Loading...
HomeMy WebLinkAboutHUNTINGTON BEACH POLICE OFFICERS ASSOCIATION - HBPOA - SETTLEMENT AGREEMENT - GUN RANGE - 2006-10-02• IA Lo CITY OF HUNTINGTON BEACH Inter -Department Communication TO JOAN FLYNN, City Clerk FROM JENNIFER McGRATH, City Attorney DATE January 18, 2007 SUBJECT City of Huntington Beach v HBPOA At the October 2 2006 Closed Session the City Council authorized the Mayor to sign and the City Clerk to attest to the Settlement Agreement between the City the POA Scottsdale Insurance Company and American States Insurance Company in the Gun Range litigation The Settlement Agreement and Policy Release between the City the POA Scottsdale and American States is now fully executed and an original with wet signatures is attached It should be retained in the permanent records of the City In addition, at the October 2 2006 Closed Session the City Council authorized the Mayor to sign and the City Clerk to attest to the Settlement Agreement between the City and the POA This Agreement too is now fully executed and an original with wet' signatures is attached It also should be retained in the permanent records of the City Finally would you please provide Scott Field with five copies of each Agreement with your certification that each is a true copy of the original Agreements on file with the City of Huntington Beach Jj /,200 �- NY JENNIF ER McGRATH City Attorney Attachments 7061 JJ { CITY OF HUNTINGTON BEACH Inter -Department Communication TO JOAN FLYNN, City Clerk FROM JENNIFER McGRr1TH, City Attornev DATE November 28 2006 SUBJECT City of Huntington Beach v HBPOA At the October 2 2006 Closed Session the City Council authorized the Mayor to sign and the City Clerk to attest to the Settlement Agreement between the City, the POA Scottsdale Insurance Company and American States Insurance Company in the Gun Range litigation This authority was subject to the City Attorney approving the form of the Agreement to ensure it conforms to the eight material settlement tcrins that are set torth in the October 2 2006 Closed Session Report The City Attornev has negotiated the terms of the attached Settlemcnt Agreement with the PO-\ Scottsdale and American States and detennmed that the Agreement conforms to the Citv Council s authorization Please have the Mayor sign and the City Clerk attest to five original copies of the Agreement Please retain one original, and return tour originals to our office We will return counterpart on b Scottsdale and mencan States to the Clerk s Office as soon as we receive them nA i JENNIFER McGRATH City Attorney Attachments '70"4'-u. t 549� SETTLEMENT AGREEMENT AND POLICY RELEASE This Settlement Agreement and Policy Release (the Agreement ) is made by and entered into by and between the City of Huntington Beach ( City ) the Huntington Beach Police Officers Association ( HBPOA ) Scottsdale Insurance Company ( Scottsdale ) and American States Insurance Company ( American States ) all as defined below and collectively referenced herein as the Parties The City and the HBPOA are collectively referenced herein as the Insureds Scottsdale and American States are collectively referenced herein as the Insurers RECITALS This Agreement is made and entered into among the Parties for the following purposes and with reference to the following facts A Scottsdale and American States provided comprehensive general liability insurance to the HBPOA as indicated on the policy listing attached hereto and incorporated herein by reference as Attachment A (the Known Policies as defined further in 118 below) The City was named as an additional insured on the Policies B During the time the Policies (as defined further in 117 below) were in force the City owned certain property located at 18211 Gothard Street Huntington Beach California (the Site ) The City had acquired the Site from the County of Orange in 1963 prior to the issuance of the Policies The County had operated the Site as a landfill The City still owns the Site C From 1968 to 1997 the Site was leased from the City to the HBPOA for the purpose of operating and maintaining a gun range on the site (the Gun Range ) During that period dozens of law enforcement agencies private security firms and individuals (the Shooters ) discharged millions of rounds of lead ammunition at the Site As a result of these operations the Site is allegedly contaminated with lead D On or around November 25 2001 the City filed an action against the HBPOA entitled City of Huntington Beach v Huntington Beach Police Officers Association United States District Court Central District of California Case No SACV 011125 JVS (ANx) (the Underlying Action ) alleging that the HBPOA was responsible in whole or in part for the alleged contamination of soil and groundwater at the Site E The HBPOA tendered the Underlying Action to Scottsdale and American States seeking defense and/or indemnity pursuant to the Known Policies After investigating the claim both Scottsdale and American States agreed to defend the HBPOA subject to a reservation of rights Among other things the Insurers contended that the Policies do not provide coverage for the claims asserted in the Underlying Action due to the applicability of the pollution exclusions and owned property exclusions in the Policies among other grounds F In or around March 2002 the HBPOA answered the complaint in the Underlying Action and asserted various affirmative defenses including affirmative defenses for set off and equitable indemnification contending that its liability if any should be reduced by the amount of damages attributable to the City s own liability Thereafter the City tendered the defense of the affirmative aefenses to Scottsdale and American States Scottsdale denied the City s tender on the grounds that no suit had been filed against the City American States Page 1 of 13 agreed to defend the City under a reservation of rights specifically reserving the right to reimbursement of the City s legal fees if it were later determined that American States was not obligated to defend the City with respect to the HBPOA s affirmative defenses G Thereafter Scottsdale and American States paid the reasonable and necessary legal fees and costs of defense counsel selected by the HBPOA the law firm of Castle Petersen & Krause formerly known as the Petersen Law Firm ( Petersen ) In addition American States paid certain legal fees and costs as well as various consultant fees and costs on the City s behalf subject to its reservation of rights Petersen and Caufield contended that that the Insurers wrongfully failed to pay all of their bills for legal fees and costs incurred on behalf of the HBPOA in the Underlying Action and/or the Coverage Action H On or around April 30 2003 Scottsdale filed an action against the HBPOA entitled Scottsdale Insurance Co v Huntington Beach Police Officers Association et al United States District Court Central District of California Case No SACV 03 1154 JVS (ANx) seeking a determination of its rights and obligations under the Known Policies at issue and for declaratory relief against American States for equitable contribution (the Coverage Action ) I American States thereafter filed a cross complaint in the Coverage Action seeking a determination of its rights and obligations under the Known Policies and a declaration of its rights and obligations with respect to equitable contribution by Scottsdale J The HBPOA and the City filed cross claims and counter claims in the Coverage Action which asserted among other things claims for declaratory relief breach of contract against Scottsdale and American States and breach of the implied covenant of good faith and fair dealing against Scottsdale Scottsdale vigorously disputed those allegations K In the Coverage Action American States filed a motion for declaratory relief and restitution against the City on the grounds that it had no obligation to defend the City with respect to the HBPOA s affirmative defenses By order dated May 17 2004 the Court granted American States motion ruling that American States had no obligation to defend the City with respect to the HBPOA s affirmative defenses and ordered the City to reimburse American States for funds expended in its defense in the total amount of $207 573 59 (the Restitution Order ) L On June 22 2004 by stipulation of the City and the HBPOA the HBPOA filed a counter claim against the City in the Underlying Action which the City thereafter tendered to Scottsdale and American States for defense Upon entry of the stipulation the City filed a motion for reconsideration of the Court s Restitution Order which was denied by order dated August 23 2004 in the Coverage Action M Thereafter the City tendered the HBPOA s counter claim to Scottsdale and American States American States declined the City s tender and Scottsdale accepted the City s tender of defense of the HBPOA s counterclaim in the Underlying Action subject to a reservation of rights Thereafter Scottsdale expended sums in contribution to the City s defense costs with respect to the HBPOA s counterclaim against the City subject to its reservation of right to recover amounts paid in the defense N Thereafter as the Underlying Action proceeded toward trial the HBPOA sought to retain the law firm of Trutanich Michel LLP ( Trutanich ) to act as co counsel with Petersen The Insurers declined to retain Trutanich Thereafter Petersen hired one of the Trutanich firm s attorneys Jeffery Caufield who later formed his own law firm Caufield & James LLP Page 2 of 13 ( Caufield ) which replaced Petersen as the HBPOA s counsel of record in or around July 2005 Scottsdale and American States thereafter paid Caufield s reasonable and necessary attorneys fees and costs for representing the HBPOA in the Underlying Action O Thereafter Trutanich filed an action against American States styled Trutanich Michel LLP v American States Insurance Cc Los Angeles County Superior Court Case No NC 041569 (the Trutanich Action ) seeking recovery of legal fees and costs including fees and costs for work performed by attorney Jeffery Caufield while he was an attorney at Trutanich American States demurred to Trutanich s complaint on the grounds that American States had not agreed to retain Trutanich and the Trutanich action was later dismissed without prejudice on or around March 22 2006 P In the meantime a dispute arose between American States and