Free Declaration in Support - District Court of California - California

Case 5:08-cv-02814-JF

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JOSEPH P. RUSSONIELLO (SBN 44332) United States Attorney JOANN M. SWANSON (SBN 88143) Chief, Civil Division CHARLES M. O'CONNOR (SBN 56320) Assistant United States Attorney 450 Golden Gate Avenue, 9th Floor San Francisco, California 94102-3495 Telephone: (415) 436-7180 Facsimile: (415) 436-6748 Email: [email protected] Attorneys for Intervenor United States of America

8 UNITED STATES DISTRICT COURT 9 NORTHERN DISTRICT OF CALIFORNIA 10 SAN JOSE DIVISION 11 12 13 14 15 16 17 18 19 20 I, Lorraine Herson-Jones, declare that, 21 1. I am an Attorney, Office of the Regional Counsel, Western-Pacific Region of the 22 Federal Aviation Administration ("FAA"). My duties include providing legal advice to the 23 Western-Pacific region, with the majority of my time dedicated to the Airports Division. I have 24 held this same position for over three and one-half years. 25 2. I have reviewed the official and business records of the FAA regarding the transfer of 26 the Half Moon Bay Airport property (the "Property") and have personal knowledge of the facts 27 and circumstances of the above-captioned lawsuit and the reverter action taken by the FAA to 28 // ) ) Plaintiff, ) ) v. ) ) COUNTY OF SAN MATEO, a political ) subdivision of the State of California; and ) DOES 1 to 20, inclusive, ) ) Defendants. ) ____________________________________) ) UNITED STATES OF AMERICA, ) ) Intervenor. ) ) Montara Water and Sanitary District, No. C 08-2814 JF (RS)

LORRAINE M. HERSON-JONES IN SUPPORT OF INTERVENOR'S OPPOSITION TO REMAND Date: September 19, 2008 Time: 9:00 a.m. Ctrm: Hon. Jeremy Fogel

Case 5:08-cv-02814-JF

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regain title to the Property, and if called as a witness, I could and would testify competently to those facts. 3. Earlier in 2008, the FAA exercised its reversionary interest in the parcels which are subject of the above-captioned case by issuing a Notice of Reverter. The FAA filed its Notice of Reverter with the Recorder's Office, County of San Mateo, thereby explicitly exercising its reversionary rights by recording its legal interest in the subject parcels. 4. Subsequently, the FAA ordered and obtained a title report from First American Title Company for the subject real property. A true and accurate copy of that title report is attached hereto as Exhibit 1. 5. The title report confirms that "Title to the estate or interest in the Land is vested in: UNITED STATES OF AMERICA and COUNTY OF SAN MATEO, A POLITICAL SUBDIVISION OF THE STATE OF CALIFORNIA." See Exhibit 1, at Page Number: 2, Paragraph 5. I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Signed at Lawndale, CA this 21st day of August, 2008.

/s/ Lorraine M. Herson-Jones

DECL. OF LORRAINE HERSON-JONES IN SUPPORT OF OPPOSITION TO MOTION FOR REMAND -2C 08-2814 JF (RS)

Case 5:08-cv-02814-JF

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First American Title Company
1386 Leadhill Blvd., Suite 100 Roseville, CA 95661
August 01, 2008

GRETCHEN KELLY SAN FRANC:ISCO AIRPORTS DISTRICT OFFICE 831 M m E N ROAD, SUITE 210 BURLINGAME, CA 94010 Fax: (6513)876-2733

Title Officer: Phone: Order Number:

JIM PROTHERO 650-569-2518 3401-3109342 ()

Property:

9850 CABRILLO HWY HALF MOON BAY, CA 94037

Attached please find the following item(s): Guarantee Thank You for your confidence and support. We at First American Title Company maintain the fundamental principle:

Customer First!

EXHIBIT
First American W e Company

.4

Case 5:08-cv-02814-JF
Form No. 1 (12116192) CLTA Litigation Guarantee

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Order Numbe-: 34013109342 Page Number: 1

LITIGATION GUARANTEE
SUBJECT TO THE LIMrrATIONS CONTAINED HEREIN, THE EXCLUSIONS FROM COVERAGE, THE UMITS OF L I A B I W AND OTHER PROVISIONS OF THE CONDITIONS AND STIPULATIONS HERETO ANNEXED AND MADE A PART OF THIS GUARANTEE.

First American Title Insurance Company a California corporation, herein called the Company
GUARANTEES The Assured named in Schedule A against loss not exceeding the liability amount stated in Schedule A which the Assured shall sustain by reason of any incorrectness in the assurance which the Company hereby gives that, according to the public records, as of Date of Guarantee shown in Schedule A:
I.

2.

3.

4.

