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HomeMy WebLinkAbout6/29/1992SPECIAL CALL MEETING Tuesday, June 29, 1992 The Board of County Commissioners of Indian River County, Florida, met in Special Session at the County Commission Chambers, 1840 25th Street, Vero Beach, Florida, on Monday, June 29, 1992, at 9:30 o'clock A.M. Present were Carolyn K. Eggert, Chairman; Margaret C. Bowman, Vice Chairman; Richard N. Bird; Gary C. Wheeler; and Don C. Scurlock, Jr. Also present were James E. Chandler, County Administrator; and Deputy County Attorney William G. Collins, II. The Chairman called the meeting to order. DISCUSSION RE SETTLEMENT WITH PRINCE CONTRACTING COMPANY INC. Chairman Eggert advised that Attorney Collins will explain the emergency of this Special Call Meeting. Attorney Will Collins explained that this special call meeting has been called to discuss settlement of pending litigation in the sunshine. Normally, we give more public notice than we actually had available, and, if in fact, we're going to discuss the settlement here, we should state for the record that a member of the press is here. The reasons for which an emergency exists which precludes more notice of this special call meeting is that Commissioner Bird is going to be leaving town today and will not be N 2,91992 °X00 ho r J U- INI Z 9 19 92 -7 available for at least a few days, and because County's counsel, Attorney Lyman Reynolds, has some obligations to the Court in terms of responding. Attorney Reynolds will address those emergency constraints, and we can move into the settlement discussion. Attorney Lyman Reynolds reported that mediation was held in this matter on Friday and lasted all day into the early evening, whereby the parties all discussed settlement. He has been advised in writing by plaintiff's counsel that their position relative to settlement remains open until 9 o'clock tomorrow morning. Originally, it was 5 o'clock today, which is the basis for this emergency meeting. One of the primary considerations of both Prince and Guettler for settlement of the case is the stopping of the occurring of additional attorney's fees and costs in the case, i.e., hearings, depositions, travel. Requirements for all of the attorneys basically begin in earnest tomorrow morning, which is why they wanted the Commission's position on settlement to be finalized today, in addition to some of the Commissioners perhaps not being available after today. Attorney Reynolds advised that he was not able to be present at the mediation because his presence was required before Judge Gross in a jury trial that lasted a week. The trial was supposed to have finished on Thursday, but did not, and he had his partner, Attorney Ren Moffett, attend the mediation with both Mrs. Beth Jordan and Mr. Roger Moore of the County's Risk Management Office. Specifically, with regard to mediation, Prince and Guettler have either settled or are in the process of attempting to settle, together with Commissioner Scurlock, in his individual capacity. That settlement between those three individual entities (Prince, Scurlock and Guettler) is confidential between those three parties. The Mediator kept representatives of Indian River County out of the meeting room where the settlement negotiations took place between the three individual parties to this lawsuit. It is confidential, F and we have been specifically advised by plaintiff's counsel of an intention to seek sanctions if the confidentiality of that individual settlement or potential settlement were breached. Attorney Reynolds stated he was completely unaware of the terms or conditions *of that confidential settlement, which makes it extremely easy. Again, the County was never a part of these individual settlement negotiations. In mediation all of the parties originally come in as one group, everybody states their position, and then to facilitate the mediation process, the Mediator asks different parties to go into separate meeting rooms for settlement discussions. Essentially, Indian River County was isolated from the individual settlement negotiations in this case because we made it eminently clear at the inception of mediation that the position of Indian River County as a governing board is that we did not do anything wrong as a governing board. If Prince, in fact, proved any of its allegations individually against _ Commissioner Scurlock and or against Guettler, then we would file indemnity claims against those two individual entities from whom we would seek damages and reimbursement for both attorney's fees and for any judgment entered against Indian River County in this cause. For that reason, we were set separate and apart, and basically, what transpired was that a settlement was reached or almost reached between those three individual entities. We were then provided with a request on behalf of Prince Contracting to write a letter to Mr. Prince, as president of Prince Contracting Co., setting forth that Indian River County Board of Commissioners and its staff have concluded, based upon their investigation of the qualifications of Prince Contracting Co., that Prince Contracting Co. was qualified to perform the referenced golf course project. The referenced lawsuit was dismissed by Prince Contracting Co. after all issues were amicably resolved. Furthermore, Indian River County will sign a statement that affirms and commits that Prince Contracting will be equitably considered in the future for all golf course and other 3 JUN 29 1992 MOK Fr,� construction contract awards by Indian River County. This statement was faxed to him in typewritten form by Attorney Joe Lawrence late yesterday afternoon. June 26, 1992 Mr. Chaster Prince President Prince Contracting Co., Inc. 5411 Willis Road Palmetto, Florida 34221-9295 REs Sandridge Golf Course Second 18, Bid No. 92-63, County Project No. 9105= Prince Contracting Co., Inc., Dennis L. Smith and Dennis L. Smith, Inc. v. Don C. Scurlock, Jr., individually and The -Board of County Commissioners, Indian River County, Florida, Carolyn K. Eggert, Margaret C. Bowman, Richard M. gird, non C. Scurlock, jr., and. Gary C. Wheeler, Commissioners/ and Guettler .