City Faces $6.7 Million Jury Award - Legal Disaster?

After a four year legal battle with the City of San Juan Capistrano, on Tuesday June 1, 2010, a jury awarded $6,768,000 in compensation to the Scalzo Family Trust for the city’s illegal imposition of development conditions on the Trust’s proposed residential subdivision.

This is a disastrous result that we should all hope is somehow overturned. But after such a jury award, the prospect for relief is remote. Still, it is likely that the City will first ask the trial judge to set aside the verdict. If that doesn't work, then they will certainly appeal the case.

In the political dimension, this situation shows that the City is being poorly advised on legal matters. The fact that this matter got to an actual trial by jury suggests that on numerous occasions the City Council was assured by its attorney that the City would prevail. Obviously, that advice was wrong.

The failure is on two levels. The City's choice of legal representation should be reviewed. But more importantly, the City Council as a whole is responsible to voters for this result because it failed to exercise oversight that might have kept this matter out of court and away from a jury in the first place.

The City Council is collectively to blame. It is impossible to know whether the decision not to settle but instead submit the matter to trial was the position of every City Council member because this entire matter was handled in closed session and the strategy and votes will never be revealed to the public. It is therefore a collective Council decision, along with the selection of the attorney who represented the City.

San Juan Capistrano has a deserved reputation for being capricious in its demands on those who would seek to develop their property or start a business within the town. This is the bitter result -- an uninsured loss of $6.7 million, plus attorney's fees, plus the City's own attorney's fees, plus the fact that the property remains undeveloped yet today.

Will the City learn from this result? Only if there is outrage among the voters in November!


Anonymous said...

Whoever wrote this article is very astute. It makes no sense that the City would have allowed itself to be lead around for years by its attorneys. I believe that the attorneys for the City not only were wrong in allowing things to get this far, I believe that they were to blame for giving the City Council repeated advice for years. Their bad advice allowed the firm of Woodruff, Spradlin & Smart to make hundreds of thousands if not millions of dollars at the end of the City Council and the taxpayers. If their legal advice was not sound, or worse, if they gave bad advice which now seems to be the case, I think they should be asked to refund the money that they charged the City. Does the word 'malpractice case' seem too far fetched?

Anonymous said...

It may be unfair to blame the present City Council for the entire thing, since I think they were probably relying on the legal advice they were given. One thing that I completely agree with is that the present Council should bear responsibility for allowing the case to go to trial. Now they are talking appeal? Oh that makes a lot of sense. The verdict will probably be increased by a huge amount for the plaintiff's attorney bills, and then have the City spend lots more dough on an appeal which has little chance of success. The City will also have to pay interest of maybe half a million or more each year on top of everything. Does it really make sense to allow this City's Attorneys to keep billing the City at a furious pace, when the case has already been lost? I think not.

Anonymous said...

Isn't using the city attorney's law firm to represent the city a conflict of interest?

Seems to me that the law firm "wins" even if the city loses. Which is why I'd like the council to tell us citizens who recommended they take this one to court.

Anonymous said...

I have dealt with the city attorney on many occasions and he has the be the worst attorney I have ever dealt with. He tells the city whatever they want to hear and allows them to violate the law. I have personally challenged and won against the city 3 times. Each time the city attorney told the City they had the legal high ground when clearly they didn't. My lawyer was amazed at the incompetence when I consulted with him on these issues.

Anonymous said...

It seems a lot of people are placing blame for this matter going to court on everyone except the Scalzo group. Had they (Scalzo) been willing to compromise on the issues that led to a jury trial a long time ago we would not be faced with this matter. So before you place blame look at the history of the entire process and talk to others who can provide background information. Also maybe take a look at the people behind all the law suits that have been filed in regard to this development.

Anonymous said...

Whoever it is that wrote "It seems a lot of people are placing blame for this matter going to court on everyone except the Scalzo group." ...doesn't know their back end from their front!

They obviously don't know or understand what the case was all about. Shame on them for talking about something they have no clue.

Do they really think the Jury fell off a turnip truck or something? They must have had hard facts in front of them for an inverse land-use case. So whoever, whomever is, could have at the least found out what they were talking about before giving such an ignorant statement.

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