The title to the herein described estate or interest is vested in the vestee named in Schedule A. Except for the matters shown in Schedule B, there are no defects, liens, encumbrances or other matters affecting title to the estate or interest in the land shown in Schedule A, which matters are not necessarily shown in the order of their priority. The current interest holders claiming some right, title or interest by reason of the matters a) shown in Part Two of Schedule B are as shown therein. The vestee named in Schedule A and parties claiming to have some right, title or interest by reason of the matters shown in PartTwo of Schedule B may be necessary paMes defendant in an action, the nature of which is referred to in Schedule A. b) The current interest holders claiming some right, title or interest by reason of the matters shown in Part One of Schedule B may also be necessary parties defendant in an action, the nature of which is referred to in Schedule A. However, no assurance is given hereby as to those current interest holders. The return addresses for mailing after recording, if any, as shown on each and every document referred to in Part Two of Schedule B by specific recording information, and as shown on the document(s) vesting title as shown in Schedule A are as shown in Schedule C.

THIS LmGATION GUARANTEE I S FURNISHED SOLELY FOR THE PURPOSE OF FACIUATING THE FILING OF THE ACTION REFERRED TO I N SCHEDULE A. TT SHALL NOT BE USED OR RELIED UPON FOR ANY OTHER PURPOSE.

fimt Amerhn Pt/e Company

Case 5:08-cv-02814-JF
Form No. 1 (12/:L6/92)
CLTA Litigation Guarantee

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Order Number: 34013109342 Page Number: 2

SCHEDULE A Liability: $1,000.00 Fee: $360.00

1 .

Name of Assured: SAN FKANCISCO AIRPORTS DISTRICT OFFICE

2.

Date of Guarantee: July 07, 2008 a t 7:30 A.M,

3.

This. Litigation Guarantee is furnished solely for the purpose of facilitating the filing of an action to: OWNERSHIP VERIFICATION

4.

The estate or interest in the Land which is covered by this Guarantee is: A fee.

5.

Title t o the estate or interest in the Land is vested in: UN1:TED STATES OF AMERICA and COUNW OF SAN MATEO, A POLmCAL SUBDIVISION OF THE STATE OF CALIFORNIA

6.

The! Land referred t o in this Guarantee is described as follows: Real property in the unincorporated area, County of SAN MATEO, State of CAUFORNIA, described as follows: : PARCEL I BEGINNING A T A POINT I N THE SOUTHEASTERLY LINE OF MARINE VIEW TERRACE TRACT, WHICH BEARS NORTH 29O 19' EAST 1110.54 FEET AND NORTH 43O 00' WEST 1579.39 FEET FROM THE MOST EASTERLY CORNER OF LOT 1 BLOCK 26 OF THE RIVIERA OCEAN VILLA , TFbICT, AS PER MAP THEREOF FILED FOR RECORD I N BOOK 6 OF MAPS AT PAGE 20, RECORDS OF SAN MATEO COUNTY, CAUFORNIA; THENCE NORTH 28O 42' 45" EAST 1100 FEET, MORE OR LESS, TO THE SOUTHWESTERLY LINE OF CAUFORNIA STATE HIGHWAY BENVEEN MIRAMAR AND FARALLONE CTPI, IV-SM-56-C.D.; THENCE I N A GENERAL SOUTHEASTERLY DIRECnON, FOLLOWING THE MEANDER OF THE SOUTHWESTERLY LINE OF SAID STATE HIGHWAY, 4287 FEIT, MORE OR LESS, TO A 1INCH IRON PIPE, WHICH I S AT THE MOST NORTHERLY CORNER OF PORTION OF FRANCISCO HEIGHTS, "MAP OF FRANCISCO HEIGHTS NEAR HALF MOON BAY" FILED MARCH 3, 1908 I N BOOK 6 OF MAPS AT PAGES 5 AND 6; THENCE CONTINUING ALONG THE SOUTHWESTERLY UNE OF THE HIGHWAY 1125 FEET, MORE OR LESS, TO A POINT ON THE SOUTHEASTERLY LINE OF FRANCISCO HEIGHTS SUBDIVISION; THENCE CONTINUING SOUTHEASTERLY ALONG THE SOUTHWESTERLY LINE OF SAID STATE HIGHWAY AND ALONG

First American W e Company

Case 5:08-cv-02814-JF
Foml No. 1 (12116192) CLTA Litigation Guarantee

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Order Number: 34013109342 Page Number: 3

