Brooks Koch & Sorg/DOL ATTORNEYS
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BROOKS KOCH & SORG
www.bksattorneys.com
TERRENCE J. SORG DAVID M.BROOKS
DIRECT LINE 317/822-3704 L. MICHAEL KOCH
E-MAIL tjsorg@bbks-law.com TERRENCE J. SORG t
REGISTERED ARCHITECT
September 17, 2008
VIA FIRST CLASS U.S. MAIL
Douglas C.Haney
City Attorney, City of Carmel
One Civic Square
Carmel, Indiana 46032
RE: Waiver of Conflicts— Joint representation of the City of Carmel, Indiana and Owners of Guilford
Reserve—Brownstones of Carmel townhouses("Owners")/Contract Employing Attorneys
Dear Doug:
The Owners of certain townhouses ("Owners") in the Guilford Reserve — Brownstones of Carmel
subdivision development ("Development") have asked the law firm of Brooks Koch & Sorg to serve as
counsel in connection with prosecuting claims against Savoy Homes, Inc; and/or Crawford Development,
LLC and / or Robert Barbato, individually, (collectively "Defendants") with respect to construction
defects, building code violations and other unlawful acts and omissions related to the construction of the
townhomes in the Development (the "Litigation"). The City of Carmel, Indiana has also requested our
firm to serve as counsel in prosecuting claims against Defendants in the same Litigation as a co-plaintiff
for violations of state and local laws. This letter will confirm that you have been informed about the
potential conflicts of interest inherent in any representation of two or more entities. It is important that
you understand that since this firm would be representing both Carmel and each Owner, that each entity
would be our client.
A. Conflicts of Interest
As we have previously discussed, our representation of each Owner and the City of Carmel in connection
with the Litigation has raised certain conflicts of interest because the interests and objectives of each
Owner individually are, or may become, inconsistent with the interests of the City of Carmel.
For example, as you know, the City of Carmel inspected the construction of the townhomes in the
Development and issued Certificates of Occupancy. Independent inspections have identified serious and
substantial construction defects and building code violations existing in the respective homes (collectively
"construction defects") which will require substantial sums of money to repair and correct. While other
conflicts may exist not identified herein, the Owners' interests' conflict with our representation of the
City of Carmel with respect to potential or prospective claims that the Owners may have against the City
of Carmel based upon the aforementioned inspections and /or other acts or omissions.
B. Risks of Multiple Representation
Our representation of multiple interests has significant implications which you should consider. Our
multiple representation may result in the loss of the attorney-client privilege for communications between
615 RUSSELL AVENUE • INDIANAPOLIS, IN 46225 • TEL: 317/822-3700 • FAR: 317/822-3705
S
Douglas Haney/City Attorney/September 17,2008/page 2
you and members of our firm, because anything disclosed by one client on a matter of common interest
may be disclosed to a jointly represented client in a civil proceeding between you. Further, in the event of
a dispute between an Owner and the City of Carmel, we may be precluded from representing any
individual party without first obtaining the consent of all concerned. For these reasons, our normal
practice in these circumstances is to represent only one party. However, you have advised us that you do
not wish to seek other counsel at this time and, instead, you desire that we represent your multiple
interests in connection with the Litigation.
Accordingly, we are requesting the City of Carmel to sign this informed consent to our joint
representation of the Owners and the City of Carmel waiving all conflicts respecting our joint
representation. We are also requesting the Owners to execute a similar waiver of conflicts provision a
copy of which has been provided to you. In addition, we are requesting each Owner to sign the WAIVER
AND RELEASE—the form of which you have been provided and approved.
The City of Carmel, in consideration for each Owner executing the WAIVER AND RELEASE, has
agreed to pay our firm all of the fees and expenses reasonably required to prosecute claims at the trial
court level against Defendants on behalf of the City of Carmel and the Owners in the Litigation. The
WAIVER AND RELEASE is expressly conditioned upon, and shall not become effective until, a written
agreement is executed between our law firm and the City of Carmel authorizing our firm to proceed with
the prosecution of Defendants in the Litigation.
C. Rules of Professional Conduct
As you know, we are governed by specific rules relating to our representation of clients when present or
potential conflicts of interest exist. Rule 1.7of the Model Rules of Professional Conduct provides as
follows:
Rule 1.7. Conflict of Interest: Current Clients
(a) Except as provided in paragraph (b), a lawyer shall not represent a client if
the representation involves a concurrent conflict of interest. A concurrent conflict
of interest exists if:
(1) the representation of one client will be directly adverse to another
client; or
(2) there is a significant risk that the representation of one or more clients
will be materially limited by the lawyer's responsibilities to another client, a
former client or a third person or by a personal interest of the lawyer.
(b) Notwithstanding the existence of a concurrent conflict of interest under
paragraph (a), a lawyer may represent a client if:
(1) the lawyer reasonably believes that the lawyer will be able to provide
competent and diligent representation to each affected client;
(2)the representation is not prohibited by law;
(3) the representation does not involve the assertion of a claim by one
client against another client represented by the lawyer in the same litigation or
other proceeding before a tribunal; and
(4) each affected client gives informed consent, confirmed in writing.
BROOKS KOCH & SORG
615 RUSSELL AVENUE • INDIANAPOLIS,IN 46225 •TEL: 317/822-3700 • FAX: 317/822-3705
Douglas Haney /City Attorney/September 17,2008/page 3
Accordingly, we request an authorized official of the City of Carmel to sign and return to us a copy of this
letter, acknowledging that:
1. The City of Cannel has been advised of Rule 1.7 and of the conflicts associated with our joint
representation of the City of Carmel and Owners in the Litigation; and
2. You nevertheless want us to represent the City of Carmel in connection with the matters
discussed above.
