HomeMy WebLinkAboutC-880 - Sale of Water Outside the City - negotiations terminatedFebruary 17, 1964
City Council
City Of Newport Beh9h
Newport Beach, California
Gentlemen:
xzza 0s. fir. rsrtoabto P.
� Unta Alta, Uffornin
The Board of Directors of The Santa Ana Heights Water
Company at a special meeting held on"February 14, 1964
passed the following resolution:
That all contract proposals and agreements be-
tween the City of Newport Beach and The Santa
Ana Heights Water Company be cancelled and all
negotiations terminated.
Motion carried unanimous.
Yours very
c� truly,
Harry M. own
Acting Seely
EKB /v j e
CC:Mr Walter Charanza, Newport Beach, California
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CITY Of
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11/12/53 (5)
C-`63'90
CONUIACT TO BUY AND SELL
THIS AGIREM, T. made and entered into this 12th day of
November, 1963, between the CITY OF NDIPOET BEACH, a municipal
corporation, hereinafter referred to as "Buyer ", and SANTA ANA
HEIGHTS GTAT 1 CMIPANY, a California corporation, hereinafter
referred to as "Seller ";
WITNESSETH:
WIMEAS, seller is a mutual water company owning and
operating a water system, including a well site, water wells,
pipelines, a reservoir site, and water reservoir necessary for
the operation of a water system for the service of water for
domestic and agricultural purposes within the boundaries of said
company as defined in Article X of the By -Laws of buyer as revised
on February S, 1956, as said area is shoma upon a map marked
Exhibit "A ", attached hereto and by this reference made a part
hereof; and
WHEIRMS, buyer also or.rns and operates a municipal water
system, including the BiS Canyon reservoir and water transmission
and distribution line:; ::or the distribution and sale of water for
domestic and other purposes and includes within its boundaries a
portion of the area of buyer as shot-in on Exhibit "A "; and
WHEREAS, buyer has the facilities to increase water
pressure in the water system of seller and has adequate storage
capacity to serve the area of seller as hereinafter provided in
this contract; and
VJHEREAS, seller and buyer have determined that it would
be in the interests of seller and its shareholders and in the
interest of buyer and its residents for buyer to purchase and
seller to sell the assets of seller and for buyer to serve water
to the area encompassed within the boundary of seller as herein-
after provided in this contract;
-mss xs a'
NCWj TE EEO.'LE', the parties agree as follows:
1. Purcim se and Sale.
Buyer hereby agrees to purchase from seller and seller
hereby agrees to sell to buyer the follo -7irg described property:
(a) Land, including all improvements thereon
and water rights therein, described as follows:
Parcel 1:
Beginning at a point in the Southwesterly line
of Lot 3 of Tract No. 456, in the County of Orange,
State of California, as per map thereof recorded
in Book 17, at page 9, of Miscellaneous taps,
records of said Orange County, which said point
is distant Southeasterly, measured along the
South- gosterly line of said Lot 3, 150.42 feet
from the most Westerly corner of said Lot 3;
and mnning thence frog said point of beginning
South 340 27' 009° East along said Southwesterly
line of Lot 3, 396 feat; thence North 39° 481 4571
East 303.2, feet to a point in the Northeasterly
line of swid Lot 3, said point being in the South -
w sterly line of ialio_:e: s road; thence North-
westerly alor.3, said i:c;: L: ;asterly line of Lot 3
to a point wz�lch b<ca= i, rth 39° 481 45P1 East
from t'_he oint of bz z
i_� nS; thence South
39° 48' 43" West, 25354 feet to the point of
beginning.
Parcel 2:
Lot 3 in Block "E" of the Berry Tract, in the
Co,nt;j of Orange, State of California, as per
n t:rur :cf recor.'e6 in Book 302 at page 74,
of+Mis:� Il4 r.-_asv records of Los Angeles County,
Calisor, ia;
EXCEPTING ^IMR—Et" 0.4 the West one acre of the
South 5 acres of said Lot 3;
ALSO EXCE13TING Zrom all of Lot 3 =cept the South
5 acres, the West one acre thareof;
ALSO EXCEPTI'IVG tie Sout erly 7 feet of said prem-
ises, as 2rWnted to tle County of Orange by deed
dated January 11, 1943, and recorded in Book
11!x, at nape 96, of Official records, in the
office of t5e County Recorder of said Orange
County.
(b) All fixtures cw ed by seller located on the
above- described real property used in connection with the
operation of seller's water works, including but not limited
to p=ps, pipes, motors, reservoirs, electrical facilities,
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chlorination equipment, and transmission mains.
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(c) All interest.of seller in real property,
including but not limited to all water rights and easements
and franchises used in connection with the production,
transportation, storage, processing, and distribution of
crater .
(d) All accounts receivable of seller remaining
unpaid forty-five (45) days after the final closing date
hereinafter specified.
