1994 AGN MAY 03 I19 - Laserfiche WebLink

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AGENDA REPORT CITY OF COLTON For City Council Meeting of May 3, 1994 April 27, 1994 TO: HONORABLE MAYOR AND CITY COAIJNCIL FROM: Julie Hayward Biggs, City Attorn SUBJECT: Rescission of NORCAL Consultant Agreement Councilmember Beltran has asked that the Consultant Agreement with NORCAL/SAN BERNARDINO, INC. ("NORCAL"), which was approved by the City Council on March 15, 1994 be agendized for possible rescission under the provisions of Resolution No. R-185-86 of the City Council. This Agreement was entered into by the City and NORCAL to accomplish the planning, engineering, site location, fiscal analysis and joint powers authority development for a Materials Recovery Facility/Transfer Station ("MRF"). The City only has an obligation to pay all the costs associated with those planning and development tasks if the project goes forward and if NORCAL is not selected as the operator of the facility. Rescission is permitted under the rules established by the City Council regarding the conduct of City business. Resolution R-185-86 provides as follows in this regard: "A motion to rescind (repeal, cancel, nullify) prior Council action on a main motion shall be in order at any meeting of the Council. The effect of rescinding prior Council action shall operate prospectively only and not retroactively to the date of the original action. That is, it shall not operate to adversely affect intervening legal rights which create an estoppel situation. " The legal doctrine of promissory estoppel applies in situations where a contract has been entered into and one of the contracting parties has relied upon the contract to his detriment. This means in the case of the NORCAL Consultant Contract, if any action or expenditure has been taken or made by NORCAL, an intervening legal right has been created that would create an estoppel situation. Therefore rescission may not be the appropriate action to be taken if the Council wishes to terminate its obligation under the approved Agreement. Rescission is a drastic measure that may unnecessarily expose the City to liability under the existing contract and that may seriously undermine the credibility of the City in dealing with contracting parties in the future. Rather than taking such a drastic step, the City Attorney's office would recommend simple termination of the contract pursuant to its terms if the City wishes to end its