THE SOUTHWESTERLY LINE OF THE COUNTY ROAD TO PRINCETON, 2650 FEET, MORE OR LESS, TO A POINT ON THE NORTHEASTERLY BOUNDARY OF THE 33.90 ACRE TRACT FORMERLY OF DANERI FROM WHICH THE MOST NORTHERLY CORNER OF SAID TRACT BEARS NORTH 71° 00' \NEST 965 FEET, MORE OR LESS, THENCE SOUTH 71° EAST 100 FEET, MORE OR LESS, TO A POIIVT I N THE CENTER OF THE DENNISTON CREEK, FROM WHICH A WITNESS POST MARKED AV BEARS NORTH 71° WEST, DISTANT 19.80 FEET; THENCE DOWN SAID CREEK I N THE CENTER OF THE SAME AND FOLLOWING THE MEANDERINGS THEREOF AS FOLLOWS: SOUTH 1' WEST 104.28FEET; THENCE SOUTH 14O 45'EAST 132 FEET; THENCE SOUTH 43" 89.10 8 FEET; THENCE SOUTH ' WEST 165.0FEET; THENCE SOUTH 31" 30'WEST 72.60 FEET; 8 THENCE SOUTH 66 FEET; THENCE SOUTH 13O EAST 88.44 FEET; THENCE SOUTH 23" EAST 75.90FEET; THENCE LEAVING THE CENTERUNE OF SAID CREEK SOUTH 85" 30' EAST 26.40 FEET TO A POINT FROM WHICH A WrrNESS POST MARKED AX111 BEARS NORTH 27" 30'EAST, 0 A DISTANCE OF 24.42 FEET; THENCE SOUTH 5' EAST 51.48 FEET TO A POINT FROM WHICH WITNESS POST MARKED AX11 BEARS NORTH 27O 30" EAST, DISTANT 24.42 FEET; THENCE SOUTH 11° 30' EAST 419.76 FEET; THENCE NORTH 27O 30'EAST 24.92 FEET TO A FENCE CORNER POST MARKED AXI; THENCE SOUTH 25" 30' EAST 87.02FEET TO A POST MARKED AX, STANDING I N UNE OF FENCE ON THE WESTERLY SIDE OF THE TRACT OF LAND BELONGING TO PATRICK MCMAHON; THENCE NORTH 71° WEST 1598.23 FEETTO A POINT, FROM WHICH POST MARKED AVII BEARS NORTH 71" WEST 100.61 FEET; THENCE NORTH 47" EAST 64.93 FEET; THENCE NORTH 43" 00' WEST 5889.74FEETTO A POINT FROM WHICH THE MOST EASTERLY CORNER OF LOT 1 I N BLOCK 26 OF RIVIERA OCEAN VILLA TRACT AS PER MAP THEREOF FILED I N BOOK 6 OF MAPS AT PAGE 20 BEARS SOUTH 2g0 19' WEST 1766.54FEET; THE:NCE NORTH 43" 00 WEST 1193.27FEET; THENCE SOUTH 47" 00' WEST 625.0 FEET; THENCE NORTH 4' 00' WEST 186.85 FEET TO THE POINT OF BEGINNING. 3

A PORTION OF THE RANCHO CORRAL DE TIERRA (PALOMARES) AND A PORTION OF FRANCISCO HEIGHTS AS THE SAME I S SHOWN ON THAT CERTAIN MAP ENTlTLED, "MAP OF FRANCISCO HEIGHTS NEAR HALF MOON BAY, SAN MATEO, SAN MATEO COUNTY, CALIFORNIA, FILED I N THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE OF CAIJFORNIA ON MARCH 23, 1908 I N BOOK 6 OF MAPS AT PAGES 5 AND 6, DESCRIBED AS A WHOLE AS FOLLOWS: COMMENCING AT THE POINT OF INTERSECnON OF THE REFERENCE UNE OF THE DElPARTMENT OF PUBUC WORKS OF THE STATE OF CALIFORNIA SURVEY FOR THE FLIGHT STRIP I N SAN MATEO COUNTY PROJECTIV-SM-HALF MOON BAY, F.S. 4-A.F.A.-4 WITH THE NORTHWESTERLY BOUNDARY OF PRINCETON BY THE SEA AS THE SAME I S SHOWN ON THAT CERTAIN MAP ENTITLED, "MAP OF PRINCETON-BY-THE-SEA, HALF MOON BAY, SAN MATEO COUNTY, CAUFORNIA, FILED I N THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE OF CALIFORNIA ON SEPTEMBER 8, 1908 I N BOOK 6 OF MAPS AT PAGE 32, SAID POINT BEING ENGINEERS STATION 15+31.75OF SAID SURVEY AND DISTANT SOUTH 25" 28' 15" WEST 202.14 FEET FROM A POST MARKED AVII AT THE MOST NORTHERLY CORNER OF SAID MAP OF PRINCETON-BY-THE-SEA; THENCE FROM SAID POINT OF COMMENCEMENT ALl3NG SAID NORTHWESTERLY UNE OF PRINCETON-BY-THE-SEA, SOUTH 25" 28'25" WEST 34'3.38 FEET TO A LINE PARALLEL WITH AND DISTANT SOUTHWESTERLY 32.5 FEET MEASURED AT RIGHT ANGLES FROM SAID REFERENCE UNE; THENCE ALONG SAID PARALLEL LINE NORTH 43) 00'WEST 7196 FEET; THENCE NORTH 47O 00' EAST 625 FEET TO A LINE PARALLEL W l l H AND DISTANT 300 FEET NORTHEASTERLY MEASURED AT RIGHT ANGLES FROM THE REFERENCE LINE OF SAID SURVEY; THENCE ALONG SAID PARALLEL LINE SOUTH 43O 00' EAST 7083.01 FEET; THENCE SOUTH 47" WEST 64.93FEET TO THE NORTHERLY BOUNDARY OF SAID PRINCETON-BY-THE-SEA; THENCE ALONG SAID NORTHERLY LINE NORTH 70° 51'45"WEST 100.61FEET TO A POST MARKED AVII SET AT THE MOST NORTHERLY CORNER SAID