(e) All land improvements, buildings, machinery,
eeuipm.ent, automotive equipment, office furniture and
fixtures, tools, pipes, meters, cater parts, automotive
parts, office supplies, office equipmment, customer account
records and every map, claxt, drawing, record of equipment,
and all other items of tangible personal property owned by
seller on the date of this contract, whether or not recorded
in the balance sheet accounts of seller at said date.
(f) Seller's interest in the Metropolitan Dater
District connection from which seller takes water, all
transmission and distribution water pipelines owned by
seller within its service area, vehather or not shoum on
Exhibit "A" attached hereto, all meters and services
attached to said transmission and distribution mains, and
all fire hydr= is of seller within said area.
(,n,) The 22" steel i:.,a .er pipeline leading from
Parcel 2 to Parcel 1 hereinabove described.
(h) All water rigts of seller, including rights
in arEy stream, s= face eater, underground crater, water basin
or elseXhare a d re,- rdless of how obtained, whether by
gift, purchase, succession, prescription or otherwise.
2. Items Retained by Seller. ,
There is excluded from this sale and retained by seller
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all cash on hand and in banks, all accounts receivable except as
provided in paragraph 1, all notes receivable and all interest
receivable on obligations owing to seller.
3. Purchase Price.
The total purchase price shall be the sum of the follow-
ins:
(a) Land and improvements:
Parcel 1
Parcel 2
$ 85,050.
$199,800.
(b) All other real and personal property and all
rights and franchises and every other thing of whatever nature
herein agreed to be sold to buyer by seller '$ 650150.
4. Warranty and Authority to Sell.
Seller hereby represents and warrants to buyer that it
is the owner of all property hereinabove described and that it
has the authority'to sell the sane subject to the approval of its
shareholders as hereinafter provided. Seller agrees to farnish
buyer with a certified copy of a resolution of its Board of
Directors authorizing the sale hereunder and to attach to the
grant deed or deeds, any bill of sale, or other document of transfer,
the certificates provided for in Section 3904 of the California
Corporations Code.
5. Replacement of Distribution Lines.
Seller is in the process of replacing certain water
distribution lines within its service area in the following streets,
to wit:
Fairway Drive and Westminster Avenue, from Monte
Vista Avenue to Del liar Avenue (approximately
2400 feet of 6" main)
Seller also agrees to replace other existing water
distribution lines with 6" ACP within its service area in the follow-
ins streets, to wit:
4.
Orchid Street
Spruce Avenue
Azure Avenue
Zenith Avenue, from Spruce Avenue to Orchid Street
(approximately 4,000 feet)
Such replacements shall be completed by seller together
with appurtenances as necessary to serve water to the adjoining
property and shall be paid for by seller; provided, however, that
if such replacements are not completed and paid for by seller prior
to the time it discontinues operating as a corporation, seller will
deposit with buyer the amount of money necessary to'pay for such
replacements and buyer shall then pay for such replacements.
6, .1 Date of Sale and Closing.
The sale shall be com pleted on a closing date determined
as hereinafter provided in paragraph 7 hereof, and title to and
possession of the property shall pass to buyer on that date,
subject to the terms hereof. .
(a) The closing shall be handled in an escrow
account in the office of United California Bank, Mariners
Branch, which is hereby jointly designated by seller and
buyer as the escrow agent for the purpose of the sale of
the assets of seller.
(b) On or before said closing date, seller shall
deposit in said escrow.'
(1) A grant deed in the form marked Exhibit
"B" and attached hereto and by this reference made a
part hereof.
(2) A bill of sale for all fixtures and
personal property being sold hereunder.
(c) On or before said closing date, buyer shall
deposit in said escrow:
(1) The purchase price herein agreed upon.
(2) A resolution of the City Council of the
City of Tewport Beach accepting and authorizing the
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recording of the grant deed deposited by seller.
(3) Escrow instructions authorizing payment
of the purchase price to seller upon delivery to buyer
of said bill of sale,,the recording of said grant deed,
and the receipt by escrow holder for buyer of a standard
ownerts policy or policies of title insurance insuring
that title to the real property.consisting of Parcel 1
and Parcel 2 hereinabove described is vested in buyer
subject only to exceptions theretofore approved by
buyer in writing, said policy or policies to be in the
amount of the purchase price for the parcel or parcels
to which applicable.
(d) The title insurance policy premium and the cost
of allAnternal revenue stamps shall be paid by seller. The
recording cost, if any, as to the documents conveying title
to buyer shall be borne by buyer.
(e) The escrow charges except as herein specifically
provided shall be borne equally by buyer and seller.
