Resolution No. 6780
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RESOLUTION NO. 6780
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A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING AND AUTHORIZING THE EXECUTION
OF A SETTLEMENT AGREEMENT RELATING TO LOS
ANGELES SUPERIOR COURT CASE NO. BC 104302 BY AND
BETWEEN THE CITY OF ANAHEIM AND THE CITY OF
VERNON
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WHEREAS, on May 6, 1994, the cities of Anaheim, Colton,
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Riverside, Azusa and Banning 'filed an action against the City of
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Vernon in the Los Angeles Superior Court, Case No. BC 104302,
alleging a right to reimbursement on certain contracts concerning
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the California-Oregon Transmission Project; and
WHEREAS, the City of Vernon has been negotiating with the
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individual cities in an attempt to compromise each of their
respective claims in the litigation; and
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WHEREAS, the City of Vernon and the City of Anaheim wish
to enter into a full settlement of each of their respective claims
in the above-referenced litigation; and
WHEREAS, said settlement is not an admission or a
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determination by the City of Vernon as to the merits of any claims
or allegations raised by the cities in said litigation.
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NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
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SECTION 1: The City Council of the City of Vernon does
hereby find and determine that the recitals contained,hereinabove
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are true and correct.
SECTION 2: The City Council of the City of Vernon hereby
approves the Settlement Agreement by and between the City of
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Anaheim and the City of Vernon, the original Agreement has been
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presented to the City Council concurrently with this resolution,
and the City Council hereby orders said Agreement to be received
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and filed by the City Clerk.
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SECTION 3: The City Council of the City of Vernon hereby
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authorizes the Mayor and the City Clerk to execute said Agreement
for, and on behalf of, the City of Vernon.
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SECTION 4: The City Clerk of the City of Vernon shall
certify to the passage of this resolution and thereupon and
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thereafter the same shall be in full force and effect.
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APPROVED AND ADOPTED this 16th day of April, 1996.
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ATTE~..~ //
y~ A~~~
BRUCE V. MALKENHORST, City Clerk
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STATE OF CALIFORNIA )
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COUNTY OF LOS ANGELES )
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I, BRUCE V. MALKENHORST, city Clerk of the City of
Vernon, do hereby certify that the foregoing Resolution, being
Resolution No. 6780, was duly adopted by the City Council of the
City of Vernon at a regular meeting of the city Council duly held
on Tuesday, April 16. 1996, and thereafter was duly signed by the
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Mayor of the City of Vernon.
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12 (SEAL)
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EXECUTION COPY
8 SETTLEMENT AGREEMENT BETWEEN
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THE CITY OF ANAHEIM
AND
THE CITY OF VERNON
RELATING TO
LOS ANGELES SUPERIOR COURT
CASE NO. BC 104302
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TABLE OF CONTENTS
PARTIES
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RECITALS
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TERM OF AGREEMENT
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AGREEMENT .................
4.1 Non-firm Transmission Service
4.2 Dismissal of Action . . . . . .
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BILLING AND PAYMENT
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AUTHORIZED REPRESENTATIVES
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LIABILITY AND INDEMNITY
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NONPRECEDENT AND RESERVATION OF RIGHTS . . . . . . 9
8.1 Nonprecedent .......... . . .. 9
8.2 Non-Admission Bv Vernon . . . . . . . .. 10
8.3 Non-Oooosition to Other Settlement Aareements 10
PREVIOUS COMMUNICATIONS
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NONSEVERABILITY
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NONWAIVER OF CONTRACTUAL RIGHTS
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UNCONTROLLABLE FORCE . . . . ~
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NONDEDICATION OF FACILITIES
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NOTICES
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RELATIONSHIP OF PARTIES
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NO THIRD PARTY RIGHTS
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ASSIGNMENT . . . . . .
GOVERNING LAW AND REGULATIONS
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CONSTRUCTION OF AGREEMENT
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CAPTIONS AND HEADINGS
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SIGNATURE CLAUSE . . .
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SETTLEMENT AGREEMENT
BETWEEN
THE CITY OF ANAHEIM
AND
THE CITY OF VERNON
RELATING TO
LOS ANGELES SUPERIOR COURT CASE NO. BC 104302
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7 1.0 PARTIES
8 The parties to this settlement agreement ("Agreement") are
9 the City of Anaheim, a municipal corporation of the state of
10 California ("Anaheim"), and the City of Vernon, a municipal
11 corporation of the state of California ("Vernon"). Each signatory
12 is a Party and collectively are the Parties.
