Rancho Palos Verdes City Council
   

JANUARY 17, 2006 ACCEPTANCE OF PUBLIC TRAIL EASEMENTS, REVISED GRANT DEEDS FOR FOUNDER'S PARK AND NON-GOLF-SETBACK AREA, INDEMNITY AGREEMENTS, AND RELEASE AGREEMENT (TRUMP NATIONAL GOLF CLUB PROJECT) JANUARY 17, 2006 ACCEPTANCE OF PUBLIC TRAIL EASEMENTS, REVISED GRANT DEEDS FOR FOUNDER'S PARK AND NON-GOLF-SETBACK AREA, INDEMNITY AGREEMENTS, AND RELEASE AGREEMENT (TRUMP NATIONAL GOLF CLUB PROJECT) JANUARY 17, 2006 ACCEPTANCE OF PUBLIC TRAIL EASEMENTS, REVISED GRANT DEEDS FOR FOUNDER'S PARK AND NON-GOLF-SETBACK AREA, INDEMNITY AGREEMENTS, AND RELEASE AGREEMENT (TRUMP NATIONAL GOLF CLUB PROJECT)

TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL

FROM: DIRECTOR OF PLANNING, BUILDING & CODE ENFORCEMENT

DATE: JANUARY 17, 2006

SUBJECT: ACCEPTANCE OF PUBLIC TRAIL EASEMENTS, REVISED GRANT DEEDS FOR FOUNDER'S PARK AND NON-GOLF-SETBACK AREA, INDEMNITY AGREEMENTS, AND RELEASE AGREEMENT (TRUMP NATIONAL GOLF CLUB PROJECT)

Staff Coordinator: Gregory Pfost, AICP, Deputy Planning Director

RECOMMENDATION

That the City Council: 1) adopt Resolution No. 2006-__, accepting certain public trail easements, Founder's Park, "Non-Golf Setback Area" and public open space lots within the Trump National Golf Club project; 2) authorize the Mayor and City Clerk to execute the Indemnity Agreement and Easement Deed between the City and V.H. Property Corporation pertaining to the City's acceptance of certain "Public Trail Easements"; 3) authorize the Mayor and City Clerk to execute the revised Indemnity Agreement between the City and V.H. Property Corporation pertaining to the City's acceptance of "Founder's Park" and the "Non-Golf Setback Area", and 4) authorize the Mayor and City Clerk to execute the Release Agreement between the City and V.H. Property Corporation.

EXECUTIVE SUMMARY

At the December 20, 2005 Council meeting, the Council conditionally approved the temporary opening of the 18-hole golf course pending the Developer's completion of certain conditions and approval for opening from the California Coastal Commission. Additionally, the Council continued the acceptance of public trails to the January 17, 2006 Council meeting, as the Coastal Commission Staff was not satisfied with the content of the acceptance documents. According to the Developer, the Coastal Commission Staff is now satisfied with the content of the documents and therefore Staff is recommending that the Council accept the subject trails. If the Council accepts the trails, this will take the Developer one step closer to opening the 18-hole golf course.

Additionally, while the Council has previously taken action to accept certain lots (Founder's Park, "Non-Golf Setback Area", and open space lots in Tract No. 50667) as well as an Indemnity Agreement covering such lots, after the Council's action, Trump's attorney in New York wanted to add a provision to the Indemnity Agreement so that it would be a covenant running with the land. Staff has no objection to that new provision and wants all of the documents to be as similar as possible. Accordingly, Staff is bringing all of the documents back for approval at once so that all the documents regarding the park, the non-golf setback and the trails will be approved at the same time and will have consistent provisions.

BACKGROUND

In June 1992, the City Council approved the Ocean Trails project, which, at that time, included an 18-hole golf course, public open space and 83 single-family residential lots. Since June 1992, the project has been revised several times. The project as currently entitled includes an 18-hole golf course, 59 single-family residential lots, 4 on-site affordable housing units, a Clubhouse, Maintenance Building, open space lots, and a variety of public amenities. The entire project site is comprised of two tracts; Tract No. 50667, which is a recorded tract, and Tract No. 50666, which is still a Vesting Tentative Tract.

