BY LINDA BENTLEY | FEBRUARY 5, 2014
Council rejects Freeman settlement agreement
He said the underlying question is whether Freeman, as an easement holder, can preclude the underlying landowner from using the easement
CAVE CREEK – With no one wishing to speak during Call to the Public, Monday night’s council meeting began with the town manager’s report.
Interim Town Manager Rodney Glassman told council about a new program to welcome new businesses to the town put together by Community Outreach Director Patty Pollnow.
Glassman announced the move-in date for the consolidated court is slated for March 21.
He passed out a copy of a memo from Finance Director Robert Weddigen which was not made available to the public.
After visiting with Town Engineer Wayne Anderson, Glassman said he was told the town is repairing the lights at the rodeo grounds.
Glassman told council new Utilities Manager David Prinzhorn, who introduced himself to council and then to the homeowners at Las Ventanas immediately after they spoke during Call to the Public in January to complain about odors from the wastewater treatment plant, already has corrective action in the works.
Last, Glassman spoke to the new Town Manager Peter Jankowski, whom he said was in his car driving cross country and would be here on Monday.
The first item on the agenda was the settlement agreement between Gerald Freeman, the town and Cahava Springs, which was continued from last week’s special meeting in order to obtain a legal opinion as to whether the agreement violated other pre-annexation/development agreements from 1997.
Town Attorney Gary Birnbaum (r) told council his law firm was not involved in the annexation agreements as Mariscal Weeks hadn’t arrived on the scene until 1999.
However, he reviewed the agreement and gave an overview of portions of the agreement that could be affected by the settlement agreement with Freeman.
He pointed out Mariscal Weeks, now Dickenson Wright, is not the law firm representing the town in the Freeman litigation, and the town turned it over to the risk pool to handle.
However, according to Birnbaum, the case is not costing the town anything and is covered by the town’s insurance.
He said there are two ways the court could look at the annexation agreement, plain language when it is unambiguous, or if the language of a contract is subject to two or more interpretations the court will look at evidence testimony to determine the original intent by the people who negotiated it.
Birnbaum said the question was whether the settlement agreement violated any of the annexation agreements.
He said the settlement agreement could “arguably” violate the 1997 annexation agreement.
However, he said if the court decides the agreement doesn’t create a continuous roadway, then the agreement does not violate the 1997 agreement.
“What a court would do?” asked Birnbaum, “I have no idea.”
He pointed out another section of the annexation agreement containing an exception clause if the town finds there are health and safety concerns.
Birnbaum said the town has the right to determine, based on plain language, that the Freeman agreement violates the annexation agreement.
On the other hand, he said council could choose to approve the agreement and possibly subject itself to new litigation.
He said the underlying question is whether Freeman, as an easement holder, can preclude the underlying landowner from using the easement.
Birnbaum said the town could presume Freeman, as an easement holder, cannot interfere with the fee land holder from utilizing his own land so long as it doesn’t interfere with Freeman’s access to his property.
According to Birnbaum, if there are no damages, the most the town would be liable for in defense costs is $18,750.
He said, “So far, defense costs are covered entirely by the risk pool. Based solely on my experience, a claim of this size is highly unlikely to have any impact on the town.”
Mayor Vincent Francia allowed the public to ask questions, while reserving time to comment later.
Jannell Smith-Haff questioned whose rights were superior, the easement holder or the landowner.
Birnbaum responded, “So long as the owner’s use doesn’t unreasonably interfere with the easement holder’s rights,” the owner could have use of the property.
Smith-Haff asked what was in place to prevent connections to the west side of town.
Planning Director Ian Cordwell explained the town was gifted 80 acres for open space by Cahava Springs which precluded any thoroughfare.
Janet Mohr said it sounded as though the basis of Freeman’s lawsuit was him not wanting a horse easement on someone else’s property.
Korina Riggin asked if the town approved the settlement agreement and if she owned the property to the south of Freeman could she put in a trail on her property.
