Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_97-cv-20099/USCOURTS-cand-5_97-cv-20099-23/pdf.json

Nature of Suit Code: 893
Nature of Suit: Environmental Matters
Cause of Action: 42:4321 Review of Agency Action-Environment

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Michael A. Isaacs, CSBN 99782 

Diana L. Donabedian, CSBN 191384 

LUCE, FORWARD, HAMILTON & SCRIPPS, LLP 

121 Spear Street, Suite 200 

San Francisco, CA 94105 

Telephone: 415.356.4600 

Fax: 415.356.3895 

E-mail: misaacs@luce.com 

E-mail: ddonabedian@luce.com 

Attorneys for JOHN W. RICHARDSON, 

Receiver 

UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

SAN JOSE DIVISION 

UNITED STATES OF AMERICA, 

 Plaintiff, 

v. 

ALISAL WATER CORPORATION, et al., 

 Defendants. 

Case No. C97-20099 JF(EAI) 

ORDER AUTHORIZING RECEIVER TO 

EXECUTE PURCHASE AND SALE 

AGREEMENT 

[No Hearing Requested] 

Based upon the Ex Parte Application For Entry of Order Authorizing Receiver to Execute 

Purchase and Sale Agreement filed by John W. Richardson, Receiver appointed in the abovereferenced case (“Receiver”) and good cause appearing, and good cause appearing therefor, it is 

 ORDERED as follows: 

1. The Receiver’s Ex Parte Application is approved. 

2. The Receivership is authorizing to execute the Purchase and Sale Agreement 

between County of Monterey, Boronda County Sanitation District and San Jerardo Water System, a 

copy of which is attached as Exhibit A. 

DATED: 

UNITED STATES DISTRICT COURT JUDGE 

301197361.1 

**E-Filed 11/17/2010**

11/17/2010

Case 5:97-cv-20099-EJD Document 943 Filed 11/17/10 Page 1 of 18
PURCHASE AND SALE AGREEMENT 

between 

COUNTY OF Monterey County 

and 

SAN JERARDO WATER SYSTEM 

 THIS PURCHASE AND SALE AGREEMENT (“Agreement”), is made and 

entered into as of OctoberAugust ____, 2010, by and between the County of Monterey, 

Boronda County Sanitation District (hereinafter, “County”), and the SAN JERARDO 

WATER SYSTEM, by and through John W. Richardson, in his capacity of federally 

appointed Receiver for San Jerardo Water System (hereinafter, “Receiver”) and not in his 

personal capacity, with reference to the following facts: 

A. County is a political subdivision of the State of California. Among 

County’s important and fundamental goals are to protect and provide for the health and 

safety of its residents, and to preserve and improve the supply of housing affordable to 

residents of low and moderate income. 

B. Receiver controls a domestic water enterprise currently furnishing service 

to customers in the San Jerardo Housing Cooperative, Inc. Community (hereafter, “San 

Jerardo Community”) and is under a Receivership ordered by the United States District 

Court in the matter entitled, United States of America v. Alisal Water Corporation, Case 

No. C97-20099 (JF) (the “Action”). Pursuant to an April 9, 2002 Order, inter alia, John 

W. Richardson was appointed as the Receiver for the San Jerardo Water System 

(hereafter, “System”). Said Order is attached hereto as Exhibit “A” and incorporated by 

this reference. Receiver is charged with managing the affairs of the System, as noted in 

the Action, until discharged by the United States District Court (“District Court”). All 

actions herein shall be taken by Receiver. 

C. Among other things, Receiver has been ordered to facilitate the 

improvement and sale of the System, located in the County of Monterey. The System 

serves a farmworker Community located at the former military base known as Camp 

McCalum, approximately 5.3 miles southeast of the City of Salinas. The San Jerardo 

Community is predominately characterized by households of low income. 

D. The existing source of water for the System has shown a steady increase in 

nitrates, and is in violation of State water quality standards. Testing has also shown the 

presence of 1,2,3 trichloropropane in amounts that exceed the notification level set by the 

California Department of Public Health. The System also fails to comply with County 

water standards requiring at least two (2) reliable sources of drinkable water supply. 

Prior to County’s installation of an Interim Filtration System pursuant to the Court 

approved Interim Filtration Agreement and Amendments 1 and 2, the System was 

required to provide bottled water to all residents of the San Jerardo Community for 

drinking purposes. 