DISCUSSION

When this project was approved in the early 1990's, the City and California Coastal Commission granted separate approvals. Upon approval, each agency adopted its own set of conditions of approval. While most of the City's conditions mirror the Coastal Commission's conditions, some do not. Specifically related to this agenda item, the City's conditions of approval for each Tract require that the developer dedicate trail easements to the City at the time that the Final Map is recorded. However, the Coastal Commission conditions require that certain trail easements within Vesting Tentative Tract Map No. 50666 be dedicated and accepted prior to the opening of the 18-hole golf course. This milestone is earlier than what the City's condition requires - at the time the Final Map is recorded. On December 20, 2005, when the Council considered and approved Revision "Y" to allow the temporary opening of the 18-hole golf course, Staff reported that the Council could not yet accept these trail easements because the Coastal Commission Staff had concerns regarding the content of the acceptance documents that had not entirely been worked out. Since then, according to the Applicant the outstanding issues have been resolved and therefore the Applicant is now requesting the City's acceptance of these specific trail easements so that the Applicant can move closer to temporarily opening the 18-hole golf course as approved by the Council on December 20th.

In a May 1995 Settlement Agreement between the Sierra Club, various other private parties, the developer and the City, the City agreed to accept dedication of the various open space lots throughout the project. On August 31, 2004, in association with the acceptance of certain open space lots (Lots D, E, G, I, and K of Tract No. 50667), the City Council approved an Indemnity Agreement between the two parties. The Council may recall that the Agreement requires the current Developer and any successive owner of the golf course to defend, indemnify and hold the City and its representatives harmless from any Claims that the City incurs due to its ownership of these specific open space lots (i) to rebuild or repair the open space lots in the event of a slope failure and (ii) to pay compensation or other monetary damages for failure to rebuild or repair the open space lots following a slope failure. This Indemnity Agreement has been recorded.

As part of the Settlement Agreement, the Developer is required to dedicate and the City accept an additional open space lot known as the "Non-Golf Setback Area". Additionally, the Coastal Commission requires that the Developer dedicate and the City accept Founder's Park prior to the opening of the 18-hole golf course. On August 16, 2005, the City Council accepted Grant Deeds for both the "Non-Golf Setback Area" and Founder's Park, as well as entered into a separate Indemnity Agreement for these two areas. These documents have not yet been recorded because after the Council took action at their August 16th meeting, Trump's attorney in New York wanted to add a provision about the covenant running with the land. Staff has no objection to that provision and wants all of the documents to be as similar as possible. Accordingly, Staff is bringing all of the documents back for approval at once so that all the documents regarding the park, the non-golf setback and the trails will be approved at the same time and will have consistent provisions. It is also important to bring them all back for Council approval because the indemnity and release documents contain references to the other indemnifications and this action will now make them all consistent with each other - avoiding an argument later that one negated the other.

The Coastal Commission requires the City to accept certain trails and Founder's Park prior to the opening of the 18-hole golf course. Furthermore, the Settlement Agreement requires the City to accept the "Non-Golf Setback Area" and Lots G, I and K, all of which are located in Tract No. 50667. Additionally, the conditions of approval for the Ocean Trails project require the developer to dedicate Lots D and E in Tract No. 50667. All of these public open spaces and trails are now ready to be accepted.

ADDITIONAL INFORMATION

In the future, the City will also be required to accept various open space lots within Vesting Tentative Tract Map No. 50666, along with an Indemnity Agreement covering those lots. This will occur once Tract No. 50666 has been recorded.

Status of Temporary Opening of the 18-hole Golf Course:

As reported at the December 20, 2005 Council meeting, while the Council authorized the temporary opening of the 18-hole golf course, the first day of the 3-month temporary opening period will not begin until the three City conditions, which were requested by the City's Geologist and the City's Lake Consultant, have been satisfied by the Applicant, and the Coastal Commission Staff has verified that the Coastal Commission's outstanding conditions of approval have been addressed, including trail sign installation, habitat installation, the City acceptance of Founder's Park and the City's acceptance of public trails. If the Council accepts the documents at tonight's meeting, two of the Coastal Commission conditions will be satisfied (once the documents have been recorded). The Developer has indicated to Staff that they are in the process of satisfying the 3 City conditions. Staff estimates that all of the City and Coastal Commission conditions could be addressed within the next 2-4 weeks resulting in a potential temporary opening during the month of January or February.

