The Town of Cloverdale recently learned a lawsuit that had been dismissed in Iowa has been refiled against it in Indiana.
On May 18, attorneys for Simon Fire Equipment and Repair, Inc., Iowa, filed a lawsuit in Indiana for breach of contract.
The lawsuit states that Simon Fire met its obligations and conditions in regard to entering an agreement with the town in 2005 to accept a bid from Simon Fire for a 2001 demo firetruck with a purchase price of $229,990.63, but, according to the lawsuit, the town voted down bond approval for the purchase of the fire truck.
According to the lawsuit, filed in Putnam County Circuit Court, Simon Fire is seeking judgment in favor for the amount of present and future damages in result of breach of contract.
"It's the only thing they could do," Cloverdale Town Council attorney Scott Hoff told the BannerGraphic.
According to the lawsuit, the town has 20 days to file a response, but Hoff said he would more than likely seek a continuance. He said it could be three to four weeks before an answer is filed, because he planned to discuss the lawsuit with the council.
"We've got plenty of time," Hoff said.
Hoff said Cloverdale can answer the complaint, enter into settlement negotiations, or file a motion to dismiss.
According to the lawsuit, Simon Fire is represented by William R. Groth, Ellenwarth, Dennerline, Groth and Towe, Indianapolis.
The original lawsuit stated that on or about April 2005, the town began a bidding process to purchase one fire truck from Simon Fire. A resolution was signed by all five council members on April 12. Four of the members voted to buy a fire truck. Sublett was absent from the meeting.
On June 8, the town council had a special meeting and, according to the lawsuit, accepted the bid for Simon Fire to furnish a 2001 demo fire truck, estimated at $229,990.63. At the June 8 meeting, then board vice president Whitaker motioned to accept the bid of Simon Fire for the demo truck, subject to favorable financing, with Sublett giving the second. The motion passed, 3-1-1, with Whitaker, Sublett and then council president Davis voting yes. Padgett voted no while Vickroy abstained.
Written confirmation of the bid was sent by Davis on July 5, accepting the bid of Simon Fire and the price for the vehicle, subject to favorable financing.
The town was informed by its financial advisor, Krohn and Associates, that there was favorable financing at the time, setting up a public meeting on July 19 to vote on a bond issue for financing.
However, financing of the bond issue for the fire truck was voted down, 3-2, with Padgett, Sublett and Vickroy voting no at the special session. Davis and Whitaker both voted yes.
The lawsuit was originally filed in Dubuque, Iowa, on Oct. 27, 2005.
In November 2005, Sublett, Padgett and Vickroy filed a response, asking they be dismissed from lawsuit.
The trio's response stated that Simon Fire brought a lawsuit against the town, rather than against individual members of the town council.
According to the response, Davis and Whitaker made decisions and acted independently of the town council and that they had received a letter written by Davis to Simon Fire representative Dale Bush, stating the town of Cloverdale had accepted its bid.
The response from the three council members also said they were not "comfortable" with the letter, and the letter was sent without their knowledge or approval. It said they had asked that the certified check in the amount of $25,000 be returned.
In January 2006, the lawsuit was dismissed in Iowa. On Jan. 20, a court ruling noted the Iowa court agreed with Cloverdale that it did not have personal jurisdiction over the town, and that the town's contacts with Iowa were minimal. The court ruled the case should be tried in Indiana, as most of the parties involved and key documents were in Indiana.
On April 11, 2006, board member Judy Whitaker urged the town council to set up an executive session to look at the lawsuit. At that meeting, Whitaker told the other four council members the town should evaluate the lawsuit further after receiving a fax from Simon Fire President James J. Simon.
She said the fax stated that as of March 13, the company had not sold a fire truck to Cloverdale, which was under a contract of acceptance via letter dated July 5, 2005.
The fax stated the company had no intention of letting the breach of contract go away. But her motion for an executive was voted down by a 3-2 vote, with council president Don Sublett, vice president Dennis Padgett and board member Glenn Vickroy voting no.
Whitaker and board member John Davis both voted yes.