1991-270-Authorizing The Town Manager To Execute An Agreement With Roger Ernst And Associates Inc. To Conduct The Town Public Auction Of Surplus And Unclaimed Property And The Auction Of Asset Seizure PropertyRESOLUTION 1991 -270
A RESOLUTION OF THE TOWN COUNCIL
OF THE TOWN OF LOS GATOS
AUTHORIZING THE TOWN MANAGER TO EXECUTE AN
AGREEMENT WITH ROGER ERNST & ASSOCIATES INC. TO
CONDUCT THE TOWN PUBLIC AUCTION OF SURPLUS AND
UNCLAIMED PROPERTY AND THE AUCTION OF ASSET SEIZURE PROPERTY
WHEREAS, The Town wishes to enter into two agreements with Roger Ernst &
Associates Inc. for public auction services;
NOW, THEREFORE, BE IT RESOLVED by the Town Council of the Town of Los
Gatos that the Town Manager is authorized to execute the agreement with Roger Ernst &
Associates Inc. to provide public auction services for the auction of forfeited property, which
is attached as Exhibit "A ".
BE IT FURTHER RESOLVED that the Town Manager is authorized to execute on
an as- needed basis, until July, 1992, agreements with Roger Ernst & Associates Inc. to
provide public auction service for surplus and unclaimed property in the form attached as
Exhibit 'B ".
PASSED AND ADOPTED at a regular meeting of the Town Council of the Town
of Los Gatos, California, held on the 2nd day of December, 1991, by the following vote:
COUNCIL MEMBERS
AYES: Randy Attaway, Joanne Benjamin, Steven Blanton, Brent N. Ventura
Mayor Eric D. Carlson
NAYES: None
ABSENT: None
ABSTAIN: None
SIGNED:
MAYOR OF THE TOWN OF LOS GATOS
LOS GATOS, CALIFORNIA
,ATTEST:
CLERK OF THE TOWN OF L S GATOS
LOS GATOS, CALIFORNIA
AGREEMENT FOR STORAGE AND /OR AUCTION - --
OF FORFEITED PERSONAL PROPERTY /FORFEITED VEHICLES - -- - -- - - --
THIS AGREEMENT is entered into this day of , 19
by and between the Town of Los Gatos, State of California, herein called the "Town ", and
ROGER ERNST & ASSOCIATES INC., a California Corporation, engaged in providing
PUBLIC AUCTION services herein called the 'Provider ".
RECITALS
A. The Town from time to time has in its possession property which is the product of
an asset seizure or property which has otherwise come into the hands of the Town
in the operations of their police services.
B. Section 114733(c) of the Health and Safety Code provides that the law enforcement
agency having vested title of such seized property has authority with respect to
transfer of sale property as specified by Section 11473.2 of the Health and Safety
Code.
C. The Town has determined that vehicles and other property seized pursuant to the
forfeiture laws of the State of California or the United States Government should be
stored in a secure area, protected from the elements, and be given proper care and
maintenance.
D. The Town has determined that such secured storage and protection from the
elements is not readily available to the Town.
E. The Town has determined that the most efficient and economical means to securely
store, protect from the elements, and properly maintain and care for such seized
vehicles or other personal property, is to contract for said services.
F. Provider represents that he has the facilities to store vehicles and other personal
property in a secure area, protected from the elements, and to provide proper care
and maintenance.
G. The Town believes that certain seized and forfeited vehicles or other personal
property not required for use by the Town should be sold at public auction.
H. Section 11489 of the Health and Safety Code provides that property seized and
forfeited to a local law enforcement agency may be sold, with the proceeds
distributed as prescribed by law.
I. Provider, a licensed and bonded auctioneer, represents that he is duly licensed, and
has the expertise and ability to process the necessary vehicle documents for the
Town and the Department of Motor Vehicles, and the expertise and ability to sell
forfeited property at public auction.
Page 1 of 8
J. The Town has determined and Provider represents that the proposed services to be
provided by Provider will enhance the security, care, and maintenance of seized
vehicles, and promote efficiency in the disposal of forfeited vehicles or other personal
property.
AGREEMEN'T'S
NOW, THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:
1. Scope of Services. The Provider shall provide the following services listed below.
A. Provider agrees to take possession of all vehicles or other personal property
obtained by the Town as the result of an asset seizure and to transport all
such property to Provider's facility in Modesto, California.
B. Provider agrees to store and maintain such property at its facility in Modesto,
California. Provider agrees that such property will be stored in a secure
facility and protected from the elements. Provider agrees to properly care for
and maintain such stored property, including keeping the vehicles clean.