FISCAL IMPACT

There are no fiscal impacts associated with this decision as the Developer is required to maintain the public trails, parks and open space lots and the Agreement has been designed to protect the City and its representatives in the event of a slope failure.

Respectfully submitted:

Joel Rojas, AICP
Director of Planning, Building and Code Enforcement

Reviewed By:

Les Evans
City Manager

ATTACHMENT

Resolution No. 2006-__
Grant Deed for "Ocean Trails Park" and the "Non Golf Setback Area"
Easement Deed for Public Trails
Indemnity Agreement for Ocean Trails Park and "Non-Golf Setback Area"
Indemnity Agreement for Public Trails
Release Agreement
Exhibit of Lots to be Accepted

RESOLUTION NO. 2006-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES AUTHORIZING THE CITY MANAGER TO 1) ACCEPT A GRANT DEED DEDICATING TO THE CITY REAL PROPERTY KNOWN AS THE "ADDITIONAL NON-GOLF SETBACK" WITHIN TRACT MAP NO. 50667, AND 2) ACCEPT A GRANT DEED DEDICATING TO THE CITY REAL PROPERTY KNOWN AS "FOUNDER'S PARK" WITHIN VESTING TENTATIVE TRACT MAP NO. 50666, AND 3) ACCEPT AN "EASEMENT DEED" FOR PUBLIC TRAILS WITHIN VESTING TENTATIVE TRACT MAP NO. 50666, AND 4) ACCEPTING LOTS D, E, G, I AND K OF TRACT NO. 50667 FOR PUBLIC OPEN SPACE AND LOT I AS A LATERAL PUBLIC ACCESS EASEMENT.

WHEREAS, on June 1, 1992, the City Council of the City of Rancho Palos Verdes adopted Resolution No. 92-53, certifying Environmental Impact Report No. 36 and adopted Resolution Nos. 92-54, 92-55, 92-56 and 92-57, respectively approving Vesting Tentative Tract Map Nos. 50666 and 50667, Tentative Parcel Map Nos. 20970 and 23004, Conditional Use Permit Nos. 162 and 163, Coastal Permit No. 103 and Grading Permit No. 1541 for a Residential Planned Development consisting of a total of eighty-three (83) single family dwelling units, an 18 hole public golf course and public open space on 261.4 acres in Coastal Subregion Nos. 7 and 8; and,

WHEREAS, on August 12, 1992, after finding that an appeal of the City's approval of the project raised substantial issue, the California Coastal Commission denied Coastal Permit No. 103, directed the landowners to redesign the project to address the concerns raised by the Coastal Commission Staff and remanded the project back to the City of Rancho Palos Verdes for reconsideration; and,

WHEREAS, on December 7, 1992, the City Council of the City of Rancho Palos Verdes adopted Resolution No. 92-115 approving the Addendum to Environmental Impact Report No. 36 and adopted Resolution Nos. 92-116, 92-117, 92-118 and 92-119 approving Revisions to Vesting Tentative Tract Map Nos. 50666 and 50667, Tentative Parcel Map Nos. 20970 and 23004, Conditional Use Permit Nos. 162 and 163, Coastal Permit No. 103, and Grading Permit No. 1541 in order to address concerns raised by the Coastal Commission with regard to adequate provisions for public open space, public access and habitat preservation; and,

WHEREAS, on April 15, 1993, the California Coastal Commission approved Coastal Development Permit No. A-5-RPV-93-5 (i.e. Coastal Permit No. 103), subject to additional conditions of approval; and,

WHEREAS, on October 5, 1993, the City Council of the City of Rancho Palos Verdes adopted Resolution No. 93-89 approving a second Addendum to Environmental Impact Report No. 36 and adopted Resolution Nos. 93-90, 93-91, 93-92 and 93-93 respectively re-approving Vesting Tentative Tract Map Nos. 50666 and 50667, Tentative Parcel Map Nos. 20970 and 23004, Conditional Use Permit Nos. 162 and 163, and Grading Permit No. 1541 in order to comply with a Court mandate to provide affordable housing in conjunction with the project, pursuant to Government Code Section 65590; and,

