Monday, September 19, 2016 by Jo Clifton

Attorney trying to settle Pine Forest suit

Bastrop’s City Council has budgeted just $220,000 for legal fees for the next fiscal year, starting in October, a small sum compared to the $1 million plus it has spent under the administration of former City Manager Mike Talbot and longtime outside attorney Jo-Christy Brown.

One of the biggest drains on the city’s coffers has been expenses of litigation over a proposed subdivision contract with the Pine Forest Investment Group LLC and the homeowners association at Pine Forest. The lawsuit has been ongoing for about a year and a half.

As of Aug. 23, Bastrop had paid nearly $652,000 to Charles Bundren, the attorney representing the city, Bastrop County and the Bastrop Independent School District in that litigation. Update: Chief Financial Officer Tracy Waldrop informed the Monitor Monday that Bastrop has paid Bundren an additional $71,531, bringing the total for this case to $723,531.

That case is set for a final hearing before District Judge Carson Campbell on Wednesday. Unless there is a settlement, whichever side loses the case will undoubtedly appeal to the 3rd Court of Appeals, a process that could take years.

The judge has already indicated that he is likely to rule in favor of the government entities on most issues. However, the Court of Appeals could decide to send the matter back to the District Court for rehearing on any number of items.

Attorneys for the defendants in the case have been seeking to have a settlement conference with Bundren and have offered to meet at any time to discuss the matter, according to an email exchange received by the Austin Monitor but not provided by the attorneys.

According to the emails, Ben Wetmore, an attorney for Robert Leffingwell, the major investor in Pine Forest Investment Group, has offered to meet with Bundren or speak with him on the phone.

However, Bundren, who first told Wetmore he would not be available until Thursday, the day after the hearing, then told Wetmore on Friday via email that he would not be available on Thursday, either. Bundren told the Monitor that he could not comment.

Wetmore told the Monitor that it is in everyone’s best interest to settle the lawsuit. Appealing the matter is “going to suck up 12 to 18 months of everybody’s time and just run up the fees,” Wetmore said. “I think everybody just wants their money. … And if you look at the numbers, there’s just no way for anybody to make a dime” if the lawsuit continues, he said.

Wetmore said he was present in the judge’s chambers when Bundren told Campbell that an appeal would cost the governments $75,000 to $125,000. Wetmore added, “I think as attorneys, we have an obligation not to do scorched earth litigation.” He compared continuing the litigation to spending $50,000 on a lawsuit over a $5,000 car.

Wetmore said he thinks that most people do not understand the difficulties of developing the subdivision, starting with bad titles to many of the properties. In addition to title problems, he said, about one-third of the 500 lots the city has foreclosed on cannot be developed due to drainage problems.

He added, “I’m worried that people are making major decisions in this case and … they don’t know what a hot mess this will be to try to develop.” He said the government entities would have to put in $10 million and carry the cost of that money for the life of the project for roads, utilities and streets. Wetmore reiterated that it would be in everyone’s best interest to settle the suit.

Bill Aleshire, attorney for three third-party defendants, said he has also offered to settle part of his clients’ disagreements with the Bastrop governmental entities.

One of the investors in Pine Forest, who wished to remain anonymous, provided a document to the Monitor explaining how the matter might be resolved.

The document says, in part, “Robert’s (Leffingwell’s) intention is to sell the development rights to another developer as quickly as possible. He needs to recover his costs and move on. There are many advantages in allowing him to do this. The city would control the purchaser without the time and cost involved in rebidding the project. The predevelopment costs would be borne by Robert and passed on to the purchasing developer. The predevelopment process could be completed by no longer than the end of this year and the sale completed around the same time. Construction could begin very quickly and the resulting revenue stream from the residents and businesses would add to the economy in a shorter period of time. Several elements already in the development agreement allow for this.”

Bastrop City Council Member Gary Schiff said he had received a copy of the document on his front porch. He told the Monitor he hopes to discuss the lawsuit during the executive session of a special called meeting on Tuesday evening.

Also at that meeting, the Council is set to consider recommending to interim City Manager Marvin Townsend that he replace Bundren in a case that involves use of red-light cameras.

According to the agenda for that meeting, the city would instead hire the Fort Worth law firm of Taylor, Olson, Adkins, Sralla, and Elam, which is representing 24 other Texas cities in the same litigation. “The firm’s hourly rate of $260 for partner work is less than the $295 per hour being paid” to Bundren, the agenda says, noting that the cost of the suit “will be evenly distributed among the 25 cities being represented by the firm.”

The Monitor first raised the issue of Bastrop’s high legal bills in April, noting that Bastrop had paid out more than $1 million over a 15-month period.

Photo by Larry D. Moore, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=609290

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Bastrop: Bastrop is a city and the county seat of Bastrop County. It's located about 30 miles southeast of Austin

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