Answer"). 28661447