7. Closing Date.
The closing date shall be December 20, 1963, provided
that seller may extend the time for 60 days by written notice to
buyer on or before December 18, 1963, and provided further that
said date may be further extended by mutual consent. Seller agrees
Eo:-£urnish buyer with title reports on the land being sold here-
under as soon as possible after execution of this contract by
buyer, and buyer shall have ten (10) days after receipt thereof
within which to examine the sane and report any defects in title
thereto and to examine the real properties and to report any
encroachments or overlaps that may be disclosed thereby. If any
valid defects of title in any of said real property or any such
encroachments or overlapping shall be discovered by buyer and
reported to seller within said 10 -day period, seller shall have
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until the closing date within which to remedy the same and, if not
so remedied within said time, buyer shall have the right (and no
other rights or remedies) atits election to accept said defects
and comnplete this contractor to terminate this contract, in which
event all parties shall be released from all obligations and
liabilities hereunder and any documents or money deposited in
escrow shall be returned to the party by whom the same was depos-
ited.
The sale shall be effective as of 12.01 A.M.; on the
closing date and buyer shall thereupon take possession of the real
property and-all other property being transferred hereunder.
Seller will read all its water meters within six (6)
days prior to the closing date and will bill all customers for
water used up to such date of reading within ten (10) days after
the closing .date. Seller shall permit a designated employee of
buyer to accompany seller's meter reader on the final reading by
seller. It is agreed that the meter reading so obtained by seller
shall be the closing reading for seller and the opening reading
for buyer for billing purposes following the assumption of service
in the area by buyer.
Seller and buyer will both read the water meter through
which seller takes water from the Metropolitan Water District of
Southern California line as near as possible to the closing date
and in any event within three (3) days thereof, and.seller will
pay for the water taken through said meter up to the time of said
reading. Buyer will pay for water taken through said meter after
i said reading.
The meter or meters through which seller purchases
electricity for both power and light shall be read by the supplier
or by both buyer and seller on the same date said water meter is,
read. Seller shall pay for electricity up to the time of said
reading and buyer shall pay for the same thereafter.
7.
8. Delivery of Documents Outside of .Escrow.
All documents to which buyer is entitled hereunder other
than those specified in paragraph 6 to be delivered in escrow shall
be delivered outside of escrow as soon as reasonably possible after
the closing date, it being the intention of the parties that the
delivery of all such documents shall be completed within thirty
(30) days after the closing date. In connection therewith, seller
will execute and deliver to buyer such further instruments in
writing as may be required to complete or evidence the transaction
herein provided for and buyer will on request execute and deliver
like instruments to seller. Such instruments include, but shall
not be limited to, conveyatice,of all easements, franchises, and
similar rights or interests of seller, certificates of title on
any motor vehicles being transferred and other documents of owner-
ship as may be necessary. Seller and buyer agree that all such
documents shall be properly executed pursuant to the authority of
the Board of Directors and City Council, respectively.
9. Accounts Receivable.
Buyer shall bear all risks as to the collectibility of
accounts receivable sold hereunder and shall bear the discount
expense, if any, with respect thereto. Buyer, however, shall not
be responsible for the settlement of any claim by any shareholder
or water user arising at any time prior to the closing date or the
date buyer assumes control of the water system, whichever date may
be later.
10. Operations Pending Sale.
Seller represents that it has not sold or otherwise
disposed of any major asset of seller since September 1, 1963,
and that it will not sell or dispose of any such asset or of any
property being sold to buyer hereunder between the date of this
contract and the date of final closing, and that it has not since
September 1, 1963, and will not enter into any transaction affecting
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the property to be sold hereunderother than in the usual and
ordinary course of its business. Seller agrees to maintain in
effect all insurance policies it carried on September 1, 19630
until thirty (30) days following the date buyer assumes title
and possession to the property and water system. Seller further
agrees to maintain its Workmen's Compensation insurance in effect
so long as any employee of seller is in any manner employed by
seller or is doing any work on or in connection with said property
or water system and to be responsible for any injury to or claim
by any such employee.
11. Accounts Payable Debts, and Liabilities.
Except as otherwise expressly provided herein, seller
agrees to indemnify buyer.against and hold buyer harmless from
any and all debts, liabilities, and obligations of seller accruing
or based upon or arising out of any fact or event occurring before
the closing date or the date buyer takes possession of the prop-
erty and water system being sold hereunder, whichever is later.
Except as otherwise expressly provided herein, buyer shall
indemnify seller against and save seller harmless from any and
all debts, liabilities, and obligations accruing or based upon
or arising out of any facts or events connected with the property
and water system being sold hereunder or the operations thereof
occurring after the closing date or the date buyer takes possession
of the property and water system pursuant hereto, whichever is
later.
Whenever either party shall learn through the filing of
any claim or the commencement of any action or proceeding of the
existence of any possible liability for which the other party is
or may be responsible under this agreement, such party shall
notify the other party promptly and furnish such copies of'docu-
ments (and make the originals thereof available for inspection)
and other information as such party may have which may be used or
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useful in the defense of such claims and shall afford the other
party full opportunity to defend the same in the names of any
party and shall generally cooperate with the other party in the
defense of any such claim or action or proceeding.
12. Sales or Use Tax:
It,is the belief of both parties that no sales tax or
use tax is applicable to the transaction encompassed in this agree-
ment. However, any sales or use tax which becomes payable under
the law.of the State of California by reason of the sale of all
or any portion of the property under this agreement shall be borne
by buyer and buyer agrees to reimburse seller on demand for any
such tax seller may be obligated to pay and does pay.