WHEREAS, on September 6, 1994, the City Council of the City of Rancho Palos Verdes adopted Resolution No. 94-71 approving a third Addendum to Environmental Impact Report No. 36 and Adopted Resolution Nos. 94-72, 94-73, 94-74, 94-75, 94-76 and 94-77, respectively, approving Revision "A" to the approved Ocean Trails project, including, but not limited to, relocation of the golf course clubhouse from the area southwest of the School District property to an area north of Half Way Point, locating the golf course maintenance facility and four (4) affordable housing units southeast of the corner of Palos Verdes Drive South and Paseo Del Mar, reducing the number of single family residential lots from eighty-three (83) to seventy-five (75) and increasing the height of the golf course clubhouse from thirty (30) feet to forty-eight (48) feet; and,

WHEREAS, between September 6, 1994 and June 7, 2005, the City Council approved various other amendments to the Ocean Trails project; and,

WHEREAS, in May 1995, the City, California Coastal Commission, the Sierra Club, the California Native Plant Society, Coastal Conservation Coalition, Save Our Coastline 2000, Andrew Sargent, Palos Verdes Land Holdings Company, and Zuckerman Building Company entered into a Settlement Agreement, where such Agreement required certain project modifications and required the City to accept certain open space lots located within Vesting Tentative Tract Map Nos. 50666 and 50667; and,

WHEREAS, on November 20, 1997, the City entered into a Development Agreement with the owner of the property concerning the proposed project. Such Agreement was amended on September 18, 2001 and again on March 4, 2003; and,

WHEREAS, on April 26, 2005, the Rancho Palos Verdes Planning Commission adopted P.C. Resolution No. 2005-18, finding that the City's acceptance of the "Additional Non-Golf Setback" area within the Trump National Golf Course Project is consistent with the Rancho Palos Verdes General Plan; and,

WHEREAS, since the Planning Commission and City Council have already approved the entitlements for the Trump National Golf Course project, which specifically identify the location, purpose and extent of the project's required open space lots and trails except the non-golf setback, and all of these entitlements were found to be consistent with the General Plan, a separate General Plan Consistency Finding is not required prior to the City's acceptance of the "Easement Deeds for Public Trails", "Founder's Park", and Lots D, E, G, I and K of Tract No. 50667; and,

WHEREAS, Government Code Section 27281 allows the City to authorize by resolution one or more of its officers or agents to accept such dedications or grants on behalf of the City and consent to the recording of these documents;

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO PALOS VERDES DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS:

Section 1. The City Manager, the Assistant City Manager or the Director of Planning, Building and Code Enforcement of the City of Rancho Palos Verdes are hereby duly authorized to accept the grant deed for the "Non-Golf Setback Area" within Tract No. 50667, the grant deed for "Ocean Trails Park" within Vesting Tentative Tract Map No. 50666, the "Easement Deed" for public trails within Vesting Tentative Tract Map No. 50666, and accept Lots D, E, G, I and K of Tract No. 50667 on behalf of the City of Rancho Palos Verdes by executing the form which is attached hereto as Exhibit “A” and incorporated herein by this reference.

PASSED, APPROVED and ADOPTED this 17th day of January 2006.

____________________
Mayor
Attest:

____________________
City Clerk

State of California )
County of Los Angeles ) ss
City of Rancho Palos Verdes )

I, Carolynn Petru, City Clerk of The City of Rancho Palos Verdes, hereby certify that the above Resolution No. 2006- was duly and regularly passed and adopted by the said City Council at a regular meeting thereof held on January 17, 2006.

_________________________
City Clerk

CERTIFICATE OF ACCEPTANCE

This is to certify that the interests in real property conveyed by 1) the dedication of Lots D, E, G, I and K of Tract No. 50667 for "Public Open Space" and Lot I of Tract No. 50667 as a "Lateral Public Access Easement" as described in Final Map No. 50667 as recorded by the County of Los Angeles on October 12, 1999, as Instrument No. 99-1934089 , and 2) the attached Grant Deed for the "Non-Golf Setback Area" within Tract No. 50667, and 3) the attached Grant Deed for "Founder's Park" within Vesting Tentative Tract Map No. 50666, and 4) the attached Easement Deed for public trails within Vesting Tentative Tract Map No. 50666, from V.H. Property Corporation, to the City of Rancho Palos Verdes, a political corporation, are hereby accepted by the undersigned agent on behalf of the City of Rancho Palos Verdes pursuant to authority conferred by Resolution No. 2006-__ of the City Council of the City of Rancho Palos Verdes, adopted on January 17, 2006, and the grantee consents to the recordation thereof by its duly authorized agent.
Dated: January 17, 2006.
________________________
Les Evans, City Manager

