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Kingsport mayor hopes to recoup costs of AEP building lawsuit

Matthew Lane • Jan 12, 2008 at 12:00 AM

KINGSPORT — The city of Kingsport spent more than $56,000 in litigation costs fighting the legal battle over the sale of the old American Electric Power building.

Now, Mayor Dennis Phillips thinks the city should explore the possibility of recouping those legal costs by suing Tom Dossett.

Dossett, a Kingsport attorney, sued the city in 2005 challenging the sale of the AEP building to veteran banker Lynn Shipley to be used as the headquarters of the new TriSummit Bank. Dossett claimed the city’s ordinance for disposing of surplus property was invalid and that two meetings to discuss the sale that were attended by two members of the Board of Mayor and Aldermen were in violation of the Tennessee Open Meetings Act.

In November 2006, Chancellor E.G. Moody dismissed the Open Meetings Act claim and found Dossett did not have standing to challenge the validity of the ordinance. Dossett then appealed to the Tennessee Court of Appeals, which issued its ruling on Nov. 28, 2007, upholding Moody’s judgment.

Dossett has 60 days from the Court of Appeals ruling to file an appeal to the Tennessee Supreme Court. Calls to Dossett for comment were not returned this week.

Over the past two years, Kingsport has spent $56,848 defending itself in the lawsuit, with much of the money (87 percent) going to pay former city attorney Joe May, who represents the city in the matter. This figure does not include the in-house expenses the city has incurred during the course of defending the lawsuit.

“I’m not surprised at all,” said Phillips. “Litigation is very expensive. That’s money we’ve spent of the taxpayers that we shouldn’t have had to spend.”

Phillips said he thinks the city owes it to its citizens to explore the possibility of recovering this money.

“I say that without conferring with the city attorney. I would not be willing to do this if we were assured we had no case of winning, or if there was some law that prevents us from it,” Phillips said. “I think this is a terrible precedent to be set, for when the city sells a piece of property that a lawsuit is filed, because this could happen every time we need to sell a piece of property.”

Phillips said he has not spoken with City Manager John Campbell about the idea but has sent an e-mail to City Attorney Mike Billingsley about it. Phillips said the response he got from Billingsley was it would be premature at this time to sue Dossett.

“Right now (Kingsport) is buying some properties I feel like we’ll be selling later on. If we’re going to be fighting a lawsuit every time we sell a piece of property, we’ll never be able to accomplish our goal,” Phillips said. “We don’t need to spend money recklessly. If we have an opportunity to recover money, I think we should.”

Phillips said he plans to ask Campbell and Billingsley to discuss with the BMA what actions they feel appropriate for the city to take.

“It’s very difficult with the court system to recover attorney fees. History is probably against us, but I don’t think that should prevent us from trying,” Phillips said.

Campbell said the decision of whether the city should sue Dossett would be for the BMA to make, though he understands their frustration in the matter. Campbell said he remembers at least one case during his tenure as city manager of Johnson City where the city recovered legal costs from someone who had sued the city.

“It’s very frustrating to be sued in situations like this. Ultimately, all of the costs go to the taxpayers,” Campbell said.

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