Birnbaum said she could, adding, “If I’m the judge, you’re correct. But you can’t stop him or anyone else from asserting a claim. Will he win? I don’t think so.”
During public comment, Attorney Grady Gammage, Jr. of Gammage & Burnham law firm, representing Cahava Springs, said there were 11 lots with 10 on the west side of Cave Creek Wash and 1 on the east.
He said, according to the subdivision ordinance, any subdivision with eight or more lots requires two points of access and must be accessed from a public roadway and stated Cahava was working to obtain legal access.
Gammage also stated a trail does not violate the annexation agreement, only vehicular access.
He said the settlement agreement could be modified in a manner that does not violate the annexation agreement.
He said they were looking at access along 48th Street.
Smith-Haff said there were other provisions in the settlement agreement that would violate the annexation agreement and asked council to let a court decide.
Terry Smith stated his concern has always been with trails and unless provision one in the settlement agreement was eliminated, he would prefer a court decide.
He said the problem with the agreement is that it ends at 48th Street, leaving the town with a trail to nowhere.
And because of the wording stating the town “not allow” a trail, even if people rode their horses through the area without the town’s approval, it opens the town up to another lawsuit by Freeman.
Smith asked council not to approve the settlement agreement since the town is not paying anything for the current litigation.
Luke Rosen said he didn’t understand why the town was being held hostage by one man and stated, “It doesn’t make sense.”
Shelley Anderson said the town should not be subject to someone’s lifetime in order to have a trail.
She said, “This does not in any way serve the interests of our town.”
Steve LaMar said the best they could hope for by entering into the settlement agreement is further litigation.
He said, “This agreement should have never been considered. It’s unthinkable that the town would abdicate its responsibility to develop trails to Mr. Freeman. He’s the biggest enemy to open space.”
LaMar asked, “What has Mr. Freeman done for the town?”
He told council if they had any conscience at all they would set aside their personal feelings and reject the agreement.
Mark Stapp, managing member of Cahava Springs, told citizens he is committed to resolving the matter with the town in a manner that does not create further litigation.
He also addressed Smith-Haff’s concern by stating he has “zero interest” in connecting the 230-home Cahava Springs development to the east side of town and wanted to put to rest the rumor that it would allow traffic from Anthem.
Bruce Arlen said he was there to defend Freeman but Francia stopped him and said they were there to discuss the settlement agreement.
Everett Bell said, “Clearly a method has to be found to have trail access,” adding he didn’t want the town to come into another lawsuit.
He urged a continuing effort to find a way to have a trail without conflict.
Birnbaum suggested council not enter into the settlement agreement as written and recommended revisions so the town could put a trail in now, not put a roadway in and allow plat approval by development agreement to allow exceptions to the subdivision ordinance for Cahava Springs access.
Councilman Ernie Bunch moved to approve the agreement for discussion purposes only, stating, “There’s no way I can support the thing as written. If it were just me, I’d let it go straight to a judge. I don’t think it has any merit.”
Councilman Mike Durkin, who seconded the motion, said, “If we agree, we don’t get a trail and we get sued by the annexation people.”
He said he spoke to Freeman who told him he didn’t mind if they put a road in but doesn’t want a trail under any circumstances.
Councilman Thomas McGuire said the issue was near and dear to him and there were a great many assumptions.
He stated it was not clear the town would have access to the state land on the west and the best way is to have a planned trail.
Councilman Charles Spitzer said, “Contrary to popular belief, Mr. Freeman has property rights. One way or another we’re getting sued.”
Vice Mayor Adam Trenk, who urged approval of the settlement agreement during last week’s meeting said citizens want a trail as soon as possible and he couldn’t support the agreement as written, calling it a “mess.”
Council voted unanimously to reject the agreement and Francia asked Birnbaum to work with the new town manager when he arrives to revise the agreement.