Jose Gutierrez, the ousted head of the District government's purchasing department, was a "distracted, unfocused" administrator who sometimes "would shake" in meetings and regarded any supervision as "a threat to his manhood," according to a sworn deposition by City Administrator Thomas M. Downs.
Downs said that after repeated instances of "insubordination and incompetence," he revoked Gutierrez's authority to sign leases on Jan. 7, but said he did not publicly disclose that decision at Gutierrez's request.
When he removed Gutierrez's leasing authority, Downs said Gutierrez told him, " 'You can't do this to me. It will emasculate me.'
"And I said, 'That's not my worry,' " Downs continued.
"He said, 'You can't do this. I won't be able to function as the director of the department. I will lose face . . . . Make it lower key, lower profile, and I will promise you that I will sign no contract lease without your specific signature and authority.'
"My mistake was believing that," Downs concluded.
The Downs deposition, taken June 5, was presented yesterday in U.S. District Court here as part of a lawsuit by a real estate partnership and an insurance company that seeks enforcement of a group of nine leases that Gutierrez signed for office space in a building at 1111 E St. NW. The partnership is headed by Angel Roubin, of McLean, a Gutierrez friend.
In a separate lawsuit, filed two weeks ago, Gutierrez has charged Downs and Mayor Marion Barry with pressuring him to approve contracts for political reasons.
Gutierrez first made his accusations in newspaper interviews in late March, two weeks after he had been demoted from his purchasing job. He was fired from the District government in late May after a report by Herbert O. Reid Sr., the mayor's legal counsel, accused him of steering "lucrative, give-away contracts" and leases to Roubin.
Yesterday John H. Suda, the District's principal deputy corporation counsel, told U.S. District Judge Oliver Gasch that "nobody has accused Mr. Roubin of wrongdoing" but he said the city was justified in breaking the leases because Gutierrez exceeded his authority in signing them.
Even before Downs took away all of Gutierrez's leasing authority Suda said he had to get Downs approval for any lease of more than $5 million.
The leases for the E Street building, which used to be the headquarters of Perpetual Savings and Loan, total $22.9 million over 10 years.
To avoid sending the matter to Downs, Suda said Gutierrez deliberately split the transaction into nine separate leases, seven signed in November and two in January. He said the price per square foot of $26.12 was about 40 percent more than what the city had been offered less than six months earlier by a previous owner of the building.
In comments from the bench, Gasch expressed concern about the propriety of the leases that Gutierrez signed, but he also expressed concern that the District government had not acted quickly to notify Roubin and the insurance company, Mutual Benefit Life, of possible problems.
Gasch asked both sides to submit more legal papers next Monday and promised to rule quickly.
On May 21, Judge John H. Pratt, the federal judge who first heard the case, issued a temporary restraining order, banning the city from suspending Roubin's partnership as a city government. He also ordered the city to pay $165,000 into an escrow account for back rent, pending the outcome of the case.
The District formally notified Roubin on May 17 that it was voiding the lease, but had refused to make any payments since January.
Yesterday David Kuney, a lawyer for Mutual Benefit, argued that even if Gutierrez's actions had been improper, the District had to honor the leases because it waited too long before acting against him. Kuney said the company had no knowledge that Gutierrez had been stripped of authority when he signed a certificate March 1 that declared the leases proper.
Based on that statement Kuney said Mutual Benefit gave Roubin $15 million in loan money on March 28.