First American Ut/e Company

Case 5:08-cv-02814-JF
Form No. 1 (12116192)
CLTA Lltlgatlon Guarantee

Document 17-2

Filed 08/29/2008

Page 5 of 12

Order Number: 34013109342 Page Number: 4

SUBDIVISION; THENCE ALONG THE NORTHWESTERLY BOUNDARY OF SAID SUBDIVISION SOUTH 25' 28' 15" WEST 202.14 FEET TO THE POINT OF BEGINNING. PARCEL 111: ALL THAT PARCEL OF LAND LYING 20 FEET ON EACH SIDE OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT A POINT ON THE WESTERLY LINE OF PRINCETON-BY-THE-SEA AS SAID LINE I S SHOWN UPON THAT CERTAIN MAP ENTITLED, "PRINCETON-BY-THE-SEA, HALF MOON BAY, SAN MATEO COUNTY, CALIFORNIA, FILED I N THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE OF CAUFORNIA ON SEPTEMBER 8,1908 I N BOOK 6 OF MAPS AT PAGE 32, 'WHICH SAID POINT I S DISTANT 573.02 FEET FROM A POST MARKED AVII AS SHOWN ON SAID MAP; THENCE FROM SAID POINT OF COMMENCEMENT NORTH 43O 00' WEST 7388.37 FEET TO A POINT ON THE EASTERLY LINE OF THAT CERTAIN SUBDIVISION ENTITLED, "RESUBDIVISION OF MARINE VIEW TERRACE TRACT, SAN MATEO COUNTY, CALIFORNIA, FILED I N THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO. STATE OF ~.~ - - .~ - -~ CALIFORNIA ON OCTOBER 30, 1907 I N BOOK 5 OF MAPS AT PAGE 39, SAID POINT I S DISTANT NORTH 28O 43' 45" EAST 59.88 FEET FROM THE MOST SOUTHERLY CORNER OF LOT 1 I N BLOCK 25 OF SAID SUBDIVISION, 1
~

WHICH

THE. SAID UNES OF SAID STRIP OF LAND TO BE PROLONGED OR SHORTENED AS TO INTEREST W n H THE SOUTHEASTERLY UNE OF SAID MARINE VIEW TERRACE TRACT AT THE NORTHWEVERLY TERMINATION OF SAID STRIP AND W r r H THE NORTHWEVERLY LINE OF PRINCETON-BY-THE-SEA AT THE SOUTHEASTERLY TERMINATION OF SAID STRIP. APN: 037-292-030

First AmeN'cdn ntle Company

Case 5:08-cv-02814-JF
Form No. 1(12/16/92)
C L l A Lltlgatlon G,uaRntee

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3109342

Order Number: 3401Page Number: 5

SCHEDULE 6

Defects, liens, encumbrances or other matters affecting title:

PART ONE

1 .

General and special taxes and assessments for the fiscal year 2008-2009, a lien not yet due or payable. The lien of supplemental taxes, if any, assessed pursuant to Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation Code. Rights of the public in and to that portion of the land lying within THE AREA COMMONLY KNOWN AS ICAPISTRANO ROAD AND AIRPORT STREET. An easement for COMMUNICATIONS CABLE and incidental purposes, recorded JUNE 24,1942 as INSTRUMENT NO. 56634-E I N BOOK 1025, PAGE 170 of Official Records. I n Favor of: UNITED STATES COAST GUARD Affects: A PORTION OF THE LAND An easement for ALL RIPARIAL, APPROPRIATIVE AND PRESCRIPTIVE RIGHTS and incidental purposes, recorded APRIL 15, 1943 as INSTRUMENT NO. 79129-E IN BOOK 1059, PAGE 117 of Official Records. I n Favor of: RIVIERA LAND COMPANY Affects: A PORTION OF THE LAND An easement for ALL RIPARIAN, APPROPROVATIVE, PRESCRIPTIVE AND OTHER RIGHT5 TO THE WPkTERS OF SAN VICENTE CREEK and incidental purposes, recorded APRIL 15, 1943 as IN!TRUMENT NO. 79130-E I N BOOK 1056, PAGE 307 of Official Records. I n Favor of: RIVIERA LAND COMPANY A PORTION OF THE LAND AffeN: Covenants, conditions, restrictions and easements in the document recorded MAY 25, 19,48 as INSTRUMENT NO. 32951-H I N BOOK 1521, PAGE 1of Official Records, but deleting any covenant, condition or restriction indicating a preference, limitation or discrimination based on race, color, religion, sex, sexual orientation, marital status, ancestry, disability, handicap, familial status, national origin or source of income (as defined in California Government Code 512955(p)), to the extent such covenants, conditions or restrictions violate 42 U.S.C. 5 3604(c) or California Govenment Code 512955 Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status.

2.

3.

4.

5.

6.

7.

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First American ntle Company

Case 5:08-cv-02814-JF
Form No. 1 (12/16/92)
CLTA Litigation Guarantee

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Filed 08/29/2008

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Order Number: 34013109342 Page Number: 6

8.

