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SETTLEMENT AGREEMENT AND RELEASE
THIS SETTLEMENT AGREEMENT AND RELEASE ("Agreement") is entered
into by and between ROBERT E. BRICKLEY, RANDALL K. DARKENS, BONNIE J.
HALES, JACOB MANTEL, MARSHALL B. MEAD, RAYMOND B. MILLS, JAMES H.
SMITH, LEONA TERRY, and OLIVIA M. VILLA (collectively "Retirees"), the City of
Redlands ("Redlands"), and the California Public Employees' Retirement System, a unit
of the State of California ("CalPERS").
RECITALS
A. Retirees are former employees of Redlands and are members of CalPERS.
B. Retirees are currently receiving retirement allowances from CalPERS.
C. In or about 1993, CalPERS excluded certain items of Retirees' final compensation
("Additional Compensation") from its calculation of Retirees' retirement allowances.
CalPERS based its decision on the applicable provisions of the Public Employees'
Retirement Law.
D. Retirees appealed from this decision of CalPERS ("Administrative Appeal"). The
Administrative Appeal is entitled, In the matter of the Appeal of the Calculation of
Benefits Pursuant to the Employer's Report of Final Compensation by ROBERT E
BRICKLEY, RANDALL K DARKENS, JEAN A. FREEMAN, BONNIE J. HALES,
DAVE L. MARTIN, MARSHALL MEADE, RAYMOND B. MILLS, JAMES H. SMITH,
LEONA TERRY, OLIVIA M. VILLA, and JACOB MANTEL, Respondents, and CITY
OF REDLANDS, Respondent, Office of Administrative Hearings number L-9604113.
E. On May 29, 1997, the Office of Administrative Hearings, Administrative Law Judge
Judith Wharton presiding, issued its proposed decision ("Proposed Decision") on
the Administrative Appeal. On September 24, 1998, the Office of Administrative
Hearings, Judge Wharton presiding, issued its Ruling and Order on Respondents'
Motion to Contest Jurisdiction ("Administrative Order") in the Administrative Appeal
proceedings. On December 16, 1998, the CalPERS Board of Administration
adopted the Proposed Decision as its own ("The Board Decision").
F. Retirees, Redlands, and CalPERS (individually "Party" and collectively "Parties")
enter into this Agreement to avoid the inconvenience and the expense of litigation
over the facts and subject matter of this Agreement and the Administrative Appeal.
G. Attached to this Agreement as Exhibit 1 is a summary of the Retirees' final
compensation calculations. Column A of the exhibit sets forth the annual average of
each Retiree's final compensation as reported by Redlands. Column B sets forth
the annual average of each Retiree's final compensation as approved by CalPERS
prior to the Proposed Decision, Column C sets forth each Retiree's final
Settlement Agreement and Release Page 2 of 17
compensation as adjusted by the Proposed Decision. Column D sets forth the
annual average of each Retiree's final compensation as adjusted by the terms of
this Agreement.
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS,
OBLIGATIONS, AND AGREEMENTS SET FORTH BELOW, IT IS AGREED BY AND
BETWEEN THE PARTIES AS FOLLOWS:
Section 1. RETIREMENT ALLOWANCES.
Leona Terry and Raymond Mills each shall receive a CalPERS retirement
allowance based upon final compensation that is equal to the sum of the following: (1)
the amount of final compensation as adjusted by CalPERS prior to the Proposed
Decision and (2) ninety five percent (95%) of the additional amount of final
compensation approved in the Proposed Decision. Robert E. Brickley, Randall K.
Darkens, Bonnie J. Hales, Jacob Mantel, Marshall B. Mead, James H. Smith, and Olivia
M. Villa each shall receive a retirement allowance based upon final compensation that
is equal to the sum of the following: (1) the amount of final compensation that had been
approved by CalPERS prior to the Proposed Decision and (2) seventy percent (70%) of
the additional amount of final compensation approved in the Proposed Decision. The
Parties acknowledge and agree that Column D of Exhibit 1 describes for each Retiree
the amount of their final compensation as described in this paragraph.