& Sons, Iao.f Case No. 92 - in circuit Court of the Nineteenth Judicial Circuit in and for Indian River County, Florida Dear Mr. princal t A dispute has arisen among Prince Contracting Company, Inc., and Indian River County and other defendants and is now pending in the Nineteenth Judicial Circuit Court before Circuit Judge Charles Smith, W1 Ce Contrantinr. The Indian River Board of County Commissioners and its staff have concluded, based upon their investigations of the qualifications of Prince Contracting Company, Inc., that Prince Contracting Company, Inc., was qualified to perform the referenced golf course project. The referenced lawsuit was dismissed by Prince Contracting Company, Inc. after all issues were amicably resolved by the parties. Furthermore, the Indian River Board of County Commissioners affirms and commits that Prince Contracting Company, Inc. Will be equitably considered in the future for all golf course and other construction contract awards by Indian River County. JUN 28 '92 15:13 Sincerely, Carolyn K. Eggert Chairman, Indian River Board Of County Commissioners 305 524 6927 PAGE.003 4 r � r Chairman Eggert thanked Attorney Reynolds for the faxed copy, and asked Attorney Collins for his comments on what Attorney Reynolds has said so far. Attorney Will Collins felt that the letter does not.say that Prince was most qualified. It simply states that they were qualified, but does not seem to put us in the position of acknowledging that they were the most responsive bidder. He believed that is good. Attorney Reynolds stated that is absolutely correct. Based on his individual meetings with the individual Commissioners, he believed that Indian River County paying no money to any party in this case and simply acknowledging to Mr. Prince the qualifications of his firm is in the best interests of the County. Specifically, the language that was agreed to in principle to present to the Board was phrased such that Prince was qualified to perform the referenced golf course project. However, he believed, -as stated in _ defense of this case at the temporary injunction hearing, that if the case doesn't settle and actually ends up going to trial, our defense at that point in time will be that it was not a question that either Guettler or Prince were qualified to do the job, but that this particular job required time being of the essence, and, specifically, the Commission made a decision with regard to the contractor they believed would be best able to meet those time constraints and went with the lowest, best contractor in the case. In reviewing every Minute and every representation in preparation for trial of this case, this Commission, at no time, made a ruling or finding or placed on the record that Prince was not qualified. Therefore, he believed that this letter only states what the Commission has stated throughout. Chairman Eggert wished to split a hair here, because she felt one of the reasons that three Commissioners voted for it was that Guettler had prize-winning experience and was more qualified. She agreed with the time factor, and the fact that they were on site, 5 JUN 29 1992 JUN 2 91992 BOOK [r I i(b but didn't know if she would make as big a deal out of the time because she understood that Prince could get there in a fairly decent time. It was just that Guettler was on time, and it was felt they had more of a particular kind of experience, and were award-winning, if you will. Attorney Reynolds didn't know that it is necessary to find in this case for the purpose of signing the statement. Attorney Reynolds advised that in Court we will be put to the standard of what was in the best interest of the County, with the lowest, most qualified bidder. Again, that does not mean that Prince was not qualified. The Commission will recall that when the questions about the bid and the vote all came up originally, Prince had been involved in some other litigation with some other governmental entities and they produced a similar type of letter or document. That is not an unusual request at all, and Chairman Eggert has stated she doesn't have a problem with the letter or statement. Commissioner Wheeler understood that our specific reason for holding this special call meeting is to either approve or not to approve the statement that was faxed to you. Attorney Reynolds responded that is correct. Commissioner Wheeler still had some questions, and Attorney Reynolds explained that the Commission, Prince, Scurlock and Guettler are working out their settlement, and that the only contribution that is requested of Indian River County is this letter. No money. We did file an answer on behalf of Indian River County in this particular case which includes claims for indemnification and attorney's fees against Mr. Scurlock, individually, and Guettler & Sons. Specifically, as it relates to Guettler, the payment by Guettler in this case of any consideration - whatever that consideration may be - he has worked out by way of