Subject: Legal Services Agreement
Adoption of a resolution authorizing the City Attorney to execute the Sixth Amendment to the legal services agreement with Ogden, Gibson, White, and Broocks to increase the compensation by $120,000 for a total not to exceed $685,000.
BACKGROUND
Effective October 1, 1998, the Board entered into an agreement with the law firm of Ogden, Gibson, White & Broocks, L.L.P. to represent the Board in the matter of The Board of Administration for the Police and Fire Department Retirement Plan of San José California vs. Tangle Woodway, LTD, et al; No. 98-57712; in the 215 Judicial District Court of Harris County Texas.
The original budget was $50,000 and as the law firm developed our case, it became a viable claim. Due to the extent of the construction defects and the damage to the buildings, many defendants were added to the lawsuit and subsequent increases to the contract were made to the current not to exceed limit of $565,000 done in March 2001.
As the trial date approached legal activity increased. A settlement conference with all parties held March 27-28, 2001 proved unsuccessful as no agreement was reached with any of the main defendants. However, settlement talks continue and the trial start date of May 14, 2001 was cancelled and a new date was requested. Our attorney estimates that the new trial date will be in August 2001, if settlement cannot be reached. Therefore, legal costs are increasing. As of OGWB’s March 2001 invoice, the Plan has paid $500,000 in legal fees and expenses. Their April invoice will use up the remaining $65,000 on the current agreement.
If necessary, OGWB best estimate to take the case through trial is to increase the contract by $120,000 to an amount not to exceed $685,000. This estimate includes attorney fees, expert
witness costs and preparation of exhibits. It is anticipated that we will be able to recoup all expenses incurred at the conclusion of this lawsuit.
This item was approved by the Police and Fire Retirement Real Estate Subcommittee at their May 7, 2001 meeting and is on the June 7, 2001 Board agenda.
Not applicable.
Preparation of the contract amendment was coordinated with the Office of the City Attorney.
The expenses will be paid from the Police and Fire Retirement Fund.
Fund: Police and Fire Retirement Fund
Amount: $120,000
Budget Document: 2000-2001 Operating Budget
Page 977
EDWARD F. OVERTON
Secretary, Board of Administration