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Home My WebLink About25B - AGMT - BRISTOL ST IMPROVEMENTSREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: OCTOBER 2, 2018 TITLE: AUTHORIZE AGREEMENT FOR TENANT GOODWILL COMPENSATION FOR BRISTOL STREET IMPROVEMENTS PROJECT - PHASE 3A (PROJECT NO. 136792 NONGENERAL FUND) (STRATEGIC PLAN NOS. 6, 1G; 3,2C) CITY MANAGER CLERK OF COUNCIL USE ONLY: FTIT051-007iTol ❑ As Recommended ❑ As Amended ❑ Ordinance on 15' Reading ❑ Ordinance on 2"d Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER Authorize the City Manager and Clerk of the Council to execute an agreement for compensation for loss of business goodwill related to the full real property acquisition listed below from the following property owner, subject to nonsubstantive changes approved by the City Manager and City Attorney: Property commonly known as / Related Loss of Business Business Owner Assessor's Parcel Number Acquisition Goodwill Compensation Khaled H. Jawhary dba Advantage 1111 North Bristol Street Unit D Full $163,000 Auto Insurance APN 405-274-10 (Nov. 2016) DISCUSSION Bristol Street is a north -south transportation corridor designated as a major arterial highway in the City's Circulation Element of the General Plan. Improving the 3.9 -mile Bristol Street segment from Warner Avenue to Memory Lane has been a long-term priority that is being constructed in several phases. Improvements include widening the street from two to three lanes in each direction, raised landscape medians, and bike lanes. The City is acquiring properties for the development of Phase 3A, bounded by Civic Center Drive and Washington Avenue. Property acquisitions for this phase are expected to be completed by spring 2019 and construction is anticipated to begin in summer 2019. Property acquisitions on Bristol Street (Exhibit 1) were necessary to accommodate the improvements and widening for Phase 3A. The business owned by Kahled H. Jawhary has relocated and has already been compensated by the City for its tenant -owned improvements and movable items. The business owner is now seeking compensation for loss of business goodwill that it alleges has been experienced as a result of displacement. No claim for business goodwill 25B-1 Tenant Goodwill Compensation Bristol Street Improvement Phase 3A October 2, 2018 Page 2 was made at the time of relocation; however, this claim does fall within the three year statute of limitations period allowed. The City utilized an independent licensed business goodwill appraiser to determine the loss of goodwill value and both parties have agreed to compensation in the amount of $163,000 as a full and final settlement of all claims, pursuant to the corresponding agreement (Exhibit 2). STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal #6 — Community Facilities & Infrastructure, Objective #1 (establish and maintain a Community Investment Plan for all City assets), Strategy G (develop and implement the City's Capital Improvement Program in coordination with the Community Investment and Deferred Maintenance Plans). Approval of this item also supports the City's efforts to meet Goal #3 — Economic Development, Objective #2 (create new opportunities for business/job growth and encourage private development through new General Plan and Zoning Ordinance policies), Strategy C (support business development and job growth along transit corridors through the completion of critical transit plans/projects). ENVIRONMENTAL IMPACT In 1990, City Council approved the Bristol Street Final Environmental Impact Statement/Environmental Impact Report (FEIS/EIR No. 89-01). Due to several minor design modifications in Phase 3A, which lies between Civic Center Drive and Washington Avenue, an Addendum to the FEIS/EIR was prepared and adopted pursuant to the California Environmental Quality Act by City Council on April 7, 2015. FISCAL IMPACT Funds in the amount of $163,000 are available for expenditure in FY 2018/2019 in the Bristol Street Improvements Project (No. 136792), in the Select Street Construction Fund (Account No. 05917661-66100), subject to nonsubstantive changes. APPRO 'ED AS TO FUNDS AND ACCOUNTS: Fuad S. weiss, PE, PLS Sergio al Executiv Director Acting Executive Director Public W ks Agency Finance and Management Services Agency Exhibits: 1. Location Map 2. Agreement 25B-2 4 (NTS) 10TH STREET 9TH STREET u a S g E D z CIVIC CENTER DR. SUBJECT PRJPEPT!ES -FCOUIRED PROPEPTTES SANTA ANA PWA rua x6r WASHINGTON AVENUE 25B-3 25B-4 AGREEMENT FOR COMPENSATION FOR LOSS OF BUSINESS GOODWILL This Agreement for Compensation for Loss of Business Goodwill ("Agreement") is made by and between the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and taws of the State of California ("City") and Khaled H. Jawhary dba Advantage Auto Insurance Brokerage ("Business"). City and Business shall collectively be referred to as the "Parties". RECITALS A. On or about November 2, 2016, through a voluntary sale, City acquired the real property at 1111 North Bristol Street, in the City of Santa Ana, Assessor Parcel No. 405-274-10 ("Property"), for purposes of the Bristol Street Widening Project Phase 3A, resulting in displacement ofthe Business. B. The Business had an interest in the Property as a Lessee but voluntarily ceased operations on or about February 28, 2017 and relocated on or about March 1, 2017. C. The Business has been already been compensated by City for its tenant -owned improvements and movable items and seeks further compensation for loss of goodwill value that it has allegedly suffered as a result of displacement. D. City has agrees{ to provide such compensation based on a study it has had prepared to determine the loss of goodwill value. E. By this Agreement, the parties desire to settle all present, past and future controversies, claims, causes of action or purported causes of action, defenses, and disputes, both real and potential, which the Business may have against City with respect to City's acquisition and