Scottsdale with respect to Scottsdale s alleged failure to contribute to the HBPOA s ongoing defense costs In addition a dispute arose between American States and Scottsdale as to the appropriate allocation of the HBPOA s reasonable and necessary defense costs between the two insurers By order dated September 29 2004 in the Coverage Action the Court granted American States motion for partial summary judgment on the issue finding that 23 percent of the HBPOA s reasonable and necessary defense costs should be equitably allocated to American States and 77 percent should be allocated to Scottsdale Q Thereafter a dispute arose between Caufield and the Insurers as to the appropriate hourly billing rate for the HBPOA s defense fees and costs under California Civil Code Section 2860(c) Caufield contended that he should be paid at a rate of $350 00 per hour for partners $250 per hour for associates and $135 per hour for paralegals and law clerks and the Insurers contended that Caufield should be paid at a rate of $150 00 per hour under the guidelines set forth in Section 2860(c) Caufield also contended that the Insurers failed to make timely payments and the Insurers contended that Caufield failed to submit invoices in a timely manner R The Parties acknowledge the existence of disputed questions in the Underlying Action and the existence of disputed questions in the Coverage Action S The Parties now desire to finally and completely resolve compromise and settle all disputes claims claims and controversies between and among them relating to the Site including without limitation the controversies in the Underlying Action and Coverage Action including all cross actions as respects all Policies as well as the rescission and buy back of the Known Policies pursuant to the payments releases and agreements set forth below It is the express intention of the Parties to fully release all claims and to further buy back all Known Policies The Parties understand that the scope of this Agreement compromises issues beyond those alleged in the Underlying Action and the Coverage Action as specified in the releases set forth in Section 3 of this Agreement NOW THEREFORE in reliance upon the aforesaid recitals and in consideration of the mutual agreements contained herein it is agreed by and between the Parties as set forth herein 1 DEFINITIONS For purposes of this Agreement only the following specifically defined terms shall have the following meanings Page 3 of 13 1 1 The City shall mean and include the City of Huntington Beach and each and all of its past present and future agents officers directors elected officials appointed officials attorneys agents employees administrators representatives predecessors successors and assigns 12 The HBPOA shall mean and refer to the Huntington Beach Police Officers Association and all of its past present and future members directors officers predecessors successors assigns subsidiaries affiliates employees agents representatives administrators attorneys and trustees 13 Scottsdale shall mean and refer to Scottsdale Insurance Company and each and all of its past present and future affiliates subsidiaries parent companies employees officers directors shareholders and each and all of their respective heirs predecessors successors assigns attorneys and agents 14 American States shall mean and refer to American States Insurance Company and ,each and all of its past present and future affiliates subsidiaries parent companies employees officers directors shareholders and each and all of their respective heirs predecessors successors assigns attorneys and agents 15 ' Petersen shall mean and refer to attorney Gregory Petersen the Petersen Law Firm the law firm of Castle Petersen & Krause LLP and each and all of their respective past present and future affiliates employees partners associates independent contractors predecessors successors firms partnerships ,corporations assigns and agents all in their individual and professional capacities 16 Caufield shall mean and refer to attorney Jeffery Caufield Jeffery Caufield s work while at Trutanich the law firm of Caufield & James LLP and each and all of their respective past present and future affiliates employees partners associates independent contractors predecessors successors firms partnerships corporations assigns and agents all in their individual as well as professional i capacities This definition shall not include work performed by Jeffery L Caufield while of counsel for Trutanich except to the extent that Caufield may seek direct payment for such work in his individual capacity and not as a representative of Trutanich 17 The term Policies shall mean and refer to all insurance policies actually or allegedly issued by Scottsdale or American States to the City the HBPOA or either of them or any insurance policy actually or allegedly issued by Scottsdale and/or American States allegedly identifying the City and/or the HBPOA as an additional insured whether primary umbrella excess or otherwise and whether known or unknown that insures purports to insure or allegedly provides insurance for the City and/or the HBPOA including but not limited to the Policies listed on Attachment A hereto The term Policies shall not include any insurance policies (i) issued by a company other than Scottsdale Insurance Company or American States Insurance Company which company is acquired by or merged into Scottsdale or American States after the Effective Date of this Agreement and/or (ii) issued, after the Effective Date of this Agreement by Scottsdale or American States The term Policies includes but is not limited to the Known Policies which shall mean and refer to those policies specifically identified on Attachment A to this Agreement Page 4 of 13 18 The Site shall mean and refer to the certain property located at 18211 Gothard Street Huntington Beach California as well as soils and waters upon adjacent to surrounding and underneath such property including but not limited to surface and underground waters remaining on the Site or flowing through or under the Site as well as the atmosphere above and surrounding and emanating from said Site 19 The Underlying Action shall mean and refer to the action entitled City of Huntington Beach v Huntington Beach Police Officers Association United States District Court Central District of California Case No SACV 011125 JVS (ANx) and all cross claims and counterclaims thereto 110 The Coverage Action shall mean and refer to the action entitled Scottsdale Insurance Co v Huntington Beach Police Officers Association et a/ United States District Court Central District of California Case No SACV 03 1154 JVS (ANx) and all cross claims and counter claims thereto 111 The City/HBPOA Settlement Agreement shall mean that agreement dated on or about November 6 2006 settling and resolving the Underlying Action 112 The term Environmental Contamination shall mean and refer to any actual or alleged release discharge escape or dispersal of any irritants contaminants or pollutants into the soil groundwater or surface water including but not limited to actual or alleged presence of hazardous substances at or emanating from the Site including but not limited to (a) any substance defined as a hazardous substance hazardous material hazardous waste waste or any similar terms used in any state or federal statute or regulation (b) any substance defined or designated as a hazardous substance pursuant to sections 101(14) and/or 102(a) of the Comprehensive Environmental Response Compensation and Liability Act ( CERCLA ) 42 U S C § 9601(14) and 9602(a) and amendments thereto (c) any pollutant or contaminant under section 104(a)(1) of CERCLA 42 U S C §9604(a)(1) (d) any substance defined as a hazardous waste in section 6903(5) of the Resource Conservation Recovery Act ( RCRA ) 42 U S C § 6901 et seq (e) any substance defined as petroleum in section 6991(8) of RCRA (f) any chemical substance or mixture found by the Administrator of the United States Environmental Protection Agency to present an unreasonable risk of injury to health or the environment pursuant to the Toxic Substances Control Act 15 U S C § 2601 et seq and/or (g) any substance designated or considered to be a hazardous substance hazardous material hazardous waste waste pollutant or contamination under any statute rule regulation or judicial decision that relates to amends or is a successor to any of the foregoing statutes rules regulations or cases 113 Effective Date of this Agreement shall mean the date of the last signature is placed hereon and this Agreement shall be effective as of such date provided that this Agreement shall not be effective until the City/HBPOA Agreement is fully executed SETTLEMENT PAYMENTS 21 In consideration of the agreements and warranties herein it is hereby agreed that within thirty (30) days of the Effective Date of This Agreement Scottsdale shall pay the sum of Four Hundred Fifty Thousand Dollars ($450 000) as follows Page 5 of 13 One Hundred Fifty Thousand Dollars ($150 000) shall be paid to the City One Hundred Fifty Thousand Dollars ($150 000) shall be paid to Petersen and One Hundred Fifty Thousand Dollars ($150 000) shall be paid to American States For internal administrative purposes Scottsdale may allocate these payments among its policies in any manner that it determines to be appropriate 22 In addition the Insurers agree to pay additional legal fees and costs to Caufield for (a) legal fees and costs not yet invoiced as of August 22 2006 and (b) legal fees and costs that are reasonable and necessary to finalize this Agreement as follows All of such invoices by Caufield shall be billed at a rate of One Hundred Fifty Dollars ($150) per hour and supported by adequate documentation Scottsdale agrees to pay 77 percent of the Caufield attorneys fees and costs payable under this Section in an amount not to exceed Twenty Thousand Dollars ($20 000) American States agrees to pay 23 percent of the Caufield attorneys fees and costs payable under this Section in an amount not to exceed Five Thousand Dollars ($5 000) Any disputes arising from payment of these amounts shall be submitted to the United States District Court Central District of California for determination 23 The billing rates set forth in paragraph 2 2 above are agreed upon for purposes of this Agreement only and Caufield does not waive or