Judge finds holes in county's suit over 2003 East Side land sale tainted by commissioner's bribes

In a court hearing Monday, District Judge Stephen Ables advised lawyers for El Paso County Jose Rodriguez that there are problems with the legal approach the county took in a lawsuit to set aside the deed for 305 acres the county sold to Tropicana and Carefree Homes in 2003.

The county’s April 1 suit contends that the sale of the land and the settlement of a decade-old lawsuit over the property that made it possible were tainted by the bribe that former county Commissioner Betti Flores admitted in 2007 that she took to support the settlement and the sale.

The county cites Flores “fraud upon the court” in seeking a bill of review to set aside the settlement of a decade-long lawsuit over the property and the $3 million sale made possible by the settlement agreement.

Ables, the state’s administrative judge for the judicial region that includes El Paso County, recessed the case until May 4. Then, the county will be expected to present a revised argument in support of its effort to reverse what is known as a Rule 11 agreement to settle a legal dispute.

“Ables told them that the bill of review is not the proper way to attack the Rule 11 agreement,” said Larry Baskind, a lawyer for the defendants, said after Monday’s hearing.

In the meantime, he said, the developers and homebuilders who have borrowed money to develop the property are in difficult straights.

“They can’t do anything,” Baskind said. “The banks won’t advance any money. We’re just frozen.”

Although parts of the property have been sold to homeowners and the Socorro school district as well as to homebuilders, City Bank holds the lien on the original 305 acres.

Rodriguez could not be reached for comment about Ables’ ruling or the case in general.

The defendants in the case are Catalina Development, Collins, lawyer David Escobar, the trustee for a joint venture composed of Carefree Homes and Tropicana Homes.

In an effort to pre-empt the county’s suit, they filed suit in March to force the county into a closed-door arbitration process that was called for by the 2003 settlement in the event of a dispute.

Ables consolidated the two lawsuits into one at Monday’s hearing.

On the same day the county filed its lawsuit in state court, it filed another suit in federal court naming more then 20 defendants and seeking to recover all profits from the sale of the property as well as possession of any undeveloped land that has not been sold to innocent purchasers.

For the county attorney’s office, it was the second time it had gone to court against a company and individual who had allegedly profited by allegedly illegal dealings revealed by the FBI and U.S. attorney’s office in the course of a public corruption investigation.

In 2007, the county last year sued LKG Inc. and it’s owner Ruben “Sunny” Garcia for $600,000 they had been paid under contracts with the county to evaluate the Border Children’s Mental Health Collaborative.

The original dispute over the East Side property located east of Loop 375 and just north of Interstate-10 goes back to 1993 when El Paso County Commissioners Court approved the sale of 385 acres to Catalina Development and Greg Collins.

The Commissioners Court backed away from that sale in 1994 before the documents were signed, and, in 1995, Collins sued for breach of contract to force the sale.

Collins spent 10 years in the legal battle with the county, losing in district court, appeals court and before the Texas Supreme Court.

Other investors, including Tropicana, Carefree and Escobar, bought out most of Collins interest in the property and approached the county with a new deal to buy the land just after the Texas Supreme Court ruling.

Going against the advice of the county attorney’s office, Commissioners Court voted to settle the case, which Escobar and lawyer Luther Jones threatened to take to the U.S. Supreme Court, and sell all but 75 acres of the original parcel.

But in 2007, Flores confessed to taking a number of bribes involving a number of county contracts, including one to vote for and to support the settlement and sale of the property Collins has once sought.