An easement for WATER PIPE LINE and incidental purposes, recorded MAY 25, 1948 as INSlrRUMENT NO. 32951-H IN BOOK 1521, PAGE 1of Official Records. I n F,avor of: UNITED STATES OF AMERICA Affects : 10 FOOT STRIP OF THE LAND An easement for PUBLIC ROADS/HIGHWAYS, EXISnNG EASEMENTS FOR PUBLIC LKILITIES, RAII-ROADS AND PIPELINES and incidental purposes, recorded FEBRUARY 3, 1949 as INSTRUMENT NO. 74828-H I N BOOK 1620, PAGE 414 of Official Records. I n Favor of: UNITED STATES OF AMERICA Affects: 60 FOOT STRIP OF THE LAND Covenants, conditions, restrictions and easements in the document recorded JANUARY 18, 1957 as INSTRUMENT NO. 20746-P I N BOOK 3161, PAGE 534 of Official Records, but deleting any covenant, condition or restriction indicating a preference, limitation or discrimination based on race, color, religion, sex, sexual orientation, marital status, ancestry, disability, handicap, familial status, national origin or source of income (as defined in California Government Code §12955(p)), t o the extent such covenants, conditions or restrictions violate 42 U.S.C. 5 3604(c) or C:alifornia Govenment Code 312955 . Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status. An easement for WATER LINES PURPOSES and incidental purposes, recorded MARCH 10, 1964 as INSTRUMENT NO. 24824-Y I N BOOK 4909, PAGE 389 of Official Records. CITIZENS UTILITIES COMPANY OF CALIFORNIA, ITS I n Favor of: SUCCESSORS AND/OR ASSIGNS 10 FOOT STRIP OF THE LAND Affects: The terms and provisions contained in the document entitled RESOLUTION NO. 50749 RESOLUTION ESTABLISHING SAN MATE0 COUNTY SERVICE AREA NO. 12 (MONTAR4-MOSS BEACH) FOR WATER SERVICES AND ESTABLISHING THE AFFECTED AREA recorded SEPTEMBER 26, 1988 as INSTRUMENT NO. 88128897 of Official Records. Any claim that any portion of the land is or was formerly tidelands and submerged lands within the bed of any tidal slough or creek. Rights of parties in possession.

9.

10.

11.

12.

13.

14.

First American ntle Company

Case 5:08-cv-02814-JF
Form No. 1(12/1.6/92)
CLTA Litigation Ciuarantee

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Filed 08/29/2008

Page 8 of 12

Order Number: 34013109342 Page Number: 7

PART TWO 1 .

Notice of pendency of action recorded JUNE 6, 2007 as INSTRUMENT NO. 2007-087093 of 0ffic:ial Records. Coutt: IN THE SUPERIOR COURT OF THE STATE OF CALIFORNIA I N AND FOR THE COUNTY OF SAN MATEO CIVIL UNLIMITED JURISDICTION Case No.: CIV 463068 Plaintiff: MONTARA WATER AND SANITARY DISTRICT, A PUBLIC BODY COUNFf OF SAN MATEO, A POLlTICAL SUBDIVISION OF THE Defendant: STATE OF CALIFORNIA; AND DOES 1TO 20, INCLUSIVE Purpose: CONDEMNATION Any statutory lien for labor or materials arising by reason of a work of improvement, as disclosed by a notice of completion recorded AUGUST 8, 2007 as INSTRUMENT NO. 2007-119804 of Official Records, which reflects a completion date of JULY 26, 2007.

2.

The map attached, if any, may or may not be a survey of the land depicted hereon. First American expressly di!;claims any liability for loss or damage which may result from reliance on this map except to the extent coverage for such loss or damage is expressly provided by the terms and provisions of the title insurance policy, if any, to which this map is attached.

First American ntle Company

Case 5:08-cv-02814-JF
Form No. 1(12/16/92) CLTA Litigation Guarantee

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Filed 08/29/2008

Page 9 of 12
34013109342

Order Number:

Page Number: 8

SCHEDULE C ADDRESSES Paragraph Number: 5. SCHEDULI? A Recording Information: JANUARY 18, 1957 I N BOOK 3161, PAGE 5 3 1 JUNE 6,2007 AS INSTRUMENT NO. 2007-87093 Mailing Address: BOARD OF SUPERVISORS COUNTY OF SAN MATE0 CHRISnNE C. FmGERALD, ESQ. LAW OFFICES OF HERMAN H. FmGERALD 345 LORTON AVE. s u m 302 BURLINGAME, CA 94010 SUSAN DURLING PONY NO. DPW155