compromise its right to assert that a higer billing rate applies to any future and/or current Cumis or section 2860 work on any other matter 3 DISMISSALS AND RELEASES 31 Within five (5) days of delivery of the payments referenced in Paragraph 2 1 above Scottsdale American States the City and the HBPOA shall jointly file a request for entry of dismissal with prejudice of the complaint cross claims and counter claims in the Coverage Action and The City and the HBPOA shall file their good faith settlement motion pursuant to the terms and conditions of the City/HBPOA Settlement Agreement 32 In consideration of the payments and releases set forth herein the City and the HBPOA hereby release and forever discharge each other pursuant to the terms of the City/HBPOA Settlement Agreement 33 In further consideration of the payments and releases set forth herein both the City and the HBPOA hereby remise release acquit and forever discharge Scottsdale and American States from any and all claims or obligations under the Known Policies Page 6 of 13 The City and the HBPOA and its counsel expressly accept the payments and releases set forth herein in full and complete satisfaction of all of the past present and/or future actual or alleged obligations of Scottsdale and American States under the Known Policies including bt t not limited to actual or potential claims demands orders suits attorney fees and defense costs or causes of action which have been or may be brought or asserted against the City and/or the HBPOA in the Underlying Action or any other action past present or future 34 In further consideration of the payments and releases set forth herein as to all Policies other than the Known Policies the City and the HBPOA hereby relieve release and forever discharge Scottsdale and American States of and from any and all actual or potential obligations to the City and/or the HBPOA arising out of the Policies as defined herein for any claims demands orders or suits including without limitation any claims or causes of action that could have been asserted in the Underlying Action or the Coverage Action or relating in any manner to the Site including but not limited to the following a Any and all actual or alleged liability whatsoever past present or future for all actual or potential claims actions demands suits liabilities obligations rights or causes of action of every kind and nature known or unknown including but not limited to claims demands orders suits or causes of action for compensatory consequential and/or punitive damages loss of profit compensation emotional distress property damage bodily injury personal injuries environmental contamination response costs clean up costs investigative costs damage or injury to natural resources payment of orphan shares expenses attorneys fees and defense costs equitable apportionment injunctive reliet declaratory relief or any other {orm of relief which claims or causes of action arise out of allegedly arise out of or are in any way connected with Site or the subject matter of the Underlying Action or the Coverage Action and o Any and all claims or causes of action for bad faith unfair claim handling refusal to defend or settle statutory violations including alleged violation of the provisions of the California Insurance Code § 790 03 breach of any implied covenant of good faith and fair dealing breach of contract fraud or misrepresentation or any other matter that was or could have been raised in the Coverage Action oy the City and/or the HBPOA c The releases set torth in this Paragrapr 3 4 do not apply to claims demands or suits for daniages that asserted after January 1 2000 and do not arise out of or relate in any manner to Environmental Contamination 35 Effective upon (i) the receipt of the payments described at Section 2 1 above (ii) the dismissals described at Section 3 1(a) above and the filing of the good faith motion in the Underlying Action pursuant to the terms of the City/HBPOA Settlement Agreement the Parties further agree that the Known Policies are hereby rescinded void ab initio and null as f the Policies inception dates and the payments and releases rcferenced here n represent a return of premium and good and sufficient consideration for these policy ouy backs The City and the HBPOA further agret that Scottsdale and American Stags arc fully released and discharged from any and all past present and future obligatiors or claims of any nature whatsoever wheLver actual or potential under any of the Kno vn Policies ledge 7 o{ 13 36 Except as otherwise provided in Paragraph 2 1(b) and 2 2 above in consideration of the payments and agreements herein Petersen and Caufield hereby release and forever discharge Scottsdale and American States from any and all claims causes of action demands or suits which have been or could have been asserted against Scottsdale and/or American States with respect to legal fees and costs allegedly incurred in defense of the HBPOA in the Underlying Action or any other attorneys fees or costs which Petersen and/or Caufield have or may contend are owed by Scottsdale and/or American States with respect to the subject matter of this litigation including but not limited to legal fees and costs included on invoices previously forwarded to Scottsdale and/or American States in connection with the Underlying Action legal fees and costs incurred with respect to the Coverage Action legal fees and costs exceeding the hourly billing rate of One Hundred Fifty Dollars ($150) demands for payment of the fees and costs of individuals independent contractors law firms or others retained by or at the request of Petersen Caufield and/or the HBPOA with respect to the Underlying Action and/or the Coverage Action for which Petersen and/or Caufield did or could have requested reimbursement from Scottsdale and/or American States 37 In consideration of the payments and releases set forth herein Scottsdale and American States hereby release and forever discharge the City the HBPOA of and from any and all past present or future actual or potential claims demands suits liabilities obligations or causes of action of every kind and nature known or unknown arising from claims demands suits or causes of action that Scottsdale and/or American States could have asserted against the City and/or the HBPOA in the Coverage Action including but not limited to any and all claims or causes of action for breach of the implied covenant of good faith and fair dealing reverse bad faith reimbursement restitution insurance fraud and alleged violation of the provisions of the California Insurance Code breach of policy conditions misrepresentation concealment in connection with the Underlying Action the Coverage Action or the matters released herein 38 In consideration of the payments and releases set forth herein American States hereby releases the right to enforcement of the Court s Restitution Order and waives its rights of recovery against the City with respect to said Order 39 In consideration of the payments and releases set forth herein Scottsdale and American States hereby release and forever discharge any claims and/or causes of action that have been or may be asserted against each other for equitable contribution equitable subrogation equitable indemnity or other forms of relief with respect to each Insurers respective alleged obligations to their mutual Insureds or either of them for defense or indemnity payments past present and future arising out of or related to the Underlying Action and/or the Coverage Action or with respect to payments made pursuant to this Agreement 310 With regard to the claims and causes of action released in the paragraphs above the Parties each acknowledge that each of them is familiar with and each expressly waives all rights and benefits which they now or in the future may have under California Civil Code 11542 which provides A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release which if known by him or Page 8 of 13 her must have materially affected his or her settlement with the debtor The Parties each acknowledge that they may have claims or causes of action within the scope of the claims or causes of action released in this Agreement which are presently unknown and unsuspected and nonetheless intend hereby to release and discharge one another from any and all liability whatsoever for such unknown or unsuspected claims or causes of action (whether for damages rescission reformation declaratory relief or any other form of relief) 4 ADDITIONAL CONDITIONS 41 The Parties and each of them represent and warrant that they have not and will not in any manner assign transfer convey or sell or purport to assign transfer convey or sell to any entity or person any claim cause of action any chose in action or part thereof arising out of or connected with the matters released herein and that they are the only persons or entities entitled to recover for any damages under such claims causes of action and rights The City and the HBPOA further represent and warrant that no subrogation of any cause of action chose in action or part hereof has taken place 42 This Agreement is the result of a compromise and accord and shall not be considered an admission of liability or responsibility This Agreement is a compromise and settlement of disputed claims and is the product of arms length negotiations 43 Each Party has participated in the drafting of this Agreement with the assistance of counsel Therefore the language of this Agreement shall not be construed against any Party as the drafter ' 44 Except as otherwise set forth herein this Agreement contains the entire Agreement regarding the matters herein and no representations warranties or promises have been made or relied on by the Parties or any of them other than as set forth herein 45 This Agreement is intended to confer rights and benefits only on the Parties and is not intended to confer any right or benefit upon any other person or entity No person or entity other than the Parties hereto shall have any legally enforceable right under this Agreement All rights of action for any breach of the terms of this Agreement are hereby reserved to the Parties and are not included in any release herein 46 This Agreement is without prejudice or value as precedent and shall not be used in any proceeding or hearing to create prove or interpret the obligations