settlement with Prince. It was Attorney Reynold's opinion that would constitute what this Commission is looking for by way of 6 M - M indemnification. In terms of attorney's fees, it is the usual practice and procedure when you settle a case that each party bear their own attorney's fees and costs. Therefore, with Guettler paying his own attorney's fees and paying whatever, if any, consideration towards the monetary settlement of this case when the Commission has a claim pending against it for compensation from Prince for attorney's fees and bid preparation cost, then that obligation has been met by Guettler such that he would recommend, as a part of the settlement, - and it is the requirement obviously of Guettler - that the claim for indemnity against them be dropped. He felt that would be eminently reasonable. We also have filed a cross-claim against Mr. Scurlock individually for indemnification and attorney's fees. Florida Statute Sec. 111.07 would be relevant to our defense of Commissioner Scurlock in his official capacity if he were found to have done something wrong in his individual capacity. For purposes of today, Attorney Reynolds understood there was no agreement reached at mediation relative to Commissioner Scurlock, because Commissioner Scurlock, essentially, under that same Statute has a claim for attorney's fees that he has utilized in his defense of this case. Chairman Eggert asked if that is Commissioner Scurlock individually, and Attorney Reynolds responded that it is individually. He understood that for the time being the indemnification claim against Commissioner Scurlock would remain and we can discuss the liability of dropping that, pursuing that or settling that at another time. His recommendation to the Board is that we pay nothing in settlement; we acknowledge that the individual parties have simply resolved their dispute and issue Mr. Prince the letter as requested by his counsel. Attorney Reynolds felt that accurately reflects the Commission's and Indian River County's position throughout the vote and the defense of this case, and that we should drop the cross-claim for indemnity against Guettler. 7 9 1992 86, 1ADE J U 01 2 91992 Chairman Eggert asked if it would affect any kind of relationship we have on the building of the golf course. Attorney Reynolds advised that it would not; the County only would be dropping an indemnification claim that relates only to the vote, (to the lawsuit). The indemnification claim is that, if the Court finds that you and Commissioner Scurlock, individually, conspired to violate the conflict of interest law such that this County is found to have damages against it, then Mr. Scurlock should pay those damages and our attorney's fees because we are only being held vicariously liable due to his misfeasance, malfeasance or improper acts in violation of the conflict. The contribution claim is only for purposes of pro -rata distribution of fault, which is a joint tort feasor theory that, in essence, says if the Commission is at fault, we wouldn't be nearly as much at fault as Commissioner Scurlock ,individually and Guettler, individually, if in fact Prince is able to prove the conflict. These are simply what are called derivative claims; there is not a basis upon which to sue these two individual entities, in his opinion, in a viable manner on an independent tort theory or breach of contract or any other basis. It does not affect the contract; if this case settles as we proceed, the contract goes forward and Guettler builds the golf course. We're all done, except as it relates to the individual claim against Mr. Scurlock. Again, the individual claim against Mr. Scurlock, very importantly, is a derivative claim. Chairman Eggert felt if we if we could just take up everything today, it just might be easier all the way around. Attorney Reynolds went into greater detail regarding the derivative claim against Mr. Scurlock. That claim is that we do not believe there was a conflict of interest at the time of the vote; however, if Prince proves that there was and you find that there was either actual conflict of interest known only to Mr. Scurlock or a conspiracy with Guettler to get this contract, then 8 M 07 our liability as the County would be only vicarious. Therefore, Commissioner Scurlock would owe us attorney's fees for defending this action, and he would owe us indemnification or contribution based upon his individual acts. Then we have a third separate count under Fla. Statute 111°.07 relative to whether or not the individual acted in his individual capacity or his official capacity. Essentially, that cuts both ways. Commissioner Scurlock, at this point and time, has not filed a claim back against the County for his attorney's fees, but potentially, he could do so. Attorney Reynolds stated that he isn't saying that it is a viable claim, but at least the argument could be made. With regard to the individual claim against Mr. Scurlock, he felt we should settle everything and walk away. Attorney Lyman Reynolds stated that he has not found throughout the exhaustive research and discovery in this case by Prince any evidence of a conflict of interest existing on the day and time of the vote. We have third party statements relative to representation by Mr. Scurlock as to his relationship; we have the Ocoee project; we have what he (Reynolds) characterized to the court as braggadocios statements to this Commission, to individual members of the County staff and to individual Commissioners about Mr. Scurlock's alleged relationship with Guettler. However, under