EXHIBIT A 

Case 5:97-cv-20099-EJD Document 943 Filed 11/17/10 Page 2 of 18
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E. County desires to facilitate the remedying of water quality and water 

supply issues relating to the System, in order to alleviate conditions, which risk the health 

and safety of residents of the San Jerardo Community. 

 

 F. On January 26, 2007 the County and Receiver entered into a 

Predevelopment Agreement, approved by the Court on or about January 29, 2007 to set 

forth the terms of the Purchase and Sale Agreement and to provide for financing of the 

System Improvements to allow the development and completion of a safe and suitable 

water system for the San Jerardo Community. Said Predevelopment Agreement and 

related amendments and attachments are attached and incorporated by this referenced as 

Exhibit “BD.” 

 G. In furtherance of the terms of the Predevelopment Agreement, and subject 

to the approval of grant funding, the County prepared an Request For Proposals (RFP) for 

the construction of improvements to the San Jerardo Water System. Said RFP was 

approved by the Board on or about October 6, 2009. Said RFP included the Project 

Description. Said Project Description and Location Map are attached and incorporated 

by this reference as Exhibit “CB.”

 H. Pursuant to the terms of the Court approved Predevelopment Agreement, 

and subject to the receipt of State Grant Funds, County and Receiver agreed to execute a 

formal Purchase and Sale Agreement containing substantially the terms set forth below, 

and to initiate the process for transfer with the California Public Utilities Commission.

 I. On July 9, 2009, the Board of Supervisors approved Ordinance No. 5134, 

An Ordinance of the County of Monterey, State of California, Relating to Water 

Facilities of the Boronda County Sanitation District which became effective on *******. 

Ordinance No. 5134 is attached hereto and incorporated by thie reference as Exhibit “D.”

JI. On September 24, 2009 the California Public Utilities Commission 

approved the transfer of the System to the County pursuant to Resolution No. W-4786. 

Said Resolution is attached hereto and incorporated by this reference as Exhibit “EDC.” 

KJ. On October 29, 2009, the United States District Court for the Northern 

District of California approved the transfer of the System to the County pursuant to the 

Order (1) extending Receivership for Limited Purpose; and (2) Addressing Matters Heard 

on October 2 2009. Said Order (1) extending Receivership for Limited Purpose; and (2) 

Addressing Matters Heard on October 2 2009 is attached and incorporated by this 

reference as Exhibit “FE.” 

NOW, THEREFORE, the Parties agree as follows: 

ARTICLE 1 DEFINITIONS AND EXHIBITS 

EXHIBIT A 

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 Section 1.1 Definitions

 The following capitalized terms have the meaning set forth in this Section 1.1 

wherever used in this Agreement, unless otherwise provided: 

(a) “Agreement” shall mean this Purchase and Sale Agreement. 

(b) “ARRA” shall mean American Recovery and Reinvestment Act. 

(c) “CDBG Funds” shall mean funds available under Community 

Development Block Grant Program. 

(d) “County” shall mean the County of Monterey, a political subdivision of 

the State of California and/or the Boronda County Sanitation District (BCSD), a 

dependent Special District, staffed by the Department of Public Works (DPW) and 

governed by the Board of Supervisors of the County of Monterey. 

(e) “Default” shall have the meaning set forth in Section 6.1 below. 

(f) “Predevelopment Funding” shall mean the provision of County funds 

pursuant to the Court approved Predevelopment Agreement in the amount of Three 

Hundred Thousand dollars ($300,000). 

 

(g) “Project” shall mean the course of action as described in the attached 

Project Description, incorporated by this reference as Exhibit “B”. 

(h) “Purchase and Sale Agreement” shall mean this Agreement for the 

County’s acquisition of the System. 

(i) “Receiver” shall mean John W. Richardson, in his capacity as Courtordered receiver of the Water System, domestic water enterprises operating under an 

order or receivership in United States District Court Case No. 97-20099; United State of 

America v. Alisal Water Corporation, et. al. and not in his personal capacity. 

(j) “State Grant Funds” shall mean all grant or other moneys which may be

(j) “State Grant Funds” shall mean all grant or other moneys from 

governmental agencies which may be used for the improvement of the System’s supply 

and quality, including, but not limited to, the California Department of Public Health’s 

Safe Drinking Water State Revolving Fund (“SRF”), but not including CDBG Funds or 

ARRA Stimulus Funds. 

(k) “System” shall mean the San Jerardo Water System. 

(l) “Transfer” shall have the meaning set forth in Section 4.4 below. 

