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Lawsuit terms TWSA policy ‘unconstitutional’
By Justin Goble
A suit was filed last week against the Tuckaseigee Water and Sewer Authority.
Sylva attorney Eric Ridenour prepared the complaint on behalf of Reggie Holland and his wife, Tamara, of Franklin, who purchased the Grindstaff Cove property across from the Justice Center from Three James Limited Partnership LLC last April.
Ridenour said the prior owners had purchased 3,600 gallons per day of water and sewer capacity, which was included in the deed when it was sold to the Hollands. However, since Three James did not hook up its water and sewer within six months, TWSA officials started assessing a capacity-assurance fee as specified by authority policy. That policy also states that, if the capacity-assurance fee is not paid, TWSA can rescind the allocation and re-sell it.
According to TWSA Director Joe Cline, that fee was not paid and the authority took the allocation back from Three James.
However, Ridenour claims that act is unconstitutional and filed suit because it has stopped his clients from making improvements to the property and hurt them financially.
“When Three James paid for the allocation, it wasn’t a deposit – they paid for the whole thing,” Ridenour said. “After that, TWSA charged a monthly service fee when they were not providing anything. The water and sewer was purchased for that property, and the price my client paid for the property included the allocation. When we asked TWSA what to do, they said they’d already taken it back, and there was nothing we could do because they are under this sewer moratorium. I’m saying that policy is unconstitutional. They just took it without warning or compensation. You have to file a lawsuit or come to an agreement with the current owner. There’s no theory in law that allows someone to take something that has already been purchased.
“They basically took back something that was already bought and paid for, turned around and sold it to someone else,” Ridenour said. “Maybe the people who work at Wal-Mart should start doing that, because it’s marketing genius.”
Ridenour also said that, since the property in question lies within town limits, TWSA by law should be providing water and sewer service.
“My clients pay city taxes, and the town is required to provide services to them,” he said. “TWSA took over providing water and sewer from the municipalities more than a decade ago, so it’s their responsibility now. They created this frenzy by saying they were running out of sewer capacity, and everybody went out and bought a lot of water and sewer they don’t need. They didn’t provide for an allocation that is within corporate limits, which is called for by law.”
For his part, Cline said TWSA is only following policies it’s had in place for some time now.
“That’s been the policy for a long time – back before I was director,” he said.
Cline also said TWSA sent Three James an invoice letting them know of the fact they had to pay the fees to keep their allocation. At that point, the owners said they weren’t moving forward with a project at the site and weren’t going to pay to keep the allocation.
“We felt like they knew and understood that they had to pay to keep the allocation,” Cline said.
TWSA attorney Raymond Large agreed, saying he’s confused about being sued by the Hollands when the authority took the allocation back from Three James Limited.
“I’m not sure how this has come about,” Large said. “The allocation was allotted to the predecessors to the Hollands. They were the ones who didn’t pay the fee, and my clients followed their policy and took the allocation back. The Hollands purchased the property knowing the allocation was gone.
“We have 30 days to respond,” he said. “We’ll do that, then see what happens.”
The Hollands’ complaint requests that the court place an injunction on TWSA which would force them to restore the water and sewer allocation pending a jury trial to see if TWSA would be responsible for any damages caused by the action.
However, Ridenour said that if TWSA officials would give the allocation back on their own the whole matter could be resolved without involving the courts.
“If they would give us the water and sewer back, the whole matter will be done,” Ridenour said. “Of course, if they don’t get it done in a timely fashion, there will be an exorbitant amount of damages they are responsible for. My clients don’t need this a year from now. They need it now.”
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