the law, he has found no evidence that a relationship existed whereby Mr. Scurlock would be individually rewarded or remunerated for the award of this contract. His recommendation to the Board would be to resolve it all. Mr. Scurlock would pay his attorney fees and we would pay our attorney fees. Remembering that indemnification and contribution are only a derivative claim, if Prince settles, and if Guettler settles this case, and we are only left with a derivative claim against Mr. Scurlock, we then as Indian River County would take over in essence the burden of proof from Prince to prove that this relationship in fact existed and the most that you could hope for would be recouping all or a portion of V] BOOK F- I e dIJ Cal V 1992 U���K your attorney fees, specifically remembering that he has only been represented in one- fifth of the official capacity pursuant to State Statute. Chairman Eggert felt it seems reasonable to resolve it all and each pay our own attorney's fees, and let it go at that, since everybody has recommended that. Attorney Reynolds stated that it seems so to him. Commissioner Bird agreed and felt the reasoning that Attorney Reynolds gave before as to why we agreed to write the letter, etc. is sufficient. There was no question of choosing the best, not that one was not qualified, but choosing the best we felt could do the project under the tight time constraints that we had. He believed that if the weather ever starts cooperating a little bit more, time will prove us to be correct on that, being that the construction is far ahead of schedule and as far under budget as it is at the present time. Commissioner Scurlock understood that Attorney Reynolds _ has indicated that after four and a half months of exhaustive investigation, he has found no evidence that proves in any way that on the day of the vote, that he, in fact, had a conflict of interest. Mr. Reynolds confirmed that to be correct. He stated that nothing has been provided to him by plaintiff's counsel to the contrary. He wished to interject a word of caution at this point since we are here on an emergency basis on a matter open to the public and open to the press to whom we have given as much reasonable notice as possible. By representing each of you in your official capacities, including Commissioner Scurlock, and in view of the fact that we have now have broached the subject about resolving the individual claim as it relates to Commissioner Scurlock and having made that recommendation as the attorney for the Commission in their official capacity, he must point out that Commissioner Scurlock does not have a lawyer present to represent Eu7 M him in his individual capacity. Attorney Reynolds had thoughts that perhaps Commissioner Scurlock's participation in the discussion and this vote in his official capacity could potentially invoke questions about conflict of interest at the time of the vote and of the discussion. Addressing Commissioner Scurlock directly, Attorney Reynolds advised that this matter is open to the public and any individual can come in and state whatever they want, and in your individual capacity you certainly are so entitled. He recalled that one of the matters that came up during the defense of this case was why something wasn't said when the County Attorney or anyone else thought you had a potential conflict of interest.- Attorney Reynolds stressed that for purposes of the record today, he was saying it, because in Commissioner Scurlock's official capacity, and his representing him in his official capacity, he would be bothered by the potential for a conflict of interest by Commissioner Scurlock's participation as a Commissioner in the discussion and vote of this matter. He noted that under the conflict of interest statute, Commissioner Scurlock is guided by his own best counsel, but felt it is very important to point out his reservation at this time. Commissioner Scurlock asked if there was an effort to resolve all the issues today, what format or vehicle would he have as an individual to indicate to this Commission. Attorney Reynolds advised that Commissioner Scurlock had only to so state. His advice to Commissioner Scurlock is that he should not vote. Commissioner Scurlock stated that wasn't a problem and agreed not to vote on this issue. 001 JUN 29 1992 lli� BOOK 86 FN.uI 6' IF YOU MAKE NO ATTEMPT TO INFLUENCE THE DECISION EXCEPT BY DISCUSSION AT THE MEETING: • You must disclose orally the nature of your conflict in the measure before participating. ' • You must complete the form and�file it within IS days after the vote occurs with the person responsible for recording the minutes of the meeting. who must incorporate the form in the minutes. A copy of the form must be provided immediately to the other members of the agency, and the forth must be read publicly at the next meeting after the form is filed. DISCLOSURE OF LOCAL OFFICER'S INTEREST I, __ non r_ -Scurlock- 0 r , hereby disclose that on June 29 199 2 (a) A measure came or will come before my agency which (check one) Potentia 1 1 y X X inured to my special private gain; inured to the special gain of my business associate, inured to the special gain of my relative, inured to the special gain of by whom I am retained; or inured to the special gain of , which is the parent organization or subsidiary of a principal which has retained me. (b) The measure before my agency and the nature of my conflicting interest in the measure is as follows: A proposed settlement of a lawsuit. The County Commission is a defendant, and I am also an individual