Section 1.2 Exhibits

EXHIBIT A 

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 The following exhibits are attached to this Agreement and incorporated into this 

Agreement by this reference: 

 EXHIBIT A: Order Appointing Equitable Receiver in Case No. C97-20099 JF 

(EAI), dated April 9, 2002. 

 EXHIBIT B: PREDEVELOPMENT AGREEMENT AND EXHIBITS

 EXHIBIT CB: PROJECT DESCRIPTION AND LOCATION MAP. 

EXHIBIT D: ORDINANCE NO. 5134: AN ORDINANCE OF 

THE COUNTY OF MONTEREY, STATE OF CALIFORNIA, 

RELATING TO WATER FACILITIES TO THE BORONDA 

COUNTY SANITATION DISTRICT

EXHIBIT EDC: CALIFORNIA PUBLIC UTILITIES COMMISSION 

 RESOLUTION NO. W-4786. 

EXHIBIT D: PREDEVELOPMENT AGREEMENT AND RELATED 

AMENDMENTS AND ATTACHMENTS

EXHIBIT FE: ORDER (1) EXTENDING RECEIVERSHIP FOR 

LIMITED 

PURPOSE; AND (2) ADDRESSING MATTERS HEARD ON 

OCTOBER 2, 2009

EXHIBIT F: ORDINANCE NO. 5134: AN ORDINANCE OF THE COUNTY 

OF MONTEREY, STATE OF CALIFORNIA, RELATING TO WATER FACILITIES 

TO THE BORONDA COUNTY SANITATION DISTRICT

ARTICLE 2 COUNTY TO ACT AS LEAD AGENT FOR RECEIVER IN 

OBTAINING GRANT MONEYS AND PROJECT IMPLEMENTATION 

 Section 2.1 County to Act as Lead Agent for Receiver in Actions to Obtain

 State Grant Moneys; Assignment of Grant Application by Receiver

 To County

 The parties understand and agree that in order to facilitate the award and 

implementation of State Grant Funds, as well as the ultimate transition of the System 

from the Federal Receivership to the care and operation of the County, Receiver shall 

consult with, and utilize the services of County in the actions remaining to comply with 

any and all State or Federal grant funding requirements. Receiver hereby assigns all 

rights, title and interests in the State and Federal Grant Funds for the System to County. 

EXHIBIT A 

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 Section 2.2 County to Act as Lead Agent for Implementation of State Grants

 The parties understand and agree that pursuant to the terms of the Predevelopment 

Agreement, County has acted as the Receiver’s agent in all respects to the pursuit and 

implementation of the State Grants, CDBG awards, and any other funding, as well as the 

construction of improvements. Such work has included, but has not been limited to, the 

bidding of contracts and hiring of contractors, overseeing the work, and taking such 

action as necessary to construct the improvements as contemplated by State and Federal 

Grant funding sources, the Predevelopment Agreement and this Agreement. 

ARTICLE 3 TERMS FOR PURCHASE AGREEMENT OF SYSTEM BY COUNTY

 Section 3.1 Agreement for Purchase of the System by County

 The parties acknowledge that the State’s willingness to provide funds to construct 

improvements to the System is based upon the County’s agreement to acquire, own and 

operate the System upon completion of said improvements. Pursuant to the terms of the 

Court approved Predevelopment Agreement, and subject to the receipt of State Grant 

Funds, County and Receiver agreed to execute a formal Purchase and Sale Agreement 

containing substantially the terms set forth below, and to initiate the process for transfer 

with the Public Utilities Commission. 

Section 3.2 Basic Terms of Purchase and Sale Agreement for the San Jerardo 

Water System

County and Receiver agree that the basic terms of the agreement for the purchase 

of the San Jerardo Water System are: 

(a) Substantial completion of the improvements described in the State 

and Federal Grant agreements and CDBG agreement; 

(b) Completion of any repair or replacement of any defects in the 

System identified as part of the application process for State and 

Federal Grant Funds and CDBG funds; 

(c) Payment of One Dollar ($1.00) by County for title to the System, 

in light of the actions taken by County pursuant to the Court 

approved Predevelopment Agreement and this Agreement; 

(d) Formal approval by the United States District Court in Case No. 

C97-20099 (JF); and 

(e) Formal approval of the purchase by the California Public Utilities 

Commission. 

 

 The County and Receiver expressly agree herein that, regardless of any additional 

terms that the parties may mutually agree upon, both parties shall diligently pursue the 

completion of these basic terms and that, upon their completion, the transfer shall take 

place. This representation is a material term and condition to the County’s participation 

in this Agreement. 