1 SCHEDULIE 8, PART 2 ,

2, SCHEDULE 8, PART 2

AUGUST 8,2007 AS INSTRUMENT NO. 2007-119804

Fint American Utle Company

Case 5:08-cv-02814-JF
Form No. 1 (12116p2) CLTA Litigation Guarantee

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Filed 08/29/2008

Page 10 of 12
3109342

Order Number: 3401Page Number: 9

SCHEDULE OF EXCLUSIONS FROM COVERAGE OF THIS GUARANTEE
1 Except to the extent that specific assurance are provided in Schedule A of this Guarantee, the Company assumes no liability for loss w damage by . reason of the foliowin!g: (a) Defects, liens, encumbrances, adverse claims or other matters against the title, whether or not shown by the public records. (b) (1) Tares or aswtssmenb of any taxing authority that levies taxes or assessments on reai property; or, (2) Proceedings by a pubiic agenq which may result in taxes or assesments, or notices of such proceedings, whether or not the matters excluded under (1) or (2) are shown by the records of the taxing authority 01- by the public records. (c) (1) Unpatented rnining claims; (2) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (3) water rights, claims or title to water, whether or not the matters excluded under (I), (2) or (3) are shown by the pubiic records. 2. Nohvithstanding ably specific assurances which are provided in Schedule A of this Guarantee, the Company assumes no liability for loss or damage by reason of the follo~aing: (a) Defects, liens, encumbrances, adverse clalms or other matters affecting the title to any property beyond the lines of the land expressly described in the description set folth in Scheduie (A), (C) or in Part 2 of this Guarantee, or title to streets, roads, avenues, lanes, ways or watemays to which such land abuts, or the right to maintain theren vaults, tunnels, ramps, or any structure or improvements; or any rights or easements therein, unless such OrOoertY. riahts or easements are exDresslv and soeciflcallv set forth in said descriotion. ~. . (0) Defsrs. .ens, erc.moranccs, aagersc c a rns or otncr maners, wncther or not snown ~y mc p.0.c rccoms. (I) whlch are reateo, wfferea, ass-mea or agreed tcr cy one or more of tnc ASs.rMs: (2) whncn rcs. r n n~ oss to rnc Ass.co, or (3) wn.cn ao nor res. r n 11e .n+ala v or potenrla. nga. 0.ty ot an( 1 c a or oon-]dJlc d pfoceea ng wn cn is worn n r?e scope an0 purpose of tnr r%..ranrp< p r o dco d . (c) The identity of any party shown or referred to in Schedule A. (d) m e validity, legal effect or priority of any matter shown or referred to in this Guarantee

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..

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GUARANTEE CONDmONS AND STIPULATIONS 1 Definition of Terms. .
The following termswhen used in the Guarantee mean: (a) the "Assured": the party or parties named as the Assured in this Guarantee, or on a supplemental writing executed by the Company. , (b) "land: the land described or referred to in Schedule (A) (C) or in Part 2 and improvements amxed thereto which by law constitute real property. The term "land" doe!; not include any property beyond the lines of the area described or referred to in Schedule (A) (C) or in Part 2, nor any right, title, interest, estate or easement in a b u t h g streets, roads, avenues, alleys, lanes, ways or watemays. (c) "mortgage": mortgage, deed of trust, trust deed, or other swurity instrument. (d) "public rwords" : records established under state statutes at Date of Guarantee for the purpose of imparting constructive notice of matters relating to real property to porcbasers for value and without knowledge. (e) "date": the effective date.

2. Notice of Claim1 to be Given by h s u r e d Claimant.
An Assured shall notify the Company promptly in writing in case knowledge shall come to an Assured hereunder of any claim of title or interest which is adverse to the title to the estate or interest, as stated herein, and which rnlght cause loss or damage for which the Company may be liable by virtue of this Guarantee. I f prompt notice shall not be given to the Company, then ail liability of the Company shall terminate with regard to the manner or matters for w h ~ prompt notice is required; provided, however, that failure to notify the Company shall in no case prejudice the rights of any Assured h under thls Guarante,: unless the Company shall be prcjudiccd by me failure and then only to the extent of the prejudice.

3. No Duly to Defend or Prosecute.
The Company shall have no duty to defend or prosecute any actirn or proceeding to which the Assured is a party, notwithstanding the nature of any allegation in such artion or proceeding.

4. Company's Option to Defend or Prosecute Actions; Duly of Assured Claimant to Cooperate. Even though the Company has no duty to defend or prosecute as set forth in Paragraph 3 above: (a) The Company shali have the right, at is sole option and cost, to institute and prosecute any action or proceeding, interpose a defense, as limited in (b), or to do any other act which in its opinion may be necessary or desiraMe to establish the title to the estate or Interest as stated herein, or tv
establish the lien ril~hts the Assured, or to prevent or reduce loss or damage to the Assured. The Company may take any appropriate action under of the terms of this Guarantee, whether or not it shall be liable hereunder, and shall m t thereby concede liability or waive any provision of this Guarantee. I f the C:ompany shall exerclse its rights under this paragraph, t shall do so diligently. (b) I f the Company elects to exercise its options as stated in Paragraph 4(a) the Company shall have the right to select counsel of its choice (subject to the right of such Assured to objed for reasonable cause) to represent the Assured and shall not be liable for and will not pay the fees of any other counsel, nor will the Company pay any fees, costs or expenses incurred by an Assured in the defense of those causes of action which allege matters not covered by this Guarantee. (c) Whenever the Company shall have brought an action or interposed a defense as permitted by the provisions of this Guarantee, the Company may pursue any litigation to final determination by a court of competent )urisd~ction and expressly reserves the right, in illsole discretion, to appeal from an adverse .--A - or order. - - .-~ iudament ,d) In al cases wnt,rc rhs G-arantec perm.& trc Company to prosec.rc cr pro ~~

.

