Northgate Village Development, LC v. Orem City

2014 UT App 86, 325 P.3d 123, 758 Utah Adv. Rep. 20, 2014 WL 1584500, 2014 Utah App. LEXIS 89
CourtCourt of Appeals of Utah
DecidedApril 17, 2014
DocketNo. 20120817-CA
StatusPublished
Cited by12 cases

This text of 2014 UT App 86 (Northgate Village Development, LC v. Orem City) is published on Counsel Stack Legal Research, covering Court of Appeals of Utah primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Northgate Village Development, LC v. Orem City, 2014 UT App 86, 325 P.3d 123, 758 Utah Adv. Rep. 20, 2014 WL 1584500, 2014 Utah App. LEXIS 89 (Utah Ct. App. 2014).

Opinion

Opinion

VOROS, Judge:

T1 Orem City sold a parcel of land to Northgate Village Development. Northgate spent nearly three million dollars excavating material buried on the property. Northgate sued the City, claiming that the City failed to perform its contractual cleanup responsibilities. The district court granted summary judgment in the City's favor and limited Nor-thgate's recovery to a single claim, valued at $1,965. Northgate appeals. We affirm in part, reverse in part, and remand.

BACKGROUND 1

T2 For years the City operated a public works facility on City-owned property located at 900 West in Orem. The City mined sand from the property for use in public works projects and filled the resulting holes "with fill material left over from various Pub-lie Works operations." Though "[mjost of the fill material consisted of dirt and rock," later excavation unearthed a trove of urban detritus: car bumpers, bicycle tires, water heaters, washing machines, car engines, car parts, asphalt, galvanized pipes, asbestos containing transit pipe, trees, bushes, medical waste products, brick, mason blocks, concrete, toilets, electrical panels, refrigerators, silverware, 50-gallon drums, conduit, general garbage, storm drains, ABS pipe, barbed wire, field fence, cedar fence posts, railroad ties, plywood, carpet, transformers, mercury-containing ballasts, gas cables, truck mud flaps, plastic sheeting, car doors, pallets, rebar, pop bottles, sewer pipe, metal T posts, fire hydrants, water [vials], ductile iron, copper{] parts and valves, brass parts, fiberglass insulation, twine, rubber traffic cones, concrete manhole sections, metal rings, and lids for manholes, valve boxes, bags of leaves and metal sheeting for roofs.

The Land Sale Contract

3 When the City decided to relocate the public works facility, it sold the Public Works Pareel on 900 West to Northgate. The City and Northgate signed a "Real Property Exchange and Sale Agreement" in March 2004 and an amended agreement in May 2004. The May 2004 Land Sale Contract divided the purchase and exchange of property into two phases: Closing 1 and Closing 2. At Closing 1, the City and Northgate would exchange two parcels of equal value and the City would purchase two additional pieces of Northgate property. At Closing 2, Nor-thgate would purchase two pieces of the City's property, including the Public Works Parcel.

T 4 Section 3.2.1 of the Land Sale Contract describes environmental audits conducted on the properties. Section 8.2.1.1 allowed Nor-thgate to rescind the contract if it found the results of the environmental audit of the City's properties unacceptable. The City agreed to provide Northgate with a copy of an "Environmental Site Assessment" and "a list of environmental concerns/conditions with the estimated cost of resolving each of [126]*126the concerns ('the Environmental Clean-Up List')" Section 8.2.1.1 adds, "A copy of the Environmental Clean-Up List is attached hereto ... and incorporated herein by reference."

15 Section 4.3 of the Land Sale Contract describes the parties' post-Closing 2 responsibilities, which would "survive Closing 2 and the conveyance of the deeds." Section 4.3.2, titled "Demolition and Clean-up of Northgate Lease Property," required the City to perform certain work on the Public Works Parcel before it turned the property over to Northgate. The City agreed "to complete any environmental clean-up responsibilities specified in the written action plan for the City Public Works Parcel."

T 6 The Land Sale Contract also contains a provision discussing Section 108 loans, which are federally financed loans offered to qualified redevelopment projects. The provision describes Northgate's intent "to apply for Section 108 loan money and [other redevelopment] grant money" through Orem's Economic Development Commission. But the provision also states, "The City cannot make any representations to Northgate as to whether Northgate will receive these funds."

