CLOVERDALE -- The Cloverdale Town Council voted recently to accept a settlement of one of the town's four lawsuits that will pay two Cloverdale real estate investors $15,000 and extend their claim to profits on the hookups on utility lines they paid to lay along County Road 1000 South.
Town Council President Don Sublett, Vice-President Dennis Padgett and member Glen Vickroy voted for the measure. Member Judy Whitaker opposed it and member John Davis, who attended the mediation session last Thursday night, was absent.
The agreement means that the town will see the end of the 2003 lawsuit filed by John Setty and Curt Sinclair.
The lawsuit accuses the town of breaching the contract it struck with Sinclair in 2000 when he paid more than $1 million to install water and sewer lines along Burma Road. The contract stipulated that Sinclair would receive a portion of the utility fees from all new houses that hook on to the lines for the next 10 years.
Since the lines were installed, very few customers have hooked up.
Sinclair and Setty accuse the town of encouraging homeowners to wait to hook on to town water until after the 10-year cut off and attempting to circumvent the contract, according to court documents.
Originally, the lawsuit also included accusations that the town, under Davis' direction stifled growth and harassed the developers and their clients, though those parts were dismissed in June.
The settlement extends to 15 years, or until April 2015, the amount of time Sinclair can receive compensation from water line hookups.
When Whitaker asked why the town is paying to settle the lawsuit, Sublett said insurance will cover $12,500 of the cost, leaving the taxpayers to pay $2,500.
He said the settlement, even with the payout, will save the town money since a trial on the case would take between two and three days, according to the mediator.
Davis, in an interview with the BannerGraphic, accused the other board members at mediation of selling out the town. He said Sinclair's problems with making his investment pay off were the result of a bad business decision, not anything the town did.
Davis was the only council member at the mediation who served on the board when the lawsuit was filed.
Additionally, Davis and Whitaker filed a lawsuit at the beginning of the month against Setty and Sinclair for allegedly bankrolling a recount and lawsuit filed by four candidates in the 2003 town election.
For his part, Setty, who was at Thursday night's meeting, said he was pleased for the lawsuit to be over.
He said that even though the politics on the town board have since swung in his favor -- he is an ally of Sublett and board member-elect Terry Puffer -- he did not drop the lawsuit because he wanted to negotiate terms that would help him and Sinclair recoup the loss from the $1.1 million investment.
The $15,000 from the settlement all goes to cover attorney feeds, he added.
Of the other lawsuits against the town, one was filed by Davis and Whitaker over the town's contract with the Cloverdale Township Volunteer Fire Department, one was filed by a company that says the town accepted a bid on a $250,000 fire truck only to renege and one was filed by several residents the town annexed who claim they have yet to receive any services for their tax dollars.