Former City Executive Employee Admits Negligence in Issuing Building Permits in Lawsuit Against Elk Grove, Says Developer 'Misled' City

June 25, 2018 | 

In a stunning admission of negligence, a former member of City of Elk Grove's executive management team admitted in a lawsuit declaration that a developer had misled city hall personnel regarding a new housing development and the city had acted negligently. That admission came from the city's former planning director, Taro Echiburo.

In a lawsuit filed on June 7, 2018, in Sacramento Superior Court, Joseph Mohamed alleges that the City of Elk Grove breached a written contract when it transferred 78.1-acres worth of conservation rights without consent to Pulte Homes for Swainson's Hawk habitat mitigation. The mitigation was for two Pulte developments in the city's Laguna Ridge subdivision that were improperly granted building permits. 

As part of the suit, in a declaration dated March 14, 2018, Echiburo admitted that he and the city bungled paperwork, and according to his sworn word, gave the mitigation rights to Pulte based solely on the word of their representative, Greg Van Dam. Echiburo, who left his job with the city in June 2014, said that Van Dam, who on behalf of Pulte, applied for building permits in April 2013, did not reveal that they had not purchased the conservations rights as required.

In a declaration under the penalty of perjury, former
Elk Grove  Taro Echuburo planning director admitted
the city did not follow procedures and improperly
issued building permits to Pulte Homes in 2014.

The case has its origins to May 2008 when Mohamed recorded a deed grant for 80-acres of land in favor of Elk Grove to establish a conservation easement. As part of the transaction, it authorized the city to transfer the conservation rights but only with Mohamed's prior written consent.

At the same time, Pulte told Mohammed that it planned to use 78.1-acres of the conservancy for their two Laguna Ridge subdivisions. The agreement between Mohamed and Pulte gave Pulte an option to purchase the rights.

Because of the Great Recession and the credit collapse, Pulte did not begin construction in 2008 as planned. Consequently, Pulte's option to purchase the rights expired on December 31, 2011.

During the intervening years, Mohamed claims to have been in contact with the city regarding the rights. In November 2010 an email from the city confirmed that the rights had not been exercised, and further before transferring rights, the city had to obtain Mohamed's written consent. 

Also Mohamed contents over the last several years he met at annually with city personnel on the 80-acre site to verify that the land continued to be used for wildlife habitat. At no time during these annual inspections, Mohamed said was he ever informed that the rights had been transferred.  

With a recovering housing market, the complaint says in April 2013 as Pulte pursued restarting the subdivisions, a series of emails were exchanged between Van Dam, Echiburo, and Sandy Kyles, a city employee under the supervision of Echiburo.   

Kyles told Van Dam that she and Echiburo were unable to find any documentation that Mohamed had transferred the conservation rights to Pulte. Kyles wrote, "Would you by any chance have anything in your records?"

Mohamed's filing also states that at no time did Echiburo or any members of the planning staff seeking his verification. Nonetheless, the city transferred the conservation rights to Pulte on or shortly after April 30, 2013.

On August 22, 2017, Mohamed says he contacted the city planning department to see if anyone might be interested in buying the conservation rights to his 80-acres. It was then, the plaintiff claims, which he discovered that his rights had been granted to Pulte four years earlier, which Mohamed contends was a breach of contract with the city.

A few days later Mohamed sent a demand letter to Van Dam and Pulte for $1.5 million for the unauthorized and unpaid use of the conservation rights. In response, Pulte recorded a quitclaim release of the conservation rights with the Sacramento County Recorder on September 19, 2017  

It is not known if Pulte ever paid for and properly acquired the conservation rights for their two housing developments.

The complaint notes while Pulte relinquished their rights, the city of Elk Grove "refused to credit back to Mohamed the Conservation Rights that were unlawfully transferred to the Pulte Projects and has refused to compensate Mohamed for the transferred Conservation Rights."

In response, Mohamed sought documents from the city that revealed several email exchanges between Pulte and the city. The complaint says "These and other documents led Mohamed to believe that Mr. Van Dam lied to, and deceived the city when applied for building permits in April 2013."

It is asserted that "Taro Echiburo a former employee of the city, provided a sworn declaration confirming the city had been misled by Mr. Van Dam in 2013." 

Furthermore, the document states "Mr. Echiburo also confirmed that the city failed to follow the correct procedure and applied the Conservation Rights to the Pulte Project. The city staff made a 'mistake' because no one from the city staff contracted Mohamed about the transfer of the Conversation Rights, regardless of the what Mr. Van Dam said or led the city to believe in April 2013."  

Stressing Echiburo's declaration of the city's negligence, Mohamed claims that by his admission, "the city had violated its own policies and practices and was therefore negligent in its transfer of the conservation rights regardless of the acts, errors or omissions of Pulte."  

As part of his declaration, Echiburo said when the rights were transferred the city's planning department used a checklist to track conservation rights. But, he also stated that Van Dam did not reveal to Echiburo or his staff that they had not exercised the rights, and had not paid their fees.

Had he known that, Echiburo says "the building permits would not have been issued until any ownership issues were resolved." Echiburo also admitted under penalty of perjury, that in September 2013 he had emailed another prospective purchaser of the rights that only 1.9-acres of the original 80-acres were available. 

As a remedy, Mohamed is seeking $1.46 million in damages or the reconveyance of the rights plus attorney fees. Mohamed is being represented by the Elk Grove-based law firm of Cassinat Law Corporation.