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HomeMy WebLinkAboutC-5034 - Abatement Agreement, 6000 West Coast Highway, #A1 [Owner-David Jalali]^'I 1 ABATEMENT AGREEMENT This Abatement Agreement (the "AGREEMENT ") is entered into by and among Brian Rene Ventura, in his personal capacity and as Chief Executive Officer ( "CEO ") of Network Patient Center, and Joshua Sheng, in his personal capacity and as Chief Financial Officer ( "CFO ") of Network Patient Center and Network Patient Center, a Califomia corporation (collectively, "OPERATOR ") and the City of Newport Beach, a charter city and California municipal corporation (hereinafter the "CITY "). This AGREEMENT is made effective as of December 5, 2011(the "EFFECTIVE DATE "). OPERATOR, OWNER and CITY are hereinafter collectively referred to as "PARTIES." This AGREEMENT is entered into in reference to the following Recitals that the PARTIES agree are accurate to the best of their knowledge and belief. For the purposes of this AGREEMENT only, the following capitalized terms shall have the following meanings: A. "CITY" shall mean the City of Newport Beach, a charter city and California municipal Corporation, and its City Council, boards and commissions, officers and employees. B. "OPERATOR" shall mean collectively Network Patient Center, a California Corporation, Brian Rene Ventura, in his personal capacity and as CEO of Network Patient Center, and Joshua Sheng, in his personal capacity and as CFO of Network Patient Center. C. "PROPERTY" shall mean the property located at 6000 West Coast Highway, # Al, Newport Beach, California. D. "OWNER" shall mean the owner of the PROPERTY, David Jalali, as Trustee of the David Jalali Living Trust 2004 dated December 3, 2004. E. "ACTION" shall mean any issue related or referring to OWNER and/or OPERATOR's use of the PROPERTY, or any other property within the CITY, for purposes of selling and /or distributing marijuana in violation of the Newport Beach Municipal Code ( "NBMC ") or administrative citations, civil or criminal actions contemplated by the City to obtain compliance with any of the provisions of the NBMC. F. "CLAIMS" shall mean all claims, charges, liabilities, damages, obligations, costs, expenses (including without limitation attorneys' fees), rights of action and causes of action of any kind, legal or equitable, whether known or unknown, anticipated or unanticipated, past, present or future, contingent or fixed, existing, claimed to exist or which may hereafter exist under the United States Constitution, the California Constitution, applicable common law, contract, tort or other federal, state, local, or 6000 West Coast Highway Abatement municipal law or regulation, relating in any way to facts and circumstances that give rise to any ACTION. G. "NBMC" shall mean the Newport Beach Municipal Code. H. "EFFECTIVE DATE" shall mean the date of the last signature necessary to execute this AGREEMENT. . I. "ABATEMENT PERIOD" shall mean that period of time extending from the EFFECTIVE DATE of this AGREEMENT to no later than December 30, 2011. RECITALS A. The most recent authorized use of the PROPERTY is for "Commercial Visitor - Serving" ( "CV ") use. NBMC section 20.20.010 (Commercial Zoning Districts) establishes the purposes of the CV district. The CV district is intended to provide for areas appropriate for accommodations, goods, and services intended to serve primarily visitors to the City. NBMC section 20.20.020 lists land uses that are allowed by right, allowed when a specific permit is obtained, and prohibited uses. Additionally, land uses that are not listed in the applicable table contained in NBMC section 20.20.020, or are not shown in a particular zoning district are not allowed, except as otherwise provided by NBMC section 20.12.020(E). B. The use of the PROPERTY to sell and /or distribute marijuana is not contained among the list of land uses in NBMC section 20.20.020 that are allowed by right or allowed when a specific permit is obtained and is therefore a prohibited use. The use of the PROPERTY to sell and/or distribute marijuana is a violation of NBMC sections 20.12.020(E), 20.16.030, 20.20.020 and 20.52.100. C. Prior to commencing operations and selling and /or distributing marijuana, OPERATOR was informed on at least two occasions by CITY Code Enforcement Officers that the use of the PROPERTY to sell and /or distribute marijuana is prohibited under the NBMC. D. During investigations conducted by CITY Code Enforcement Officers and Police Officers it was determined that OPERATOR was selling and distributing marijuana from the PROPERTY in violation of NBMC section 20.16.030, 20.20.020 and 20.52.100. E. The violations of the NBMC contained in Recital D are a nuisance per se pursuant to NBMC sections 1.04.020 and 10.50.020(1) and City of Riverside