Beginning with the June 1, 1999 warrants, CalPERS will pay each of the Retirees a
monthly retirement allowance (collectively "Adjusted Retirement Allowances") which
reflects the adjustments described in this section. The amount of each Retiree's
Adjusted Retirement Allowance is set forth in the following table:
Robert E. Brickley $ 6,661.53
Randall K. Darkens $ 6,693.90
Bonnie J. Hales $ 934.52
Jacob Mantel $ 4,721.71
Marshall B. Mead $ 4,984,60
Raymond B. Mills $ 7135.57
James H. Smith $ 6,149.88
Settlement Agreement and Release Page 3 of 17
Leona Terry $ 3,686.26
Olivia M. Villa $ 936.39
The Adjusted Retirement Allowances reflect each of the Retirees' choice of settlement
options and shall be modified by all future cost of living adjustments applicable under
law. The Adjusted Retirement Allowances shall be paid from the appropriate employer
accounts of Redlands and shall be subject to all applicable laws.
Section 2. PAYMENT OF CASH TO RETIREES.
From the appropriate employer accounts of Redlands, CalPERS shall pay in
cash within twenty one (21) days of the Effective Date of this Agreement the following
sums to the following persons:
Robert E. Brickley $ 16,553.33
Randall K. Darkens $ 25,138.16
-Bonnie J. Hales $ 6,885.26
Jacob Mantel $ 18,004.83
Marshall B. Mead $ 21,168.00
Raymond B. Mills $ 32,525.63
James H. Smith $ 20,368.42
Leona Terry $ 40,975.79
Olivia M. Villa $ 7,352.76
The Parties acknowledge and agree that each of these payments (collectively "Cash
Payments") represents the difference between the amount that each Retiree actually
received from CalPERS in monthly retirement allowance and the amount of each
Retiree's Adjusted Retirement Allowance. from the date of the adjustment by CalPERS
in the cases of Raymond B. Mills and Leona Terry and from the date of retirement in
the case of the remaining Retirees through June 30, 1999, with three and one-half (3
1/2) percent per annum simple interest,
Settlement Agreement and Release Page 4 of 17
Section 3. REDLANDS EMPLOYER CONTRIBUTION RATES.
For the purpose of setting the employer contribution rates of Redlands, the
Adjusted Retirement Allowances and the Cash Payments shall be considered a part of
the "experience" of Redlands within the meaning of Government Code section 20815.
CalPERS acknowledges and agrees that it will not charge or collect a lump sum from
Redlands to fund any actuarial loss attributable to payment of the Retirement
Allowances or the Cash Payments and that any such loss shall be amortized in
accordance with the applicable Board of Administration actuarial policies.
Section 4. WAIVER, DISCHARGE, AND RELEASE.
Retirees, CalPERS and Redlands generally and specifically waive, discharge,
and release each other and each of their respective past, present, and future officers,
directors, boardmembers, employees, agents, assigns, successors, personal
representatives, attorneys, administrators, receivers, and trustees from any and all
rights, claims, demands, liability, causes of action, actions, suits, proceedings,
obligations, attorneys' fees, and expenses, of whatever kind and nature, whether
known or unknown, or contingent or accrued, which relate to, or arise or could arise
under or out of, the Administrative Appeal, the Proposed Decision, the Board Decision,
the Administrative Order, and/or any Memorandum of Understanding entered into by
Redlands and any employee organization representing employees of Redlands.
Retirees, CalPERS and Redlands agree that the Proposed Decision, the Board
Decision and the Administrative Order are of no force or effect whatsoever.
Section 5. WAIVER OF CIVIL CODE SECTION 1542.
Section 1542 of the Civil Code provides as follows:
A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the
time of executing the release, which if known by him must
have materially affected his settlement with the debtor.