defendant against whom the County has a cross claim for indemnification and attorney's fees.. Board approval., of the settlement potentially inures to my benefit, in -that it'may give rise to a claim for reimbursement. of my individual attorney's fees and costs, under F.S. 111.07. Jena -29, 1999 �r►• L Date Filed Signature NOTICE: UNDER PROVISIONS OF FLORIDA STATUTES §112.317 (1991), A FAILURE TO MAKE ANY REQUIRED DISCLOSURE CONSTITUTES GROUNDS FOR AND MAY BE PUNISHED BY ONE OR MORE OF THE FOLLOWING: IMPEACHMENT, REMOVAL OR SUSPENSION FROM OFFICE OR EMPLOYMENT. DEMOTION, REDUCTION IN SALARY. REPRIMAND, OR A CIVIL PENALTY NOT TO EXCEED S5;000. ' _E FORM 8B-10.91 w Fps PAGE 2 E' Attorney Reynolds advised that Commissioner Scurlock, as an individual, can discuss it as any individual can in this meeting. Commissioner Eggert understood then that theoretically he should leave here and go out into the audience and talk to us from the microphone, and Mr. Reynolds responded that, theoretically, that is correct. Commissioner Scurlock understood that he would excuse himself from voting, withdraw from the Board because of the conflict, go out into the audience and address the Board as Doug Scurlock, individual. Attorney Collins concurred with Attorney Reynolds as he felt there is a clear possibility of a conflict if Mr. Scurlock was to vote on the proposed settlement. He also felt that since Mr_ Scurlock has some individual potential liability, he should have his attorney present. He assumed that Mr. Scurlock notified his attorney of the possibility of a meeting this morning. Attorney Reynolds repeated that at mediation, the Scurlock matter was left to its own separate area, and he felt it is in the best interest of the Board to resolve everything at once, but not necessarily everything hinged. In essence, we can agree to send the letter, let Guettler out and us walk, as one vote, but have a separate vote to recommend that we settle to walk away from Doug Scurlock, individually, and he walk away from us. That is only a proposal that Mr. Scurlock would then take to his attorney in his individual capacity. It would not be binding on us here today. Chairman Eggert understood then that if we followed through and accepted this and each pay our own attorneys' fees, Mr. Scurlock can take that away and come back at another public meeting and say that he doesn't agree with that exactly. Attorney Reynolds stated that is correct. Commissioner Scurlock felt he would like to be heard on it in some format. W J U N 2 9 1992 Chairman Eggert understood that Attorney Reynolds is saying that he shouldn't necessarily be heard on it today because his attorney is not here, but Attorney Reynolds pointed out that whether Mr. Scurlock's attorney is here or not doesn't really matter. We are not entering into a binding settlement with Don Scurlock here today; we are simply taking a vote on a recommendation of an offer of settlement. His recommendation is to offer Mr. Scurlock the opportunity to walk away, and if he says no, we have no settlement. Attorney Reynolds advised that before we go a step further, we should excuse Commissioner Scurlock from the Commission temporarily so he could speak to the Board as an individual. Chairman Eggert asked Commissioner Scurlock if he wanted to appear before the Board as an individual now, and Commissioner Scurlock answered affirmatively. Chairman Eggert asked Commissioner Scurlock if he wanted to call his attorney, and Mr. Scurlock replied that he did not because he was not going to make it any more complicated than it has to be. Commissioner Wheeler had a problem with us spending public funds for mediation. He was getting the impression that the information between Mr. Scurlock, Guettler and Prince being held as secret or private has some bearing on what will occur or not based on what we do as a Board. He wondered where we would draw the line, because if their agreement is contingent on what we do here, he didn't know how part of that can be kept private and part of it made public. He asked for clarification. Attorney Reynolds explained that the mediation was by court order. Irrespective of how much specific time the individual entity spends with the mediator, you have to have legal representation there and authority to settle the case. We were a small part because, as far as we were concerned, we were not going to pay a dime on behalf of Indian River County to settle this case. We do not see where Indian River County has done anything wrong. 14 _I - M The three individuals' agreement to settle the case has no bearing on Indian River County whatsoever. The only question was whether or not Mr. Prince in resolving this case could obtain a statement from Indian River County relative to his company being qualified for this particular job. That's all. There is no other contingency associated with the settlement. We are not paying a dime; we are sending an acknowledgment letter of what we have been saying all along, and that's it. Commissioner Wheeler understood that the County has incurred $35,000 in legal fees so far and that we have no avenue to recoup those legal fees. Attorney Reynolds stated that is correct, but every time Indian River County is sued, whether it's an auto accident, a slip and fall, or a conflict of interest, they pay attorney's fees. That's a fact, and those fees cannot be recouped from the suing party. The reason Indian River County has incurred $35,000 in attorney's fees is that Prince Contracting chose to sue Indian River County, and the fees and costs involved are a part of