v. Inland Empire Patient's Health and Wellness Center, Inc (2011) 2011 WL 5386590 (Cal.App. 4 Dist.), 11 Cal. Daily Op. Serv. 13,799, 2011 Daily Journal D.A.R. 16, 413. F. On November 1, 2011, the CITY's Community Development Director, Kimberly Brandt, issued a Notice of Violation ( "NOV") to OPERATOR and OWNER. A true and correct copy of the NOV is attached hereto as Exhibit A and incorporated 6000 West Coast Highway Abatement Agreement 2 herein by reference. The NOV ordered that OPERATOR and OWNER immediately cease any use of the PROPERTY not allowed by right under the NBMC. The NOV further advised that the failure to immediately comply and correct the violations will cause the City to take enforcement action. G. Following the receipt of the NOV, OPERATOR contacted CITY's Code Enforcement Supervisor, Matt Cosylion, to request a meeting with the CITY to discuss the NOV. A meeting was then held on November 22, 2011 between CITY and OPERATOR. During this meeting, OPERATOR acknowledged that OPERATOR was, and currently is, using the PROPERTY to sell and /or distribute marijuana in violation of the NBMC. H. On November 22, 2011, OWNER sent OPERATOR a letter informing OPERATOR that the lease contract dated April 15, 2011 requires OPERATOR to comply with all local laws and obtain all proper permits and OWNER requested that OPERATOR comply with CITY's laws and requirements. I. OPERATOR has agreed to cease the use of the PROPERTY to sell and /or distribute marijuana, or any other use that is in violation of the NBMC, on or before December 30, 2011. J. OPERATOR has agreed not to use any other property or land within the CITY in violation of the NBMC. NOW, THEREFORE, to obtain compliance with the NBMC on the part of OPERATOR and in consideration of the CITY refraining from pursuing any ACTION against OPERATOR during the ABATEMENT PERIOD, such civil and /or criminal remedies, and /or imposing such administrative fines as permitted by state and local law for OPERATOR's violations of the NBMC, the PARTIES agree as follows: SETTLEMENT A. REPRESENTATIONS AND WARRANTIES. The PARTIES hereby represent and warrant that: (a.) The foregoing Recitals are true and correct. (b.) That should OPERATOR fail to comply with any of the terms of this AGREEMENT that CITY may immediately commence an ACTION to seek OPERATOR's compliance with the NBMC. OPERATOR hereby expressly, knowingly, and voluntarily waive any and all rights to oppose a motion by the CITY that a court issue an injunction requiring OPERATOR to comply with the terms of this AGREEMENT and cease use of the PROPERTY to sell and /or distribute marijuana, or any other use that is in violation of the NBMC. 6000 West Coast Hiphwav Abatement (c.) The CLAIMS disposed of by this AGREEMENT have not been assigned, transferred, released or granted, or purported to assign, transfer, release or grant, any CLAIMS disposed of by this AGREEMENT. (d.) None of the CLAIMS released hereunder will in the future be assigned, conveyed, or transferred in any fashion to any other person and /or entity. 2. The PARTIES hereby represent and warrant that they have the power and authority to enter this AGREEMENT. 3. OPERATOR agrees they shall indemnify and defend and hold the CITY harmless from any and all liability, loss, expense, damage, or claims which may arise directly or indirectly from or in connection with any allegation that the warranties and representations made by OPERATOR in this section are false and /or for the breach of any of the terms and conditions of this section. 4. Nothing herein shall be deemed as a waiver or release of the warranties, representations, rights and obligations as set forth in this section. B. TERMS OF SETTLEMENT. 1. OPERATOR shall complete all actions necessary to cease any use of the PROPERTY for the sell and /or distribution of marijuana as well as any other use that is not allowed by right under the NBMC on or before December 30, 2011. 2. On or before January 3, 2012, OPERATOR shall schedule an inspection of the interior and exterior of the PROPERTY with CITY's Code Enforcement Division to confirm that the PROPERTY is not being used to sell and /or distribute marijuana and is not being used for any purpose that is not allowed by right under the NBMC. 3. After December 30, 2011, PROPERTY shall be utilized for those uses allowed by right under the NBMC unless and until all necessary permits and approvals are obtained from the CITY in compliance with the NBMC. 5. The PARTIES will use their best efforts and cooperate as necessary in performing and implementing this AGREEMENT in good faith. 6. OPERATOR acknowledges and agrees that their failure to comply with the terms of this AGREEMENT may result in the CITY bringing an ACTION against OPERATOR to obtain compliance with this AGREEMENT. D. GENERAL RELEASE. 