Retirees, CalPERS, and Redlands, and each of them, fully understand and expressly
waive any and all of their respective rights under, and the benefits of, section 1542 of
the Civil Code as to the releases given in this Agreement.
Section 6. DISMISSAL OF PROCEEDINGS WITH PREJUDICE.
Retirees shall dismiss with prejudice any and all lawsuits, actions, claims,
proceedings, and appeals including without limitation the Administrative Appeal that
they may have filed against CalPERS, Redlands, and/or their respective officers,
Settlement Agreement and Release Page 6 of 17
directors, boardmembers, employees, agents, assigns, successors, personal
representatives, attorneys, administrators, receivers, and trustees, both past and
present. Redlands shall dismiss with prejudice any and all lawsuits, actions, claims,
proceedings, and appeals including without limitation the Administrative Appeal that
they may have filed against CalPERS and/or its officers, directors, boardmembers,
employees, agents, assigns, successors, personal representatives, attorneys,
administrators, receivers, and trustees, both past and present.
Section 7. SUFFICIENCY OF CONSIDERATION.
The sufficiency of the consideration for the mutual covenants, obligations, and
agreements contained in this Agreement is acknowledged by the Parties.
Section 8. NO ADMISSION OF LIABILITY.
This Agreement is made for the purpose of avoiding the inconvenience and
expense of litigation, including the Administrative Appeal, and the making of this
Agreement shall not be deemed an admission of any liability or wrongdoing on the part
of any Party to the Agreement. Each Party shall bear his/her/its own attorney's fees,
costs and expenses incurred in connection with the Agreement, the Administrative
Appeal, and any other related proceedings.
Section-9. INADMISSIBLE AS EVIDENCE.
Except for proceedings to enforce this Agreement, neither the terms of the
Agreement nor its existence shall be admissible as evidence in any litigation between
the Parties.
Section 10. SUCCESSORS AND ASSIGNS.
All terms and conditions of this Agreement shall be binding upon, inure to the
benefit of, and be enforceable by, the Parties and their respective representatives,
successors and assigns. Each Party represents and warrants that he/she/it has not
assigned or transferred to any person or entity any of the rights, claims, and demands
released or discharged under this Agreement. Any such assignment or transfer shall
be null and void from inception.
Section 11. RIGHT TO REQUIRE PERFORMANCE.
The failure of a Party at any time to require performance by any other Party of
any of the provisions of this Agreement shall in no way affect the right of the first Party
to enforce any provisions of the Agreement. Any waiver by a Party of any breach of
this Agreement shall not constitute a waiver of any succeeding breach or a waiver of
the any provision in the Agreement,
Settlement Agreement and Release Page 6 of 17
Section 12. CLAIMS AND LIENS OF THIRD PARTIES.
Retirees agree to defend, indemnify and hold harmless CalPERS and Redlands
from any and all claims, demands, actions, suits, proceedings and liens against the
proceeds of this settlement.
Section 13. ENTIRE AGREEMENT.
This Agreement contains the entire agreement between the Parties relating to its
subject matter and all prior and contemporaneous agreements, understandings,
representations, and statements, both oral and written, are merged herein.
Section 14. MODIFICATION.
This Agreement may not be altered, amended, modified or otherwise changed in
any respect whatsoever except by a writing duly executed by all of the Parties and/or
their authorized representatives.
Section 15. LAW OF THE AGREEMENT.
Any action or proceeding brought for the purpose of enforcing this Agreement
shall be governed by the laws of the State of California.
Section 16. NO WAIVER OF PRIVILEGES OR IMMUNITIES.
Notwithstanding any term or condition of this Agreement, all privileges and
immunities from liability, including without limitation the provisions of the California Tort
Claims Act (California Government Code sections 810, et seq.) and any exemptions
from rules as provided by law, are not waived by Redlands or CalPERS and shall apply
to any claim or demand made against Redlands and/or CalPERS which arises out of
this Agreement.
Section 17. SEVERABILITY.