13. Records,
Title to all of seller's corporate records, documents, and
papers of every kind shall remain in seller (except any such agreed
to be sold or assigned to buyer hereunder), but any thereof which
buyer may reasonably require for use in connection with the opera-
tion of said water system after the closing date shall either be
delivered to buyer or made available to it in such manner as may
best meet the respective needs of the parties. In any case, the
party receiving or retaining such records shall make them available
to the other during a period of two (2) years following the closing
date. After the expiration of said 2 -year period, either party
shall, before destroying any such records received by it, offer
them to the other party if such other party is then in existence
and maintaining an office in Orange County.
Buyer shall promptly forward to seller all correspondence,
=Ll, payments and documents received by buyer after the date of
closing which relates -to the operation of the water system occurring
prior to the closing date or to seller or seller's business, except
that buyer may retain any payments of accounts receivable belonging
to buyer or any payments incorrectly addressed to seller and may
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retain any letters or documents relating thereto or to any trans-
actions occurring after closing concerning the property assigned
hereunder or to any other obligation which buyer is to perform
hereunder. Buyer shall have the right to endorse the name of
seller on all checks or other forms of payments to which it is
entitled under the terms of this contract. Seller shall promptly
forward to buyer all mail received by it of the type which buyer
is entitled to receive and retain hereunder.
14. Delivery of Possession; Destruction or Damage to
Property Prior to Closing; Force Majeure.
At the time of closing, all property agreed to be sold
hereunder shall be delivered to buyer in the same condition as at
the close of business on September 1, 1963, except for ordinary
use and wear thereof, changes occurring in the ordinary course of
business between September 1, 1963, and date of closing, and damage
or loss from causes beyond the reasonable power and control of
seller; provided, however, that if at the time of closing the
buildings, machinery, equipment, and other tangible property to be
sold hereunder shall have suffered loss or'damage on account of
fire, flood, accident, act of war, civil commotion, or any other
cause or event beyond the reasonable power and control of seller
(whether or not similar to the foregoing), to an extent which
substantially affects the value of the property to be sold here-
under, buyer shall have the right at its election to complete
the purchase, in which event it shall be entitled to all insurance
proceeds (excluding use and occupancy insurance proceeds) collect-
ible by reason of such loss or damage or, if it does not so elect,
it shall have the right, which shall be in lieu of any other right
or remedy whatsoever, to terminate this contract. In the latter
event all parties shall be released from liability hereunder. If
such loss or damage does not substantially affect the value of
such property, buyer shall complete the sale but shall be entitled
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to all insurance proceeds (excluding use and occupancy insurance
proceeds) collectible by reason of such loss or damage. 'In any
case where buyer shall become entitled to insurance proceeds by
reason of loss.or damage to assets agreed to be sold hereunder as
above provided, the purchase.price of the assets so lost or
damaged shall not be reduce& because of such loss or damage.
Except as provided above, if for any cause beyond the
reasonable power and control of seller it shall be unable to
complete the sale hereunder in accordance with its terms, buyer
may elect to accept as full performance such partial performance
by seller as shall not be so prevented or,if it does not so elect,
its sole and exclusive remedy shall be to terminate this contract.
In the latter event all parties shall be released from all liabil-
ity hereunder.
150 Notices.
All notices.required or permitted to be given hereunder
shall be in writing and shall be sent by first class mail, postage
prepaid, and if intended for seller shall be addressed to 1126 S.E.
Palisades Road, Santa Ana, California, and if intended for buyer
shall be addressed to 3300 Newport Boulevard, Newport Beach,
California. Either party may by written notice to the other change
the address where notice is to be sent to it.
16. Nonassignability; Successors and Assigns.
Neither this agreement nor any interest therein shall be
assignable by buyer without the prior written consent of the seller.
17. Warranties of Seller..
Buyer has been afforded full opportunity, to examine the
property to be purchased by it hereunder and no representations
or warranties whatever with respect thereto are made by seller,
except as specifically hereinabove stated, and;
(a) Seller now has and will at the closing
date have and will convey to buyer good and marketable
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title to all property agreed to be sold by seller here-
under; free and clear of any lien or encumbrance; subject,
however, as to the real property to be conveyed by the form
of grant deed attached hereto, to such exceptions as may
appear in the policy or policies of title insurance that
were approved by buyer as hereinbefore provided.
(b) The property agreed to be sold hereunder
includes all land, improvements, and tangible personal
property owned by seller on the date of this contract and
on the final closing date, except as otherwise expressly
provided herein.