under or terms and conditions of any other agreement or any insurance policy 47 This Agreement is not a policy of insurance and the Parties do not intend that it will be interpreted as such I 48 This Agreement shall be deemed to fall within the protection afforded compromises and offers of compromise by Rule 408 of the Federal Rules of Evidence The existence of this Agreement and terms thereof and any acts or omissions related thereto shall not be used by way of discovery evidence offer of proof or otherwise except in any action or proceeding to enforce or defend the terms of this Agreement Page 9 of 13 49 The Parties and each of them represent and warrant to the extent applicable i a That they have taken all necessary corporate municipal and/or legal actions to duly approve the making and performance of this Agreement and that no further corporate Imunicipal or other approval is necessary b That the making and performance of this Agreement will not violate any provision of law or of their respective articles of incorporation partnership agreements or bylaws c That they have read this Agreement and know the contents hereof that the terms hereof are contractual and not by way of recital and that they have signed this Agreement of their own free act and d That in making this Agreement they have obtained the advice of legal counsel 410 Wherever possible each provision of this Agreement shall be interpreted in such manner as to be valid under applicable law but if any provision of this Agreement shall be invalid or prohibited thereunder such provision shall be ineffective to the extent of such prohibition without invalidating the remainder of such provision or the remaining provisions of this Agreement 411 Each of the terms of this Agreement is binding upon and for the benefit of the Parties and their respective heirs predecessors successors transferees assigns representatives principals agents officers directors and employees Any assignment of this Agreement by any Party without the written permission of all other Parties except by operation of law shall be void and of no effect 412 The Parties agree that this Settlement Agreement and its terms and conditions are confidential to the extent permitted by law and shall not be disclosed to anyone without the written consent of all Parties to this Agreement Notwithstanding the foregoing written consent shall not be required for any disclosure (a) made pursuant to court order or (b) made to an attorney re insurer auditor representative director or employee or business interest of any Party and is not part of a general publication or dissemination or (c) made pursuant to the City s obligations under the Public Disclosure Laws including but not limited to California Government Code Section 54957 1(a)(3)(B) ( Brown Act ) and California Government code Section 6250 et seq ( California Public Records Act ) or (d) made pursuant to a valid and proper subpoena or production request directed to one of the Parties or (e) by a Party to enforce the terms of this Agreement or (f) by a Party upon a determination by the Court that such disclosure is a prerequisite to a judgment in favor of that Party against any other person with respect to claims released by this Agreement Any person to whom a disclosure is made under (b) or (d) shall be advised of the confidentiality requirements set forth herein 413 This Agreement is entered into and shall be construed and interpreted in accordance with the laws of the State of California 414 This Agreement may be executed in two (2) or more original or facsimile counterparts each of which shall be deemed an original but all of which together shall constitute one instrument I Page 10 of 13 CITY OF HUNTINGTON BEACH Date By: Dave Sullivan Mayor City of Huntington Beach ATTEST: Joan Flynn City Clerk 1`/z� - Date APPROVED AS TO FORM By: Scott Field, Esq., Assistant City Attorney City of Huntington Beach Date APPROVED AS TO FORM By: Hal Goldflam, Esq. Frandzel, Robins, Bloom & Csato, L.C. Counsel for the City of Huntington Beach Date By: Kreg Muller, President Huntington Beach Police Officers Association Date By: Gregory Petersen, Esq. Castle Petersen & Krause As GeneralCounsel for the Huntington Beach Police Officers Association And on behalf of Castle, Petersen & Krause LLP Date By: Jeffery Caufield, Esq. Caufield & James LLP As counsel for Huntington Beach Police Officers Association And on behalf of Caufield & James LLP Page 11 of 13 CITY OF HUNTINGTON BEACH Date By Dave Sullivan Mayor City of Huntington Beach ATTEST Joan Flynn City Clerk Date APPROVED AS TO FORM By Scott Field Esq Assistant City Attorney City of Huntington Beach /d A 06 Date APPROVED AS T FORM By Hal Goldflam Esq Frandzel Robins Bloom & Csato L C Counsel for the City of Huntington Beach Date By Kreg Muller President Huntington Beach Police Officers Association Date By Gregory Petersen Esq Castle Petersen & Krause As General Counsel for the Huntington Beach Police Officers Association And on behalf of Castle Petersen & Krause LLP Date By Jeffery Caufield Esq Caufield & James LLP As counsel for Huntington Beach Police Officers Association And on behalf of Caufield & James LLP Page 11 of 13 CITY OF HUNTINGTON BEACH Date By Dave Sullivan Mayor City of Huntington Beach Date ATTEST Joan Flynn City Clerk v PROVED AS TO FORM By Scott Field Esq Assistant City Attorney City of Huntington Beach Date APPROVED AS TO FORM By Hal Goldflam Esq Frandzel Robins Bloom & Csato L C Counsel for the City of Huntington Beach %,2-is Zoob Date Date Date By ident N Police Officers Association Gregory Petersen Esq Castle Petersen & Krause As General Counsel for the Huntington Beach Police Officers Association And on behalf of Castle Petersen & Krause LLP By Jeffery Caufield Esq Caufield & James LLP As counsel for Huntington Beach Police Officers Association And on behalf of Caufield & James LLP Page 11of13 CITY OF HUNTINGTON BEACH Date By: Dave Sullivan Mayor City of Huntington Beach ATTEST: Joan Flynn City Clerk l Date OPROVED AS TO FORM By: _Scott Field, Esq., Assistant City Attorney City of Huntington Beach Date APPROVED AS TO FORM By: Hal Goldflam, Esq. Frandzel, Robins, Bloom & Csato, L.C. Counsel for the City of Huntington Beach Date By: K Muller, ident untington Beac Police Officers Association Date: By: Gregory Petersen, Esq. Castle Petersen & Krause As General Counsel for the Huntington Beach Police Officers Association And on behalf of Castle, Petersen &Krause LEP Date By: J6ff66CaufieId, Esq. Caufield & James LLP As counsel for Huntington Beach Police Officers Association And on behalf of Caufield & James LLP Page 11.of13 Date By Susan Collier On behalf of Scottsdale Insurance Company Date APPROVED AS TO FORM By Bryan Barber Esq Barber Law Group Counsel for Scottscale Insurance Companv Date By Dominique Hurst On behalf of American States Insurance Company Date APPROVED AS TO FORM By Robin D Craig Craig & Winkelman LLP Counsel for American States Insurance Co Page 12 of 13 Date By Susan Collier On behalf of Scottsdale Insurance Company r /D e '� APP ED AS TO FORM By OVBryan Barber Esq Barber Law Group Counsel for Scottsdale Insurance Company Date By Dominique Hurst On behalf of American States Insurance Company Date APPROVED AS TO FORM By Robin D Craig Craig & Winkelman LLP Counsel for American States Insurance Co Page 12 of 13 Date Date t I I j oc, Date By Susan Collier On behalf of Scottsdale Insurance Company APPROVED AS TO FORM By Bryan Barber Esq Barber Law Group Counsel for Scottsdale Insurance Company I By Domin ue Hurst On behalf of American States Insurance Company Date V APPROVED AS TO FORM By Robin D Craig Craig & Winkelman LLP Counsel for American States Insurance Co Page 12of13 ATTACHMENT KNOWN POLICIES American States Ins Co Policy No CL 437 428 (2/20/72 to 2/20/73) American States Ins Co Policy No CL 604 462 (2/20/73 to 2/20/74) American States Ins Co Policy No CL 857 122 (2/20/74 to 2/20/75) American States Ins Co Policy No CL 102 119 (2/20/75 to 2/20/76) American States Ins Co Policy No CL 102 119 (2/20/76 to 2/20/77) American States Ins Cc Policy No CL 102 119 (2/20/77 to 2/20/78) American States Ins Cc Policy No CL 102 119 (2/20/78 to 2/20/79) American States Ins Cc Policy No CL 102 119 (2/20/79 to 2/20/82) American States Ins Co Policy No CL 102 119 (2/20/82 to 2/20/83) Scottsdale Ins Co Policy No GLS 06518 (3/12/84 - 3/12/85) Scottsdale Ins Co Policy No GLS 06518 (3/12/85-3/12/86) Page 13 of 13 1 2 3 4 5 6 7 8 9 10 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 JENNIFER MCGRATH, City Attorney (Bar No CA 179917) SCOTT F FIELD, Assistant City Attorney (Bar No CA 105 09) Box 190, 2000 Main Street Huntington Beach, California 92648 Telephone (714) 536-5555 Facsimile (714) 374-1590 E-mail sfield@surfcity-hb org Hal D Goldflam, Esq (Bar No CA 179689) FRANDZEL ROBINS BLOOM & CSATO, L C 6500 Wilshire Boulevard, 17th Floor Los Angeles, CA 90048-4920 Telephone (323) 852-1000 Facsimile ((�C3) 651-2577 Email hgoldflam@frandzel com Attorneys for Plaintiff and Counter -Defendant CITY OF HUNTINGTON BEACH UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California and charter city duly created and existing under the laws of the State of California, Plaintiff, vs HUNTINGTON BEACH POLICE OFFICERS ASSOCIATION, a California mutual benefit corporation, et al, Defendants And Related Claims and Third Party Complaints CASE NO SACV 0 1- 1125 JVS (ANx) SETTLEMENT AGREEMENT BY AND BETWEEN PLAINTIFF, CITY OF HUNTINGTON BEACH AND DEFENDANT, HUNTINGTON BEACH POLICE OFFICERS ASSOCIATION [PROPOSED] ORDER AND JUDGMENT P 06 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 THIS SETTLEMENT AGREEMENT AND RELEASE (the "Agreement") is entered into by and between Plaintiff, City of Huntington Beach ("City") on the one hand, and Defendant, the Huntington Beach Police Officers Association, a California mutual benefit corporation (the "POA") on the other hand The City and POA shall be referred to collectively as the "Settling Parties," and sometimes individually as a "Settling Party " No other person or entity is a party to this Agreement, WHEREAS, this Agreement is made with reference to the following facts 1 In 1963, the City acquired a portion of property commonly known as the Huntington Central Park from the County of Orange 2 On February 9, 1968, the POA leased from the City pursuant to a written lease agreement approximately