EXHIBIT A 

Case 5:97-cv-20099-EJD Document 943 Filed 11/17/10 Page 6 of 18
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 Section 3.3 Ability of County to Assign Right to Purchase to Third Party

 Receiver and County Agree that at any time prior to or after the completion of the 

improvements contemplated by this Project, County may assign its rights and obligations 

under this Agreement to another entity that otherwise meets the criteria of the various 

Grant Agreements that may be awarded. Provided, however that the County will not 

assign its rights and obligations under this Agreement to another non-County entity prior 

to the time that final disbursements of all State or Federal grant funding programs have 

been made, and provided further that the County will consult with the California 

Department of Public Health and with the California Department of Housing and 

Community Development, as applicable and as legally required with respect to each 

funding agency, on proposals to transfer ownership of the System to another public entity 

and will seek appropriate approval for any proposed ownership transfers to a or private 

entity for the purposes of ensuring that grant funding requirements are met. 

ARTICLE 4 REQUIREMENTS DURING THE TERM OF THE AGREEMENT 

 Section 4.1 Information

 County and Receiver shall provide any information reasonably required by each 

other in connection with the pursuit of the State and Federal Grant Funds and the 

completion of this Purchase and Sale Agreement. 

 Section 4.2 Fees and Taxes

 County shall be responsible for payment of any fees, assessments, taxes, charges, 

and levies imposed by any public authority or utility company, and not waived, with 

respect to the actions necessary to obtain State and Federal Grant Funds, and shall pay 

such charges prior to delinquency. However, County shall not be required to pay and 

discharge any such charge so long as the legality thereof is being contested diligently and 

in good faith and by appropriate proceedings. 

 Section 4.3 Notice of Litigation 

 

 Receiver shall promptly notify County in writing of any litigation affecting the 

Receiver, or the System and of any claims or disputes that involve a material risk of 

litigation with respect to the System. 

 Section 4.4 Transfers

(a) For purposes of this Agreement, (“Transfer”) shall mean any sale, 

assignment, or transfer, whether voluntary or involuntary, of (i) any rights and/or duties 

under this Agreement, and/or (ii) any interest in the System, including (but not limited to) 

a fee simple interest, a joint tenancy interest, a life estate, a partnership interest, a 

leasehold interest, a security interest, or any other interest. 

EXHIBIT A 

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(b) Except for a Court-approved and State Public Utilities 

Commission-approved transfer to the County or other public entity, no Transfer shall be 

permitted prior to the completion of the improvements contemplated in Exhibit B without 

the prior written consent of the County, which the County may withhold in its reasonable 

discretion in order to ensure that the intent of this Agreement is fulfilled. The County has 

the immediate and unilateral right to cease all actions and/or provide any funds pursuant 

to this Agreement in the event of any unauthorized Transfer. 

 Section 4.5 Representation and Warranties of Receiver

 The parties understand and agree that as a material inducement to the County’s 

entry into the Predevelopment Agreement, Receiver has hereby represented and 

warranted the following to the County, as of January 26, 2007, the date the 

Predevelopment Agreement was entered into by and between the parties, as set forth 

above. The parties further understand and agree that as a material inducement to the 

County’s entry into this Purchase and Sale Agreement, Receiver hereby represents and 

warrants the following to the County, as of the date set forth above: 

(a) Authority/Enforceability. Based upon the order of the United 

States District Court, Receiver has the full power and authority to enter into this 

Agreement, to apply for State Grant Funds for the System, to negotiate and implement 

the Purchase and Sale Agreement and to take any other steps to carry out the actions 

contemplated by the Predevelopment Agreement and this Agreement. 

(b) Binding Obligations. Based upon the order of the United States 

District Court, Receiver is authorized to execute, deliver and perform its obligations 

under the Predevelopment Agreement and this Agreement and such obligations shall be 

valid and binding obligations of the System. 

(c) No Violation. Receiver’s execution, delivery, and performance 

under this Agreement does not (1) require any consent or approval not heretofore 

obtained under any articles of incorporation, bylaws or other document; (2) violate any 

governmental requirement applicable to the System or any other statute, law, regulation 

or ordinance or any order or ruling of any court or governmental entity; or (3) conflict 

with, or constitute a breach or default or permit the acceleration of obligations under any 

agreement, contract, lease or other document by which the Receiver is or the System is 

bound or regulated. 

(d) Litigation. Except as disclosed to County in writing, there are 

no claims, actions, suits, or proceedings pending, or to Receiver’s knowledge threatened, 

against Receiver or affecting the System. 