T7 Finally, the Land Sale Contract contains a provision addressing default and cure. It requires the nondefaulting party to provide notice and allow ninety days for the defaulting party to cure the default. The nondefaulting party "may pursue any remedies available to it" only after the ninety-day window has closed.

Excavation and Redevelopment

8 Northgate and the City proceeded with Closing 1 and Closing 2. After Northgate took control of the Public Works Parcel, it began excavating the buried debris. Each time Northgate uncovered "another major strike" of material contained in the Environmental Site Assessment, it contacted the Orem City Manager's office. Northgate representatives met with the City Manager several times at the excavation site. At one meeting, Northgate asked the City Manager how the City planned to address its concerns about the buried debris. The City Manager responded, "We probably have responsibility here. If you will ... send me an invoice and some kind of verification of what you have done, ... we'll see what we can do about it."

T9 In January 2007, Northgate sent the City a letter detailing "a major problem with debris ... found during excavation of the site." The letter contained contractor reports, a cost breakdown, a list of excavated materials, and photographs of the excavation. The letter also described Northgate's discovery of unexpected fill material:

You asked us to provide you with costs to date and an estimate for future costs to clean up the site. As you know, we understood from soil reports provided by the city, there was an area midway in the site, that had asphalt and concrete as fill. Instead, we found to date, over 100,000 eubic yards of garbage, vehicles, appliances, organic matter, and other debris that can only be characterized as landfill.... Our costs for clean up to date approach $2,000,000 and we believe the balance of the site will cost an additional $500,000-$700,000 to clean up the site.
As per our agreement we expect the city to reimburse us the cost of clean up. We are not in a position to absorb those costs as a part of the project.

€ 10 Northgate applied for federal redevelopment loans and grants to help cover the cost of rehabilitating the Public Works Parcel. Orem's Economic Development Commission reviews and recommends redevelopment-fund applicants, but because the federal redevelopment funds go directly to municipalities, the City ultimately determines how to distribute the federal redevelopment funds it receives.

{11 Orem's Economic Development Commission recommended Northgate's application to the City. In September 2008 a City representative sent an email to a representative at the Department of Housing and Urban Development explaining the City had decided not to offer Northgate Section 108 loans but that Northgate may still be a good candidate for Brownfields Economic Development Initiative (BEDI) funding, a type of redevelopment grant:

[127]*127Originally, Northgate wanted both Section 108 and BEDI funding. The city decided that we could not expend more Section 108 money, and with the amount that we have spent, we would only be eligible to receive $220,000 in BEDI funds. The Northgate project has had extensive clean-up work on the site, and it will create many [low- to moderate-income] jobs, so we feel confident it is a great project to receive BEDI funding.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Vierig v. Therriault
2023 UT App 36 (Court of Appeals of Utah, 2023)
Brimhall v. Ditech Financial
2021 UT App 34 (Court of Appeals of Utah, 2021)
In re Foreclosure 1107 Snowberry
2020 UT App 54 (Court of Appeals of Utah, 2020)
Northgate Village Development v. Orem City
2019 UT 59 (Utah Supreme Court, 2019)
AGTC Inc. v. CoBon Energy LLC
2019 UT App 124 (Court of Appeals of Utah, 2019)
Grove Business Park v. Sealsource International
2019 UT App 76 (Court of Appeals of Utah, 2019)
Northgate Village Development v. Orem City
2018 UT App 89 (Court of Appeals of Utah, 2018)
E & H Land, Ltd. v. Farmington City
2014 UT App 237 (Court of Appeals of Utah, 2014)
McCollin v. J.D.F. Properties, LLC
2014 UT App 75 (Court of Appeals of Utah, 2014)

Cite This Page — Counsel Stack

Bluebook (online)
2014 UT App 86, 325 P.3d 123, 758 Utah Adv. Rep. 20, 2014 WL 1584500, 2014 Utah App. LEXIS 89, Counsel Stack Legal Research, https://law.counselstack.com/opinion/northgate-village-development-lc-v-orem-city-utahctapp-2014.