Please sign and return the enclosed copy of this letter. By signing and returning the letter the City of
Cannel is acknowledging that its authorized representative has read and understands this letter and that
the City of Carmel consents to the matters set forth herein.
In addition to the foregoing, we are providing the City of Carmel a"Contract Employing Attorney"
enclosed with this letter for your review and execution. The contract contains language indicating that the
City of Cannel has agreed to pay the attorney fees and expenses associated with the Litigation on behalf
of the City of Carmel as well as the Owners.
Should you have any questions about this letter or the consent, please advise.
Very truly yours,
Brooks Koch & Sorg
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Terrence J. Sorg, Attorney at Law
Encl.
Signed and Accepted this �3 day of September, 2008:
175"6-u-glas_Catan4, City Attorney, City of C iniel, Indiana
BROOKS KOCH & SORG
615 RUSSELL AVENUE• INDIANAPOLIS, IN 46225 •TEL: 317/822-3700 • FAX: 317/822-3705
CONTRACT EMPLOYING ATTORNEYS
The City of Carmel, Indiana("Client"), hereby employs the law firm of BROOKS KOCH& SORG
("Attorneys"), duly admitted and practicing attorneys in the State of Indiana, to prosecute by lawsuit the
claims of said Client as co-plaintiff with the Owners of certain townhouses ("Owners") in the Guilford
Reserve—Brownstones of Carmel subdivision ("Development") against Savoy Homes, Inc; and/or
Crawford Development, LLC and/or Robert Barbato, individually, (collectively"Defendants") with
respect to construction defects, building code violations and other violations of state and local laws and
ordinances (the "Litigation").
Attorneys will work at the rate of$275.00 per hour for all attorney hours billed for the representation
hereunder up to and including time billed 60 days prior to trial. All time billed after 60 days prior to the
scheduled trial, including, but not necessarily limited to, trial preparation, trial briefs, conducting the trial
itself and the filing of any post-trial briefs, shall be billed at$325.00 per hour.
Client has agreed to pay all reasonable legal fees and expenses for the Owners with respect to the
Litigation. Unless prohibited by Court order,the City of Carmel agrees to continue to pay all reasonable
legal fees and expenses through the conclusion of trial so long as any claims of any party remain pending-
- even if the City of Carmel has been dismissed from the Litigation. Reasonable attorney's fees and costs
shall be recoverable by Attorneys in connection with negotiation, settlement, or any action to enforce
payment of fees pursuant to this Contract. Statements will normally be prepared and mailed during the first
week of the month following the month in which services are rendered and are due within thirty-five(35)
days of receipt. The statement will reflect the hourly rates and an itemized accounting of time spent
working on the file, described in reasonable detail and in one-tenth hour increments. The hourly rates will
not change during this engagement. This agreement shall not constitute the Client's consent to nor cover
the fee structure for any appeals, which shall be the subject of negotiations and mutual agreement of the
parties hereto.
In addition to the foregoing, Client agrees to pay for reasonable out-of-pocket expenses and disbursements
of counsel
incurred on Client's behalf including and without limitation, the following:
a. Court filing and statutory witness fees.
b. Consulting and Expert fees (after consultation with Client only).
c. Deposition costs, including court reporter fees, transcript fees.
d. The actual cost of color photocopying and photograph and videotape development and
duplication and all copying/reproduction that is not completed by our law firm internally.
Unless prohibited by Court order, the City of Carmel agrees to continue to pay the above identified out-of-
pocket expenses related to the Litigation through the conclusion of trial so long as any claims of any party
remain pending-- even if the City of Carmel has been dismissed from the Litigation. Out-of-pocket
expenses will be billed on our monthly statement and are also due within thirty-five (35) days of receipt.
Client understands that all expenses in the preparation and trial of the case occasioned by the taking of
depositions, court costs, obtaining attendance of witnesses, printing of briefs, and other necessary expenses
of litigation will be borne by Client regardless of the outcome of the litigation. Any unreasonable failure to
pay the sums set forth above shall be deemed ground for withdrawal as counsel.
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Either party shall be free to terminate this arrangement at any time. In such event, Client will be
responsible for all reasonable fees, expenses, and disbursements incurred through the date of termination
and Attorneys will work with Client to effect an orderly transition to other counsel. Any termination by
Attorneys will be consistent with the then-applicable Code of Professional Responsibility.
It is agreed that Attorneys have given no guarantee concerning the results of Client's claims or the
outcome of the Litigation and all expressions of counsel are matters of opinion only. Client has read and
understands this agreement. The undersigned Client agrees not to compromise any claim covered by this
Contract without the written consent of Attorneys, and Attorneys, likewise, are not authorized to
compromise any claim covered by this Contract without the written consent of Client.
The undersigned Client agrees to cooperate in the preparation and trial of this claim, to appear on
reasonable notice for depositions and court appearances, and to comply with all reasonable requests made
by Attorneys in connection with the preparation and presentation of this claim. The undersigned is an
authorized representative of the City of Carmel and hereby acknowledges and agrees that upon execution,
this instrument shall be a valid and binding agreement upon the parties and is enforceable according to its
terms which are not in contravention of law.
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ALL OF WHICH IS SO AGREED this 3 day of , - sitki-- 2008.
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City of Carmel
By:
(--__._.Dnug_las-C-Haney, City Attorney
Attorneys hereby accept the foregoing engagement.
BROOKS KOCH& SORG
By: `SC,
Authorized agent of BROOKS KOCH& S RG
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