(e) Proceeds and Adequacy. To the best of Receiver’s knowledge, the 

EXHIBIT A 

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Predevelopment Funds proceeds are sufficient to take all actions necessary to complete 

the application process for obtaining the State Grant Funds in accordance with the intent, 

terms and conditions of the Predevelopment Agreement and this Agreement. 

(f) Accuracy. All reports, documents, instruments, information and 

forms of evidence delivered to County concerning the Predevelopment Agreement and 

this Agreement or required by this Agreement are to the knowledge of the Receiver, 

accurate, correct and sufficiently complete to give the County true and accurate 

knowledge of their subject matter, and do not contain any material misrepresentation or 

omission. 

(g) Tax Liability. During the receivership period, Receiver has filed 

all required federal, state, county and municipal tax returns and has paid all taxes and 

assessments owed and payable, and Receiver has no knowledge of any basis for any 

additional payment with respect to any such taxes and assessments. 

(h) Compliance. Receiver is familiar with governmental requirements 

for seeking State and Federal Grant Funds for the System and will conform to and 

comply with all governmental requirements and any plans and specifications as may be 

agreed in such Grant funding agreements. Receiver will join with County to take prompt 

and expeditious steps to comply with State and Federal Grant funding requirements for 

improvements of the System contemplated by the Predevelopment Agreement and this 

Agreement. 

 Section 4.6 Connection fees: Pursuant to Ordinance No. 5134, adopted by the 

County of Monterey, Board of Supervisors, acting as the Board of Directors of the 

Boronda County Sanitation District, on July 7, 2009, and effective on August 7, 2009, the 

31st day following adoption of said Ordinance, a copy of which is attached as Exhibit 

“F,” the connection fees collected for regular water service by the County of Monterey 

for the Boronda County Sanitation District San Jerardo Water System, where no main 

extension is required, during the term of this Agreement shall be applied toward one or 

more of the following purposes: (1) the payment or retirement of any debt incurred by the 

County of Monterey and/or the Boronda County Sanitation District on or after the 

effective date said Ordinance of August 7July 1, 2009, for the improvement of the San 

Jerardo Water System Improvement Project; water system; (2) directly for needed 

maintenance or improvements to the San Jerardo Water System water system; (3) to 

increase the reserves of the County for the Boronda County Sanitation District for later 

use in improving or maintaining the physical facilities of the San Jerardo Water 

Systemwater system. 

ARTICLE 5 DEFAULT AND TERMINATION 

 Section 5.1. Events of Default by Receiver

 Each of the following shall constitute a “Default” by Receiver under this 

Agreement. 

EXHIBIT A 

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(a) Breach of Covenants. Failure by Receiver to duly perform, comply with 

or observe any of the conditions, terms, or covenants of this Agreement, and such failure 

having continued uncured for thirty (30) days after receipt of written notice thereof by the 

Receiver from the County or, if the breach cannot be cured within thirty (30) days, the 

Receiver shall not be in breach so long as Receiver is diligently undertaking to cure such 

breach and such breach is cured within ninety (90) days; provided, however, that if a 

different period or notice requirement is specified under any other section of this Article 

6, the specific provisions shall control. 

(b) Suspension; Termination. Receiver shall have voluntarily delayed or 

suspended its efforts to obtain State Grant Funds or other financing, or shall have directed 

the County to suspend or delay the County’s efforts to obtain State Grant Funds or other 

financing. 

(c) Unauthorized Transfer. Any Transfer other than as permitted by the 

express written consent of the County, as provided in Section 4.4. (b). 

(d) Representation or Warranty Incorrect. Any Receiver representation of 

warranty contained in this Agreement, or in any application, financial statement, 

certificate, or report submitted to the County in connection with this Agreement, proving 

to have been incorrect in any material respect when made. 

 Section 5.2 Remedies

 The occurrence of any Default, following the expiration of all applicable notice 

and cure periods will, either at the option of the County or automatically where so 

specified, relieve the County of any obligation to make or continue disbursements under 

this Agreement and shall give the County the right to proceed with any and all remedies 

set forth in this Agreement, including but not limited to the following: 

(a) Specific Performance. The County shall have the right to mandamus or 

other suit, action or proceeding at law or in equity, before the District Court, to require 

Receiver to perform its obligations and covenants under this Agreement or to enjoin acts 

on things which may be unlawful or in violation of the provisions of this Agreement. IT 

IS SPECIFICALLY ACKNOWLEDGED BY THE PARTIES HERETO THAT THE 

CONSTRUCTION OF IMPROVEMENTS TO THE SYSTEM AND THE 

ACQUISITION OF THE IMPROVED SYSTEM BY COUNTY AFFECT THE 

HEALTH AND SAFETY OF THE SAN JERARDO COMMUNITY AND ARE 

MATERIAL TERMS OF THIS AGREEMENT FOR WHICH SPECIFIC 

PERFORMANCE IS WARRANTED, AND DAMAGES ARE AN INADEQUATE 

REMEDY. 

