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School district files objections to Signature case ruling
Pleasanton Unified hasn't decided whether it will appeal the judge's decision

by Janet Pelletier

The school district has filed objections to a judge's recent ruling in favor of Signature Properties over the construction of the city's 10th and final elementary school.

Through its attorneys, Stubbs & Leone of Walnut Creek, the Pleasanton Unified School District said it has objections to each of the 15 points listed in Judge George C. Hernandez's tentative ruling. Primarily, the district said it doesn't believe it should have to pay for design costs of the school, which Signature paid for, because the ruling declares the contract void and illegal.

Citing a 1942 Supreme Court case, Miller v. McKinnon, the district said "...(Signature) has no right of recovery for any 'damages' or 'restitution' of money spent in performance of a contract that has been declared void as Miller points out."

"The illegal (amended cooperative fee agreement to build Neal Elementary School) for all purposes and (Signature) cannot recover the almost $500,000 they claim to have spent as part of their performance of the (agreement), nor can the district recover the $4.1 million it expended to 'provide' (infrastructure for) the site," the objection continues.

In addition, the district said because the judge determined that the contract between the two parties is void since the project wasn't put out for public bidding, that Signature "cannot recover any 'damage,' 'restitution' or any other monetary relief from the district, including attorney's fees and costs."

In its last claim on the issue, the district said if it were to pay for attorney's fees for an invalid contract, it would be violating a constitutional prohibition against the gift of public funds.

In other objections, the district made a case for striking 14 of 15 points of the judge's tentative ruling from the record in an effort to preserve its right to a future jury trial, should it decide to appeal. If the judge has determined that the contract was illegal and void, the district said the other findings aren't relevant and are out of the scope of the judge's purview.

"Here, this court, having determined that no legal contract exists, is then without the power to interpret and pass judgment on that non-existent contract," the objection states. "As such, the court's remaining findings become immaterial surplusage (sic) that should not be made."

District spokeswoman Myla Grasso said this week that the district has not made a decision yet as to whether they will appeal the ruling.

A hearing date, called a case management conference, has been scheduled for July 18 at the Fremont Hall of Justice, where the case was heard last month.

"We're expecting a final written decision by the judge probably early next week, so the case management conference will be to discuss what's going to happen next based on that final decision from the judge; and of course, we don't know what that is," Grasso said.

Posted by frank, a resident of the Pleasanton Heights neighborhood, on Jul 5, 2008 at 7:56 pm

I read the article and as I write this I have not gone back to research any of the points described in the article. But it seems the district is essentially arguing why it should not pay up as ruled, not arguing the case itself, except to say it is also trying to provide wiggle room for an appeal.

On the surface the points it raises regarding the logic of the ruling saying the contract is illegal and therefore it cannot be held for costs associated with the contract seem to hold water. On the other hand, common sense says that the school district did agree to enter into activities and did engage in those activities that caused the plaintiffs to incur costs, and in the end the district showed bad faith in carrying through whatever it attempted to agree to.

So, I think we have to let the legal process continue in order to figure out where this will end up.

Posted by Liz, a resident of the Carriage Gardens neighborhood, on Jul 6, 2008 at 8:46 am

If you know the history of Signature Property in Pleasanton they have a pattern of bad faith. Signature Property had a commitment to pay for a large part of the cost to improve Vineyard Ave as one of their mitigations for the Ruby Hill community. They got out of paying it using the same bait and switch that they have now used with PUSD. The deal was set up for the road to get built through developer cooperation then after the fact Signature refused to pay their share saying no one could force them to because the city did not go through the proper bidding process. To this day they have not paid their share. This happened after or simultaneous to the school contract so the district would not have yet seen the pattern. It was all happening at the same time McKeehan was marrying our City Manager. So we had the fox guarding the hen house.

In the early days of Ruby Hill Signature got 1.5mil in park mitigation fees back from the city when McKeehan used a loophole that gave credit toward park mitigation fees if a developer built a park for their community. This was done to give developers an incentive to build more community parks. It was never anticipated that that park could be behind a gate and inaccessible to the rest of Pleasanton.

I believe that loophole has been closed but the community funded a private park in RH. Signature got the money not the homeowners.

Still no answer as to why Signature did not pay school fees for many of their houses in RH.

If the second contract is not legal does that mean the first one that it replaced still Is? Signature had a much greater obligation in the 1992 agreement which is why they wanted out of it.

Frank are you saying you think it is reasonable to continue to absorb legal costs? I genuinely don't know. Signatures win record defies all sence of right and wrong.

Posted by Stacey, a resident of the Amberwood/Wood Meadows neighborhood, on Jul 6, 2008 at 12:48 pm

Doesn't Ruby Hill allow anyone to enter as long as you register at the gate? Or do you have to specifically be visiting a Ruby Hill resident? (BTW, not a big fan of gated communities here...)

Posted by Liz, a resident of the Carriage Gardens neighborhood, on Jul 6, 2008 at 1:16 pm

Only invited guests are allowed past the gate.

I am not a fan of gated communities but that is not the point. The point is a pattern of bad faith and disregard for the community.

Posted by frank, a resident of the Pleasanton Heights neighborhood, on Jul 6, 2008 at 9:29 pm

In response to Liz's post I can only comment as follows:

The easy one first. Am I saying it is reasonable to continue to absorb legal costs (I assume this means for the school district)? Answer: far be that I know the answer because it is not me who made the decision that is the subject of the article we are posting about. Ask the school district. They are continuing the legal process. That's what this post is about.

To all of the charges and contentions made against Signature Properties. Sounds like charges and contentions, but no hooks into researchable, collaboratable references. If these contentions and charges had "legs" you would think someone would have legally challenged these things.

What does not sit well with me is the comment to seemingly explain this by the comment about the city manager and her marriage. This is a version of the "they're all a bunch of crooks" brush off. I can understand how this sort of thing enters into people's thinking, but if Signature Properties has been so horrible you would think that council members at the time (Ayala? Brozosky?) would have spoken up.

Posted by Liz, a resident of the Carriage Gardens neighborhood, on Jul 7, 2008 at 10:00 am

Frank I am disappointed in your inability to resist blaming every ill on Ayala and Brozosky. Neither were on Council at the time of the park fiasco but all council members at the time were unhappy with the situation (no crooks) they felt there was nothing they could do but to fix the loophole for the future.

There are no easy links to give you, much of this happened before internet news archives or has not been reported.

I would love for the weekly to investigate and do a story, there is really much more to add to the list. I hear something about a large unpaid water bill, I would like to understand that better.

With no suggestion of wrong doing on his part the only person that has been with the City through all of these issues is the city attorney Michael Roush. I believe him to be a good source of information and could most likely confirm all points with one call.

Posted by Cover Up, a resident of the Another Pleasanton neighborhood neighborhood, on Jul 7, 2008 at 10:45 am

Did anybody else find it interesting that the City Manager, McKeenan, after leaving the City went on to be the President of the Weekly? Talk about controlling the media. This seems like the perfect cover-up. City Manager marries developer, developer does not pay bills and learns the inside information on how to get around fees, city manager leaves city, city manager becomes president of newspaper to cover-up everything. I wonder if McKeenan still has some working relationship with the Weekly or if the paper is sticking up for their former president.