City of Jeffersonville v. Environmental Management Corp.
2011 Ind. App. LEXIS 1726
Ind. Ct. App.2011Background
- Jeffersonville contracted EMC to operate/maintain its sewer system with EPA/IDEM compliance and maintenance duties.
- Contract allowed terminating for material breach only after written notice and a 90-day cure period.
- IDEM issued a NPDES permit in 2006; DOJ/EPA/IDEM enforcement followed; Mayor Galligan raised concerns about plant operations.
- April 2008 Sewer Board meeting discussed deficiencies; April 18, 2008 letter asked EMC for records, not termination notice.
- August 7, 2008 termination letter referenced deficiencies but did not clearly state a breach; an Agreed Entry stayed dispute and preserved access.
- EMC later alleged Open Door Law violations, contempt of the Agreed Entry, and breach; trial court found for EMC on all four matters, awarding fees and costs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether written notice satisfied contract cure requirement | EMC | City | City breached by failing to provide written notice 90 days prior to termination |
| Whether Open Door Law violations occurred | EMC | City | EMC waived Open Door claims; City not liable for Open Door violations |
| Whether City was in contempt of the Agreed Entry | EMC | City | Court did not abuse discretion; City found in contempt |
| Whether attorney's fees award was proper | EMC | City | Court abused discretion by awarding fees for post-open-door/breach matters; remand for limited fees related to contempt |
| Whether costs were properly awarded | EMC | City | Costs improperly included litigation expenses; remand to recover only filing and statutory witness fees |
Key Cases Cited
- Adler v. Adler, 713 N.E.2d 348 (Ind. Ct. App. 1999) (trial court may compensate for losses from contempt)
- Chapo v. Jefferson County Plan Com'n, 926 N.E.2d 504 (Ind. Ct. App. 2010) (costs include only filing/witness fees; no litigation expenses)
- Missi v. CCC Custom Kitchens, 731 N.E.2d 1037 (Ind. Ct. App. 2000) (litigation costs not recoverable without statutory basis)
- Belle City Amusements, Inc. v. Doorway Promotions, Inc., 936 N.E.2d 243 (Ind. Ct. App. 2010) (fixed costs not reduced damages in breach context)
- Indiana Tri-City Plaza Bowl, Inc. v. Glueck's Estate, 422 N.E.2d 670 (Ind. Ct. App. 1981) (fixed costs cannot reduce damages for breach)