18. Connection to Newport Beach Water System.
Buyer agrees that, upon taking possession of the property
of seller pursuant to this contract to buy, it will within sixty
(60) days thereafter construct and will thereafter maintain an
interconnection with the water system of buyer by which the terri-
tory within which seller now distributes water or any portion
thereof so long as such territory or such portion continues to
be served by buyer will be connected to buyer's Big Canyon Reser-
voir and will have the advantages of such storage capacity for
better water pressure and fire flow as is available therein
equally with other areas served by buyer. It is the objective of
buyer, however, that ultimately it will serve water only to terri-
tory within its own boundaries, and territory within the boundaries
of adjoining municipal corporations providing water service will
be served with water by such municipal corporations. Buyer there-
fore may, at any time after undertaking the service of water within
the service area of seller, enter into contracts with any municipal
corporation or water distributing agency which new or at that time
includes a portion of seller's service area within its present or
prospective boundaries to provide or arrange for water service
within any such area or areas so included. Pending any such transfer
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WTIC : sec •
111"12163 (5)
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or transfers, buyer will continue to serve water within the area of
seller as provided in this contract..
19.• Maintenance of System.
Buyer agrees that, .subsequent to the purchase of the prop—.
erty and water system of seller,,it will maintain said system in good
working order pursuant to the same policies that are now or hereafter
applied to the maintenance of the water system presently owned and.
operated by buyer. Specifically, buyer agrees not to impose special
assessments for the acquisition, construction, operation or mainte-
nance of facilities necessary to serve the property adjoining such
facilities unless such policy is made to apply in the other areas of
buyer on a similar basis. However, it will continue to be the policy
of buyer to require distribution facilities to be provided in connec-
tion with the development of real property within the territory of..sel
ler on the same basis as is now imposed within the territory of buyer.
In addition, buyer agrees that, upon the contractual re-
linquishment of any area for service by another water distributing
agency, it will require such agency to agree by such contract not to
impose assessments relative to or in recovery of any costs or ex-
penses of any nature whatsoever it shall directly or indirectly have
incurred and which are incident to its acquisition, nor to adopt a
different policy with respect to special assessments for the acqui-
sition, construction, operation or maintenance of water facilities
for any area now served by seller that may subsequently be served by
any such agency that does not apply to the remainder of the terri-
tory of such agency.
20. Water Rates.
Upon the completion of the purchase of seller's property
and water system and the assumption of service of water within the
territory now served by seller, buyer agrees that it will provide
service to the area at its regular water rates and charges and will
not impose special rates or charges that would not apply equally
within the boundaries of buyer under similar circumstances. Buyer
... agrees that it will also impose this condition upon any agency
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which assumes service of water pursuant to a contract with buyer
within any portion of the area now served by seller..
21. Covenants Benefit Shareholders.
The purpose of the foregoing three paragraphs IS, 19 and
20 is to express the contractual obligations of buyer thereby
imposed not to discriminate against the shareholders of seller
with respect to water rates or charges or the.replacement of
distribution lines. Such obligations are for the benefit of such
shareholders and may be enforced by them subsequent to any
dissolution of seller to the same extent seller could enforce
such obligations prior to its dissolution.
22. Approval by Shareholders.
The sale of the assets of seller as provided in this
contract is subject to and contingent upon the shareholders of
sellerapproving said sale and consenting to the dissolution of
seller (Santa Ana Heights Water Company) pursuant to the pro-
visions of the Corporations Code of the State of California and
any other applicable laws. Such approval and consent shall be
submitted to such shareholders as soon as possible after the
execution of this contract by buyer and seller and, unless a
majority of the shareholders have approved and consented thereto
on or before the closing date as herein designated, this contract
shall be void in its entirety and of no further force or effect.
The parties hereto shall each bear their own expense incurred in
connection therewith.
IN WITNESS tdlIEitEOF, the parties have executed this contract
as of the day and year first above written.
CAPITA ANA HEIGHTS WATER CITY OF�EACEj;, )4"714— CO%tPANY u
By
By Mayor
President
t`—
Attest: Attes�
Secretary ' 1 City Clerk
SELLER
15.
See Contract File for
Existing Facilities
Santa Ana Heights Water Company
WWC
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(12)
RESOLUTION NO. 5884
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
NEWPORT BEACH AUTHORIZING THE - EXECUTION OF A
CONTRACT_ WITH SANTA ANA HEIGHTS WATER COMPANY
5 WHEREAS, the City of Newport teach has heretofore offered
6 to purchase the assets of the Santa Ana Heights Water Company; and
7 WHEREAS, a contract has been prepared between the City of
8 Newport Beach and Santa Ana Heights Water Company setting out the
9 details of said purchase and the agreement between the City and they
10 company relating to the assumption of service of water by the City
11 within the service area of the company; and
12 WHEREAS, said contract has been reviewed by the City
13 Council and the.City Council has found-the same to be fair and
14 equitable and in the interests of the City and its citizens;
15 NOW, THEREFORE, BE IT RESOLVED that the Mayor and City
16 Clerk be and are hereby authorized and directed to execute said
17 contract dated the 12th day of November, 1963, between the City
18 of Newport Beach and the Santa Ana Heights Water Company.
19 BE IT FURTHER RESOLVED that said contract be transmitted
20 to said company for consideration by its Board of Directors.