13 2.0 RECITALS
14 This Agreement is made with reference to the following facts,
15 among others:
16 2.1 The Parties are engaged in the generation, transmission,
17 and/or distribution of electric power and energy in the
18 southwestern United states.
19 2.2 Vernon has the right to use and sell transmission
20 capacity on the Pacific DC intertie between Nevada-Oregon border
21 ("NOB") and Sylmar Substation ("Sylmar") and between Midway
22 Substation ("Midway") and Sylmar ("Transmission Paths").
23 2.3 The cities of Anaheim, Riverside, Colton, Azusa and
24 Banning filed an action in the Superior Court of the State of
25 California, County of Los Angeles, Case No. BC 104302, ("the
26 Action"), on May 6, 1994, alleging a right to reimbursement on
27 certain contracts pertaining to the California-oregon Transmission
28 Project. Vernon denies the existence of such a right.
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2.4 In order to limit the time and expense of lengthy and
complex litigation, Vernon has been negotiating with the
plaintiffs in the Action collectively and individually, and
Anaheim is willing to individually compromise its claims in the
Action as set forth herein and to file a dismissal in the Action
with prejudice as to Anaheim.
2.5 This Agreement is entered into by the Parties in good
faith and in full settlement of each such respective claim in the
Action and with the stipulation that this Agreement is not a
determination or admission as to the merits of any claims or
allegations set forth in the Action and shall not be admitted in
evidence in any proceeding other than to prove the terms and
conditions of this Agreement.
3.0 TERM OF AGREEMENT
This Agreement shall become effective on the date last herein
mentioned when signed by the Parties hereto and shall remain in
effect until completion of performance, including payment of all
bills for service, or shall terminate in any event on July 1,
1999, and the Parties' rights shall expire on said termination
date.
4.0 AGREEMENT
In consideration of the mutual covenants contained herein,
the Parties agree as stated herein.
4.1 Non-firm Transmission Service. Vernon hereby grants to
Anaheim the right to schedule non-firm transmission service on
each Transmission Path at any time during the period May 1, 1996
through April 30, 1999, as follows:
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2 Between HOB and Sylmar:
up to 15 MWh per hour July 1, 1996 through April 30, 1997; and
3 July 1, 1997 through April 30, 1998; and
July 1, 1998 through April 30, 1999.
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Between Midway and Sylmar:
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up to 30 MWh per hour May 1, 1996 through October 31, 1996; and
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May 1, 1998 throuqh October 31, 1998.
7 up to 15 MWh per hour November 1, 1996 through April 30, 1997; and
November 1, 1997 through April 30, 1998; and
8 November 1, 1998 through April 30, 1999.
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10 The first 6,800 MWh of such transmission service scheduled and
11 used by Anaheim on each path for each month during said period
12 shall be provided at no charge except that Anaheim shall be
13 responsible for all losses and costs provided for in Section
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4.1.6.
Anaheim shall pay Vernon for transmission service
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scheduled and used by Anaheim above 6,800 MWh during each month as
follows:
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NOB-Sylmar
Midway-Sylmar
$1. ?O/MWh
$0.75/MWh
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4.1.1
Anaheim shall submit its hourly preschedules to
20 Vernon by 1030 hours. Preschedules shall be completed on each
21 Workday ("Workday" means each day which Anaheim and Vernon both
22 observe as a regular day of work). preschedules shall be for each
23 hour of the following day or days through the next Workday. The
24 Parties shall endeavor to avoid requesting changes in schedules.
25 Requests for changes in prescheduled amounts by Anaheim for any
26 hour shall be only as mutually agreed. Normally such requested
27 changes shall be submitted no later than 30 minutes before the
28 hour for which the change is to be effective.
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4.1.2 Vernon's first 60MW of capacity and firm energy
schedules using Vernon's rights to transmission service on the
Pacific DC Intertie and on the Midway-Sylmar path shall have
priority over any non-firm transmission service scheduled or
unscheduled by Anaheim pursuant to this Agreement.
4.1.3 Subject to the provisions of section 4.1.4,
transmission service may be interrupted during the next scheduled
hour by Vernon or immediately interrupted if Vernon receives
notification, or is interrupted without notification, for a system
emergency or an unscheduled reduction in Vernon's transmission
capability on the affected transmission path.
