The Mission Viejo City Council finally severed its strained relationship with City Manager Dan Joseph on Tuesday night, voting 4 to 1 to sign off on a severance settlement rather than risk a possible lawsuit by Joseph against the city.
"Given the recent history of lawsuits filed against cities by city employees, the odds were not in our favor," said Councilman Lance MacLean, who voted for the severance package.
"When you line up the two columns, it's the best thing for the residents and for Dan to be done with it."
The council immediately named Dennis Wilberg interim city manager.
"My personal preference would be to move forward and fight the lawsuit," Mayor John Paul Ledesma said, "but I think it's best for the city of Mission Viejo not to take that kind of risk. [We need to] come to an agreement and move on. Hopefully, we'll have more constructive days ahead."
Joseph, the city manager for the last nine years, lodged a claim Monday against Mission Viejo, alleging, among other things, libel, slander, breach of contract and failure to evaluate his job performance.
A second claim singled out Councilwoman Gail Reavis, charging that she "engaged in a long-continuing barrage of unprivileged personal attacks" and that she "repeatedly published false, nonprivileged and damaging statements" about Joseph, including that he was having an affair with a member of his staff.
In an afternoon press conference at her attorney's office in Newport Beach, Reavis called the city manager's allegations against her "baseless, without merit and designed simply to inflame the community and force the city to spend hundreds of thousands of dollars to buy out a contract that would expire of its own terms."
Reavis, the vice mayor, defended her decision to bring Joseph's "inappropriate actions with a staff member" to the city attorney's attention.
In an Aug. 18 letter to City Atty. Peter M. Thorson, Reavis wrote:
"It has been brought to my attention our city manager has been seen in a variety of compromising or inappropriate situations with a female city employee other than his wife."
Reavis, elected in 2000, did not clarify what those situations were.
But she said in the letter that her "concern is not the state of Mr. Joseph's morality, but the implications and ramifications for the city of Mission Viejo."
It was those allegations that prompted Joseph to file his claim against the city and the separate one against Reavis. A claim can be a precursor to a lawsuit.
After reviewing Joseph's severance package agreement and his allegations, MacLean said it makes financial sense to accept the settlement.
"We're doing Gail a favor," MacLean said.
"We're covering for her. A long, protracted lawsuit would be embarrassing for the city and would continue the disharmony. It's better to make a clean break and it seems we're better off financially."
Reavis cast the only vote against the severance package.
According to the settlement, Joseph, who is paid about $152,000 a year, will receive 14 months' salary and $40,000 in workers' compensation for emotional and physical stress. The city also settled with Joseph's wife, Ivy, who has been city clerk since Mission Viejo was incorporated 15 years ago.
Ivy Joseph filed a separate claim against the city, alleging many of the same actions, and against Reavis, saying that the councilwoman had waged a campaign to discredit her, causing emotional distress.
Ivy Joseph, who earns about $101,000 a year, will also receive 14 months' salary and $40,000 in workers' compensation for emotional and physical stress.
Reavis said she was disappointed that Ivy Joseph's contract was also bought out.
"The city offered her a two-year extension," Reavis said.
"We all want her to stay. We all love Ivy, including me."