Town agrees to pay $35,063 in attorney fees after losing suit


The Pagosa Springs Town Council agreed at its meeting last Thursday, Oct. 20, to pay fees and costs of $35,063.50 to attorney Matt Roane, who represented the plaintiff in a suit against the town under the Colorado Sunshine Law.

The agreement came in the approval by council’s vote of 4-1 of a “Full and Final Release and Settlement Agreement,” to be filed in the lawsuit brought by plaintiff William Hudson against Town Clerk April Hessman, custodian of the town’s records. Councilor Tracy Bunning, acting as mayor pro tem for the meeting, voted to reject the settlement. Mayor Don Volger was absent.

The suit was filed in the aftermath of an executive session held by council on Sept. 17, 2015, and challenged the legality of its action in allowing a “contract adversary” to join it in the private meeting. Private meetings by elected public bodies are restricted by the Colorado Open Meetings Law (also known as the Sunshine Law) to narrowly limited purposes.

Principals of the Springs Partners LLC were the persons referred to in the suit as contract adversaries.

According to the agenda for council’s Sept. 17, 2015, meeting, the executive session was held in connection with “Determining Positions Relative to Matters that may be Subject to Negotiations, Developing Strategy for Negotiations, and Instructing Negotiators,” regarding possible “Revision to Springs Partners 10-Year Vested Right Agreement.”

The 2012 Vested Rights Agreement outlines conditions for the Springs Partners to develop a tract of land they own downtown, south of the San Juan River. It also contains provisions that could lead to the construction of a new bridge at 5th Street that would provide access to the development and an alternative connection between Hot Springs Boulevard and U.S. 160.

All meetings by town council, whether held in public or in executive session, are recorded to document the discussions. But recordings of private executive sessions are not accessible to the public. After Hudson’s suit was filed, District Court Judge Gregory G. Lyman listened to the recording of the session and concluded that the discussion conducted had amounted to preliminary contract negotiations.

Noting that he perceived nothing “inappropriate, secretive, or corrupt about any of the dialogue” in the discussion, Lyman nevertheless agreed with the plaintiff that the Springs Partners were a contract adversary.

As requested by Hudson’s suit, he ruled that Colorado law regarding the proper scope of executive session did not authorize the discussion with Springs Partners, and thus did not permit the town to continue to withhold the recording “from public inspection.”

Subsequently, the town decided not to appeal Lyman’s ruling, and made the recording of the executive session available to the public on Aug. 19. The substance of the recording was summarized by The SUN in its edition published on Aug. 25.

Thereafter, on Aug. 30, Roane filed a motion seeking payment by the town of his attorney fees in the amount of $34,400, based on 172 hours worked on the suit at the rated of $200/hour during the course of approximated 11 months since the date of the challenged executive session. With costs, Roane’s demand sought payment from the town in the total of $35,063.50.

Roane’s motion seeking to compel the payment of fees and costs was based on specific authority contained in the Sunshine Law, which he argued was intended by the Colorado legislature to deter public bodies from violating the strict limits of the Open Meetings Law.

In reliance on prior court decisions, Roane contended that the law “discourages governmental bodies from forcing citizens to sue in order to access public records,” and “relieves citizens from the financial burden” of successfully challenging violations by protecting them from out-of-pocket expenses.

Initially, the town’s attorney in the Hudson suit, Steve Dawes, of Denver, contested the reasonableness of the amount of fees sought by Roane in his motion. In a response to Roane’s motion filed on Sept. 19, Dawes conceded that $200/hour was a reasonable charge by an attorney to handle litigation, but argued that the 172 hours of work reported by Roane was excessive for the nature of the suit.

But town council then received legal advice regarding the Hudson v. Hessman suit in an executive session held for the purpose (as specifically authorized by the Open Meetings Law) on Sept. 22. Legal advice is confidential, so what council may have been told is unknown.

However, the ultimate settlement agreement providing for abandonment by the town of the contention that Roane’s fees were excessive was presented to council for consideration, and approved, four weeks following receipt of that advice.

During council’s discussion last Thursday prior to adoption of the settlement, Bunning suggested that the original executive session in September 2015 had not been specifically “illegal,” and that Lyman’s ruling was limited to the conclusion that the session had extended beyond an appropriate scope.

And, he reiterated the point argued previously by Dawes, that the amount of fees claimed by Roane was “unreasonable.”

However, other council members chose not to contest Roane’s fees, in light of the intention of the Sunshine Law to encourage private parties to enforce the law by protecting them from the expense, and the fact that to contest the fees would require a factual hearing before Lyman. That might actually result in increasing the total amount of fees payable to Roane, rather than reducing them, due to the additional hours spent on the hearing itself.

As pointed out by councilor John Egan, “I agree that the amount seems excessive … but think we need to move on.”

The settlement was then approved.

Town Manager Greg Schulte confirmed to The SUN on Oct. 25 that, although the town’s expenses for litigation of the Hudson v. Hessman suit were covered by its insurance carrier, the amount owed to Roane for his fees is not covered by insurance and will be paid by the town.