doing business as a government entity. The fact that there might be a derivative claim means you might have a chance at attorney's fees; it is a possibility, but not a probability. Indian River County was sued and had to defend themselves. Attorney Reynolds recalled that it was the defense of this case that brought Guettler in. As the County's counsel, he filed a motion to dismiss the original suit by Prince against Indian River County because they failed to bring in Guettler, who he believed is an indispensable party to this action because they are the ones who were awarded the contract. Basically, for the $35,000 in attorney's fees incurred, the County has an offset by the defense having brought in the indispensable party, Guettler, through defensive motions, to pay whatever is necessary to make this go away. At the present time, you have a wash or are ahead of where you started when Prince brought their original suit, and your defense in this case has 15 JUN 2 91992 JUN 2 91992 brought in the party and brought the parties in a position where they are going to resolve it for whatever amount of money, if any amount of money, such that Indian River County will not contribute nickel one to this settlement. That is a victorv. What hannpnc ;a that you don't throw good money after bad by continuing to pay another $35,000 to pursue a derivative claim. As the County's counsel, he advised that he has found no evidence to support the allegation of a conflict at the time of the vote. Chairman Eggert understood that we can do all of this if Guettler, Scurlock and Prince don't settle. Attorney Reynolds explained that if Prince and Guettler and Scurlock don't individually work out whatever it is they work out, we're proceeding with the defense of the case and to trial. He reminded the Board of the t; mp f ramp n i vor, ..; „m i i .. i... plaintiff's counsel of 5 o'clock P.M. today. If that's acceptable, we have done our part to cross our t's, dot our i's, and if they don't and it falls apart, then so be it. Attorney Reynolds believed the hearing is set for 2 o'clock P.M. tomorrow, but the depositions may even be earlier. He was not certain because a lot has been set very quickly. Commissioner Wheeler assumed that covers all the parties. referred to in the first paragraph, and Chairman Eggert responded that it is the County, Prince, Guettler, Scurlock, and Dennis Smith who we haven't even mentioned. Attorney Reynolds advised that Dennis Smith is a plaintiff against the County and doesn't need to be mentioned. He is being represented by Prince's attorneys and has given his deposition in the case and has no financial involvement by way of the attorney fee issue with Prince. Commissioner Wheeler still wasn't clear on how you would separate it. Commissioner Bird understood that each party has to do what is requested of them, and the thing being requested of the County is 16 M to approve this letter. Apparently, any monetary negotiations that are being agreed to by the other parties are not a part of that. Attorney Reynolds explained that the Board only is voting to authorize the Chairman to send this letter if the case settles; if it doesn't settle, this doesn't go anywhere. Attorney Collins was a little concerned because saying that if the case goes forward, this letter goes nowhere, could be construed as an admission against interest by the County if the case does not settle. Attorney Reynolds advised that Prince's letter is only for purposes of settlement and any discussions or documentation under the rules of evidence associated with settlement discussions are not admissible in court. Attorney Collins noted that Prince is speaking for the other plaintiff, Dennis Smith, and should the case settle, if would be settled as to Dennis Smith vs. Indian River County as well. _ Attorney Reynolds stated that is absolutely correct. Attorney Collins felt he had to advise the Board of County Commissioners that the reason he felt Mr. Scurlock should not participate in the vote whereby the County Commission decides whether or not to enter into this settlement agreement is that by settling, the settlement could inure to the benefit of Mr. Scurlock in that he has the potential claim for attorney's fees against the County in the future. The settlement could leave him an opportunity to claim against the County, and he believed Mr. Scurlock should not vote on it as it could be to his own benefit. That's the nature of the voting conflict he felt Mr. Scurlock should declare. Attorney Reynolds stated that is the basis upon which he is making the recommendation to the Board. At this time his recommendation is for Mr. Scurlock to walk away and the County to walk away; we've had attorney's fees, he's had attorney's fees and participated in whatever manner with regard to the resolution of 17 BOOK G" JUN 91992 FF- the individual claims. He further recommended that Mr. Scurlock not waste his money chasing after us, and the County not waste their money chasing after him. But to that end, he would like to make that recommendation a part of the settlement package because we don't want to have an indemnification clause left pending against Commissioner Scurlock. You don't want him coming in at a later time and asking you to pay his attorney's fees. That would incur more attorney's fees for the County in prosecuting that matter, as well as potential attorney's fees in defending the matter. Chairman Eggert understood we're saying to Guettler, and therefore to Mr. Scurlock, that we will release his indemnity clause or whatever it is, in exchange