4.1.4 Anaheim, other third parties who have purchased
non-firm transmission service from Vernon through settlement
agreements in the Action, and Vernon, shall have priority service
over other non-firm preschedules and schedules and shall share
such capacity on a pro rata basis except as provided in section
4.1.2 above.
4.1.5 If preschedules cannot be established as
requested by Anaheim because of Vernon'~ lack of transmission
capacity or if Anaheim's existing schedule is reduced during real
time, then by the next Workday Anaheim may request Vernon to pay,
and Vernon shall pay Anaheim fifty cents per megawatt hour
($0.50jMWh) for the amount of transmission service not made
available on a prescheduled basis or curtailed by Vernon's
dispatchers if such service would have been necessary to schedule
any portion of the 6,800 MWh on each path for each month. If
Anaheim requests the payment of fifty cents per megawatt hour
($0.50jMWh) for such service, then Vernon's obligation to provide
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such non-firm transmission service at no charge pursuant to
section 4.1 in such month, shall be reduced by a like amount.
4.1.6 Anaheim shall be responsible for transmission
losses associated with its schedule of such service and shall
reimburse Vernon for any other charges Vernon incurs which are
directly related to its schedule of such service (e.g., Edison
dispatching and scheduling fees). Anaheim shall either (i) return
energy to Vernon at the sylmar Substation pursuant to Edison's
standard procedures for payment for transmission losses, or (ii)
agree with Vernon to pay monetary compensation at a mutually
acceptable rate in lieu of scheduling such energy to Vernon, or
(iii) upon securing Vernon and Edison's approval, deliver energy
directly to Edison as payment for losses.
4.1.7 The Parties recognize that the transmission
service provided by Vernon under this Agreement may be interrupted
or curtailed by Vernon in accordance with the provisions of
Sections 4.1.2-4.1.5. Such an interruption shall not be
considered a willful Action as defined in Section 7, if it is
implemented in accordance with this Section 4.
4.2 Dismissal of Action. Anaheim shall within sixty (60)
days after execution of this Agreement file a dismissal with
prejudice of the Action as to Anaheim. Upon failure to file a
dismissal, Anaheim stipulates that Vernon may file this Agreement
with the Court as a stipulation for dismissal with prejudice of
the Action.
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5.0 BILLING AND PAYMENT
5.1 Billing and payment with respect to Non~Firm
Transmission Service hereunder shall be based upon the following:
5.1.1 Vernon shall bill Anaheim for the amount of Non-
Firm Transmission Service scheduled and used pursuant to Section
4.1 above and all other charges associated with such service
provided for in this Agreement.
5.1.2 Vernon shall credit Anaheim as requested
pursuant to 4.1.5 above.
5.1.3 Billing shall be based on the records of the
respective power schedulers or dispatchers in the form directed by
the Authorized Representatives, except as the Authorized
Representatives may arrange otherwise for particular situations.
5.2 A bill for Non-Firm Transmission Service provided under
this Agreement shall be rendered monthly by Vernon on or before
the 20th of the month following the month in which such
Transmission Service is received. Bills received shall be due by
the fifteenth (15) calendar day from the date of such receipt.
Amounts not paid on or before the due date shall be payable with
interest at the rate of one percent (1%) per month from the due
date to date of payment.
5.3 In case a bill or any portion thereof is in dispute, the
full amount shall be paid when due. If the disputed amount is
determined to be incorrect, such amount shall be refunded promptly
upon determination, with interest accrued at the rate of one
percent (1%) per month computed from the original due date to the
date the adjustment is made.
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5.4 Notices and demands shall be addressed to the respective
Parties as set forth in section 14.0.
6.0 AUTHORIZED REPRESENTATIVES
6.1 Each Party shall designate an Authorized Representative.
Such Authorized Representative shall be authorized to act on
behalf of such Party in carrying out the provisions of this
Agreement and to provide liaison between the Parties. Each Party
shall notify each other Party within thirty (30) calendar days
after execution of this Agreement of the designation of its
Authorized Representative and shall promptly notify each other
Party of any subsequent changes in such designation.
6.2 The Authorized Representatives shall have no authority
to modify any of the provisions of this Agreement unless
specifically set forth herein.
6.3 Disputes on any matter relating to this Agreement shall
be discussed and resolved by the Authorized Representatives, who
shall use their best efforts to amicably and promptly resolve the
d~spute. If the Authorized Representatives are unable to resolve
the dispute, the matter shall be referred to the chief executive
officers of each Party's utility department for resolution.