five acres of the City's property (the "Property") for the purpose of operating and maintaining a police training pistol range, and related uses (the "Gun Range") The Property is commonly known as 18191 Gothard Street, Huntington Beach, California 92648 3 In 1971, the POA opened the Gun Range at the Property On January 4, 1972, the City and POA entered into a second written lease agreement, which permitted the public to use the Gun Range in addition to its use by police officers 4 Pursuant to the terms of the second lease, from January 4, 1972 through early 1996, the POA operated, managed and maintained the Gun Range as a combined police department and public firearms facility 5 In January 1987, the POA commenced a year-to-year holdover period on the same terms and conditions specified in the second lease 6 In or about May 1993, the POA closed the public portion of Gun Range The public portion of the Gun Range later reopened, but permanently closed to the public in or about the summer of 1995 In early 1996, the POA closed the Gun Range at the direction of the City Council 4 06 ] SETTLEMENT AGREEMENT 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 7 The City terminated the POA's tenancy, effective January 4, 1997 The POA vacated the Property on approximately January 17, 1997 Since the POA vacated the Property, the gun range has been permanently closed 8 The City alleges that the Gun Range operations have resulted in pervasive lead and other heavy metal contamination to the soil at the Property In addition, the City alleges the lead and other heavy metal contamination has impacted the groundwater beneath the Site 9 As a result of the lead and other heavy metal contamination at the Property, the City has been taking what it believes are necessary steps to remediate such contamination in compliance with all laws and regulations 10 On November 27, 2001, the City filed a complaint captioned as City of Huntinp,ton Beach v Huntington Beach Police Officers Association, United States District Court, Central District of California, Case No SACV 01-1125 JVS (ANx) (the "Lawsuit"), in which it seeks contribution and other relief arising under the Resource Conservation and Recovery Act of 1976 ("RCRA"), 42 U S C § 6901 et seq , the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"), 42 U S C § 9601 et seq , the California Hazardous Substance Account Act ("HSAA"), Calif Health & Safety Code § 25300 et seq , as well as breach of contract, nuisance, trespass, waste, negligence, contribution, and indemnity The City's allegations are described more particularly in the pleadings and other documents filed with the Court 11 On April 30, 2003, Scottsdale Insurance Company, one of the Settling Parties' insurers with respect to the Property, filed a complaint captioned as Scottsdale Insurance Company v Huntington Beach Police Officers Association et al , United States District Court, Central District Court of California, Case No SACV 03-1154 JVS (ANx) (the "Coverage Action"), seeking declaratory relief against the POA and American States Insurance Company, one of the Parties' other insurers with 2 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 respect to the Property, concerning insurance coverage issues allegedly arising out of II the claims at issue in the Lawsuit 12 On August 1, 2003, the POA filed a counterclaim in the Coverage Action against the City On September 5, 2003, the POA amended its counterclaim in the Coverage Action against the City The POA ultimately dismissed its counterclaim in the Coverage Action 13 In June 2004, the POA filed a counterclaim in the Lawsuit that largely duplicated the counterclaim in the Coverage Action Collectively, the two counterclaims will be referred to as the "Counterclaim " 14 The POA alleges in its Counterclaim that (i) the City is liable to indemnify the POA regarding the lead and other heavy metal contamination at the Site, and (n) the City fraudulently induced the POA to enter into the aforementioned leases and operate a gun range at the Property The POA's allegations are described more particularly in the pleadings and other documents filed with the Court 15 On December 14, 2004, the City filed its Third Amended Complaint ("TAC") in the Lawsuit adding as defendants various other entities that used the Gun Range for firearms training (the "Shooters") The City has settled its claims against almost all of the Shooters, WHEREAS, the Lawsuit, including the Counterclaim, and the claims for relief alleged therein by the Settling Parties, involve disputed questions of fact and law, WHEREAS, upon execution of this Agreement and receipt by the City of the $150,000 payment described in the terms of this Agreement, it is the intention of the Settling Parties to dismiss or cause to be dismissed with prejudice the Lawsuit and Counterclaim in their entirety, and not to proceed with any other litigation, threatened or otherwise, relating in any way whatsoever to the alleged lead and other heavy metal contamination at the Property, so as to settle the Settling Parties' disputes with finality and without resort to further additional litigation, j SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 WHEREAS, the Settling Parties anticipate that the Court (as defined below in Section I) will review and approve this Agreement and enter the Order and Judgment attached as Exhibit A, or a substantially similar Order and Judgment, NOW, THEREFORE, in consideration of the foregoing recitals and in exchange for the promises contained herein and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the Settling Parties agree as follows I JURISDICTION The Settling Parties agree that the United States District Court for the Central District of California (Hon James V Selna presiding) (the "Court") has jurisdiction over the Settling Parties and jurisdiction over the subject matter of the Action pursuant to RCRA, 42 U S C § 6901, et seg , CERCLA Section 113(b) (42 U S C § 9613(b)), and 28 U S C §§ 1331 and 1367(a) For purposes of the Court's review, approval and enforcement of this Settlement Agreement, the Settling Parties waive any and all objections and defenses they may have to the jurisdiction of the Court, to venue in this District, or to service of process II PARTIES BOUND This Agreement applies to, is binding upon, and inures to the benefit of each of the Settling Parties, and each of their agents, officers, directors, elected officials, appointed officials, administrators, representatives, predecessors, successors, and assigns Each Settling Party has indicated its acceptance and approval of the terms and conditions hereof by having a duly authorized representative execute this document below III HAZARDOUS SUBSTANCES As used in this Agreement, the term "Hazardous Substances" includes hazardous substances and hazardous waste as those terms are used in the TAC and FAC and shall include, without limitation, all substances defined as hazardous substances in CERCLA Section 101(14), 42 U S C § 9601(14) and in Section 25316 of the California Health & Safety Code, and all waste defined as hazardous waste in 4 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27. 28 RCRA Section 103 (5) and (27), 42 U S C § 6903(5) and (27), or in other statutory or decisional environmental law, as heretofore or hereafter amended IV SETTLEMENT PAYMENT A Amounts The POA will pay the City, through the POA's insurers, the total sum of One Hundred Fifty Thousand Dollars ($150,000 00) B Payment The POA, through the POA's insurers, shall deliver the settlement payment to counsel for the Plaintiff at counsel's address listed in Section XI F (Notice), within thirty (30) days of the Effective Date of the "Settlement Agreement and Policy Release" executed between the City of Huntington Beach, the Huntington Beach Police Officers Association ("HBPOA") and its counsel, Scottsdale Insurance Company and American States Insurance Company Payment shall be in the form of a check or checks made payable to "City of Huntington Beach " V EFFECTIVE DATE OF SETTLEMENT AND THE COVERAGE ACTION This Agreement shall become binding and effective on the City and the POA upon the "Effective Date," which is the date by which both of the following occur (1) the execution of this Agreement by the City and the POA, and (2) the execution of the settlement agreement for the Coverage Action by the City, the POA, Scottsdale Insurance Company, and American States Insurance Company Among other things, the settlement agreement of the Coverage Action shall provide that the POA's msui ers shall pay to the City One Hundred Fifty Thousand Dollars ($150,000 00) on behalf of the POA VI DISMISSAL AND RELEASE A Dismissal of the Entire Action The Settling Parties hereby agree that they shall use their best efforts to cause the dismissal with prejudice of the Lawsuit against the POA, and the Counterclaim against the City, including without limitation, seeking the Court's approval of this Agreement and dismissal with prejudice (in the form of the contemplated Order) of any and all claims by and between the City and 5 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 the POA based on the facts alleged, including without limitation, claims for (1) the recovery of costs incurred including any interest thereon, and/or costs to be incurred in connection with preparing or implementing measures to clean up or abate the Hazardous Substances at the Property, (2) damages arising from or related to the Hazardous Substances at the Property, (3) statutory and equitable contribution and indemnification arising from or related to the Hazardous Substances at the Property, and (4) attorneys' fees and costs and expert costs and fees This dismissal shall include, without limitation, all claims asserted, or which could have been asserted, by the POA against each other party in the Lawsuit for which there is a comparable dismissal of that party's claims against the POA B Dismissal of the Lawsuit The City agrees that in the event it is unsuccessful in obtaining Court approval of this Agreement through entry of the Order or, if submitted, modified Order, the City shall file a voluntary dismissal with prejudice of the Lawsuit in favor of the POA, within fifteen (15) business days of the denial of the Order or, if submitted, within five (5) business days of the denial of the modified Order, and thereafter shall