21 ADOPTED this 12th day of November, 1963.
22
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24 ATTEST: '��aa
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-y Z` ear cK
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'7" (12) . •
1 L1 L>nUA Iwo s
2 A RSSOLUTM w in WMICIL a T& CITY OF
3 lTRUVRT EiiACn AtITI�ZilM6 ?� F.�C1tCZAkt tl8 A
FACT WITu w A'% Am mumm WATER CMANT
5 Ujuaw. Cale CLty of Newport Bosch and the Santa A"
6 Heights Water Comp"y acre p+ wU" to a acaAxsat dated the 12th day
7 of N&vawber, 19620 under which the City aged to Wy and kiss
8 "IA ca mpany agreed to &all all of the assats of raid a ny; sand
9 waaw, it appear@ to be in the uttarests of both the
10 City and said company to extend the closing date of Uid rcetxaet
11 Pmrsuant to the provisions tlaareof; wad
12 WHZBW. a contract two been prepared betemea " City
13 and tin Santa Ayes heights Water Company U96m which the closing
14 date undex s"A agreomm" dated err 12, 19631, would be sstSU*
15 to May 180 1964; and
16 wimw, the City Coil 'has nevi ev ed the pxavisimias of
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raid aostrAmt and found the rave to be fair and sq"tabla;
NMI TMZ1 , U IT RLS"VZB that the Mayor and Gity
Clark be wad "-o b r*by authorised and direct" to execute said
cantreet an behalf of the City of Newport DMaeho
Ati rM this 14th day of yam, 1#64,
Ai \ T: r f n
'i"
To: City Clerk
Front City Attorney
Subjects Purchase of Santa Ana Rei,gl
Transmitted-is the letter fros'the „S+
Goa�any reeei�ed im this office '014; b
which extends. the closingdtti►_oii, the
purchase of the assets of the-Santa i
VK :mec
znc.
cc - City lUnager..
Public works Director
;OV .
1. Charams;
torney
I
SAI�
i
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A
,,. 1126 SE Palisades Road
Santa Ana, California
December 18, 1968
City Council
City of Newport Beach
Newport Beach, California
Gentlemen:
This .is'to� dvise.you that the undersigned elects to
extend.the closing date provided for in paragraph 7
on page 6 of our agreement; it being understood that
we will enjoy only such portion of the 60-day exten-
sion provided for in the agreement as may be neces-
gory in order for us to determine whether a majority
of our shareholders will consent to the principal
terms of said agreement.
act Mr, Walter Charemas
Very truly yours.
SANTA ANA HEIGHTS WATER COMPANY
y er,On
0
TO: Finance Director
FROM: City Clerk
SUBJECT: Contract
Contract No. d"
0
Date xoV"WbW 20& 1%$
Authorized by Resolution No. 3i , adopted on UVWkw 1 =0 1 %1
Date Mayor and City Clerk executed Contract t�rw�L20
Effective date of Contract
Geoxa t wt
Contract with v., ja W
Address 1126 Q tdiaad" Road
'COMPMY4w yet•
Brief description of Contract MMti of the •eta Ana
Amount of Contract
t
City Clerk
0 0
City Clerk
November 20, 1969
City Attorney Walter Charaiaa
City Clerk Margery Sebrouder
Re: "Contract to bu and sell" between the City
of Newport Beach and Santa Ana Heights Water
Company (C -880) .
Agreement with Costa Mesa County Water District (C -881).
Transmitted herewith are the original copies of
the documents mentioned above. aallong with
duplicate copy of each document. The documents
have been duly executed by Mayor Hart and as
and bear the seal of the City of Newport Beach.
I a also enclosing a copy of Resolution No. 5884,
authorizing the execution of the contract with
Santa Ana Heights Water Company, and a copy of
Resolution No. 5886, authorizing the execution
of the contract with the Costa Mesa County Water
District.
MS:gm
l.'
CITY OF ITAVMT BRACH 1r'` NY OF
NEWD9 'T SEACH,
AU F.
CITY2
November 19, 1963
Tot Charles E. Hart, Neyor
From: City Attorney
Subject; Letter to shareholders of Santa Ana Heights Water
Company
The City Council authorized and directed an open letter to the
shareholders to be sent out by your office subject to a determina-
tion that the expenditure for the letter and mailing is a proper
expenditure.
No case has been found in which a decision on this particular type
of expenditure has been before the appellate courts. There is no
question that an expenditure by a city for the purpose of pro-
moting a bond issue is not a proper a enditure. This was decided
in the case of Mines v. Del Valle (1927)9 201 Cal. 273. on the
other hand, an expendWire a city for the purpose of influenc-
ing legislation has been determined to be a proper expenditure.
Powell v. City and CountZ of San Francisco (1944), 62 C.A. 2d 291.