C. Provider shall, from time to time, conduct a public auction at Provider's
premises in Modesto, California. The Town shall notify Provider when
property, which is in the possession of Provider, is free and clear of any
encumbrances and eligible for auction. Provider shall sell said property to the
highest bidder. Provider shall not auction any item without having first
obtained clearance from the Town.
D. Provider agrees to:
i. Conduct the auctions and provide all necessary personnel and
equipment needed to conduct said auctions.
ii. Provide the Town a record of the property sold and the amount of
each sale.
iii. Collect all monies due from the sale of each item or lot, plus any
applicable sales tax.
iv. Pay the Town the total sum less commission, within 15 banking days
of the auction. Provider shall, at a minimum, comply with the notice
requirements of Government Code 25363. All sales tax collected shall
be paid by Provider directly to the State of California.
V. Process all necessary documents with the California Department of
Motor Vehicles needed by the buyer of the vehicle in order to show
title with the state.
Page 2 of 8
2.
E. Provider shall pay all costs of advertising associated with the sale of said
property at Provider's auction.
F. Provider shall not release any vehicle which is not being auctioned, to any
individual, the Town, or any law enforcement agency, without prior written
authorization from the Town.
Compensation.
A. If a forfeiture action is terminated for any reason and the vehicle or property
is released to the legal owner or such other person legally entitled to
possession of the vehicle or property (other than the Town), Provider shall
be entitled, to the extent the law allows, to charge the person to whom the
vehicle or property is released a reasonable amount for towing, hauling, and
storage.
B. If a forfeiture action is terminated for any reason and the vehicle or property
is released to the Town or the forfeiture is completed and the vehicle or
property is retained by the Town, Provider shall be entitled to compensation
from the Town as follows:
i. Fifty dollars ($50.00) for towing of any vehicle to Provider's place of
storage.
ii. Three dollars ($3.00) per day for storage of any vehicle with said
storage fee charges to commence on the 46th day after Provider has
taken possession of any vehicle.
iii. Repair costs for any vehicle incurred by Provider, provided that such
costs were necessary and not made necessary by the conduct or
handling of Provider.
C. If Provider is required to return any vehicle after Provider has taken
possession thereof and Provider is required to return any vehicle to the place
of seizure or any other place, Provider, in addition to the fees described in
Paragraph H above, shall be entitled to fifty dollars ($50.00) as and for towing
service in returning any vehicle.
D. For any vehicle sold at auction by Provider and which said vehicle has been
in Provider's possession a minimum of 180 days, Provider shall be entitled to
a storage fee of three dollars ($3.00) per day with said storage fee charges to
commence on the 181st day after Provider has taken possession of any vehicle.
E. The Town shall pay to the Provider a commission of ten percent (10 %) of all
gross sales for all asset forfeiture property sold, and six percent (6 %) on real
estate. Said commission is to be paid out of sale proceeds. Town also
understands Provider will charge to the buyer of auctioned items a "Buyers
Premium" of ten percent (10 %) on all items sold (excluding real estate).
Page 3 of 8
F. Once every calendar month, Provider shall submit to Town a written invoice
accurately reflecting any fees owing by Town to Provider as assessed pursuant
to this Agreement. Town shall, at its option, pay each invoice either by direct
payment to Provider within 30 days from the date of the invoice or elect to
have all or any part of said fees deducted from the sales proceeds of other
vehicles or property in Provider's possession and sold at auction by Provider.
In the event the entire amount owing or reflected in any particular invoice is
not paid in full either by direct payment and /or by deduction from other sales
within 90 days of the date of each said invoice, the remaining balance shall
be due and payable.
3. Term.
The original term of the Agreement shall be one year from the date first above
written. This agreement shall be automatically renewed for two additional one year
periods unless not later than ninety (90) days from the expiration of any such one
year period written notice is delivered by a party notifying the other party of its intent
not to renew the agreement as provided for in this Paragraph 3.
4. Indemnification.
The Town agrees to hold Provider harmless for any acts or omissions by the Town
within the terms of this Agreement, except those charges and fees levied against any
vehicle or property returned to the registered or legal owner by a court of jurisdiction
or when the Town does not pursue forfeiture.
At all times during the term of this Agreement, Provider shall be solely responsible
and liable for all vehicles and personal property from the time Provider has
possession thereof. Provider shall be fully and solely responsible for any theft,
destruction, or damage of any vehicle or personal property from any cause
whatsoever after Provider has custody thereof. In the event of any such theft,
destruction, or damage, Provider shall pay to the Town any amounts necessary to
restore to the Department the full, fair market value of the property or vehicle as of
the time Provider first had custody thereof. All such amounts owed to the Town
shall be due within forty -five (45) days from the occurrence of any such theft,
destruction, or damage.