defend and indemnify the dismissed POA as provided in Section VIII This Agreement, however, shall remain in force and effect in all other respects pursuant to Section VII C of this Agreement C Release Save and except for claims arising from alleged breaches of this Agreement, and except for claims expressly or preserved in this Agreement, the Settling Parties hereby release each other (and each of their agents, officers, directors, elected officials, appointed officials, administrators, representatives, predecessors, successors and assigns) from any and all claims, demands, actions, and causes of action arising from or relating to Hazardous Substances at, on, under, or emanating from the Property, whether such claims, costs, demands, damages, actions, attorneys' fees, causes of action and/or rights arise from, or are directly or indirectly related to, connected with, or caused by the incidents and alleged contamination which gives rise to the Lawsuit, and regardless of whether such claims, demands, actions, and causes of action are presently known or unknown, or are presently suspected or 6 SETTLEMENT AGREEMENT 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 unsuspected Nothing in this provision is intended to change or affect existing law concerning claims or actions for fraud against or involving a public entity or a public employee and shall not be construed as such This release of claims includes, without limitation, a release of claims by the POA against any other person or entity for which there is a comparable release of that party's claims against the POA D No Release of Non -Settling Defendants by the City It is expressly agreed that the City's release provided herein to the POA does not and shall not extend to or benefit any person or entity that is not a signatory to this Agreement All claims against non -signatories, whether asserted in the Lawsuit or not, are expressly preserved City expressly reserves its rights to bring or continue any action against any person or entity that is not a signatory to this Agreement, including its claims against the County of Orange, California in this Lawsuit to recover costs, damages, and attorneys' fees incurred by the City in connection with the Property or the Lawsuit E Assignment to the City of POA's Claims Against Non -Settling Parties It is expressly agreed that the POA's release provided at Section VI C as to each other party to the Lawsuit for which there is a comparable release of that party 's claims against the POA, does not and shall not extend to or benefit any other person or entity All of the POA's claims against any non -settling person or entity, whether a party in the Lawsuit, or otherwise, and whether asserted in the Lawsuit or not, are expressly preserved In consideration of the City's release of its claims against POA, the POA transfers and assigns to the City all of the POA's right, title and interest in and to any claim or cause of action it may have against any non - settling person or entity to recover costs, damages, and attorneys' fees incurred by the POA in connection with the Property or the Gun Range The City may bring such claims against any non -settling person or entity, as both a cross -complaint and an affirmative defense in connection with any action in which the City is defending and 7 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 indemnifying the POA pursuant to Section VIII, or the City may bring such claim in a separate action or proceeding VII COURT APPROVAL AND PROTECTION AGAINST CLAIMS A Good Faith Compromise The Settling Parties acknowledge and agree that the payments and other undertakings pursuant to this Agreement represent a good faith compromise of disputed claims and that the compromise (1) represents a fair, reasonable, and equitable resolution of their respective claims arising out of the release of Hazardous Substances at the Property and (2) also benefits the public interest by ending the litigation -related expenditure of government funds while providing tends to support the cleanup of the Property With regard to any claims for costs, damages, or other relief asserted, or which could have been asserted, against the POA by any person or entity that is not a signatory to this Agreement on account of the release(s) of Hazardous Substances on, under, or at the Property, the Settling Parties agree that upon approval of this Agreement by the Court, the POA is entitled to the full benefit of any and all applicable provisions of federal and state law, whether statutory, common law, decisional, or otherwise, including but not limited to California Code of Civil Procedure sections 877 and 877 6 and CERCLA Section 113(f), 42 U S C § 9613(f)(2), extinguishing or limiting POA's alleged liability to persons or entities that are not signatories to this Agreement The Settling Parties further agree that claims for relief arising from the alleged disposal, release or threatened release of Hazardous Substances on, under, or at the Property, and the claims made in the Lawsuit are matters addressed in this Agreement The Settling Parties acknowledge and agree that the dismissal of claims as described in Section VI and elsewhere in this Agreement, and the protection from contribution and indemnity claims under all applicable state and federal laws and authorities, including without limitation contribution and indemnity claims, are integral and non -divisible aspects of this Agreement and as such are necessary and material terms in the Order Hence, the City is required to seek entry by the Court of 8 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 the Order approving this Agreement substantially in the form set forth in Exhibit A as a condition precedent to the obligations of the POA under Section IV of this Agreement Accordingly, five days after payment by the POA's insurers to the City of One Hundred Fifty Thousands Dollars ($150,000 00) on behalf of the POA pursuant to Section V, the City shall file , and the POA through its respective counsel shall join in, a mutually acceptable joint motion or other appropriate legal proceeding(s) as may be necessary or appropriate to secure the Court's approval of this Agreement, the contribution protection contemplated herein, and the dismissal of claims contemplated herein B Revised Application If Court Denies Motion If for any reason the Court declines to approve the terms of this Agreement through entry of the Order, the City shall seek direction and clarification from the Court concerning those aspects of the motion, application, this Agreement, and/or Order it finds unacceptable The Settling Parties then shall meet and confer, telephonically or in person within fifteen (15) business days following such denial, to discuss the items found unacceptable by the Court and attempt in good faith to agree upon amendments to this Agreement, the motion or application to approve this Agreement, and/or the Order so as to make them acceptable to the Court Promptly thereafter, if agreement is reached and as provided herein, the City shall apply, and the POA shall join in the application for approval of modifications to this Agreement and/or modified order from the Court Nothing in this Agreement shall require the Settling Parties to modify or submit a modified settlement agreement and/or order if, after negotiating in good faith, they are unable to agree on mutually acceptable modifications Nothing in this Agreement shall be read, interpreted or construed as requiring the POA to modify the settlement amount it should pay to the City, the City's commitment to obtain an order of dismissal or voluntarily dismiss the action with prejudice, and the City's duty to defend and indemnify the POA once a dismissal is entered If the Settling Parties are unable to agree to any modifications within said fifteen (15) business day period, the 9 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 City shall file a voluntary dismissal with prejudice of the Lawsuit in favor of the •W If the Settling Parties agree to modify either the motion, or application or this Agreement, or Order, the City shall reapply for approval of a modified settlement agreement and/or order from the Court within fifteen (15) business days after the Settling Parties agree to the modifications If the Court declines to approve the motion or application or a modified settlement agreement and/or order, the City shall file a voluntary dismissal with prejudice of the Lawsuit in favor of the POA within five (5) business days after the Court so declines If the modified order and judgment is reversed on appeal, this Agreement does not require either of the Settling Parties to pursue further modifications to this Agreement and/or the Order and Judgment Further, nothing in this Agreement shall require or preclude the City's defense of the Order and Judgment in the United States Supreme Court C Dismissal With Prejudice If Court Denies Application This Agreement shall remain binding and in effect regardless of whether 1) the Court declines to approve the terms of this Agreement and the Settling Parties cannot, in good faith, agree on the terms of a modified motion, application, settlement agreement and/or order, or 2) if the Settling Parties do agree to modify the motion, application, settlement agreement and/or order and the Court declines to approve the terms of a modified settlement agreement through entry of a modified order In such an eventuality, the City shall dismiss with prejudice the Lawsuit against the POA and all claims for relief filed by City against the POA as provided in Section VI B and Section VII B VIII INDEMNIFICATION A City's Duty To Defend And Indemnify City agrees it shall, upon entry of the Order contemplated in this Agreement or a voluntary dismissal with prejudice of the Lawsuit in favor of the POA, whichever occurs first, indemnify, protect, defend and hold harmless the POA from any and all claims under federal, 10 SETTLEMENT AGREEMENT 4 5 6 7 9 1� ]1 12 13 14 ]5 16 17 18 19 20 21 22 23 24 25 26 27 28 slate or other law asserted against the POA in the Laii<suit, or in any other proceeding (whether in equity, law or administrative), including without limitation, claims for { i} the recovery of costs incurred including any interest thereon, and/or costs to be incurred in connection with preparing or implementing measures to clears up or