The proposed expenditure actually fits in neither category. Its
purpose is to support and defend the contract approved by the City
with the Santa Ana Heights Water Company. The purpose of 4Le con -
tract is a proper purpose without any question; that is, the
acquisition of facilities to provide water service to the resi-
dents of the City. It is not possible to predict with any accu-
racy the conclusion a court would reach if someone contested this
expenditure. However, the probability of its being contested and
the result of a successful contest in view of the small amount
involved indicates there is little risk in proceeding with the
execution of the Council directive. If it were determined to be
an improper expenditure, it would be necessary to repay the amount
spent.
With your approval, we will consult with the City Manager on the
precise wording of the letter and have it ready for your signature
this afternoon.
WWC:mec Walter W. Charamza
cc - City Manager City Attorney
City Clerk �
To: Charles R. Hart, Mayor
From: City Attorney
Subject: Letter to shareholders of
Company
The city Council authorized and dire
shareholders, 'to b&-sent out by your
tion that tlie:.expenditure for the le
expenditure.
No case has bemlound in which A AV
of expenditure has b6en before tto.s
question that an expenditure 6Y 4-1cl
moting a bond issue -is not a proper
in the case of Mines V. Dal Yal .. (I
other hand, an expenditure by a c=3
ing legislation has been determined
The proposed expenditure actually.fil
purpose is . to support and defend-the
vita the Santa Ana Heights Water COM
tract is a proper'purpose.withput an'
acquisition of facilities to o-provide
dents of the City. it is not possib]
racy the conclusion a ccA=tViouIiI.re4
expenditure. Rowever3, thiepiobabilk
the result of a successful contest h
involved indicates there is little r
execution of the council directive.
an improper expenditure, it'would be
spent.
With your approval,-we will' consult.'
precise wording of the letter,#64 ba
this afternoon.
6CH
November. 19, 1963
.Lta Ana Neighte Water.
Bd an open letter.-to thB
fice ,_Subjict 64 o' a deterdbA-ie
Br and mailing is.. a.. pro
per
Oicm an tKa"paxticulAr
'�
tYPe
jljAt_O..courts.. [sere lv
no
for the purpose -6tpre:
P�
pendittwee This was-dA
i. ded
ft
7) 201 Cal 4 271..., On
or tba-pur p ose-o
be' atop. expend?.
is6o 9 62 -O,A.:.._
.in.. r
.tier catego y .
its
ontract appredb
qty:.: ty
ny. '.The puso _,
.POA -
question; is
ater aitvice to t L. ,
. .
to predict with any a
h "if tei
"if ewe 100A
this
of- its"Ai0ing 'context&
and
view (if the.
�k in proceeding vith'- t
:f it.v . me ActiivIned t-
'be
Lecessat 7 to repay the
X
VWC:mec I
cc - city manager 7t
City Clerk
h.the City Manager. on the
it 'ready for your sir atu
I AJ .. I
V Charamza U
Att;r;Ty
CITY OF ;
CITY ATT�Y, _
- j
Enc.
CITY OF.-IMPM I
To: The Honorable Mayor and
city- council
From: City Attorney
Subject: Contract with Coate Mesa-0
Transmitted is a sed resolution
City Council, would authorize the eju
under -which the Catinty Water'.Dist-riol
water within a portion of'the.servicl
Heights Water Company and provideje h
District,of a portion of the assets"]
City from the company.
The objective of the contract is.to 4
of the company and to agree at this I
served by the City and what area-vill
Water District, The figure of $47"
2(b) is subject to adjustment do
of meters being taken over by the Cit
taken over by the District*
It would be in order for the City Cm
authorizing the execution of the ebit
the Board of Directors of the'Costa
at a_ meeting this.. evening. . I. I
Vw:mec City
Raco
Noveiab." 18a 1963 tQ
%
4L
NV_
my Hater District
hick, if adopted b3
Ution 4k the contra
assumes thO`66rVJe;4
area -of the Santa- i
by the I
by the J
tgregate the service 'a.
so on what area
be served by the zo� will' m
I appearing in parogra
Z upon the final numb
and -the. number being
cil to adopt the reaq
act which will, be bei
so county Vitir .1K.St r
AJ
17
pff
5
N,
J
MANT
The City of heeepon boach has ofierod to purohaso Wis
assets of the ssnta Ana Feights tinter CompMy. The Only abjective
of the Clty is to prarfda as adequate and swats Supply Of motor
to all rosielants with the City at the lowest possible costo
upon approval of the contrast to peso„ all dome-
boldors of the company will hers the use and dW adventage of the
ressatwlrs pumping plants, tranasfssiaw waina, and intereonnsating
distribution malAo of the City of Newport Muh or the Goota Us"
County Water District, ah#ah boss a Val" of many millions of
1Ri Mfi a, a 'Y��e�iata' Cost to the N aii6 We* G..
e q
The City Council of M mport Noseh loels that the doelelaa
of the hoard of Directors of the try to antboriso the OAtmet
Mein a W.Md. and advantageous deeiaiise and In the boat interests
of the shareholders.
