Case

Holland & Knight – skirting conflicts by creating subsidiaries and providing attorneys as “consultants”

In 1 on February 3, 2009 at 1:10 am
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Amendment of CRA By-Laws

Motion

made by Commissioner Moore and seconded by Commissioner Katz to approve

amendments to the CRA By-Laws. Roll call showed: YEAS: Commissioners Hutchinson, Katz,

Moore, Smith, and Mayor Naugle. NAYS: none.

CRA Consultant

A motion was presented to approve hiring

Mr. David Cardwell, Holland and Knight

Redevelopment Strategies LLC, as the CRA consultant effective as of May 1, 2000 for a period

of 12 months.

Commissioner Hutchinson was uncomfortable with giving away the attorney/client relationship.

She understood Mr. Cardwell was not being hired as an attorney type of consultant, but his law

firm dealt with a lot of development cases in Fort Lauderdale. Commissioner Moore was

unclear on the issue. Commissioner Hutchinson explained that page 2 of the May 1, 2000 letter

distributed in connection with this item indicated that this would not include any legal services,

and no attorney/client relationship would be created by virtue of this agreement.

The City Attorney said the reason the document was so clear in expressing the fact that there

would be no attorney/client relationship was because the firm would not be performing any legal

services for the CRA. Rather, they would provide only consulting services in terms of strategies

to implement the program. He stated that Mr. Cardwell was a recognized expert in that aspect

of CRA work. The City Attorney agreed the law firm of Holland & Knight did occasionally

represent clients making presentations to the DRC, the Planning & Zoning Board, and/or the

City Commission. In order to ensure there was no conflict, the law firm was not being retained

by the City or the CRA for legal services, and Mr. Cardwell would be performing a specific set of

tasks with a “wall” between the two types of services to keep them separate and apart.

Fort Lauderdale CRA 5/16/00 – 2

Commissioner Smith understood the idea was to prevent any collusion between Mr. Cardwell

and the firm. Mayor Naugle believed a situation could arise in which someone disagreeing with

a City decision relating to a development issue in the CRA district, and Mr. Cardwell could end

up testifying against the City. Commissioner Moore believed that would also be true if a

separate consultant was selected. He understood Mr. Cardwell would provide information about

how the CRA could be better operated, but the situation envisioned by Mayor Naugle could

occur even if the consultant had no relationship with a legal firm.

Commissioner Smith asked why Mr. Cardwell was being selected. Ms. Kim Jackson, CRA

Manager, stated that the CRA would be entering into an aggressive, creative type of

redevelopment activity in a very diverse area in terms of a strategic plan and its implementation.

She explained it was very difficult to find anyone who understood how the CRA Statutes worked

and how to implement strategic plans. Ms. Jackson stated that Mr. Cardwell was well respected

in the field and had an enormous amount of experience in tax increment financing and could

provide a Statewide perspective.

Commissioner Moore recalled that when the County had tried to limit the CRA boundaries, Mr.

Cardwell had been asked for his opinion and was well respected by all the CRA directors in the

County. Commissioner Hutchinson was sure Mr. Cardwell was well qualified and could do a

wonderful job, but she was uncomfortable waiving the attorney/client relationship.

Mr. Cardwell explained that the statement pertaining to attorney/client privilege had been

included because he was a consultant. However, even if he was retained as an attorney, the

Supreme Court had indicated that when lawyers were hired by public agencies, with a few

exceptions, attorney/client privilege was waived. Therefore, the statement on page 2 was really

just to confirm the fact that as a consultant, there was not even a hint of an attorney/client

relationship. Thus, the privilege was already gone. Mr. Cardwell stated that as far as conflicts

were concerned, the policy of the firm was to follow the policies of the City. Therefore, his firm

would not be able to represent anyone who came in and submitted a proposal for a project

within the CRA boundaries because that would be a conflict of interest.

Mayor Naugle noted that the City hired a lot of outside counsel. He asked if there was any

policy that these outside counsel could not work against the City if a lawsuit was filed. The City

Attorney replied it did, and there had never been any deviation from that policy. Mayor Naugle

asked if this would be deviation because the City was hiring a subsidiary of a law firm. The City

Attorney replied it would not.

The City Attorney said he had briefly discussed with Mr. Cardwell the possibility that the City’s

own consultant might end up as a witness. He advised that a separate letter agreement would

be executed that Mr. Cardwell would maintain confidentiality to a certain extent and not testify

under such circumstances.

Motion

made by Commissioner Moore and seconded by Commissioner Katz to approve the

hiring of David Cardwell, Holland & Knight Redevelopment Strategies LLC, as the CRA

Consultant effective as of May 1, 2000 for a period of 12 months. Roll call showed: YEAS:

Commissioners Hutchinson, Katz, Smith and Moore. NAYS: Mayor Naugle.

Posted via email from HKLaw Investigation

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