In the wake of a spurning by the Supreme Court of Alabama, plaintiffs in the ongoing civil suit over control of the county’s water department have filed a motion asking the court to reconsider its decision to allow the South Cumberland Cooperative District (SCCD) to retain control of the department as the suit — along with the defendants’ appeal of a circuit court’s injunction order against it — moves forward.

The high court had granted a request by the defendants in the case to overturn a portion of a preliminary injunction requiring that the SCCD cease corporate action and give the water department back to the county until the civil suit has been resolved.

The defendants — including the Governmental Utility Services Corporation of Cullman County (GUSC), the SCCD, and associate county commissioners Doug Williams and Wayne Willingham — appealed the injunction to the high court, and followed the appeal with a request for an emergency stay to prevent the SCCD from having to re-deed those assets back to Cullman County.

The assets in question consist of a broad network of water pipe infrastructure in Cullman, Winston, Walker and Morgan counties, valued at more than $30 million. Ownership of those assets was transferred from Cullman County to the SCCD on the day of its creation in late April, when Williams and Willingham voted the SCCD and GUSC into existence and appointed five people to overlapping seats on the two entities’ governing boards. The GUSC board has three seats; the SCCD’s has five. One of those five remains vacant after a charter member resigned shortly after accepting his seat.

In the plaintiffs’ motion to reconsider, filed Wednesday of last week, attorneys outlined a number of points they claim justify a reaffirmation of Circuit Judge Don Hardeman’s original injunction of May 28. That order followed a hearing to determine the merits of an allegation made in the civil suit that the two associate commissioners violated the Alabama Open Meetings Act in scheming to create the SCCD and GUSC.

The plaintiffs pointed out to the high court last week that the Open Meetings charge was but one of many others claimed against the defendants, and that the full merits on the case had not yet been heard in circuit court.

  “This case is about more than the Open Meetings Act,” the plaintiffs’ motion reads. “The Appellants [SCCD, et. al.] have narrowly focused on the Open Meetings Act portion of the proceedings and the perceived subject matter jurisdictional issue associated with the Open Meetings Act claims. However, the underlying complaint, the motion for preliminary injunction, and the trial [circuit] court’s two orders all reference the broader scope of the complaint.”

The “subject matter jurisdictional issue” has to do with defendants’ claims that the circuit court did not have authority to rule on a claim involving alleged violation of the open meetings law because, their argument implies, that is a matter for a higher court.

“Subject matter jurisdiction” refers to the authority granted a court to hear cases of a certain type—for instance, the power of a probate court to adjudicate estate cases. The defendants in this case argue that the circuit court does not have subject matter jurisdiction over any of the five counts alleged in the civil suit — including the allegation that associate commissioners violated the Alabama Open Meetings Act.

One of the issues that transcends the Open Meetings Act charge, claim plaintiffs, is the alleged misuse of the state statute providing for the setup of a utility services corporation. Plaintiffs stressed that statute, written into Section 11-97 of the Code of Alabama, was abused by creating one entity so that it could then act as a “middleman” to put the SCCD out of the legal reach of the county commission.

“The Appellants’ entire scheme to transfer the assets of the publicly owned water system to an entity beyond the control of a future Cullman County Commission was contrary to the statutes used to create those entities,” attorneys wrote to the high court last week.

“It is clear from the record…that the whole purpose of the…GUSC was to act as a partner for the County to form the SCCD, despite the fact that the statute was not intended for such a purpose…The [GUSC] legislation as a whole makes clear that the GUSC statute was intended to allow for the construction and improvement of utility facilities by private-public partnerships and that GUSCs are to be used to facilitate financing for such improvements, but the GUSC in this case has no function other than to act as a partner with Cullman County to create the SCCD and to appoint four of the five board members of the SCCD. [In contravention of the statute,] No assets were transferred to the GUSC and the GUSC has not other function…

“The complicated scheme purportedly enacted by the Appellants was created to avoid public oversight of public assets…It is also a violation of public policy to transfer thirty million dollars’ worth of public assets to an entity that was created by surprise at the same meeting with no public debate, no discussion, and no meaningful notice, not even to the third member of the commission [commission chairman James Graves].”

The plaintiffs also urged the high court to consider that Judge Hardeman’s preliminary injunction should not be overturned because, they argue, it did not abuse judicial discretion.

Citing a precedent decision in a 1990 Alabama case, the plaintiffs noted that similar cases afford a trial judge “wide discretion [in] hearing the motion and deciding whether to grant the injunction, and his action will not be disturbed on appeal unless he abuses his discretion.”

Hardeman, they maintained, clearly did not abuse his powers in that he heard the Open Meetings Act allegation on its merits and issued the preliminary injunction after both sides had presented testimony — first at the initial hearing; then in further deposition testimony, and, later, at a second hearing ordered by the Supreme Court.

Plaintiffs’ attorneys also argued that the defendants requested an emergency stay from the high court without presenting a factual basis as to why such a stay should be granted.

“No specific excerpts from the [May 28 circuit court] hearing were used [before the Supreme Court] to show the need for an emergency stay, nor were any affidavits attached alleging facts which would give rise to a stay,” they wrote.

“This Court’s grant of a stay based solely on the Appellants’ allegation…is an invitation for all litigants who are unhappy with a trial court’s injunctive relief to appeal the issue of subject mater jurisdiction and seek emergency relief of the trial court’s judgment…The factual basis should be undisputed and should contain clear and convincing evidence that the Appellants will not be harmed if a stay is not granted. The Appellants have not met that burden.”

Further, the plaintiffs accused the SCCD and GUSC defendants of attempting to use the appeals process as a means of making an end run around the local judicial process.

“The Appellants seek to have this Court [the Supreme Court] substitute its judgment for the judgment of the trial court without the fact-finding benefit of discovery and a trial,” they wrote. “The trial court that conducted an ore tenus [live, with witnesses] hearing is in a much better position than this Court to determine the credibility of the testimony and other evidence presented and to decide whether injunctive relief is necessary and proper. The trial court’s preliminary injunction should not be put on hold without presentation of factual basis for a stay.”

The Supreme Court operates on a separate timeline from the local circuit court docket, and may take up the SCCD’s appeal — and motions such as the plaintiffs’ request to reconsider their earlier decision — at any time. Unless the two parties reach a settlement, and until the appeals process is done, the civil suit remains on hold in circuit court. Hardeman’s last action in that case was last week’s bond hearing, after which he set the defendants’ bond for the appeal at $7.5 million.  

A new lawsuit filed Aug. 24 by Trimble-area farmer Billy Meeks also looms. That suit names the GUSC and SCCD board members individually as defendants, along with Williams and Willingham, and alleges that the county commission did not abide by state law in the manner in which it deeded the water department’s pipe properties to the SCCD. It also cites a section of the Code of Alabama which requires a public hearing in advance of the creation of a GUSC — a hearing they allege never took place. No hearing in the Meeks suit has yet been scheduled.

* Benjamin Bullard can be reached by e-mail at bbullard@cullmantimes.com or by telephone at 734-2131 ext. 270.