1. General Release and Discharge of Claims by OPERATOR. Upon the EFFECTIVE DATE of this AGREEMENT, OPERATOR, for itself and all of its predecessors, successors, assigns, representatives, attorneys, employees, officers, and agents, do hereby fully and forever release and discharge the CITY, and all of its 6000 West Coast Abatement predecessors, successors, assigns, representatives, attorneys, agents, elective and appointive council members, council boards, commissions, commissioners, officers, employees, of and from any and all actions, CLAIMS, demands, rights, damages, costs, litigation expenses, attorneys fees, expert fees, consultant fees, other fees, interest, lost profits and earnings, diminution in the value of the business, loss of past, current, future and subsequent business and patronage, the value of the leasehold interest, the loss of goodwill, any inverse condemnation claims, any claims for the taking of property, diversion of resources, any other damages, costs or expenses arising from any and all actions of the CITY and compensation of any nature whatsoever, which they have or may hereafter accrue, including without limitation, any and all known and unknown, foreseen and unforeseen claim, damage and injury. 2. Waiver of Claims. It is understood and agreed that OPERATOR's release set forth herein extends to all CLAIMS of every kind, nature and description whatsoever, known or unknown, suspected or unsuspected and any and all rights under the provisions of Section 1542 of the Civil Code of California or under any comparable statute of any other jurisdiction. OPERATOR expressly acknowledges that they are familiar with and expressly waive and relinquish every right or benefit they have or may have under the provisions of Section 1542 of the Civil Code of California that reads as follows: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.° 3. Representations and Warranties. OPERATOR represents and warrants to the other that, except as otherwise expressly provided in this AGREEMENT, they are not relying on any representation whatsoever, whether express or implied, including without limitation, representations of fact or opinion made by or on behalf of the PARTIES herein. E. MISCELLANEOUS PROVISIONS. 1. Local California Law to Aoply. This AGREEMENT shall be governed and interpreted in accordance with the laws of the State of California. Each party hereto agrees that the laws of the State of California shall apply and that any action brought hereunder shall be subject to the laws and statutes of the State of California. The venue of any legal challenge to this AGREEMENT shall be the Superior Court of the State California in and for the County of Orange. 2. Integrated Agreement. This AGREEMENT, and the exhibits hereto, contains the entire understanding and agreement between the PARTIES and the terms and conditions contained herein shall inure to the benefit of, and be binding upon, the heirs, representatives, successors and assigns of each of the PARTIES. No other representations, covenants, undertakings, or other prior or contemporaneous 6000 West Coast Highway Abatement agreements, oral or written, respecting such matters, which are not specifically incorporated herein, shall be deemed in any way to exist or bind any of the PARTIES hereto. The PARTIES acknowledge that this AGREEMENT has been executed without reliance upon any such promise, representation, or warranty not contained herein. 3. Modification. No supplement, modification or amendment of this AGREEMENT shall be binding useless executed in writing by the effected PARTIES. No waiver of any of the provisions of this AGREEMENT shall be deemed to constitute a waiver of any other provision whether or not similar, nor shall waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the PARTIES making the waiver. 4. Binding on Successors. This AGREEMENT and the covenants and conditions contained herein shall obligate, bind, extend to and inure to the benefit of the PARTIES and each of their respective successors in interest, including, but not limited to, their administrators, executors, owners, partners, officers, directors, trustees, shareholders, legal representatives, assignees, attorneys, successors, and agents or employees. Prior to assigning any rights or obligations OPERATOR has with respect to this AGREEMENT, OPERATOR shall obtain written confirmation and deliver to CITY that such assignee shall be bound by the terms of this AGREEMENT and that such Assignee shall also be entitled to receive the benefits of this AGREEMENT. 5. Representation. The PARTIES affirmatively represent they have been represented by counsel of their own choosing or have been allowed the opportunity to consult with counsel of their choosing and have elected not to. They have read this AGREEMENT and have had the terms used herein and the consequences thereof explained by their attorneys of choice. 