7.0 LIABILITY AND INDEMNITY
7.1 Except for willful Action, each Party shall indemnify
and save each other Party harmless from liability, loss, damage,
claim, costs, and expenses (inclUding attorney fees) on account of
injury to persons (including death), or damage or destruction of
property, occasioned by the sole negligence, whether active or
passive, of the indemnifying Party's officers, directors,
employees, or contractors; provided, however, that:
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7.1.1 Each Party shall be solely responsible for the
claims or any payments to any employee or agent for injuries
occurring in connection with their employment or arising out of
any Workers' Compensation law.
7.1.2 No Party shall be liable for any loss of
earnings, revenues, indirect or consequential damages, or injury
which may occur to the other as a result of outages in delivery of
energy or service hereunder by reason of any cause, including
negligence, but excluding willful Action.
7.2 Each Party shall indemnify and save each other Party
harmless for any liability, loss, claim, cost (including attorney
fees) for any claims made by the indemnifying Party's electric
service customers as a result of any failure of a Party to provide
electric power or energy contemplated by this Agreement for any
reason or any cause, including the negligence of each other Party,
but excluding Willful Action.
7.3 For the purpose of this section 7, willful Action shall
be defined, except as otherwise provided in section 4.1. 7 hereof,
as follows:
7.3.1 Action taken or not taken by a Party at the
direction of its directors or members of its governing bodies,
officers, or employees having management responsibility affecting
its performance under this Agreement,' as follows:
7.3.1.1 Action which is knowingly or
intentionally taken or not taken with conscious indifference to
the consequences thereof or with intent that injury or damage
would result or is likely to result therefrom.
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7.3.1.2 Action which has been determined by final
arbitration award or final judgment or judicial decree to be a
material default under this Agreement and which occurs or
continues beyond the time specified in such arbitration award or
judgment or judicial decree for curing such default or, if no time
to cure is specified therein, occurs or continues thereafter
beyond a reasonable time to cure such default.
7.3.1.3 Action which is knowingly or
intentionally taken or not taken with the knowledge that such
action taken or not taken is a material default under this
Agreement.
7.3.2 willful Action does' not include any act or
failure to act which is merely involuntary, accidental, or
negligent.
7.3.3 The phrase "employees having management
responsibility", as used in this Section 7.3, means the employees
of a Party who are responsible for one or more of the executive
functions of planning, organizing, coordinating, directing,
controlling, and supervising'such Party's performance under this
Agreement with responsibility for results.
7.4 The provisions of this Section 7 shall be binding upon
the Parties to the full extent permitted by law.
8.0 NONPRECEDENT AND RESERVATION OF RIGHTS
8.1 Nonprecedent. None of the principles or the
methodologies underlying this Agreement shall be deemed by any
Party as binding precedent in any proceeding or litigation except
to the extent specifically stated herein.
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8.2 Non-Admission Bv Vernon. By its execution of this
Agreement, Vernon does not admit to and hereby denies any
allegations relating to any of the activities raised by the
Plaintiffs in the Action.
8.3 Non-Opposition to Other Settlement Aqreements. Anaheim
agrees not to oppose or otherwise challenge any settlement
agreement between Vernon and any other party to the Action.
9.0 PREVIOUS COMMUNICATIONS
This Agreement contains the entire agreement and
understanding between the Parties as to the subject matter herein,
and supersedes all prior agreements, commitments, representations,
and discussions between the Parties.,
10.0 NONSEVERABILITY
This Agreement is subject to each and every condition set
forth herein, and each term of this Agreement is in consideration
and support of every other term.
11.0 NONWAIVER OF CONTRACTUAL RIGHTS
The failure of any Party to insist promptly in anyone or
more instances upon strict performance of any provision of this
Agreement, or to enforce any of its rights, shall not be construed
as a waiver of any such provision or the relinquishment of any
such rights.
12.0 UNCONTROLLABLE FORCE
No Party shall be considered to be in default in the
performance of any of its obligations hereunder other than the
obligation of a Party to make payment, when a failure of
performance shall be due to an uncontrollable force. The term
"uncontrollable force" shall mean any cause beyond the control of
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the Party unable to perform such obligation, including, but not
limited to, failure of or threat of failure of facilities, flood,
earthquake, storm, fire, ~ightning, and other natural
catastrophes; epidemic, war, riot, civil disturbance or
disobedience, strike, labor dispute, labor or material shortage,
sabotage, government priorities, and restraint by court order or
public authority, and action or nonaction by or failure to obtain
the necessary authorizations or approvals from any governmental
agency or authority, which by exercise of due diligence such Party
could not reasonably have been expected to avoid and which by
exercise due diligence it shall be unable to overcome. Nothing
contained herein shall be construed as to require a Party to
settle any strike or labor dispute in which it may be involved.