(b) Right to Cure at Defaulting Party’s Expense. The County shall have the 

right (but not the obligation) to cure any uncured Default by a defaulting party by taking 

whatever action, or expending whatever funds, deemed necessary by the County to 

preserve the intent and purpose of this Agreement. The defaulting party agrees to 

EXHIBIT A 

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reimburse the County for any funds advanced by the County to cure a default by said 

defaulting party upon demand therefore, together with interest thereon at the lesser of the 

maximum rate permitted by law or ten percent (10%) per annum from the date of 

expenditure until the date of reimbursement. 

 Section 5.3 Termination of Agreement

 This Agreement may be terminated for the following reasons: 

(a) In the event of condemnation, seizure or appropriation of all or the 

substantial part of the System, either Receiver or the County may at any time thereafter 

terminate this Agreement (except for the indemnification obligations under Section 6.4), 

by notice to the other party. Not later than thirty (30) days after the later of (i) such a 

termination, or (ii) Receiver’s receipt of any compensation to which it may be entitled in 

connection with condemnation, seizure or appropriation, Receiver shall reimburse the 

County for funds disbursed pursuant to Predevelopment Agreement. Receiver shall be 

entitled to credit against the amount of payment otherwise due, the amount of any 

compensation received by County in connection with the condemnation, seizure or 

appropriation. 

(b) In the event State, Federal or CDBG Grant Funds are not 

awarded, or are awarded in an amount insufficient to cover necessary expenses for 

development and construction of the Project, either Receiver or County may terminate 

this Agreement by notice to the other party. 

 Termination under this Section 5.3 shall not affect Receiver’s or County’s right or 

obligations in connection with any default existing under this Agreement at the time of 

termination. 

ARTICLE 6 MISCELLANEOUS PROVISIONS 

 Section 6.1 Relationship of Parties

 Nothing contained in this Agreement shall be interpreted or understood by any of 

the Parties, or by any third persons, as creating the relationship of employer and 

employee, principal and agent, limited or general partnership, or joint venture between 

County and Receiver or its respective agents, employees or contractors, and, as to 

County, Receiver shall, and at all times, be deemed an independent contractor and shall 

be wholly responsible for the manner in which it or its agents, or both, perform the 

services required of it by the terms of this Agreement. 

 Section 6.2 No Claims

 Nothing contained in this Agreement shall create or justify any claim against 

County by any person that Receiver may have employed or with whom Receiver may 

have contracted relative to the purchase of materials, supplies or equipment, or the 

EXHIBIT A 

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furnishing or the performance of any work or services with respect to the pursuit of State 

or Federal Grant Funds or other funding, or the negotiation or implementation of this 

Agreement. 

 Section 6.3 Amendments

 No alteration or variation of the terms of this Agreement shall be valid unless 

made in writing by the Parties. 

 Section 6.4 Indemnification

 Receiver shall indemnify, defend and hold harmless County, and its officers, 

agents and employees, from and against: (a) any and all claims, liabilities and losses 

whatsoever (together with any expenses related thereto, including but not limited to, 

damages, court costs and attorneys fees) occurring to or resulting from any and all 

persons, firms or corporations furnishing or supplying work, services, materials, or 

supplies in connection with the performance of this Agreement, and (b) any and all 

claims, liabilities and losses occurring or resulting to any person, firm, or corporation 

for damage, injury, or death arising out of or connected with Receiver’s performance of 

this Agreement, including but not limited to any such claims, liabilities or losses which 

occur on or adjacent to the System or are related to the pursuit of State and Federal Grant 

Funds or the negotiation and implementation of this Agreement and (c) such claims, 

liabilities, or losses which arise out of the purchase, construction and operation of any 

aspect of the System. “Receiver’s performance” includes Receiver’s action or inaction 

and the action or inaction of Receiver’s officers, employees, agents, contractors, and 

subcontractors. This indemnification and hold harmless obligation shall not extend to 

any claim arising solely out of the gross negligence or willful misconduct of the County 

or its agent and employees. The provisions of this Section 6.4 shall survive the 

expiration or termination of this Agreement. 