FirstAmerican ntle Company

Case 5:08-cv-02814-JF
Form No. 1 (12116192) CLTA Litigation Guarantee

Document 17-2

Filed 08/29/2008

Page 11 of 12

Order Number: 34013109342 Page Number: 10

I n addition to and after the notices required under Section 2 of these Conditions and Stipulations have been provided to the Company, a proof of ioss or damage signed and w o r n to by the Assured shall be furnished to the Company within ninety (90) days after the Assured shall ascertain the facts giving rise to the loss or damage. The proof of ioss or damage shall descrlbe the matters covered by this Guarantee whlch constitute the basis of ioss or damage and shall state, to the extent possible, the basis of calculating the amount of the loss or damage. I f the Company is prejudiced by the failure of the Assured to provide the required Proof of loss or damage, the Company's oMigation to such Assured under the Guarantee shall terminate. I n addition, the Assured may reasonably be required to submit to examination under oath by any authorized representative of the Company and shall produce for examination, inspection and cowing, at such reasonable times and places as may be designated by any authwized representative of the Company, all records, books, ledgers, checks, correspondence and memoranda, whether bearing a date before or after Date of Guarantee, which reasonably pertain to the loss or damage. Further, if requested by any authorized representative of the Company, the Assured shall grant its permission, in writing,. for any authorized representative of the Company to examine, inspect and copy all records, books, ledgers, check, correspondence and tnemoranda in the custody or control of a third party, which reasonably pertain to the ioss damage. All information designated as confidential by the Assured provided to the Company, pursuant to this Sedion shall not be disclosed to others unless, in the reasonable judgment of the Company, it is necessary in the administration of the claim. Failure of the Assured to submit for examination under oath, produce other reasonably requested informatior~ grant permission to secure reasonably necessary information from third parties as required in the above paragraph, unless of prohibited by law or g~overnmental regulation, shall terminate any liability of the Company under this Guarantee to the Assured for thatclaim. 6. Options t o Pay o r Otherwise Settle Claims: Termination of Liability. I n case of a claim umier this Guarantee, the Company shall have the following additional options: (a) To Pay or Tender Payment of the Amount of Liability or to Purchase the Indebtedness. The Company shaii have the option to pay or settle or compromise for or in the name of the Assured any claim which could result in loss to the Assured within the coveraae of this Guarantee. or to Dav the full amount of this Guarantee or. if this Guarantee is issued for the benefit of a holder of a ~-~ . . morrgage nr a enho der, the Company m a nave me opt on to purcnase tnr noeDtmness sec.reo ~y sa a rnncgage or sa a en for me amount ow ng mereon, tngetner wt, anv cosrs, reasonable attorneys' fees ana e x p m r s nc.rred by l i e Assured c.a man! ~ h o c n were autnor z by the Company up m to the time of purcha;e. Such purchase, payment or tender of payment of the full amount of the Guarantee shall terminate all liability of the Company hereunder. I n the event after notice of claim has been given to the Company by the Assured the Company offers to purchase said indebtednezs, the owner of such indebtedness shall transfer and assign said indebtedness, together with any collateral security, to the Company upon payment of the purchase price. Upon the exercise by the Company of the option provided for in Paragraph (a) the Company's obligation to the Assured under this Guarantee for the any claimed loss or damage, other than to make the payment required in that paragraph, shall terminate, includ~ng obligation to continue the defense or prosecution of any iltigation for which the Company has exercised its options under Paragraph 4, and the Guarantee shall be surrendered to the Comnanv for r.?nreiiatinn . . , (b) To Pay 0:heervr r Settle Wlth Panoes Otner Tnan IW k u r e d or W tn i r e A S S . ~ ~ mant Ca c TO pay or ntneervr re w t t c w th other parrlps for or n the name of an Asr~reo a mant any clalm Ass.reo aga nst unacr th s Guarantee, togetner wltn any costs, attorneys' fees and expenses incurred by the Assured claimant which were authorized by the coipany up to the time of payment and which the Company is oblig,lted to pay. Upon the exercise by the Company of the option provided for in Paragraph (b) the Company's obligation to the Assured under this Guarantee for the claimed loss ordamage, other than to make the payment required in that paragraph, shall terminate, including any oMigatian to continue the defense or prosecution of any litigation for which the Company has exercised its options under Paragraph 4. 7. Determination ;and Extent o f Liability. This Guarantee is a contract of Indemnity against actual monetary loss or damage sustained or incurred by the Assured claimant who has suffered loss or damage by reason of reliance upon the assurances set forth in this Guarantee and only to the extent herein described, and subject to the Exclusions From Coverage of This Guarantee. The Liability of the C(3mpanyunder this Guarantee to the Assured shall not exceed the least of: (a) the amount of liaI2ility stated in Schedule A or in Part 2; (b) the amount of thl? unpaid principal indebtedness secured by the mortgage of an Assured mortgagee, as limlted or provided under Section 6 of these Conditions and Stioulations or as reduced under Section 9 of these Conditions and Stioulations. at the time the ioss or damaae Assured aaainst bv this together w tn nteres! thereon; or Guarantee occ~rs, (c) tne Olflerence elw ween m e va . of tnc estate or nterest covered nercby as stated nere n and the value of tne estate or nterest s-bled to any c defect, lien or encumbrance Assured against by this Guarantee. 8. Limitation o f Liability. (a) I f the Company establishes the title, or removes the alleged defect, lien or encumbrance, or cures any other matter Assured against by this Guarantee in a reasonably diligent manner by any method, including litigation and the completion of any appeals therefrom, a shall have fully oerformed its obliaations with resoen to that matter and shaii not be liable for anv ioss or damaae caused therebv. (b) In tne event 07 a ly tlgat on by h e Company or w i n me Company's conrent, 'thc Company ;ha. have no lab' tv 'or .oss or oamage .nt tnere nas been a f ndl dererm llat 00 ~y a c0.n of competent ;.rlsd ctlon, an0 d Spos t!on of a1 appeals tnerefrom, adverse to dne t t e, as stated lere n. (L) Tne Company sh.1 nnt oe l.aD e for loss or damage to any Ass.rm for l aD ty vo .ntar y assumed by the Ass.rm in senttng any clam or s t . wlthout the prior written consent of the Company. 9. Reduction of Liibility o r Termination o t Liability. Ail payments under this Guarantee, except payments made for cosh, attorneys' fees and expenses pursuant to Paragraph 4 shall reduce the amount of liability pro tanto. 10. Pavment o f Loss. (a) ho dament m a De maoe w tho.1 proa.cng c s Guarantee fnr enootsrment of tne payment unless m e Guarantee has bPen ost or oestmveo, n n wnch case proof of 0 1or destr.ct,on sha. be furnished to tne satldaaon of tnr Cnmpany 1 (b) Wnen ab 11 ar 0 tne extent of loss or namage has ocrn dernre y fkro n accoroance w m tncse Con01t.ons and Stlpu.aoons, tne 0% or damage shall be payable within thirty (30) days thereafter. 1 . Subrogation l l p o n Payment o r Settlement. 1 Whenever the Company shall have settled and paid a claim under this Guarantee, all right of subrogation shall vest in the Company unaffected by any act of the Assured claimant. The Com~anv shall be subroaated to and be entitled to all riahts and remedies which the Assured would have had aaainst anv Derson or . . . in DroDelfy . . respect to tnr c.a m nao tn s G.arantee not been 6ss.ea. ! req.cstm by m e Company, tne Ass.rea shal bander to the Company a I r gnts and I remeo es agansr an! person or propelfy nccessaw in nrder to perfect In r r gnt of s.brogat on. Tne Ass..red snall pPrm!l tne Company tc sue, comprom re or sen.,! n tne name of the &urea an0 to .re the nam? nf t r c Ass-re0 n any transacuon or lot garon involv~ng tnesr rlShb or remrd PS
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First American ntle Company