Attest:

 

______________________
City Clerk

RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

City of Rancho Palos Verdes
30940 Hawthorne Blvd.
RANCHO PALOS VERDES, CA 90275
Attention: City Clerk
____________________________________________________________________
INDEMNITY AGREEMENT

THIS INDEMNITY AGREEMENT (the “Agreement”) dated __________ __, 2006 is entered into between VH Property Corp., a Delaware Corporation, the owner of the golf course and residential project that is commonly referred to as “Ocean Trails” (hereinafter referred to as “Developer”), and the City of Rancho Palos Verdes, a California municipal corporation (the “City”).

RECITALS

A. Developer is in the process of developing that certain real property described and/or depicted on Exhibit A attached hereto (the “Property”).

B. In connection with the development of the Property, conditions of approval have been imposed which, among other matters, require Developer to convey to the City or another accepting agency, as specified in the conditions, certain real property described and/or depicted on Exhibit B attached hereto to be used as park land, trails, open space and habitat preserves (the “Encumbered Land”) in fee simple. Developer will retain easement interests in the Encumbered Land for maintenance purposes pursuant to that certain Declaration of Restrictions recorded on December 8, 1997 as Instrument No. 97-1929842 in the Official Records of Los Angeles County, California, and for other purposes as reserved in the documents conveying the Encumbered Land to the City.

C. The City has expressed concern regarding its potential liability as record owner in fee simple of the Encumbered Land to rebuild or otherwise make repairs in the event of a landslide, land subsidence or slope failure (collectively, “Slope Failure”).

D. The City has required Developer, as the owner of that certain real property described and/or depicted on Exhibit C attached hereto (the “Golf Course”), and the successor owners of any portion of the Golf Course, to defend, hold harmless and indemnify the City and its representatives from any and all actions, written claims, judgments, liabilities, costs, written orders or written demands (collectively, “Claims”) that City might incur as owner in fee simple of the Encumbered Land to (a) rebuild or otherwise make repairs in the event of a Slope Failure and (b) pay compensation or other monetary damages for failure to rebuild or otherwise make repairs to any portion of the Encumbered Land after a Slope Failure; except that the obligations of Developer shall be reduced by the percentage that the City, its representatives or its contractors performing work on the Encumbered Land are at fault with respect to the Slope Failure(s), as set forth in paragraph 1(a) below.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing recitals, and the mutual promises and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, it is agreed as follows:

1. Indemnity by Developer. Developer, for itself and for its successors in interest in any portion of the Golf Course, covenants and agrees that the following covenants shall run with and burden the Golf Course:

(a) Developer hereby agrees to defend, indemnify and hold the City and its respective employees, officers, agents, attorneys, representatives, affiliates, successors and assigns (referred to collectively as “City Representatives”) harmless from any and all Claims that the City or the City Representatives might incur due to City’s ownership in fee simple of the Encumbered Land to (i) rebuild or otherwise make repairs in the event of a Slope Failure and (ii) pay compensation or other monetary damages for failure to rebuild or otherwise make repairs to any portion of the Encumbered Land after a Slope Failure. The obligations of Developer hereunder shall be reduced by the percentage that the City, the City Representatives or the City’s contractors performing work on the Encumbered Land proximately caused the Slope Failure(s) for which indemnity is sought pursuant to this Agreement due to the active negligence or active misconduct of the City, any City Representative or the City’s contractors performing work on the Encumbered Land. Active negligence or active misconduct by the City and the City Representatives shall expressly exclude review and approval of plans prepared by Developer or Developer’s representatives, the issuance of permits or approvals to Developer by City or the City Representatives and the inspection of the Property or any improvement thereon by the City or the City Representatives. The duty to defend set forth above shall apply upon the assertion of any such written Claim, but the duty to indemnify and hold harmless shall only apply after the entry of a nonappealable judgment by a court of competent jurisdiction that the City or any City Representatives has liability pursuant to subparagraph (i) or (ii) of this paragraph (a) or a compromise of any such Claim that has been approved by Developer in writing. Additionally, the duty to defend, indemnify and hold the City and the City Representatives harmless shall only apply if the City gives written notice to Developer of any written Claim within fifteen business days of the receipt of the same, unless Developer is not prejudiced by a delay in giving such written notice to Developer of such written Claim. The City covenants to cooperate with Developer and its attorneys in connection with the defense of any such Claim.