 Section 6.5 Non-Liability of County Officials, Employees and Agents

 No member, official, employee or agent of the County shall be personally liable 

to Receiver in the event of any default or breach by County or for any amount that may 

become due to Receiver or its successors or on any obligation under the terms of this 

Agreement. 

 Section 6.6 No Third Party Beneficiaries

 There shall be no third party beneficiaries to this Agreement. 

 Section 6.7 Discretion Retained by County

 Except as may be expressly stated in this Agreement, County’s execution of this 

Agreement in no way limits the discretion of County in the review of grant application 

materials, environmental reviews, permits applications, or any other action connected to 

EXHIBIT A 

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the implementation of this Agreement and the development of a safe and suitable water 

system for the San Jerardo Community. 

 Section 6.8 Conflict of Interest

(a) Except for approved eligible administrative or personnel costs, no 

person described in Section 6.8(b) below who exercises or has exercised any functions or 

responsibilities with respect to the activities funded pursuant to the terms of the 

Predevelopment Agreement and this Agreement or who is in a position to participate in a 

decision-making process or gain inside information with regard to such activities, may 

obtain a personal or financial interest or benefit from the activity, or have an interest in 

any contract, subcontract or agreement with respect thereto, or the proceeds thereunder, 

either for themselves or those with whom they have family or business ties, during or at 

any time after, such person’s tenure. County and Receiver shall each exercise due 

diligence to ensure that the prohibition in this Section 6.8(a) is followed. 

(b) The conflict of interest provisions of Section 6.8(a) above apply to 

any person who is an employee, agent, consultant, officer of the County, or any 

immediate family member of such person, or any elected or appointed official of County, 

or any person related within the third (3rd) degree of such person. 

 Section 6.9 Notices, Demands and Communications

 Formal notices, demands, and communications between the parties shall be 

sufficiently given if and shall not be deemed given unless dispatched by registered or 

certified mail, postage prepaid, return receipt requested, or delivered by express delivery 

service, return receipt requested, or delivered personally, to the principal office of the 

parties as follows: 

 County: Attn: Yazdan T. Emrani, M.S., P. E., Director 

 County of Monterey 

 Resource Management Agency 

 Department of Public Works 

 168 W. Alisal Street, Second Floor 

 Salinas, California 93901-2439 

 

 Receiver: San Jerardo Water System 

 c/o John W. Richardson 

 5161 Soquel Drive, Suite F 

 Soquel, California 95073 

Such written notices, demands and communications may be sent in the same manner to 

such other addresses as the affected Party may from time to time designate by mail as 

provided in this Section 6.9. Receipt shall be deemed to have occurred on the date shown 

on a written receipt as the date of delivery or refusal of delivery (or attempted delivery, if 

undeliverable). 

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 Section 6.10 Applicable Law

 This Agreement shall be governed by the State of California. 

 Section 6.11 Parties Bound

 Except as otherwise limited herein, the provisions of this Agreement shall be 

binding upon and inure to the benefit of the parties and their heirs, executors, 

administrators, legal representatives, successors, and assigns. 

 

 Section 6.12 Severability

 If any term of this Agreement is held by a court of competent jurisdiction to be 

invalid, void or unenforceable, the remainder of the provisions shall continue in full force 

and effect unless the rights and obligations of the parties have been materially altered and 

abridged by such invalidation, voiding or unenforceability. 

 Section 6.13 Force Majeure

 In addition to specific provisions of this Agreement, performance by either party 

shall not be deemed to be in default where delays or defaults are due to war; insurrection; 

strikes; lockouts; riots; floods; earthquakes; fires; quarantine restrictions; freight 

embargoes; lack of transportation; or court order; or any other similar causes beyond the 

control or without the fault of the party claiming an extension of time to perform. An 

extension of time for any cause will be deemed granted if notice by the party claiming 

such extension is sent to the other within ten (10) days from the commencement of the 

cause and such extension of time is not rejected in writing by the other Party within ten 

(10) days of receipt of the notice. In no event shall the County be required to agree to 

cumulative delays in excess of thirty (30) days. 