abate the Hazardous Substances at the Property, (2) damages ansing from or related to the Hazardous Substances at the Property, (3) statutory and equitable contribution and indemnification ansing from or related to the Hazardous Substances at the Property, and (4) attorneys' fees and costs and expert costs and fees B City Dutv to Defend and Indemnify Conditional Upon Cooperation The City's duty to defend and indemnify the POA shall be governed by Sections VI, VIII and IX The City shall defend the: POA with counsel selected from the staff of the Office of the Huntington Beach City Attorney or other competent counsel ("Designated Counsel"), to be chosen in the sole discretion of the City The POA agrees that as long as the City shall defend, indemnify and hold the POA harmless, the same counsel that represents the City may represent the POA in this Lawsuit or other proceeding involving the Property and its alleged contamination By separately initialing here, the POA waives any actual or potential conflict of interest of its defense counsel, and acknowledges and agrees that there has been a full disclosure and informed consent by all the Settling Parties within the meaning of California State Bar Rule 3-310(B), (C) and (E) permitting dual representation of clients and further permitting the representation of interests adverse to a client or forrner client with the informed written consent of the client Inakals of POA The City's duty to defend and indemnify the POA shall be conditional upon the POA's reasonable cooperation with and assistance to Designated Counsel as follows 1 In any proceeding where the City has a duty to defend and indemnify the POA pursuant to Section VII1 A, or the City is proceeding against a person or entity pursuant to Section VI E, the POA shall cooperate with Designated Counsel in said proceeding by testifying at trial and I SETTLEMENT AGREEMENT I submitting to a properly noticed oral deposition, providing declarations 2 necessary to the efficient prosecution of the proceeding and assisting in 3 responding to written discovery requests (Interrogatories, Requests for 4 Admission and Requests for Production) properly propounded upon the 5 POA The time expended by the POA in connection with attending the 6 deposition or assisting Designated Counsel in the preparation of 7 necessary declarations or responses to wi itten discovery shall not be 8 charged to the City or its Designated Counsel To the extent allowed by 9 law, Designated Counsel shall seek reimbursement of the POA's internal 10 costs and expenses, including costs associated with attending oral 1 1 depositions and assisting with and providing responses to written 12 discovery Notwithstanding the above, if a member of the POA who is 13 also a current City employee is called as a witness to testify on behalf of 14 the City, or is called to testify as to firearms activities at the Gun Range 15 unrelated to the POA's operation of the Range, then the City shall compensate that employee as the City would for any other employee 16 2 The POA shall cooperate with Designated Counsel in locating and 17 identifying documents that relate to firearms training at the Property and 18 provide hard copies to Designated Counsel To the extent allowed by 19 law, Designated Counsel shall seek reimbursement of the POA's costs 20 and expenses from the person or entity, other than Designated Counsel, 21 requesting the documents To the extent possible, the hard copies will 22 be provided within 30 days after the request is received from Designated 23 Counsel 24 3 The POA may be requited, at its own cost, to expend funds in 25 performance of the obligations contained in this Subsection B, including 26 but not limited to personnel time and expense, incidental transportation, 27 parking, telephone, fax and mailing costs, which funds shall not be 28 reimbursed by the City 12 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 IX APPEAL A Reversal Of Order And Appeal If the Court approves this Agreement through entry of the contemplated Order (including a modified version of the Order) and the Order is appealed, the POA agrees to cooperate with the City in defending the Order, at City's expense, through a final judgment in the Ninth Circuit Court of Appeal Nothing in this Agreement shall require the POA to meet and confer to modify or submit to the Court a modified settlement agreement and/or order in the event of an appeal and/or reversal of the Order If an appeal is undertaken or the Order is reversed on appeal, the City may dismiss with prejudice the Lawsuit against the POA or, at its expense, pursue further court review The City's duty to defend and indemnify the POA pursuant to Section VIII arises at the time of entry of the Order (including a modified version of the Order) and continues thereafter, regardless of whether any appeal or challenge to the Order is undertaken or whether the Order is reversed on appeal Nothing in this Settlement Agreement shall require or preclude the City's defense of the Order in the United States Supreme Court X CONTINUING JURISDICTION The Settling Parties agree that the Court specifically retains jurisdiction over the subject matter of this Action and the Settling Parties for the purpose of (1) resolving any disputes arising under this Agreement, (2) issuing such further orders or directions as may be necessary or appropriate to construe, implement, modify, or enforce the terms of this Agreement, and/or the Order, and (3) for granting any further relief as the interests of justice may require The Settling Parties further agree that if there is a dispute over the terms of this Agreement or performance of the obligations arising from this Agreement which the disputing Settling Parties cannot resolve among themselves, such dispute shall be heard and resolved by the Court XI ADDITIONAL TERMS A Representations of Non-Assignment/Transfer The Settling Parties represent and warrant that they have not assigned or otherwise transferred any claim, 1 j SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 cause of action, or other right which has been released in this Agreement The Settling Parties agree to hold each other harmless, and to indemnify each other from and against any claim made by any person or entity who purports to be the recipient of an assignment or other transfer of any claim, cause of action or right by the Settling Parties in connection with the Lawsuit or the incident which gave rise to the Lawsuit B Assumption of Risk It is understood and agreed by the Settling Parties that the facts may hereafter turn out to be other than or different from the facts now known to be or believed to be true The Settling Parties expressly assume the risk of the facts turning out to be different than they now so appear, and that this Agreement shall be, in all respects, effective and not subject to termination, rescission, alteration, or other such action by reason of any such difference in facts C Waiver of Section 1542 There is a risk that, after the execution of this Agreement, the Property will manifest new damages, the scope, location, and/or character of which is unknown and/or not discovered at the time this Agreement is signed There is a risk that the damages of which City, the POA, and their attorneys are presently aware, may become more serious, or otherwise increase in magnitude (qualitatively and/or quantatively) The Settling Parties shall, and hereby do, assume the above -mentioned risks The Release set forth in this Agreement is expressly intended to cover and include all future damages, defects, and discoveries, including all rights and causes of action arising in favor of one Settling Party against the other regarding Hazardous Waste at the Property The Settling Parties are aware of the provisions of California Civil Code section 1542, which provides "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HERFAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER 14 SETTLEMENT AGREEMENT 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR " � The Settling Parties hereby expressly waive the provisions of Civil Code section 1542 � as to all matters within the scope of the claims released by this Agreement and specified in Section VI C The Settling Parties hereby warrant and guarantee that they have full and complete authority to release all such claims on behalf of themselves, and their agents, representatives, heirs, assigns, and successors in interest D No Admission of Liability It is understood and agreed that this Agreement is a compromise of disputed claims, and that the agreements made herein are not to be construed as an admission of liability on the part of either Settling Party against the other, and that the Settling Parties deny liability and intend merely to avoid continued litigation, and that this Agreement is entered into solely by way of compromise and settlement E Settling Parties Bear Own Costs And Fees The Settling Parties shall bear all attorney's fees and costs arising from the actions of their own counsel in connection with the Lawsuit and Counterclaim through the preparation and execution of this Agreement and entry of a dismissal, whether by Court order or voluntary dismissal with prejudice of the Lawsuit and Counterclaim F Notice All notices and other communications, and payments, pertaining to this Settlement Agreement shall be in writing and shall be deemed received when delivered personally, by overnight courier, or by facsimile to the Settling Party or Settling Parties, as the case may be, at the following addresses (or such other address for a Settling Party as shall be specified by that Settling Party in a notice pursuant to this Section) AS TO THE CITY OF HUNTINGTON BEACH Huntington Beach City Clerk City of Huntington Beach 2000 Main Street 15 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 I 12 13 14 15 [roil 17 18 19 20 21 221 23 24 25 26 27 28 Huntington Beach, CA 92648 Fax (714) 374-1557 With Copy To Scott F Field, Assistant City Attorney City of Huntington Beach 2000 Main Street, P O Box 190 Huntington Beach, CA 92648 Fax (714) 374-1590 AS TO THE HUNTINGTON BEACH POLICE OFFICERS ASSOCIATION Kreg Muller, President Huntington Beach Police Officers Association P O Box 896 Huntington Beach, CA 92648 With Copy To Jeffiey L Caufield, Esq CAUFIELD & JAMES, LLP 2851 El Camino Del Rio South, Suite 250 San