HomeMy WebLinkAboutItem 5f - 2nd Amend to Legal Services Agreement w Civica Law Group for 1150 Laurel Code Enforcement Item 5f
Department: Attorney
Cost Center: 1501
For Agenda of: 5/19/2026
Placement: Consent
Estimated Time: N/A
FROM: Christine Dietrick, City Attorney
Prepared By: Kelly Holcomb, Senior Legal Analyst
SUBJECT: SECOND AMENDMENT TO LEGAL SERVICES AGREEMENT WITH
CIVICA LAW GROUP, APC, RELATED TO 1150 LAUREL CODE
ENFORCEMENT
RECOMMENDATION
1. Authorize the City Attorney to enter into a Second Amendment to the legal services
agreement with Civica Law Group, APC, for their work in support of code enforcement
actions at the commercial property located at 1150 Laurel Lane.
2. Approve $223,000 as the new contract not-to-exceed amount (an $80,000 increase).
POLICY CONTEXT
In accordance with the City Purchasing Policy, City Council approval is necessary for
professional services agreements of more than $150,000. A Request for Proposals is also
required for this approval threshold but was waived in this matter by submission and
approval of a Specialized Services Justification form at the time of initial contracting with
outside counsel.
DISCUSSION
Background
In May 2025, after the commercial property at 1150 Laurel Lane had several years of
code violations, substandard building conditions, and failure to make progress following
the issuance of an extensive notice of violation and order to abate, the City Council made
the decision to file, in the name of the City, a civil complaint seeking the appointment of
a receiver to take control of the property. Due to the expected complexity of the matter,
and the significant number of financial interest holders and liens against the prope rty,
compared to the receiverships for residential properties that in-house attorneys have
petitioned for in recent years, outside counsel with extensive, relevant experience was
contracted to take lead on the matter. The law firm chosen, Civica Law Group, APC,
(“Civica”), almost immediately learned the matter was even more complex than
anticipated with two separate pending lawsuits involving the property, a pending
bankruptcy proceeding, and more than 18 lienholders with more than 40 liens. The
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noticing alone to all these parties took several months longer than anticipated due to the
need to negotiate subordination agreements and/or stipulations with various interest
holders and due to difficulty in completing legal process service in some instances .
The City’s Verified Complaint for Violation of Health & Safety Code and Receivership;
Nuisance; Nuisance per se; and Unfair Business Practices was filed in October of 2025.
Since then, Civica attorneys and staff have been navigating communications and formal
responses from the numerous defendants and interested parties. In March, in order to
keep the litigation moving forward, the City filed an ex parte application for the motion
seeking appointment of a receiver. At the March 12th hearing on the application, the court
declined to appoint a receiver ex parte, but did grant in the alternative a request to shorten
time (moving up the regularly scheduled hearing to May 6, 2026).
Looking forward, Civica expects the following work will be needed through Fall 2026:
Review and respond to any and all oppositions to the City’s motion
Prepare for and attend the May 2026 hearing
Post-hearing notices and respond to opposition to proposed order
Coordinate with receiver for implementation of order (if granted); filings and
hearings related to the rehabilitation plan
Continued meet and confers with various defendants
Research and respond to any new variables that arise
Previous Council or Advisory Body Action
On May 5, 2025, the Construction Board of Appeals held a hearing for the appeal of the
property owner contesting the validity of the notice of violation and order to abate. City
Council then held a closed session on May 20, 2025, during which approval was granted
to file the initial complaint in the name of the City. After that, the initial contract with Civica
was increased by the City Manager on December 11, 2025.
Public Engagement
When the various tenants at 1150 Laurel were forced to vacate their leased spaces due
to the un-remediated hazardous conditions of the property, City Council and staff
engaged in written and verbal communication with members of the public about the
necessity of the action. There was also public comment at the May 2025 Construction
Board of Appeals hearing.
For the current item, public comment can be provided to the City Council through written
correspondence prior to the meeting and through public testimony at t he meeting.
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ENVIRONMENTAL REVIEW
The California Environmental Quality Act (“CEQA”) does not apply to the recommended
action in this report, because the action does not constitute a “Project” under CEQA
Guidelines Sec. 15378.
FISCAL IMPACT
Budgeted: No Budget Year: 2025-26
Funding Identified: Yes
Fiscal Analysis:
The Community Development Department (“CDD”) reviewed its staffing budget for the
current fiscal year and determined there are salary savings sufficient to cover the $80,000
increase being recommended to the not-to-exceed amount of the agreement with Civica.
The previous $143,000 for the agreement came from City Attorney legal and other
contract services, and CDD Code Enforcement contract services budgets.
Funding
Sources
Total Budget
Available
Current
Funding
Request
Remaining
Balance
Annual
Ongoing
Cost
General Fund $230,000 $80,000 $150,000 $0
State
Federal
Fees
Other:
Total $230,000 $80,000 $150,000 $0
ALTERNATIVES
1. Approve a different not-to-exceed amount. If $80,000 seems too much to add to
this matter, a lesser amount could be selected. However, with the work forecast
through Fall of 2026, approving a lesser amount now may require another request be
made for additional funding as soon as July. As there is currently $80,000 available in
CDD salary savings, it is strongly recommended that the full amount be approved.
2. Decline to increase the contract with Civica. The work to continue litigation in
pursuit of the appointment of a receiver would then fall on in-house attorneys. With
the other existing workload and priorities being managed in-house at this time, and
the title and lien complexities involved, selection of this alternative would also require
further direction from City Council as to which work efforts should be deprioritized. If
no work efforts can be removed from or made lower priority in the City Attorney
workload, then this option is not recommended.
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3. Dismiss the complaint. Should City Council now deem this matter fruitless, the
complaint in the name of the City could be dismissed. However, the complaint in the
name of the People of the State of California, that was concurrently filed by the City
Attorney as City Prosecutor, could continue and still require funding and/or staff time.
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