use of the Property and any clai n for loss of goodwill. AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and mutual covenants set forth herein, the receipt and adequacy of which is hereby acknowledged, the Parties agree as follows: 1. RFcrrALs The Recitals are incorporated into and are made a part of this Agreement. The purpose of this Agreement is to resolve, in their entirety, all present, past and future controversies, claims, causes of action or purported causes of action, defenses, and disputes, both real and potential, which the Business may have against City with respect to City's acquisition and use of the Property and any claim for loss of goodwill. Page 1 of 4 EXHIBIT 2 25B-5 2. CONSIDERATION. In consideration of this Agreement, City shall pay to the Business the sum of One Hundred Sixty -Three Thousand Dollars ($ t63,000,00) as a frill and final settlement of all claims by the Business for loss of goodwill as alleged to have been suffered by the Business arising from the acquisition. of the Property. Payment shall be by check made payable to Khaled 1-1. Jawhary Ciba Advantage Auto Insurance Brokerage. d. RELEASE. (a) In further consideration of this Agreement and in recognition of the benefits to be derived therefrom, and except as to the rights, duties and obligations of the Parties asset forth in this Agrvomont, the Business hereby releases, and dilly and finally and forever discharges City, and each of its administrators, assigns, agents; directors, officers, partners, employees, representatives, lawyers, and all persons acting by, through, under, or in conceit with the City or any of them, of and from any and all mamror of actions or causes of action, in law or in equity, suits, debts, liens, liabilities„ claims, demands, and damages of any nature whatsoever, known or unknown, fixed or contingent including, but not limited to severance damages, relocation assistance, relocation benefits, claims for inverse condemnation or unreasonable precondentnation conduct, or any other claims for damages or benefits arising from the acquisition of the Property by the City, existing or as the law may change, including without limitation, claims which the Business may now have against the City arising from or related to the acquisition and use of the Property by the City and any claim for loss of goodwill. (b) Except as otherwise provided in this Agreement, it is the intention of the Parties that this Release shall be effective as a bar to all claims, causes of action, actions, damages, losses, demands, accounts, reckonings, rights, debts, liabilities, obligations, and attorneys' fees, of every character and kind, known or unknown, existing or contingent, latent or patent; and in furtherance of such intention, the Business expressly waives any and all rights conferred upon it by the provisions of California Civil Code Section 1542, which reads as follows: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH ]'HE 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 HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR, 4. NECESSARvACTs. Each Party shall perform any further acts and execute and deliver any further documents that may be reasonably necessary to carry out the provisions of this Agreement. 5. AUTHORITY TO SIGN. Each Party warrants that the individuals who have signed this Agreement on behalf of that Party have the legal power, right, and authority to so sign and thereby bind that Party and its Page 2 of 4 r heirs, personal representatives, successors and assigns and any person or entity that may otherwise be entitled to grant the Release. b. ENTIRE AGRrXM ENT; AMENDMENTS. This Agreement is the entire agreement between the Parties concerning the subject matter hereof, and supersedes any prior negotiations, discussions, oral or written communications, or agreements between the Parties. The terms of this Agreement may only be modified or amended by an instrument in writing executed by all Parties. 7. GOVERNING LAW; VENUE. This Agreement shall be governed by and construed in accordance with the taws of the State of California. Any legal action or proceeding concerning this Agreement shall be filed and prosecuted in the appropriate California state court in the County of Orange, California. S. No THIRD PARTY 11ENEFICIARIES. The Parties acknowledge that there are no express or implied third party beneficiaries to this Agreement. No person or entity not a signatory hereto shall have any rights or causes of action against any Party hereto as a result of that Party's performance or nonperformance of any obligation hereunder. 9. No PRIOR ASSIGNMENTS. The Parties represent and warrant that they have not sold, assigned or transferred, or purported to sell, assign or transfer, and shall not hereafter sell, assign or transfer, any obligations, liabilities, demands, claims, costs, expenses, debts, controversies, damages, rights, actions, or causes of action released pursuant to this Agreement. 10. SUCCESSORS AND ASSIGNS. 'Phis Agreement shall be binding upon and shall inure to the benefit of the successors, assigns, personal representatives, executors, estate, heirs, agents and related entities of the respective Parties. 11. COUNTERPART EXECUTION. This Agreement may be executed in multiple counterparts, eacit of which shall be deemed an original, but all of which, together, shall constitute one and the same instrument. This Agreement may be executed on counterpart signature pages and may be signed by fax or scanned email signature. —signatures are next page — Page 3 of 4 25B-7 IN WITNESS WHEREOF, each Party has executed this Agreement on the date which appears next to its/his signature below. Dated: CITY OF SANTA ANA By: Name: Title: Dated: % %�� KHALEDH.JAWHARYdbaADVANTAGE AUTO INSURANCE BROKE GE By: Name;X .()a -Z %i49r r Title:��,� APPROVED AS TO FORM J ��FuiR1 Assistant City Attorney ATTEST Maria D. Huizar Clerk of the Council FOR APPROVAL Fuad S. Sweiss, PE, P Executive Director Public Works Agency Page 4 of 4