Diego, CA 92018 Fax (619) 325-0231 Greg Petersen Castle, Petersen & Krause 4675 MacArthur Court, Suite 1250 Newport Beach, CA 92660 G Cooperation The Settling Parties agree to take such further acts or execute any and all further documents that may be necessary or appropriate to make this Settlement Agreement legally binding and to effectuate its purposes H Settlement Agreement May be Executed in Counterparts This Agreement may be executed in any number of counterparts, and each such counterpart shall be deemed to be an original instrument, however, all such counterparts shall comprise but one Agreement 16 SETTLEMENT AGREEMENT 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I Entire Agreement This Agreement constitutes the full and entire agreement between the Settling Parties, and the Settling Parties acknowledge that there is no other agreement, oral and/or written, between the Settling Parties hereto relating to the Lawsuit and the Counterclaim, except for the settlement agreement of the Coverage Action J Authority to Enter Agreement Each person signing this Agreement on behalf of one of the Settling Parties hereto acknowledges that he/she has the full authority to bind said Party K Final Agreement The Settling Parties acknowledge that this Agreement and its reduction to final form is the result of good faith negotiations between the Settling Parties, and that the Settling Parties have had the opportunity to discuss this Agreement with counsel When signed, this Agreement is intended to be the final Agreement between the Settling Parties regarding the subject matter hereof L Interpretation of Agreement This Agreement is made and entered into in the State of California, and shall be interpreted, enforced, and governed by and under the laws of the State of California If it becomes necessary to interpret any of the provisions of this Agi eement, it shall be assumed that the Agreement was jointly drafted by the Parties M Modifications This Agreement may be amended or modified only by a writing signed by all Parties to the Agreement N No Inducement The Settling Parties warrant that no promise or inducement has been made or offered by the Settling Parties other than those set forth herein, and that this Agreement is not executed in reliance upon any statement or representation of any such Settling Parties, or their representatives The Settling Parties further represent that they have been represented by legal counsel during the course of the negotiations leading to the signing of this Settlement Agreement, and that they have been advised by legal counsel with respect to the meaning of this Agreement and its legal effect 17 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated aVEM,g , 2006 Dated / 2006 Dated kPvt"[v /, 2006 Dated Dated .2006 CITY OF HUNTINGTON BEACH, Plaintiff By Mayor Attest qByJoanYlynn City Clerk APPROVED AS TO FORM B Y A;� SCOTT F FIELD, Assistant City Attorney HUNTINGTON BEACH POLICE OFFICERS ASSOCIATION Defendant and Counterclaimant By KREG MULLER, President APPROVED AS TO FORM BY JEFFREY L CAUFIELD, ESQ 18 SETTLEMENT AGREEMENT A 1 2 3 4 5 6 7 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Dated 2006 0 CITY OF HUNTINGTON BEACH, Plaintiff By A, ` Mayor Attest Dated 2006 By oan ynn rty Clerk APPROVED AS TO FORM Dated A/Ovt*f kep- /, 2006 By SCOTT F FIELD, Assistant City Attorney Dated Df G cm Btu 18, 2006 HUNT ON BEACH POLICE OFFICERS ASSOCIATION Defendant and Counterclaimant By KREG MULLER, President APPROVED AS TO FORM Dated , 2006 r BY - JEFFREY L CAUFIELD, ESQ 18 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 3 9 10 I 12 13 14 15 16 17 18 19 20 21 221 23 d 24 25 26 27 EXHIBIT A JENNIFER MCGRATH, City Attorney (Bar No CA 179917) SCOTT F FIELD, Assistant City Attorney (Bar No CA 105 09) Box 190, 2000 Main Street Huntington Beach, California 92648 Telephone (714) 536-5555 Facsimile (714) 374-1590 E-mail sfield@surfcity-hb org HAL D GOLDFLAM, ESQ (Bar No 179689) FRANDZEL ROBINS BLOOM & CSATO, L C 6500 Wilshire Boulevard, 17th Floor Los Angeles, CA 90048-4920 Telephone (323) 852-1000 Facsimile (323)) 651-2577 E-mail hgolldflam@frandzel coin Attorneys for Plaintiff CITY OF HUNTINGTON BEACH UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA CITY OF HUNTINGTON BEACH, a municipal corporation of the State of California and charter city duly created and existing under the laws of the State of California, Plaintiff, vs HUNTINGTON BEACH POLICE OFFICERS ASSOCIATION, a California mutual benefit corporation, et al , Defendants And Related Claims and Third Party Complaints CASE NO SACV 01-1125 JVS (ANx) [PROPOSED] ORDER AND JUDGMENT 19 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ORDER AND JUDGMENT THE COURT HAS CONSIDERED THE FOREGOING settlement agreement by and between Plaintiff, City of Huntington Beach ("City") and Defendant and Counterclaimant, Huntington Beach Police Officers Association (the "POA") ("Agreement") Upon consideration of the Agreement and the Motion to Approve the Agreement, the pleadings on file herein, and the arguments of counsel, IT IS HEREBY ORDERED, ADJUDGED AND DECREED, as follows 1 The Motion to Approve the Agreement By and Between Plaintiff, City and Defendant, the POA is granted in its entirety 2 The Agreement previously filed with the Court in this Lawsuit consistent with the Agreement is approved and adopted as the Judgment of this Court resolving this Lawsuit as between the City and the POA The Court finds and decrees that there is no just reason for delay and accordingly directs the Clerk of the Court to enter this Order and Judgment as the Judgment of this Court 3 The Agreement is fair and reasonable, both procedurally and substantively, and was and is made in good faith, pursuant to all relevant federal and state law including without limitation California Code of Civil Procedure section 877 and 877 6, 42 U S C § 9613, and federal common law 4 The Agreement is in the public interest in that it avoids further expenditure of government funds on protracted litigation and makes funding available to resolve alleged environmental contamination at 18211 Gothard Street, Huntington Beach ("the Property") that is the subject of this Lawsuit captioned as City of Huntington Beach vs Huntington Beach Police Officers Association, United States District Court, Case No SACV 01-1125 JVS (ANX) (the "Action") 5 Pursuant to federal and state law, including but not limited to California Code Civil Procedure sections 877 and 877 6, 42 U S C § 9613, and federal common law, the POA is entitled to protection from, and is protected from any and all claims under federal, state or other law asserted against the POA in the Lawsuit, or in any other proceeding (whether in equity, law or administrative), including, without 20 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 limitation, claims for (1) the recovery of costs incurred including any interest thereon, and/or costs to be incurred in connection with preparing or implementing measures to clean up or abate Hazardous Substances (as that term is defined in the Settlement Agreement) at the Property, (2) damages arising from or related to Hazardous Substances at the Property, (3) statutory and equitable contribution and indemnification arising from or related to Hazardous Substances at the Property, and (4) attorneys' fees and costs and expert costs and fees 6 As set forth in the Agreement, all claims, cross -claims for relief asserted against the POA by the City in this Lawsuit are hereby dismissed with prejudice All claims asserted against the City by the POA, and all claims asserted by the POA against any other defendants that may have settled pursuant to a comparable settlement agreement, are also hereby dismissed with prejudice 7 All claims, cross -claims, counterclaims, or third party claims which have been, or could have been, asserted by any person or entity against the POA in this Action, including all claims described at paragraph 5 above, are hereby barred 8 The Court shall retain jurisdiction over the Settling Parties and jurisdiction over the subject matter of this Action for purposes of enforcing the Settlement Agreement, and this Order and Judgment of Dismissal 9 Except as otherwise provided herein, each Settling Party shall bear its own litigation costs and expenses, including attorneys' fees Upon entry of the Order and Judgment of Dismissal, the City shall have the duty to defend and indemnify the POA pursuant to the terms of the Agreement Dated IT IS SO ORDERED AND JUDGMENT IS SO ENTERED United States District Court Judge 21 SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 limitation, claims for (1) the recovery of costs incurred including any interest thereon, and/or costs to be incurred in connection with preparing or implementing measures to clean up or abate Hazardous Substances (as that term is defined in the Settlement Agreement) at the Property, (2) damages arising from or related to Hazardous Substances at the Property, (3) statutory and equitable contribution and indemnification arising from or related to Hazardous Substances at the Property, and (4) attorneys' fees and costs and expert costs and fees 6 As set forth in the Agreement, all claims, cross -claims for relief asserted against the POA by the City in this Lawsuit are hereby dismissed with prejudice All claims asserted against the City by the POA, and all claims asserted by the POA against any other defendants that may have settled pursuant to a comparable settlement agreement, are also hereby dismissed with prejudice 7 All claims, cross -claims, counterclaims, or third party claims which have been, or could have been, asserted by any person or entity against the POA in this Action, including all claims described at paragraph 5 above, are hereby barred 8 The Court shall retain jurisdiction over the Settling Parties and jurisdiction over the subject matter of this Action for purposes of enforcing the Settlement Agreement, and this Order and Judgment of Dismissal 9 Except as otherwise provided herein, each Settling Party shall bear its own litigation costs and expenses, including attorneys' fees Upon entry of the Order and Judgment of Dismissal, the City shall have the duty to defend and indemnify the POA pursuant to the terms of the Agreement Dated IT IS SO ORDERED AND JUDGMENT IS SO ENTERED United States District Court Judge 21 SETTLEMENT AGREEMENT