(b) No third party shall have the right to rely on any provision set forth in this Agreement, as it is not the intent of Developer to abrogate any defenses to any Claims that the City or the City Representatives may possess. There shall be no third party beneficiary of this Agreement.

(c) In the event that Developer is obligated to indemnify the City or the City Representatives from any Claims, Developer shall have the express right to rely on any and all defenses to such Claims that the City or the City Representatives may possess.

2. Extent of Liability. Developer, and any successor in interest in any portion of the Golf Course, shall only be liable pursuant to this Agreement for any Claims that arise during their respective period of ownership of the Golf Course. Upon the sale of all of the interest in the Golf Course held by Developer or each of its successors in interest, Developer (or such successor in interest) shall be released from its respective liability hereunder, except for any Claims hereunder which arose prior to such transfer. For purposes of this paragraph only, a Claim arises when a Slope Failure occurs on the Encumbered Land.

3. Covenants Run With the Land. The covenants of each of Developer and the City herein made shall be deemed to be covenants running with the land pursuant to applicable law, and each of Developer and the City making any covenant herein agrees, as covenantor, that each covenant to do or refrain from doing any act with respect to the Golf Course and the Encumbered Land or any portion thereof (either an “Affected Property” and together the “Affected Properties”): (i) is for the benefit of the owner, as the covenantee, of each Affected Property, (ii) runs with the Affected Property owned by each respective covenantor and the Affected Property owned by each respective covenantee, and (iii) shall benefit in the case of covenantee, and be binding upon, in the case of covenantor, all successive owners of the Affected Properties and every part thereof and all persons or entities having any interest therein derived from or through any owner of the Affected Properties.

4. Entire Agreement. This Agreement, together with that Indemnity Agreement being entered into between Developer and the City concurrently herewith with respect to the conveyance of certain easement interests from Developer to the City and that Release being entered into between Developer and the City concurrently herewith with respect to Developer’s release of the City for potential liability as record owner in fee simple of the Encumbered Land in the event of a Slope Failure, constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof, and the final, complete and exclusive expression of the terms and conditions thereof. All prior agreements, representations, negotiations and understandings of the parties hereto, oral or written, express or implied, are hereby superseded and merged herein.

5. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute a duplicate original hereof.

6. Authority. The persons executing this Agreement on behalf of Developer and the City represent and warrant that they are duly authorized so as to fully and legally bind Developer and the City, respectively.

7. Applicable Law and Venue. This Agreement shall be construed under the substantive laws of the State of California. Any action that is brought to enforce this Agreement shall be filed in the County of Los Angeles, State of California.

8. Enforcement of Agreement. The parties agree that if any action or dispute arises regarding enforcement of this Agreement, or any of its terms, the prevailing party shall be reimbursed for all reasonable expenses incurred in resolving such dispute, including attorney’s fees and court costs.

9. Amendments. This Agreement can only be modified by a written amendment, executed by both parties hereto.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written.
“DEVELOPER”:

VH PROPERTY CORP.,
a Delaware Corporation

By:
Name:
Title:

THE “CITY”:

CITY OF RANCHO PALOS VERDES, a California municipal corporation

By:
Name:
Title:

ATTEST:

By: __________________________________
Name: Carolynn Petru
Title: City Clerk

STATE OF CALIFORNIA

COUNTY OF __________

On before me, , a Notary Public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

WITNESS my hand and official seal.

Signature (Seal)

STATE OF CALIFORNIA

COUNTY OF __________

On before me, , a Notary Public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.

Signature (Seal)
STATE OF CALIFORNIA

COUNTY OF __________

On before me, , a Notary Public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.

Signature (Seal)

EXHIBIT A
[attached]

EXHIBIT B
[attached]

EXHIBIT C

Lots 38 and 39, Tract No. 50667 in the City of Rancho Palos Verdes, County of Los Angeles, State of California, as per map filed in Book 1241, pages 71 through 82 inclusive of maps, records of said County.