13.0 NONDEDICATION OF FACILITIES
No undertaking by one Party to another under any provision
of this Agreement shall constitute the dedication of the electric
system or any portion thereof of such Party to the public or to
the other Party, and it is understood and agreed that any such
undertaking by any Party shall cease upon the termination by such
Party of its obligations hereunder.
14.0 NOTICES
14.1 Any formal notice, demand or request provided for in
this Agreement, or served, given or made in this Agreement, or
. served, given or made in connection with it, shall be in writing
and shall be deemed properly served, given or made if delivered in
person or sent by united states mail, postage prepaid, to the
person specified below:
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City Clerk
200 South Anaheim Boulevard
Anaheim, California 92805
with copy to: Public utilities General Manager
201 South Anaheim Boulevard, suite 1101
Anaheim, California 92805
To Anaheim:
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Attention: Chief Executive Officer of Light
and Power
Light and Power Department
4305 Santa Fe Avenue
Vernon, CA 90058-0805
14.2 Either Party may at any time and from time to time, by
To Vernon:
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notice to each other Party, change the designation or address of
the person so specified as the one to receive notices pursuant to
this Agreement.
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RELATIONSHIP OF PARTIES
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The covenants, obligations and liabilities of the Parties
are intended to be several and not joint or collective.
Nothing
contained in the Agreement shall be construed to create an
association, joint venture, trust, agency, or partnership.
Each
Party shall be individually responsible for its own covenants,
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obligations and liabilities as provided in this Agreement.
No
'party shall be under the control of or shall be deemed to control
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No Party shall be the agent of or have a right or
another Party.
power to bind another Party without such other Party's express
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written consent.
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16.0 NO THIRD PARTY RIGHTS
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The Parties do not intend to create rights in, or to grant
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remedies to, any third party as a beneficiary of this Agreement or
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of any duty, covenant, obligation or undertaking established
herein.
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17.0 ASSIGNMENT
No Party shall assign or otherwise transfer this Agreement,
or its right or interest or any part thereof to any third party,
without the prior written consent of each other Party except as
set forth herein. Such consent shall not be unreasonably
withheld. No assignment of this Agreement shall relieve the
assigning party of its obligations until such obligations have
been assumed in writing by the assignee.
18.0 GOVERNING LAW AND REGULATIONS
This Agreement shall be interpreted, governed, and construed
under the laws of the State of California as if to be performed
wholly within the State of California.
19.0 CONSTRUCTION OF AGREEMENT
Ambiguities or uncertainties in the wording of this
Agreement shall not be construed for or against the Parties, but
shall be construed in a manner that most accurately reflects the
intent of the Parties, as expressed when this Agreement was
executed and as is consistent with the nature of the rights and
obligations of the Parties with respect to the matter being
construed.
20.0 CAPTIONS AND HEADINGS
All captions and headings appearing in this Agreement are
inserted to facilitate reference and shall not govern the
interpretations hereof.
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1 21.0 SIGNATURE CLAUSE
2 The signatories hereto represent that they have been
3 appropriately authorized to enter into this "Settlement Agreement
4 Between the City of Anaheim and the City of Vernon, Relating to
5 Superior Court Case No. BC 104302" on behalf of the Party for
6 which each signs. This Agreement is entered into on this ?1rn
7 day of
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April
, 1996.
CITY
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BY:
TITLE:
lities General Manager
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12. BY: ~~ ~
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Seal:
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TITLE:
City Clerk
APPROVED AS TO FORM:
JACK L WHIiE. CITY ATTORNEY
8~ ~j1'U;1tQ- (Yff.CA.
4JI'1J '1 (0
APPROVED AS TO FORM:
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BY:
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TITLE:
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::E<5~Y~
BRUCE V. MALKENHORST
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TITLE: city Clerk
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APPROVED AS TO FORM:
BY: D~ \)( l)~
DAVID B. BREARLEY'
TITLE: city Attorney
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CITY OF VERNON
BY;.~~~) I
TITL ... Mayor
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