TO: ADAM PIRRIE, CITY MANAGER
FROM: ALISHA PATTERSON, CITY ATTORNEY
DATE: MARCH 12, 2024
Reviewed by:
City Manager: AP
SUBJECT:
Title
AUTHORIZATION TO WAIVE LEGAL CONFLICTS AND ENTER INTO A JOINT DEFENSE AGREEMENT WITH THE CITY OF LA VERNE TO ALLOW THE CALIFORNIA JOINT POWERS INSURANCE AUTHORITY (CJPIA) TO RETAIN KUTAK ROCK, LLP TO JOINTLY DEFEND THE CITIES OF CLAREMONT AND LA VERNE IN A DEFENSE OF GOVERNMENT CLAIMS AND ANY SUBSEQUENT LITIGATION REGARDING STONE CANYON GROUNDWATER SEEPAGE AND FLOODING (FUNDING SOURCE: CJPIA)
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SUMMARY
In April of 2023, several residents of the Stone Canyon community experienced groundwater seepage and flooding on their properties. To date, eleven of these households have submitted government claims against the Cities of Claremont and La Verne. Both Cities are members of the California Joint Powers Insurance Authority (CJPIA). Both Cities tendered these claims to the CJPIA, and the CJPIA have confirmed coverage to both Cities.
The CJPIA would like to retain Kutak Rock, LLP to jointly defend Claremont and La Verne with respect to these Stone Canyon claims and any subsequent litigation. To do so, the Cities of Claremont and La Verne must approve a conflict waiver and joint defense agreement.
RECOMMENDATION
Recommended Action
Staff recommends the City Council authorize the City Manager to execute a conflict waiver and joint defense agreement to allow the CJPIA to retain Kutak Rock, LLP to jointly defend the Cities of Claremont and La Verne with respect to the Stone Canyon groundwater seepage and flooding claims and any subsequent litigation.
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ALTERNATIVE TO RECOMMENDATION
In addition to the recommendation, there is the following alternative:
• Request additional information from staff.
FINANCIAL REVIEW
The CJPIA has determined the City has insurance coverage for the Stone Canyon groundwater seepage and flooding claims and has indicated they will not be reserving any rights for these claims.
ANALYSIS
After record rainfall in the winter of 2023, several households in the Stone Canyon community experienced groundwater seepage and flooding in April of 2023. In October of 2023, eleven of these households submitted government claims against the Cities of Claremont and La Verne alleging the Cities’ and other agencies’ actions or inactions caused the groundwater seepage and flooding. All of the claimants are currently represented by Kiesel Law, LLP. The Cities of Claremont and La Verne are both members of CJPIA, who has confirmed coverage of the claims.
CJPIA has requested authorization from the Cities of Claremont and La Verne to retain Kutak Rock, LLP to jointly defend Claremont and La Verne in this dispute and any resulting litigation. Joint defense of claims of this nature is time and cost effective and is unlikely to result in conflicts. In the unlikely event that a conflict arises, either City or both Cities can terminate the agreement and obtain separate legal counsel.
A letter from Edwin J. Richards of Kutak Rock, LLP outlining the proposed arrangement is included as Attachment A. Drafts of a joint defense agreement and conflict waiver are included as Attachments B and C. For this arrangement to go forward, the City of La Verne would also need to approve the agreement and waiver. Staff recommends the City Council authorize the City Manager to execute the agreement and waiver in substantially the same substance and form as these attachments (with the understanding that the City of La Verne, CJPIA, and Kutak Rock, LLP may make changes to the agreement and waiver before they are executed).
LEGAL REVIEW
The City Attorney has reviewed and commented on draft versions of the conflict waiver and joint defense agreement and will review the final versions of these documents and approve as to form.
RELATIONSHIP TO CITY PLANNING DOCUMENTS
Staff has evaluated the agenda item in relationship to the City’s strategic and visioning documents and finds that it does not apply to City Planning Documents.
CEQA REVIEW
This item is not subject to environmental review under the California Environmental Quality Act (CEQA).
PUBLIC NOTICE PROCESS
The agenda and staff report for this item have been posted on the City website and distributed to interested parties. If you desire a copy, please contact the City Clerk’s Office.
Submitted by:
Alisha Patterson
City Attorney
Attachments:
A - Letter from Kutak Rock, LLP, dated February 27, 2024
B - Draft Joint Defense, Common Interest, and Confidentiality Agreement
C - Draft Conflict Waiver