6. Construction. This AGREEMENT shall not be construed against any Party, but shall be construed as if all PARTIES jointly prepared this AGREEMENT. Any uncertainty and ambiguity shall not be interpreted against any one Party. Language in all parts of the AGREEMENT shall be in all cases construed as a whole according to its very meaning. 7. Attorneys' Fees and Costs. The PARTIES to this AGREEMENT will bear their own costs and attorneys' fees incurred until the EFFECTIVE DATE of this AGREEMENT. Should an ACTION be brought by CITY to enforce or interpret any part of this AGREEMENT, the prevailing party is entitled to recover attorneys' fees and related costs. 8. Gender Neutral. Whenever in this AGREEMENT the context may so require, the masculine, feminine and neutral gender shall be each deemed to include the other and the singular and the plural shall refer to one another. 9. Counterparts. This AGREEMENT may be executed in duplicate counterparts, each of which shall be deemed an original and all of which shall constitute an agreement to be effective as of the date of signing. Further, signatures transmitted 6000 West Coast Highway Abatement Agreement 6 electronically or by facsimile shall be deemed to have the same weight and effect as an original signature. The PARTIES may agree that an original signature will be substituted at some later time for any electronic or facsimile signature. 10. Headings. The headings included in this AGREEMENT are for convenience only and do not limit, alter, or affect the matters contained in this AGREEMENT or the paragraphs they encaption. 11. Invalid Clause May Be Severed. If any provision, clause, or part of the AGREEMENT is adjudged illegal, invalid or unenforceable, the balance of this AGREEMENT shall remain in full force and effect. 12. Survival of Warranties and Representatives. The warranties and representations made in this AGREEMENT are deemed to survive the execution of this AGREEMENT are deemed to survive the execution of this AGREEMENT. 13. BY SIGNING THIS AGREEMENT, THE PARTIES CERTIFY THAT THEY HAVE READ IT, THAT THEY HAVE CONSULTED WITH THEIR LEGAL COUNSEL, OR HAVE FREELY, VOLUNTARILY, KNOWINGLY AND INTELLIGENTLY ELECTED NOT TO SEEK LEGAL COUNSEL, ABOUT ITS EFFECT, AND THAT THEY FULLY UNDERSTAND IT. [SIGNATURES TO FOLLOW ON NEXT PAGES] 6000 West Coast Highway Abatement Agreement 7 IN WITNESS WHEREOF, the PARTIES have caused this AGREEMENT to be executed as of the dates indicated below and their attorneys, if applicable, have indicated their approval as to form by their respective signatures in the appropriate spaces below. OPERATOR: Network Patient Center, a California corporation '�� k' I Bddh Rene Ventura, as an individual and Date as the CEO of Network Patient Center i4.1slll Sheng, as an-hidiv ' u I and as Date of Network Patient ;,e ter CITY OF NEWPORT BEACH A charter City and California municipal corporation Dave iff, City Manager APPROVED AS TO FORM: OFFICE OF THE CITY ATTORNEY Date: 9 ! I 9� Aar . H rp, City Attorney Date ATTEST: Date: �jr -! p [END OF SIGNATURES] 6000 West Coast Highway Abatement Agreement 8 7AGE LEFT L"OLP. NK IN"FLAMIALLY 6000 West Coast Highway Abatement CERTIFICATE OF ACKNOWLEDGEMENT State of California ) County of ORANGE) On 4j . a011 before me, 0L ") t dVptary Public, personally appeared = l who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he /sh6h*y�executed the same in his{herd eir authorized capacity(os` , and that by his�tWir signature on the instrument the - person, or the entity upon behalf of which the person(a) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. � h {OUL HAMEEO KHAHAPII Signature N Comm 9 0 , y �Cl `L C't •_ My Con, EEm On. 17. 2011 .J` (Seal) CERTIFICATE OF ACKNOWLEDGEMENT State of California ) County of ORANGE) On be Y,�z4 before mejjAi)>j V.Notary Public, personally appeared� 5i�6-A1(, who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowled ed to me that he a /t executed the same in his/ it authorized capacity(ie, and that by his/ it signature on the instrument the person, or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. ODUL HAMEEO HHANANI 1918940 xoTARP exr vueu 0WITVORNU Signature WCo E .o ".11 4 (Seal) 6000 West Coast Highway Abatement Agreement 10 CALIFORNIA ALL - PURPOSE ACKNOWLEDGEMENT STATE OF CALIFORNIA) COUNTY OF ORANGE ) On December 15, 2011 before me, M Locey, Notary Public, personally appeared David A. Kiff who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. M.LOCEY Commission k 1864431 WITNESS my hand and official seal. Notary Public • Calltornla Orange County MY Comm. Expires Oct 7, 2013 + (SEAL) Notary Public in and for a e OPTIONAL INFORMATION Title or Type of Document: Abatement Agreement — 6000 West Coast Highway Date of Document: December 5, 2011 ma