Construction of new fire department remains halted
EDWARDS CO.—The lawsuit that was predicted to happen by all involved has hit a stalling point in Edwards County Circuit Court.
The suit, filed December 16, 2013, by Greenwalt and Sons Construction, is against the City of Albion and former mayor Ryan Hallam, and emerged from the massive debacle that erupted a little over a year ago when an improperly-executed contract was signed for Greenwalt to build a new fire department for the city.
Breach of contract alleged
Greenwalt is alleging that the city breached the contract when they caused the construction to cease, this on April 24, 2013, after construction had commenced in January 2013.
The total of the contract, records show, was $624,340. Greenwalt is asking for a judgment against the City and Hallam separately, seeking damages on each in excess of $50,000 plus costs of the suit.
It’s unclear if Greenwalt is asking for the bulk of the contract cost to be submitted; whether they are asking for a pro-rated amount of the contract to be submitted (three months’ worth); or if only the “damages” sought will satisfy their complaint.
Nevertheless, the city’s motion to dismiss, filed Jan. 13, 2014, indicates that the city may have a more positive position than Greenwalt does in the case.
Motion to Dismiss holds several counts
Represented by Troy G. Payne of LeFevre Oldfield Myers Apke & Payne Law Group in Vandalia.
The Motion to Dismiss is brought over several counts. The first lays claim to the fact that Involuntary Dismissal can be based upon certain defects or defenses, one of those being that “the claim asserted against defendant is barred by other affirmative matter avoiding the legal effect of or defeating the claim.” In short, the city is claiming several facts: chief amongst them that the city did not sign the January 17, 2013 contract; instead, it shows that the contract is between Greenwalt and Sons, Hallam, and the Albion Fire Department (on which Hallam was a volunteer firefighter).
Hallam, the motion states, signed the contract “individually and not in any capacity for the City of Albion; therefore, there is no privity of contract between the city and Greenwalt.”
Under this motion, the city is asking that they be dismissed from being named in the suit.
Contract signed reflected more than agreed
The second Motion to Dismiss claim arises from the fact that in October 2012, during a city council meeting, alderman Brett Berger presented to the city council the proposed firehouse drawings and the specifications for the new building, function, drive through, storage, office space, etc. Berger advised that Greenwalt was the only bidder. Costs were broken down to include $449,788 for construction of the building; $27,500 for removal of the old building; $20,000 for removal of old concrete; and $65,000 for a new concrete parking lot, leaving a total project cost of $562,288.
This contract cost was approved during that October 2, 2012 meeting.
However, when the contract got around to being signed (by Hallam alone), the cost ended up being $624,340—$62,052 MORE than the agreed-upon contract.
“There was no meeting of the minds between the city of Albion and Greenwalt,” the documents state. “As seen by the vote on Oct. 1, 2012, the city was potentially willing to accept the bid of Greenwalt in the amount of $562,288.”
There was no vote showing Albion accepted a contract of bid from Greenwalt for the increased amount, the documents show; and the city never accepted any offer from Greenwalt for the increased amount. The move lay strictly in the lap of Hallam…and the second count on the motion to dismiss asks that the city be removed from the suit on that basis.
Contract between Hallam and Greenwalt, not City and Greenwalt
Payne also outlines in the case (under the third Motion to Dismiss) that because Albion is a municipality, they have “certain contract liabilities and limitations…in that no contract shall be made by the corporate authorities, or by any committee or member thereof, and no expense shall be incurred by any of the officers or department of any municipality, whether the object of the expenditure has been ordered by the corporate authorities or not, unless an appropriation has been previously made concerning that contract or expense. Any contract made, or any expense otherwise incurred, in violation of the provisions of this section (of the law) shall be null and void as to the municipality, and no money belonging thereto shall be paid on account thereof.”
In other words, Hallam couldn’t himself sign for the entire city. Effectively, the contract was between him, and Greenwalt.
The documents also point out that no appropriation ordinance for the time period of the alleged contract was made…and that there was no appropriation ordinance for the amount of the alleged contract that was made between Greenwalt and Hallam, individually.
No appropriation ordinance
A fourth count on the Motion to Dismiss restates the lack of an appropriation ordinance, as well as restates the lack of authority Hallam had to bind the city into a contract with Greenwalt.
Minutes from the October 1, 2012 meeting were placed on file, along with the annual appropriations ordinance for fiscal year ending April 30, 2013, which shows no appropriation for the funding for the fire department construction (most of the money was obtained by grants, making the move by Hallam all the more egregious, as federal funds were likely involved in that grant set somehow).
The mess that was created from the signing of the contract, which is being termed, for court purposes, “improper,” lead to Hallam’s resignation as mayor in February 2013 and a mass walkout of fire department volunteers not long thereafter.
The whole matter was mis-covered by local media, who seemed oblivious to the improperly-signed contract and continued to focus on some perceived hateful attitude of certain members of the Albion city council toward fire volunteers, the latter of which wasn’t the case at all…the concern by those council members was strictly geared toward legality, and the city didn’t want to be stuck on the receiving end of a grant misuse, which was where it was headed if the work wasn’t stopped.
That’s not something Greenwalt seems to be prepared to accept, however, and they filed suit despite an abundance of information available that the contract was improper.
No court date has been set in the matter; as rules of the court go, the motion to dismiss will be heard first.