Miriam Hayenga, Phoenix Developer, Suing Prominent Zoning Attorney Paul Gilbert Over What She Says Is Botched Legal Work
See also: Miriam Hayenga Proves You Can Fight City Hall, After All
See also: Don't Even Think About Fighting City Hall Unless You're a Good Old Boy
Miriam Hayenga celebrated her settlement with the City of Phoenix. Now, she's going after her former attorney.
Sarah Fenske (former New Times columnist who is now the editor at our sister paper the L.A. Weekly) ended her 2009 column with the words 'Stay tuned...'
Nearly three years later, Hayenga, an unlikely developer, is pushing forward with a lawsuit against Gilbert, her former attorney. Depositions are under way in the case that has cost Hayenga millions of dollars -- both out of pocket and in lost potential profits -- and countless hours over nearly a decade.
Gilbert did not return our calls seeking comment.
Hayenga's story is as simple as it is complicated.
It boils down to this: The city gave her bad information about her development rights, and she lost out on an opportunity for a $4.35 million sale. She hired an attorney -- Paul Gilbert, regarded as the top zoning lawyer in the state -- who advised her to go after the man who sold her the land, blaming solely him for his client's inability to now develop it.
Although that was Gilbert's claim, the truth was in easily accessible city records -- documents that Phoenix planning officials and this premier attorney are accused of not bothering to carefully review, if they reviewed them at all.
Hayenga lost her lawsuit against Bob Gosnell, the man who sold her the land, in part because city officials testified under oath that, indeed, it was their screw up. And the real trouncing came when she was ordered to pay more than $300,000 worth of Gosnell's attorney's fees.
Why? Because even after Hayenga's legal team knew -- or should have known -- that it was the city that messed up, they pressed forward with their lawsuit against Gosnell.
Years ticked by, and the focus on going after Gosnell cost her an opportunity to fully go after the city for damages. She had a case, but was faced with a real possibility of it getting tossed out because she didn't file it sooner.
The city argued that an attorney of Gilbert's caliber would have known that she had a case against the city, but said they never filed it. Thus, the statute of limitation had run its course.
She dropped Gilbert and hired another attorney to sue the city. They eventually settled for $2.5 million. She hired yet another attorney to go after Gilbert for steering to make him pay for what she contends is botched legal work and steering her case so poorly.
As Fenske explained in her 2009 articles, Hayenga bought six acres of land in 1997 with a tennis club and the Waterin' Hole restaurant from Bob Gosnell, the master builder of the Pointe communities at South Mountain and Tapatio Cliffs.
Although she tried to breathe life into the property, business wasn't good. And it was just getting worse. She decided to go to Plan B, and started talking to developers.
Based on information she received from Phoenix planning officials -- who assured her several times that she could build up to 120 units on the property -- she worked out a deal with the Hilton to sell the land for $4.35 million.
Three years later, when she was ready to seal the deal, city officials told Hayenga a very different story.
It was around February 2000, when they informed her that she couldn't put 120 units on that property -- in fact, assistant city planner Steven Muenker told her there were almost no units available for that swath of land.
City officials traced the problem back to a cap of 2,147 residential units placed on the Pointe Tapatio back in 1979. And, by the time that Hayenga arrived at City Hall with her plans, most of those units had been used up.