for his not pursuing any legal fees from us. Attorney Reynolds stated that Guettler has no basis for attorney's fees from us. Commissioner Bird asked if that can be a separate issue and not part of the vote. Attorney Reynolds advised that it can be a separate issue, but his recommendation to the Board is that we ought to take care of everything now and be in a position to settle it or not settle it. The latest indications from Guettler and Prince is that they are close and should be able to close this out, which is why we were given the time frame. Attorney Reynolds repeated that his advice is to close this out, cut the bleeding, and stop the attorney's fees from all sides before we get into the trial mode. Chairman Eggert understood then that either we hold the indemnity claim against Mr. Scurlock or we release it in exchange for not paying him for any legal fees and his not claiming any legal fees from us. Attorney Collins felt that is what it boils down to. Attorney Reynolds is here asking for the Board to authorize the signature of this letter to settle the case with Smith and Prince, and he'll 18 M M take that letter to the settlement meeting. Attorney Reynolds is also requesting that the Board authorize him to settle the cross- claim against Mr. Scurlock for attorney's fees if Mr. Scurlock agrees to drop any potential claims he has against the County. If Mr. Scurlock, upon advice of his counsel, chooses not to, then the matter could come back for further negotiation on that point or to trial. Attorney Reynolds confirmed that we could take Mr. Scurlock to trial, and as he had advised earlier, we would take over in essence the role of Prince where we would then begin our digging process to find out if there is an indemnification or basis for that claim. Again, as Attorney Collins has pointed out, there is the fact that a settlement between Prince and Scurlock does open up that question about Mr. Scurlock's legal fees. We need to discuss that now, and make a decision now. We need to be aware that if we settle this, Mr. Scurlock's attorney's fees could be a potential claim back against the County. Attorney Reynolds stated that his position on this would be that his attorney's fees should be minimal up to this point due to the defense of the County by himself in representing all of the Commissioners in their official capacity. That defense has inured to the benefit of Commissioner Scurlock to the point that his attorney, Robert Stone, has been able to take a less active role in his defense and his billing rate for this particular claim probably would be minimal at this point. Attorney Reynolds felt it is in everyone's best interest to settle this case now. Chairman Eggert asked if Attorney Reynolds had filed a cross- claim for attorney's fees against Prince or any other party other than Mr. Scurlock. Attorney Reynolds advised that he did file a cross-claim in the answer asking for attorney's fees back against Prince primarily on the theory that if the courts held they're entitled to attorney's fees, we should be as well. However, it is not a formal counter -claim per se. In addition, we did follow the cross-claim 19 300K '0 F", C L ej JUN 2 9 W2 BOOK c'G PA�r y against Guettler. With everybody having claims for attorney's fees back against everyone else, the best thing to do, in his opinion, is for everyone to walk away. Commissioner Bird agreed and planned to make a motion along those lines at the proper time. Chairman Eggert recognized Mr. Scurlock speaking as an individual. Don C. Scurlock, Jr., felt Attorney Reynolds is absolutely correct that we need to get on about our business and that we have spent enough time on this. We spent from 9:30 in the morning to 9 o'clock in the evening trying to mediate this and we were all in different rooms. He had no idea what Guettler's proposal is or isn't, nor did he assume Guettler knows his. We were all separate, and the Mediator goes from place to place. Mr. Scurlock was willing to settle this thing today, and also willing to settle whether the County pays his attorney's fees or not, but he would ask that the Board consider that Attorney Reynolds has indicated that in four and one-half months, they haven't found the first bit of evidence that, in fact, on the day of that vote he had a conflict. His attorney's fees are $5,000, and that is what he would request the Commission to pay him. He noted that this is the second time that the County has had one of these situations. He and Utilities Director Terry Pinto were involved a few years ago with a frivolous suit, in his opinion, and in that case Mr. Stone's attorney's fees of $25,000 were paid by the County. Mr. Scurlock pointed out that as individuals, the Commissioners can be sued at any time on any of their actions; in fact, he understood that Mr. Fred Mensing has filed action against the Board. Attorney Reynolds has stated that he looked for four and one-half months and has found no concrete evidence of a conflict, and that should be given due consideration because $5,000 is not a lot of money. Mr. Scurlock stated that he would settle, regardless, because that is how important he thinks it is for the County to get on about its 20 business. However, he would request that the Board seriously consider paying $5,000 to him because he has incurred these costs as a member of this Board. He pointed out that if he wasn't there, he would never have been in this litigation, and neither would the other Commissioners. He would respectfully request, not demand, that the $5,000 be paid as it means a lot to