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Judges rule on breach of contract lawsuit

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The City of Jeffersonville breached its contract with a company hired to maintain its sewer system by not adequately providing written notice before ending the contract.

Environmental Management Corporation filed an action against the City of Jeffersonville and its Sanitary Sewer Board alleging Jeffersonville breached its contract with EMC, violated Indiana’s Open Door Law, and acted in contempt of an agreed entry and order.

Based on the parties’ contract, written notice had to be given to the other party 90 days before terminating the contract, to allow the party to cure its performance. There were issues after EMC began operating the city’s sewer system, and a letter was sent by the city attorney to EMC asking for specific information, but it never detailed that the city would terminate the contract if problems were not rectified within 90 days. That letter, and one sent in August that said the city was terminating the contract, were authorized during an executive session of the sewer board held before the open board meeting. The city took over operations of the plant in December 2008.

EMC filed its suit, in which the judge ruled in favor of EMC, awarded damages to EMC, and ordered the city to pay attorney fees and costs.

In City of Jeffersonville, Indiana and City of Jeffersonville Sanitary Sewer Board v. Environmental Management Corporation, No. 10A01-1005-PL-217, the Court of Appeals agreed that the city did not provide sufficient written notice to EMC 90 days before terminating the contract. The city’s verbal comments at a regular sewer board meeting held prior to the first letter being sent do not count because they were oral and never recorded in the board’s minutes. In addition, the letter didn’t allege inadequate performance as required by the terms of the contract.

The judges reversed summary judgment for EMC regarding its Open Door Law claims, finding EMC waived those claims. EMC had a 30-day time limit to file its complaints, which it did not do. The time period begins when the plaintiff “knew or should have known” about the act or failure to act that had occurred. EMC had representatives attending every sewer board meeting, so it should have known under the principles of common knowledge and experience, that the two letters weren’t authorized at a public meeting, wrote Judge Patricia Riley. The two complaints filed regarding these letters were filed more than 30 days after the point when EMC should have known about a violation.

The trial court based its award of attorney fees in part on the Open Door Law violations, so the judges remanded for the trial court to recalculate those fees as well as only order the city to pay EMC costs related to filing fees and statutory witness fees.

The judges affirmed the finding the city was in contempt of an agreed entry between the parties to not interfere with EMC’s access to the sewer facilities while a preliminary injunction hearing was pending. The appellate court also affirmed the trial court’s decision to reduce EMC’s corporate support expenses from its losses during calculation of EMC’s damages.

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  1. Number one, only $1 was earmarked as punitives. Most of the $1,950,000 was earmarked as pain and suffering. But I will give you, JS, that sure does sound punitive! Number two, remittitur, for certain, but how does one unring the dinner bell that has now been sounded? Catholic school blood is in the sharktank.

  2. Hi, I had an auto accident on 12/26/2012 on I-65 near Lafayette, IN. I rear hit a semi truck. Meanwhile, I got a traffic ticket. I went to White Superior Court to have a hearing. I thought that I could win the case. I lost. I am not sure if you will be able to reverse the judgment in the White Superior Court. Meanwhile, I will try to let the insurance agency for the truck driver to pay the damages to my car. I wonder if your office is willing to handle the case. Thanks.

  3. Putting aside the question of how they got past the pastoral purpose/ 1st Amendment/ MSJ hurdle-- let me ask this: a million bucks in punitive damages? are you kidding me? absolutely ridiculous. Remittitur.

  4. Compromising precious constitutional rights in order to protect them? Rather like the military intelligence slogan that the town had to be destroyed in order to save it. Looks like Joseph, Mary and Baby Jesus will have quite the eventful Boxing Day this year. Wise men will arrive to find no one to accept their gifts? Oh well, wisdom not all that desired this xmas anyway. Maybe the ACLU and Christian attorneys can work out a "three days every third year" visitation compromise and all of this messy litigation stuff can just be boxed up as well? It is an art form, now isn't it? Thomas More, a man of manifold compromises is undoubtedly cheering on wildly.

  5. From the MCBA: “This situation is not just about the death of Michael Brown, but the thousands of other African-Americans who are disproportionately targeted and killed by police officers.” The association said it was “saddened and disappointed” by the decision not to indict Ferguson police officer. HOPING that the MCBA will denouce the execution style killig of two NYC police officers this day, seemingly the act of one who likewise believes that the police are targeting blacks for murder and getting away with it. http://www.mediaite.com/online/two-nypd-cops-fatally-shot-in-ambush-in-brooklyn/ Pray this violence soon ends, and pray it stays far away from Indiana.

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