• • �'04 �
CITY OF NEWPORT BEACH
CITY ATTORNEY
DEPARTMENT—
November 12, 1963
Toe The Honorable Mayor and
City Council
From: City Attorney
Subject: Purchase of Santa Ana Heights Water Company
Transmitted are the following:
1. Page 14 of the proposed contract between the City and the
Santa Ana Heights Water Company relating to the purchase of
its assets, The original of the contract as revised is
being delivered to the City Clerk.
2. A resolution which, if adopted by the City Council, will author-
ize the execution of the contract on behalf of the City.
3. A proposed ordinance which, if enacted by the City Council,
would add Section 7241,3 to,the Municipal Code and would author-
ize the service of water outside.the City within the service
area of the company.
In considering the contract at its meeting on November 11, the Board
of the company made some changes in paragraph 19 and proposed an
additional paragraph numbered 23. Upon consideration of the pro-
posed changes, it.was determined by the undersigned that they would
not be satisfactory to the City. Further discussion with repre-
sentatives of the company indicate that paragraph 19 as contained
in the draft transmitted herewith is the most feasible language
which may be acceptable to both parties. It is, therefore, sug-
gested that the contract be authorized and returned to the company
for consideration by its Board of Directors.
The proposed ordinance adding Section 7241,3 to the Code would seem
to be necessary to authorize service in this area outside the City.
It is suggested that it be introduced at the meeting. on November 12
and, if it appears on November 25 that the purchase will be consum-
mated, it be adopted at that time. It would then be effective on
or about the time the City would possibly be assuming service in
the service area of the company ogt4de �;h( Go .
Encs.
cc - City Manager City Attorney
Public Works Director
City Clerk ,/
U4, W3
• : '. 'ZOS _ Coueteil
VMS City Attorney
"jests lursbs" Of Seattle &W Belo a water CeaPany vatw
Yraasmitted is a s PT oan1 11 with the . and ssgsant
y. the pope :
w;
desdo
These ass bals►g delivered to tits City'embed by e,* �oli� :;
ne"Irtm"t on ovember 11 in order that y" gay �y haw as
pastvnity to review them trios to tie Meeting on ltavambss
1 0! the aontraat and lett r are bieiat
da ere Origins Lts� lresidemit of the Santa Am
Y. dalivorsd to flsa'Prot� adasidentian by M 30"d •!
} p i t wratatriq aaaaswt MIX
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`'` "' • . � :iii • ^'t. '` "E � � .
wo- Congo
Under the policy of the City and your companyj, the distribution
mains from which Mater is served to adjacent property are initially
provided by the owners or developers of the laud to be served at
no cost to the City or company. So compensation Litt thereforeo
being offered for those live&.
If this offer meets with the approval of the Board, it is sug-
gested that the Board accept the offer and authorize the execution
of the contract an behalf of the company. The City Council meets
again on November 12v 1963;, at a regular meeting and could author
ize the execution of the contract on behalf of the City if the
Board has acted favorably an the offer by the City and has author*..
used the execution of the contract an behalf of the company. if
yyoouurr Board does not accept Me offer at your meeting tonight
it will eontiaua M Il tad my be accepted an or before xovemiler
no 1963.
very fly yoursf
Charles to Ron
q me Beach
layar* city of so
i
•
tf',91 .. 3:•.36>i!'wi.ia'ic3aiF.�r •' <__= %. .__..5.CIf - 'S' 1_..,i
The City Council an behalf of the City of Newport Beach has
{'
authorised an offer to purchase all of the assets of the Santa
ugh Ccm� y by the City and has directed that the
Ana Hs is water as
offer be nibmitted to you in accordance with the terms of this
letter and the contract transmitted herewith.
The City offers to pa $3508000 for the assets as provided in the
followsa
proposed contract. Tis amount is broken down as 1. For
;•cr.
the 6.664+ acres of land and appurtenances owned bbyy the company
1 ying between Paularino Avenue and Baker Street i99 800. 2. loan
the 2.43+- acres of land and appurtenances ownel by tie company cst
Palisades Road, $850050* 3* for all other assets of the company,
465.150.
Under the policy of the City and your companyj, the distribution
mains from which Mater is served to adjacent property are initially
provided by the owners or developers of the laud to be served at
no cost to the City or company. So compensation Litt thereforeo
being offered for those live&.
If this offer meets with the approval of the Board, it is sug-
gested that the Board accept the offer and authorize the execution
of the contract an behalf of the company. The City Council meets
again on November 12v 1963;, at a regular meeting and could author
ize the execution of the contract on behalf of the City if the
Board has acted favorably an the offer by the City and has author*..
used the execution of the contract an behalf of the company. if
yyoouurr Board does not accept Me offer at your meeting tonight
it will eontiaua M Il tad my be accepted an or before xovemiler
no 1963.
very fly yoursf
Charles to Ron
q me Beach
layar* city of so
i
•
tf',91 .. 3:•.36>i!'wi.ia'ic3aiF.�r •' <__= %. .__..5.CIf - 'S' 1_..,i