Provider hereby agrees and undertakes to indemnify, hold harmless, and defend
(upon proper request) the Town, its officers, agents, and employees, from any and
all losses, costs, claims, damages, liability, actions, or expenses (including reasonable
attorney fees) of any kind or nature whatsoever which may arise out of or occur in
connection with, or are alleged to have arisen out of or occurred in connection with,
any act omission of Provider, its officers, agents, employees, contractors, independent
contractors, or representatives of any type during the performance of this Agreement.
5. Insurance.
A. Workers' Compensation Certification
Pursuant to Labor Code Section 1861, the Provider hereby certifies that
the Provider is aware of the provisions of Section 3700 of the Labor
Code which require every employer to be insured against liability for
Workers' Compensation or to undertake self- insurance in accordance
with the provisions of that code, and the Provider will comply with such
Provisions and provide certification of such compliance.
ii. The portion of Section 3700 of the California Labor Code which is
relevant to this project is as follows: "Every employer except the State
shall secure the payment of compensation in one or more of the
following ways.
a. By being insured against liability to pay compensation with one
or more insurers duly authorized to write compensation
insurance in this State.
b. By securing from the Director of Industrial Relations a
certificate of consent to self- insure, which may be given upon
furnishing proof satisfactory to the Director of Industrial
Relations of ability to self- insure and to pay any compensation
that may become due to its employee:'
Liability Insurance
Provider shall, throughout the duration of this Agreement, maintain
comprehensive general liability and property damage insurance,
covering all operations of Provider, its agents and employees performed
in connection with this agreement, including but not limited to premises
and automobiles.
ii. Provider shall maintain the following minimum limits:
General Liability
Combined Single Limit Per Occurrence
General Aggregate
Automobile Liability
Combined Single Limit Per Occurrence
iii. General Liability:
a. The Town, its officers, officials, employees and
to be covered as insureds as respects: liability
activities performed by or on behalf of Ernst
Page 5 of 8
$1,000,000.00
$1,000,000.00
$1,000,000.00
volunteers are
arising out of
& Associates;
products and completed operations of Ernst & Associates,
premises owned or used by Ernst & Associates.
b. Ernst & Associates's insurance coverage shall be primary
insurance as respects the Town, its officers, officials, employees
and volunteers. Any insurance or self- insurances maintained by
the Town, its officers, officials, employees or volunteers shall
be excess of Ernst & Associates's insurance and shall not
contribute with it.
Any failure to comply with reporting provisions of the policies
shall not affect coverage provided to the Town, its officers,
officials, employees or volunteers.
d. Ernst & Associates's insurance shall apply separately to each
insured against whom a claim is made or suit is brought, except
with respect to the limits of the insurer's liability.
iv. All insurance companies affording coverage to the Provider shall be
insurance organizations authorized by the Insurance Commissioner of
the State Department of Insurance to transact business of insurance in
the State of California.
V. All Coverages: Each insurance policy required in this item shall be
endorsed to state that coverage shall not be suspended, voided,
cancelled, reduced in coverage or in limits except after thirty (30) days'
prior written notice by certified mail, return receipt requested, has be
given to the Town. Current certification of such insurance shall be kept
on file at all times during the term of this agreement with the Town
Clerk.
vi. Provider shall provide evidence of compliance with the insurance
requirements to the Town.
6. Termination
If either party is in breach of any condition or covenant of this agreement, this
agreement may be terminated by providing the breaching party with written notice
of its intent to terminate this agreement provided, however, that the breaching party
shall have the right to cure any such default within ten days of receipt of said notice,
thereby avoiding termination of this agreement. A termination resulting from Town's
breach shall not relieve the Town of its responsibility for payment of any fees owing
to Provider.
Page 6 of 8
Independent Contractor.
For the purposes of the Agreement, Provider is an independent contractor.
8. Amendment
This Agreement may only be modified or amended by the written Agreement
between Provider and Town. No waiver or modification of the Agreement or of any
covenant, condition or limitation herein contained shall be valid unless in writing and
duly executed by the parties hereto.
9. Assignment.
Provider shall not assign or transfer any interest in this Agreement without prior
written consent of the Town.