If any term, covenant, or condition of this Agreement is held by a court of
competent jurisdiction to be invalid, void, and/or unenforceable, the remainder of the
provisions of this Agreement shall remain in full force and effect and shall in no way be
affected, impaired, or invalidated.
Settlement Agreement and Release Page 7 of 17
Section 18. AMBIGUITIES NOT HELD AGAINST DRAFTER.
This Agreement having been freely and voluntarily negotiated by all Parties, the
rule that ambiguous contractual provisions are construed against the drafter of the
provision shall be inapplicable to this Agreement.
Section 19. NO MODIFICATION OF PUBLIC EMPLOYEES' RETIREMENT LAW.
Each Party acknowledges and agrees that nothing in this Agreement deletes,
modifies, or changes in any way the duties, responsibilities, and authority of CalPERS
and its Board of Administration to administer and carry out the Public Employees'
Retirement Act (Government Code, sections 20000, et seq.) with respect to Redlands
and Retirees.
Section 20. UNDERSTANDING OF AGREEMENT.
Each Party acknowledges and agrees that they are represented by counsel in
connection with the drafting and execution of this Agreement and that they have read
and fully understand the terms and conditions of the Agreement.
Section 21. PUBLICITY.
Each Party agrees not to hold a press conference or issue a press release
concerning the terms or conditions of this Agreement.
Section 22. CAPTIONS.
Captions are inserted for the convenience of reference only and do not define,
describe, limit or expand the terms of this Agreement or the intent of the Parties.
Section 23. AGREEMENT CONDITIONED UPON ALL PARTIES' SIGNATURES.
This Agreement is expressly made conditional upon all Parties' signature of the
Agreement. The effective date of this Agreement is the first date on which all Parties
have signed this Agreement.
IN WITNESS THEREOF, the Parties have signed this Agreement the day and year
written next to their signatures below in a manner fully binding upon them.
Settlement Agreement and Release Wage 8 of 17
Dated* lune 1999
Robert E. Brickley
Settlement Agreement and Release Page 9 of 17
Dated. June 524 1999
Randall K. Darkens
Settlement Agreement and Release Page 10 of 17
Dated: June 1999 •f� '�
Bonnie J. Hale
Settlement Agreement and Release Page 11 of 17
Dated: June 2. 1999 ✓ -
cob Mantel
Settlement Agreement and Release Page 12 of 17
Dated: Jane�� 1999
M rshall B. Mead
Settlement Agreement and Release Page 13 of 17
Dated: June,,,!5,'1999
M rid B. Mil s
Settlement Agreement and Release
Page 14 of 17
Dated: June 1999
James mith
Settlement Agreement and Release Page 15 of 17
Dated: June, 1999 �, �., _.
Leona Terry
Settlement Agreement and Release Page 16 of 17
Dated: June ?1999
Evia M. Villa
Settlement Agreement and Release Page 17 of 17
City of Redlands
Dated: July 16, 1999 BY:
California Public Employees'
Retirement System
Dated:-fv l _1 , 1999 By: 2eAZI
Ken Marzion, hief
Actuarial and Employer Services
Division
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REDLAMS SETTLEMENT
A
» rnil YFinal Final
G+ t comp COMP Camp
Reported Approved y ALS` By Settlement
w�38 1 46 .30 O' 6 4
I x ri 105, 758 - 73 94, 493 -90
$102,483 . 80 $100, 159 .32
W. 45, 402 . 98 37, 17 » 9
$104, 803 . 81 92, 731: » 08 102, 974 . 89 --$-9-979-0 i—. 7 7
-$-1-0
102, 602 .39 91, 608 .72 102, 602 . 39 $102, 018 . 27
' : rj $6, 880»99 71,525 »36 86, 880. 99 86, 11 »21 ;
5 $109, 659 .20 94,424 102, 341 . 96 99, 966 » 56
46, 619»14 38,553 .00 45, 871.58 43, 676 .29
79, 179.30 69, 949.88 76, 814 .25754 .
6/21/99