him. Chairman Eggert noted for the record that she received a letter from Mr. Mensing saying he was going to file, but she didn't think we have seen anything formal yet. Commissioner Scurlock felt that Attorney Stone has worked very hard; he's had a little criticism because he hasn't been so active, but he's tried to keep the bill down and he did that on purpose. Commissioner Scurlock felt $5,000 is reasonable. Attorney Reynolds wished to state for the record that in his recommendation he never intended to insult Mr. Stone with regard to his participation. He was actually patting him on the -back for his intelligence and insight in realizing that I could represent the County more than adequately in this case and at the same time keep down his attorney's fees which were a potential claim against the County. Attorney Reynolds recommended that the County not pay Mr. Stone any attorney's fees whatsoever. As Commissioner Wheeler has pointed out, the County has had to defend itself in this case to the tune of $35,000 or more, and if any taxpayer asks, they can be assured that Prince has paid substantially more in attorney's fees than the County. Be that as it may, he believed the City of Ocoee relationship, the continuous statements, braggadocios or otherwise, to members of the County staff and to members of this Commission, and made in the Minutes of this Commission by Mr.Scurlock relative to a relationship with Guettler, may or may not have led to the bringing of this lawsuit. Obviously, there is a difference between the legal criteria upon which he would defend the County in this case, which is that there is no proof that there was a conflict on the day of the vote. However, this Commission is well aware of the 21 a00K; �- CU ii JU11 2 9 1992 POOK 41 allegations and the indication of a past relationship that has been conceded to the Court already in the temporary injunction hearing. For that reason, the fact that the Commission from the appearance of a past claim or a relationship between Guettler and Scurlock has paid $35,000 or more in defense of the County in this action in trying to go forward with its golf course and trying to protect the revenue bond, he would say to Commissioner Scurlock the same thing that we said to Prince and the same thing we said to Guettler, which is, we, in our official capacity, did not do anything wrong and we are not paying one dime. So, the representation that I have done extensive research and found no conflict on the day of the vote is not completely accurate; I have not been charged with the duty, as yet, to prove Commissioner Scurlock had a conflict on the day of the vote. That would only arise should Commissioner Scurlock choose to pursue his attorney's fees and the Commission choose to pursue their attorney's fees against him, which would not be in the best interest of either party. His representation to the Board is that Prince, in four and one-half months has not found, in essence, the smoking gun on the day of the vote, but we are all well aware of the past relationships that are a matter of public record, that were alleged by Prince and brought as the basis for. this particular claim. For that reason, he felt it is in Mr.Scurlock's best interest and this Commission's best interest for each to walk away from the attorney's fee claim; he didn't think that Indian River County should pay nickel one to any entity, be it Prince, Guettler, Smith or Scurlock. Chairman Eggert felt part of her frustration with this is after coming from a totally innocent position and having voted for Prince in the first place, finding herself paying to talk to outside attorneys about several situations throughout this thing. She would have a hard time paying legal fees to Mr. Scurlock on that basis. 22 - M M Commissioner Bird felt we are getting very sound legal advice from our counsel who has stated our position very eloquently and thoroughly. Commissioner Bird felt we should accept that advice and resolve this matter here and today. MOTION WAS MADE by Commissioner Bird, SECONDED by Commissioner Wheeler, that the Chairman be authorized to sign the letter to Prince Contracting Co., Inc. that has been presented to us as our portion of the settlement in the mediation process, and direct that the County take care of our legal fees up to this point on this matter and that Commissioner Scurlock take care of his own personal legal fees and anyone else involved. Under discussion, Chairman Eggert assumed that the Motion means that the letter will be signed as soon as the lawsuit is indeed dismissed and everybody has come to an agreement. Attorney Reynolds stated that is correct. It would be his intention that if the Board so votes today, to advise plaintiff's counsel, Mr. Lawrence, that our portion is done as it would relate to Prince and Guettler and that we have a pending recommendation as it would relate to Mr. Scurlock individually. At that point, if they say we have a go, then we're done, but if they say we have a no go, then we have a trial. THE CHAIRMAN CALLED FOR THE QUESTION. The Motion carried 4-0, Commissioner Scurlock having filed a conflict of interest. 23 Ft1i,c %?rclc J U N 29 1 I IU 9 1992 BOOK 85 F'A�E 64- There being no further business, on Motion duly made, seconded and carried, the Board adjourned at 10:45 o'clock A.M. Verbatim transcript o this meetin was transcribed by: Ange,4 Waterhouse, Deputy Clerk Verbatim transcript of this meeti was edited and condensed by:v�fn-� 'Barbara Bonnah, Deputy Clerk ATTEST: J.K. Barton, Clerk --------- -1�-= Carolyn Eggert, Ch - airman 24 _I