 

RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

City of Rancho Palos Verdes
30940 Hawthorne Blvd.
RANCHO PALOS VERDES, CA 90275
Attention: City Clerk
____________________________________________________________________
INDEMNITY AGREEMENT

THIS INDEMNITY AGREEMENT (the “Agreement”) dated __________ __, 2006 is entered into between VH Property Corp., a Delaware Corporation, the owner of the golf course and residential project that is commonly referred to as “Ocean Trails” (hereinafter referred to as “Developer”), and the City of Rancho Palos Verdes, a California municipal corporation (the “City”).

RECITALS

A. Developer is in the process of developing that certain real property described and/or depicted on Exhibit A attached hereto (the “Property”).

B. In connection with the development of the Property, conditions of approval have been imposed which, among other matters, require Developer to grant to the City or another accepting agency, as specified in the conditions, a non-exclusive easement (the “Easement”) in, over, through and across a portion of that certain real property located in the County of Los Angeles, State of California, as more particularly described on Exhibit B attached hereto and by this reference incorporated herein (the “Easement Area”), for the purpose of allowing public ingress and egress and for public recreational trail purposes.

C. The City has expressed concern regarding its potential liability as record holder of the Easement in the event of a landslide, land subsidence or slope failure (collectively, “Slope Failure”).

D. The City has required Developer, as the owner of that certain real property described and/or depicted on Exhibit C attached hereto (the “Golf Course”), and the successor owners of any portion of the Golf Course, to defend, hold harmless and indemnify the City and its representatives from any and all actions, written claims, judgments, liabilities, costs, written orders or written demands (collectively, “Claims”) that the City might incur as the holder of the Easement in the event of a Slope Failure to the extent set forth below; except that the obligations of Developer shall be reduced by the percentage that the City, its representatives or its contractors performing work on the Easement Area are at fault with respect to the Slope Failure(s), as set forth in paragraph 1(a) below.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing recitals, and the mutual promises and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, it is agreed as follows:

1. Indemnity by Developer. Developer, for itself and for its successors in interest in any portion of the Golf Course, covenants and agrees that the following covenants shall run with and burden the Golf Course:

(a) Developer hereby acknowledges and agrees (a) that the Easement Area may be subject to extraordinary hazard from landslide, earth movement and bluff failure; (b) that the water features located upslope of a landslide area are subject to extraordinary hazards and that the design and execution of such work is the responsibility of the undersigned; (c) to assume the risks to the undersigned and the Easement Area of injury and damage from such hazards in connection with the permitted development of the Easement Area; (d) to accept sole responsibility for the removal of any structural or other debris resulting from landslides; (e) to unconditionally waive any claims of damage or liability against the City and its respective employees, officers, agents, attorneys, representatives, affiliates, successors and assigns (referred to collectively as “City Representatives”) for injury or damage from such hazards and (f) to indemnify, defend and hold harmless the City Representatives with respect to the City’s approval of the permitted development of the Easement Area against any and all Claims arising from any injury or damage due to such hazards. The obligations of Developer hereunder (including, without limitation, the waiver in subparagraph (e) above) shall be reduced by the percentage that the City, the City Representatives or the City’s contractors performing work on the Easement Area proximately caused the Slope Failure(s) for which indemnity is sought or the waiver would be applicable pursuant to this Agreement due to the active negligence or active misconduct of the City, any City Representative or the City’s contractors performing work on the Easement Area. Active negligence or active misconduct by the City and the City Representatives shall expressly exclude review and approval of plans prepared by Developer or Developer’s representatives, the issuance of permits or approvals to Developer by City or the City Representatives and the inspection of the Property or any improvement thereon by the City or the City Representatives. The duty to defend set forth above shall apply upon the assertion of any such written Claim, but the duty to indemnify and hold harmless shall only apply after the entry of a nonappealable judgment by a court of competent jurisdiction that the City or any City Representatives has liability pursuant to subparagraph (i) or (ii) of this paragraph (a) or a compromise of any such Claim that has been approved by Developer in writing. Additionally, the duty to defend, indemnify and hold the City and the City Representatives harmless shall only apply if the City gives written notice to Developer of any written Claim within fifteen business days of the receipt of the same, unless Developer is not prejudiced by a delay in giving such written notice to Developer of such written Claim. The City covenants to cooperate with Developer and its attorneys in connection with the defense of any such Claim.

