Town v. City Day 1: Lawsuit testimony begins

Water / wastewater pact hinges on 2 simple words

Michelle Monroe

By Michelle Monroe

Executive Editor

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“There was all kinds of outrage in the Town of St. Albans that the town was going to have to buy-in…”

- Dominic Cloud - St. Albans City Manager

ST. ALBANS — Three former St. Albans Town Selectboard members, a former town attorney and the St. Albans City Manager took the stand Monday in the first day of a planned four-day trial to determine the meaning of an agreement for water and wastewater services signed by the city and town in 2009.

The court has previously held that the contract is ambiguous and its interpretation requires the presentation of additional evidence showing what the beliefs and interpretations of the contract were at the time of its signing.

That signing took place at St. Albans Town Hall at a joint meeting of the city council and town selectboard on Feb. 23, 2009.

That morning the words “up to” had been added to the agreement. Previously the agreement had required the town to purchase 100,000 gallons per day of water and wastewater services, known as allocations, at a cost of roughly $1.1 million. The town would then have been able to redistribute those allocations within its borders when developers or private home owners required them.

With the addition of the additional words the signed agreement stated that the city granted the town an allocation of “up to” 100,000 gallons per day.
The city maintains the agreement still envisioned a single large purchase and that the only change was that the purchase could be up to 100,000 gallons per day. The town claims the change allows them to make purchases piecemeal.

During his subpoenaed testimony, town attorney John Bergeron questioned city manager Dominic Cloud about the reasons for the change in language, which originated with Cloud. Bergeron read from a previous deposition in which Cloud had described resistance within the town to what the city manager called a “buy-in” into the city’s water and wastewater infrastructure.

“There was all kinds of outrage in the Town of St. Albans that the town was going to have to buy-in,” Cloud said in the deposition, characterizing some of the opposition as “sticker shock.”

The addition of “up to” was intended to allow the town the chance to determine its needs and purchase that amount, Cloud suggested. “There was never any suggestion from the town that they were going to make multiple purchases. … The only thing that was on the table was: does the allocation have to be 100,000,” he testified.

“It was two partners who had marched an awful long way together and were on the way to making history,” he said.

Under cross examination, Cloud described the work of the committee that drafted the agreement. Initially, the town and city had convened a panel to consider a joint water and wastewater district. That committee had recommended a long-term purchase agreement instead. A second committee was convened to negotiate the agreement. The town’s primary negotiators were town selectman Bill Nihan and former selectman Jack Brigham.

Cloud described the committee as having little in the way of formal organization. Taking the barriers to an agreement one at a time, “we’d bang it around until we reached a consensus,” Cloud said. “The goal was to produce a simple document that was understandable to the man on the street.”

It was Cloud who would then take the committee’s consensus view and then write it into the agreement. There were at least 11 drafts of the agreement, all but the last one reviewed by the committee.

“I felt like this was a watershed moment between the two communities. I could see so much potential for the two communities working together,” said Cloud. “The divisiveness of the past wasn’t good for either community.”

Changing the language to include the words up to, “protected the agreement, but it also protected the city,” Cloud said. The city would be able to make a large sale at current rates, and a second one later, at rates that were likely to be higher, he said.

“Never in my wildest dreams did I think it would be interpreted something 180 degrees away,” Cloud said.

“I felt like we were all one community trying to find a way forward… ” Cloud testified. “With the benefit of hindsight maybe they pulled one over on us. That’s for the court to decide.”

The Attorney & The Selectboard

Former town attorney Dave Barra testified it might have been possible he was considering just such an interpretation the night of the signing.

Barra testified that he learned of the change in language on the morning of Feb. 23 from city attorney Eileen Elliott.

Town attorney Bergeron laid the groundwork by asking Barra about his initial interpretation of the agreement.

“Was it your understanding that the city’s position was only get one purchase?” Bergeron asked Barra.

“I had been told that, yes,” Barra replied.

“And that the purchase needs to be a significant purchase?” Bergeron asked.

“Yes.”

Bergeron then asked Barra to read from the transcript of the Feb. 23 meeting. Barra had been asked to describe the agreement to the public by then selectboard chair Kathy Middlemiss. During that brief speech he referred to allocations.

In his deposition last fall, Barra said, while under oath, he had not considered the language change as allowing the town to purchase allocations piecemeal. However, yesterday he said, again under oath, that he now believes he may have been considering the change to mean the town could make multiple purchases. “I am coming around to the idea, given I used the word allocations that night multiple times,” Barra said.

Barra was questioned about his deposition by attorneys from both sides. During that deposition, he stated, “My understanding was that the town was going to take between then and July 2010 to determine how much they would purchase.”

Meaning the words ‘up to’ would allow the town time to determine how much of an allocation they needed based on anticipated development and purchase that amount.

In his deposition, Barra said it “hadn’t occurred to me” that town would be able to make purchases piecemeal.

There were similar discrepancies between the deposition and trial testimony of former selectman Ron Allard.

Allard testified the agreement would not have been approved by the selectboard without the addition of the words “up to.” The change, he said, gave the town the option of buying nothing.

“It was my opinion we didn’t have to purchase anything. That was fine with me,” said Allard. Absent a purchase from the town, the agreement would become null and void, which Allard said would have been find with him.

“I was never happy dealing with the city,” he said. “There’s never been a time that the town got a very good deal from the city. That’s the reason I ran for the selectboard.”

Allard also said he believed the town would be allowed to purchase allocations on a pay-as-you-go basis, instead of making a single bulk purchase.

In his deposition, however, Allard had offered a different interpretation. Asked about comments made at the joint meeting by city officials, Allard replied, “Which tells me now that they wanted their money up front. We reserved it. We were buying it.”

When asked at the deposition whether the agreement would allow the town to make subsequent purchases, he answered, “I never gave it much thought, I guess.”

Asked if the agreement allowed for multiple purchases or a single purchase, Allard answered, “Never entered my mind.”

The pattern of testimony for all three former selectboard members was similar. They were asked about the change in language and how they understood it.

Larry Carlson, the only member of the board to vote against the agreement, said of the change, “In my mind, it didn’t change anything.”

Asked if the agreement allowed the town to purchase allocations on a pay-as-you-go basis, Carlson replied, “I don’t know. It wasn’t clear.”

Kathy Middlemiss, who chaired the selectboard at the time was clear. “It meant we would not have to buy the full 100,000, we could piecemeal it, Middlemiss testified. “We wanted to be able to buy the allocations as much as we needed, not the full amount, and pay for it as we bought.”

Asked if anyone from the city had said the town had to make a substantial purchase, Middlemiss said, “No.” Asked if there was anything in the agreement to indicate the town was required to make a large purchase, she said, “No.”

The selectboard members were also asked about their replies to town residents who were advocating for pay-as-you-go, particularly Paul Larner and John Gray.

Asked why he did not answer Larner, Carlson replied, “Paul just talks and talks and talks.”

Middlemiss acknowledged there was concern about how to fund a substantial purchase. She was not asked why she had not responded to the town residents expressing that concern by stating a large purchase would not be necessary.

The town will present its final witnesses today, and the city may begin its case as early as this afternoon.

Presiding Judge Dennis Pearson will issue a final ruling in this trial by court.