Provider hereby agrees and undertakes to indemnify, hold harmless, and defend
(upon proper request) the Town, its officers, agents, and employees, from any and
all losses, costs, claims, damages, liability, actions, or expenses (including reasonable
attorney fees) of any kind or nature whatsoever which may arise out of or occur in
connection with, or are alleged to have arisen out of or occurred in connection with,
any act omission of Provider, its officers, agents, employees, contractors, independent
contractors, or representatives of any type during the performance of this Agreement.
10. Entire Agreement.
This Agreement represents the entire understanding of the agency and Provider. No
prior oral or written understanding shall be of any force or effect.
Page 7 of 8
IN WITNESS WHEREOF, the Town and Ernst & Associates have executed this
Agreement as of the date indicated on page one (1).
Town of Los Gatos
David W. Knapp, Town Manager
Town of Los Gatos
ATTEST:
Clerk of the Town of Los Gatos,
Los Gatos, California
Marian V. Cosgrove, Town Clerk
SF001: \cnclrpts \auction
Ernst & Associates:
Name
Title
Approved as to Form:
Kat rine Anderton, Town Attorney
TOWN CLERK
AGR: � � /�.�� ---
AUCTION AGREEMENT IHH: —
REC
REM
IT IS HEREBY mutually agreed between ERNST & ASSOCIATES (P.O. Box 3251
Modesto, CA 95353) and TOWN OF LOS GATOS (P.O.Box 973, Los Gatos, CA 95130)
that the property on the inventory sheet attached as Exhibit "A" be sold at Public Auction
on . Owner alleges that all property is free of mortgage or encumbered as follows:
ALL FREE AND CLEAR. Ernst & Associates agrees to conduct the sale for which the
owner agrees to pay a sum equal to 10% (ten percent) on all vehicles and rolling stock and
25% (twenty -five percent) on all tangible items offered for sale, to be deducted from the
sale proceeds. Ernst & Associates agrees to absorb all costs of sale including transporting
items for sale to sale site and advertising - newspaper and direct mail flyers. Total proceeds
shall be delivered to the Town within 30 days of sale.
Insurance.
A. Minimum Scope of Insurance:
i. Ernst & Associates to provide Town of Los Gatos with a Certificate
of Liability Insurance for $1,000,000.00 for any auction related business.
ii. Ernst & Associates shall provide to the Town all certificates of
insurance, with original endorsements effecting coverage. Ernst &
Associates agrees that all certificates and endorsements are to be
received and approved by the Town before work commences.
iii. Ernst & Associates shall provide to the Town all certificates of
insurance, with original endorsements effecting coverage. Certificates
of such insurance shall be filed with the Town on or before
commencement of performance of this agreement and a copy of
insurance policy shall be attached as Exhibit "B ".
B. General Liability:
i. The Town, its officers, officials, employees and volunteers are to be
covered as insureds as respects: liability arising out of activities
performed by or on behalf of Ernst & Associates; products and
completed operations of Ernst & Associates, premises owned or used
by Ernst & Associates.
ii. Ernst & Associates's insurance coverage shall be primary insurance as
respects the Town, its officers, officials, employees and volunteers. Any
insurance or self- insurances maintained by the Town, its officers,
officials, employees or volunteers shall be excess of Ernst &
Associates's insurance and shall not contribute with it.
Ernst & Associates and Town of Los Gatos
Auction Agreement
Page Two
iii. Any failure to comply with reporting provisions of the policies shall not
affect coverage provided to the Town, its officers, officials, employees
or volunteers.
iv. Ernst & Associates's insurance shall apply separately to each insured
against whom a claim is made or suit is brought, except with respect
to the limits of the insurer's liability,
C. All Coverages: Each insurance policy required in this item shall be endorsed
to state that coverage shall not be suspended, voided, cancelled, reduced in
coverage or in limits except after thirty (30) days' prior written notice by
certified mail, return receipt requested, has be given to the Town. Current
certification of such insurance shall be kept on file at all times during the term
of this agreement with the Town Clerk.
Indemnification. Ernst & Associates shall save, keep and hold harmless indemnify
and defend the Town its officers, agent, employees and volunteers from all damages, costs
or expenses in law or equity that may at any time arise or be set up because of damages to
property or personal injury received by reason of, or in the course of performing work which
may be occasioned by a willful or negligent act or omissions of Ernst & Associates, or any
of Ernst & Associates's employees, or any subconsultant. The Town will not be held liable
for any accident, loss or damage to the work prior to its completion and acceptance.
Provider shall at a minimum comply with the notice requirements of Government
Code 25363 prior to auction.
TOWN OF LOS GATOS DATE
ERNST AND ASSOCIATES DATE
Auctioneer License #278
California Auctioneer Commission
P.O.Box 511
Sacramento, CA 95803