(b) No third party shall have the right to rely on any provision set forth in this Agreement, as it is not the intent of Developer to abrogate any defenses to any Claims that the City or the City Representatives may possess. There shall be no third party beneficiary of this Agreement.

(c) In the event that Developer is obligated to indemnify the City or the City Representatives from any Claims, Developer shall have the express right to rely on any and all defenses to such Claims that the City or the City Representatives may possess.

2. Extent of Liability. Developer, and any successor in interest in any portion of the Golf Course, shall only be liable pursuant to this Agreement for any Claims that arise during their respective period of ownership of the Golf Course. Upon the sale of all of the interest in the Golf Course held by Developer or each of its successors in interest, Developer (or such successor in interest) shall be released from its respective liability hereunder, except for any Claims hereunder which arose prior to such transfer. For purposes of this paragraph only, a Claim arises when a Slope Failure occurs on the Easement Area.

3. Covenants Run With the Land. The covenants of each of Developer and the City herein made shall be deemed to be covenants running with the land pursuant to applicable law, and each of Developer and the City making any covenant herein agrees, as covenantor, that each covenant to do or refrain from doing any act with respect to the Golf Course and the Easement Area or any portion thereof (either an “Affected Property” and together the “Affected Properties”): (i) is for the benefit of the owner, as the covenantee, of each Affected Property, (ii) runs with the Affected Property owned by each respective covenantor and the Affected Property owned by each respective covenantee, and (iii) shall benefit in the case of covenantee, and be binding upon, in the case of covenantor, all successive owners of the Affected Properties and every part thereof and all persons or entities having any interest therein derived from or through any owner of the Affected Properties.

4. Entire Agreement. This Agreement, together with that Indemnity Agreement being entered into between Developer and the City concurrently herewith with respect to the conveyance of certain fee interests from Developer to the City and that Release being entered into between Developer and the City concurrently herewith with respect to Developer’s release of the City for potential liability as record owner in fee simple of the Easement Area in the event of a Slope Failure, constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof, and the final, complete and exclusive expression of the terms and conditions thereof. All prior agreements, representations, negotiations and understandings of the parties hereto, oral or written, express or implied, are hereby superseded and merged herein.

5. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall constitute a duplicate original hereof.

6. Authority. The persons executing this Agreement on behalf of Developer and the City represent and warrant that they are duly authorized so as to fully and legally bind Developer and the City, respectively.

7. Applicable Law and Venue. This Agreement shall be construed under the substantive laws of the State of California. Any action that is brought to enforce this Agreement shall be filed in the County of Los Angeles, State of California.

8. Enforcement of Agreement. The parties agree that if any action or dispute arises regarding enforcement of this Agreement, or any of its terms, the prevailing party shall be reimbursed for all reasonable expenses incurred in resolving such dispute, including attorney’s fees and court costs.

9. Amendments. This Agreement can only be modified by a written amendment, executed by both parties hereto.

IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written.
“DEVELOPER”:

VH PROPERTY CORP.,
a Delaware Corporation

By:
Name:
Title:

THE “CITY”:

CITY OF RANCHO PALOS VERDES, a California municipal corporation

By:
Name:
Title:

ATTEST:

By: __________________________________
Name: Carolynn Petru
Title: City Clerk

STATE OF CALIFORNIA

COUNTY OF __________

On before me, , a Notary Public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.

Signature (Seal)

STATE OF CALIFORNIA

COUNTY OF __________

On before me, , a Notary Public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.

Signature (Seal)

STATE OF CALIFORNIA

COUNTY OF __________

On before me, , a Notary Public, personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.

Signature (Seal)

EXHIBIT A - Release Agreement -PDF
[attached]

EXHIBIT B - Grant Deed -PDF
[attached]

EXHIBIT C - Easement Deed -PDF
[attached]

Lots 38 and 39, Tract No. 50667 in the City of Rancho Palos Verdes, County of Los Angeles, State of California, as per map filed in Book 1241, pages 71 through 82 inclusive of maps, records of said County.