Cloverdale victorious in three-year lawsuit

CLOVERDALE -- The town of Cloverdale came away victorious after a three-year lawsuit with an Iowa firm concerning the purchase of a fire truck.

On Jan. 27, the Indiana Court of Appeals issued a decision agreeing with the Putnam County Circuit Court's June 2008 finding that there was "no evidence that the town acted in bad faith."

Cloverdale was found innocent of breaching a contract with Farley, Iowa-based Simon Fire Equipment and Repair to purchase a fire truck for an estimated $229,990.63.

In 2001, the town made a move to start a Cloverdale Fire Department. It began a bidding process to purchase one fire truck from Simon Fire. A resolution was signed by all five council members, with four voting to purchase the 2001 demo fire truck.

The council accepted a bid subject to favorable financing. A written confirmation accepting the bid of Simon Fire and the price of the vehicle was made in 2005.

It came down to a bond issuance, which was voted down 3-2 a short time later. Rural development funds were considered, but would have obligated the town to repay $213,000 at a rate of 4.125 percent for 20 years. That was in addition to a $37,650 grant from the U.S. Department of Rural Development.

Don Sublett, current town council president, admitted those conditions would have put the town in financial distress for decades.

"It would have been irresponsible for that (2005) council to commit money that far in the future (2025)," he said.

By Dec. 13, 2005, the council decided in a split decision to return the $25,000 bid check to Simon Fire and to void the deal.

Simon Fire first filed suit against the town in May of 2006 in Iowa for expenses and lost revenue of $60,585, alleging a breach of contract. That suit was dismissed, but re-filed later in Putnam County Circuit Court.

A bench trial was held in June 2008 with the verdict going in favor of the town. The case was appealed and sent back to court in Putnam County.

Judge Matthew Headley ruled in favor of Cloverdale in the appeal, stating there was no breach of contract and the town acted in good faith.

Attorney Mindi Jackman-Hanlin of Greencastle, who, along with Indianapolis lawyer, Allan Yackey represented the Town of Cloverdale in the suit, said, "The appellant has 30 days to petition the Supreme Court of Indiana to determine if they want to hear it. I've had no contact with (Simon Fire) to determine if they have intentions of doing either."

The Appeals Court ruling has saved the town of Cloverdale more than $60,000.