 Section 6.14 County Approval

 Whenever this Agreement calls for County approval, consent, or waiver, the 

written approval, consent, or waiver of the Director of the Department of Public Works 

shall constitute the approval, consent, or waiver of the County, without further 

authorization required from the County Board of Supervisors, provided that it is 

determined that the overall feasibility of the objectives of this Agreement is not in 

jeopardy, no additional funds are required from the County, and no material term of this 

Agreement is altered. The County hereby authorizes the Director of the Department of 

Public Works to deliver such approvals or consents as are required by this Agreement, or 

to waive requirements under this Agreement on behalf of the County upon the terms 

specified above. Any consents, approvals or refinements required under this Agreement 

shall not be unreasonably withheld or made, except where it is specifically provided that 

a sole discretion standard applies. The County agrees to give reasonable consideration to 

requests by Receiver for extensions of any time deadlines imposed under this Agreement, 

EXHIBIT A 

Case 5:97-cv-20099-EJD Document 943 Filed 11/17/10 Page 14 of 18
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or refinements, provided that it is determined that the overall feasibility of the objectives 

of this Agreement is not in jeopardy. The County shall not unreasonably delay in 

reviewing and approving or disapproving any proposal by Receiver made in connection 

with this Agreement. Notwithstanding this delegation, approval of the County Board of 

Supervisors is required to materially amend this Agreement, and this Section 6.14 shall 

not preclude the Director of the Department of Public Works, in his or her sole discretion, 

from seeking approval from the County Board of Supervisors for any matter under this 

Agreement. 

 Section 6.15 Waivers

 Any waiver by County of any obligation or condition in this Agreement must be 

in writing. No waiver will be implied from any delay or failure by County to take action 

on any breach or default of Receiver, or to pursue any remedy allowed under this 

Agreement or applicable law. Any extension of time granted to Receiver to perform any 

obligation under this Agreement shall not operate as a waiver or release from any of its 

obligations under this Agreement. Consent by County to any act or omission by Receiver 

shall not be construed to be consent to any other or subsequent act or omission or to 

waive the requirement for County’s written consent to future waivers. 

 Section 6.16 Title of Parts and Sections

 Any titles of the sections or subsections of this Agreement are inserted for 

convenience of reference only and shall be disregarded in interpreting any part of this 

Agreement’s provisions. 

 Section 6.17 Entire Understanding of the Parties

 This Agreement, together with Exhibits A, B, C, D, E and C,F constitutes the 

entire understanding and agreement of the parties with respect to all actions necessary to 

implement this Agreement. 

 Section 6.18 Multiple Originals; Counterparts

 This Agreement may be executed in multiple originals, each of which is deemed 

to be an original, and may be signed in counterparts. 

 Section 6.19 Negotiated Agreement

 This Agreement has been arrived at through negotiation and neither party is to be 

deemed the party which prepared this Agreement within the meaning of California Civil 

Code Section 1654. 

///

 Section 6.20 Incorporation of Recitals

EXHIBIT A 

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 The parties understand and agree that the recitals to this Agreement, as set forth 

above in Paragraphs A through I, are hereby incorporated into this Agreement. 

 Section 6.21. Conflict with Predevelopment Agreement and its Exhibits

 The parties understand and agree that if any conflict exists between the terms of 

the Predevelopment Agreement and this Purchase and Sale Agreement, the terms of this 

Purchase and Sale Agreement shall prevail. Further, the Parties understand and agree 

that the Scope of Work and/or Project Description and/or Project Budget contemplated as 

part of the Predevelopment Agreement, and attached and/or incorporated as Exhibits to 

the Predevelopment Agreement, were preliminary in nature and that the final Project 

Description and Project Budget approved by Grant Funding Agencies, as may be 

amended by said Grant Funding Agencies, shall supersede any Project Description/Scope 

of Work and Project Budget which were contemplated by the Predevelopment 

Agreement. 

 

 WHEREAS, this Agreement has been entered into by the undersigned as of the 

date first above written. 

 COUNTY OF MONTEREY, a political subdivision 

Dated: ________________, 2010 By:______________________________________ 

 Yazdan T. Emrani, M.S., P. E., Director 

 Department of Public Works 

Approved as to form and legality: 

Office of the County Counsel 

Charles J. McKee, County Counsel 

By: _________________________ 

 Mary Grace Perry, Deputy 

 

Dated:_______________________ 

 SAN JERARDO WATER SYTEM, 

 By:_______________________________________ 

 John W. Richardson, Receiver 

 Dated:____________________________________ 

 Approved as to form and legality: 

 LUCE, FOWARD ET AL. 

 Attorneys for Receiver 

 By: ______________________________________ 

 Type/Print Name:___________________________ 

 Dated: ____________________________________ 

EXHIBIT A 

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