Lawsuit filed against Rancho Santa Fe Association over handling of Rancho Librado project
A lawsuit was filed Sept. 1 against the Rancho Santa Fe Association by Golden Eagle Land Investment, alleging numerous complaints, including that the Association violated the Common Interest Development Open Meeting Act and took action on an item that was not on the agenda.
The estate of Larry Mabee is attempting to build a senior housing project, Rancho Librado, on the vacant lot on Calzada del Bosque.
The suit against the Association includes complaints such as breach of fiduciary duty; fraud: false promise; fraud: negligent misrepresentation; promissory estoppel; intentional interference with prospective economic relations; breach of implied covenant of good faith and fair dealing; and breach of Association governing documents.
The Association has 30 days to respond to the initial complaint.
“The Association board is currently considering the allegations of the complaint,” said the Association’s attorney, Mary Howell of Epsten, Grinnell & Howell. “We anticipate a vigorous defense and a favorable resolution.”
Under the Common Interest Development Open Meeting Act, a member who prevails in a civil action against an association could be entitled to attorney fees and the court may impose a civil penalty for up to $500 for each violation, as well as restitution for loss of profits and actual expenses which, to date, are about $1.6 million.
Golden Eagle Land Investment is represented by co-trustees of the Larry Mabee trust: Larry Mabee’s widow, Christine Penrod Mabee; daughter Laura Mabee-Boswell; and Golden Eagle CEO and President Daniel Ukkestad.
“What the Mabees are looking for in the lawsuit is that they be given a level playing field to present this project to the community in a fair way,” said Pete Smith, Mabee project consultant and former RSF Association manager. “The lawsuit is not about the merits of the project. The lawsuit is about the process. There are a set of rules and the Mabee family only wants the Association to follow the rules and the process.”
The Mabee project was first presented to the board in May 2014 with an informal presentation. The board members responded favorably to the project, but informed the developers that they would have to go through the process.
The 28-acre parcel on Calzada del Bosque lies within the Association and the County of San Diego. The Association has zoned the property as Class C for multiple dwellings; however, the land within the county has a more restrictive residential density, which will require the developers to apply for a density change within the zoning.
Golden Eagle submitted plans to the county to begin the approval process in September 2014 before submitting to the Association.
Laura Mabee-Boswell has stated that they started working on the county entitlements first, as they take a minimum of two years, and under the Covenant regulations, any approval they would receive would expire before the county approval.
In February 2015, the Association sent a letter to the county’s planning and development services department stating that the Association did not take a formal position on Rancho Librado. The lawsuit claims that the letter was never authorized by the Association board.
Per the lawsuit, on April 22, two weeks before the May 7 board meeting, RSF Association President Ann Boon sent an email to Laura Mabee-Boswell inviting them to come and discuss “zoning, density and traffic issues” related to the project.
In response, Laura Mabee-Boswell requested the presentation be postponed because the project’s design engineer and land planner would not be available, according to the lawsuit. Boon responded that it could not be postponed because the project was to be heard by the San Dieguito Planning Group on May 14 and the Association was being urged by neighbors against the project to take a position before the planning group’s vote, according to the lawsuit.
On April 28, Golden Eagle informed the Association that they had requested the postponement of the Planning Group meeting in order to accommodate the Association and have the opportunity to present to the Association board, according to Ukkestad.
On April 30, the lawsuit says that Boon responded, “I assure you that the RSFA board has no intention of undermining or interfering in any way with your effort to bring the county’s entitlements in line with the Covenant.”
“We thought everything was OK,” Ukkestad said, noting that the day before the meeting Boswell had a meeting with RSF Association Manager Bill Overton and two other Association employees and no one mentioned the agenda items of the next day.
The May 7 board meeting agenda had two items: an information-only item titled “Presentation on High Density Housing,” and “Review of 2006 RSFA Planning Committee Study and Board Decision,” according to the lawsuit.
Neither specifically identified Rancho Librado in any way.
Ukkestad said furthermore, the review of the 2006 study was an item that had not been discussed in nine years. It specifically says that senior housing should be built in the village, Ukkestad said.
“That one came out of left field,” he said, noting the issue was used to vote against their project.
Golden Eagle contends that the board acted in violation of the open meeting act and its own bylaws by engaging in a presentation and substantial discussion about Rancho Librado, led by the project’s opposition.
Golden Eagle contends that the board then took action on the item by voting to submit a letter to the county to remind them that no formal submittal had been made to the Association and no approval had been granted; and, secondly, requesting that the county “adhere to and enforce” the County’s General Plan 2020 that states one dwelling maximum per two-acre sites.
“They asked the county not to change the density, and that’s exactly what we’re asking the county to do,” Ukkestad said.
Golden Eagle contends that the Association’s motion contradicted its previous favorable review of the project and Boon’s statement to Laura Mabee-Boswell assuring her that the Association had no intention of interfering with the project’s efforts with the county.
On May 11, the Association had the letter, written by Overton, hand-delivered to the county.
“In the minutes, the board only approved two items to be included in the letter but Overton wrote a two-page letter that included a lot of issues that were not discussed much less voted on by the board,” Ukkestad said. “They never told us we were going to be the only project discussed, they never told us they wrote the county a letter. We found out because the county called the Mabee family.”
In July, Golden Eagle requested that the Association rescind the letter, as it was “inaccurate, intentionally misleading and improperly approved.”
Ukkestad said Golden Eagle and its legal counsel believe they have a strong case, that the Association has “deliberately and intentionally” engaged in conduct that interferes with and undermines their efforts to obtain county approval for their project.
“It’s very frustrating,” Ukkestad said. “All we ever asked for is to let the community decide and to be treated fairly…to be railroaded in this regard, that’s the frustrating part.”