Case 5:08-cv-02814-JF
Form No. 1 (121L6192) CLTA Litigation Guarantee

Document 17-2

Filed 08/29/2008

Page 12 of 12
3109342

Order Number: 3401Page Number: 1 1

If a payment on account of a claim does not fuily cover the loss of the Assured the Company shall be subrogated to all rights and remedies of the Assured after the Assured shall have recovered its principal, interen and costs of collectbn. 12. Arbitration. Unless prohibited by ilpplicable law, either the Company or the Assured may demand arbitration pursuant to the Title Insurance Arbitration Rules of the American Ahitration Ibsociation. Arbitrable matters may include, but are not limited to, any controvwsy or claim between the Company and the Assured arising out of or relating to this Guarantee, any service of the Company in connection with its issuance or the breach of a Guarantee provision or other obligation. P,II arbitrable matters when the Amount of Liability is $l,000,000 or less shall be arbitrated at the option of either the Company or the Assured. All arbitrable matters when the amount of liability is in excess of $1,000,000 shall be arbitrated only when agreed to by both the Company and the Assured. The Rules in effect at Date of Guarantee shall be binding upon the parties. The award may include attorneys' fees only if the laws of the state in which the land is located permits a court to award attorneys' lees to a prevailing party. ludgment upon the award rendered by the Arbitrator(s) may be entered in any court having jurisdiction thereof. The law of the situs of the land shall apply to an arbitration under the Title Insurance Arbitration Rules. A copy of the Rules may be obtained from the Company upon request. 13. Liability Limited to This Guarantee; Guarantee Entire Contract. (a) This Guarantee together with ail endorsements, if any, attached hereto by the Company is the entire Guarantee and contract between the Assured and the Company. I r interpreting any provision of this Guarantee, this Guarantee shall be consbued as a whole. (b) Any claim of loss or damage, whether or not based on negligence, or any action asserting such claim, shall be restricted to this Guarantee. (c) No amendment of or endorsement to this Guarantee can be made except by a writing endorsed hereon or attached hereto signed by either the President, a Vice President, the Secretary, and Assistant Secretary, or validating officer or authorized signatory of the Company. 14. Notices, When? Sent. Ail notices required tr, be given the Company and any statement in writlng required to be furnished the Company shall include the number of this Guarantee and shall be addressed to the Company at 2 First American Way, Bldg 2, Santa Ana, California, 92707.

FirstAmerican Title Company