Soares v. Barnet Fire Dist. #2

• Decision Date: 22 July 2022
• Docket Number: 21-AP-290
• Citation: 2022 VT 34
• Parties: Theodore de Macedo Soares v. Barnet Fire District #2 et al.
• Court: Vermont Supreme Court

2022 VT 34

Theodore de Macedo Soares v. Barnet Fire District #2 et al.

No. 21-AP-290

Supreme Court of Vermont

July 22, 2022

On Appeal from v. Superior Court, Caledonia Unit, Civil Division, Mary Miles Teachout, J.

Theodore de Macedo Soares, Pro Se, Barnet Plaintiff-Appellant.

Devin McLaughlin of Langrock Sperry & Wool, LLP, Middlebury for Defendant-Appellee Barnet Fire District No. 2, Prudential Committee.

Elijah R. Bergman of Larson & Gallivan Law, PLC, Rutland, for Defendant-Appellee Vermont Municipal Bond Bank.

PRESENT: Reiber, C.J., Eaton, Carroll, Cohen and Waples, JJ.

WAPLES, J.

¶ 1. Plaintiff challenges the process by which defendant, the Prudential Committee for Barnet Fire District No. 2, obtained approval for a municipal bond. The trial court denied plaintiff's request to invalidate the bond vote. It found that although the Prudential Committee violated the Open Meeting Law during the process, the defect was the result of oversight, inadvertence, and mistake, and it was cured by the Committee's validation resolution. The court denied plaintiff's remaining requests for relief as well. Plaintiff argues on appeal that the court erred in: (1) concluding that the Open Meeting Law violations could be cured under 24 V.S.A. § 1757 or 17 V.S.A. § 2662; (2) failing to address his request for a new trial; (3) denying his attorney-fee request; and (4) dismissing his claim regarding curb-stop fees. We affirm the court's judgment in favor of the Committee and remand to the trial court to enter final judgment in favor of defendant Vermont Municipal Bond Bank as well.

I. Procedural History

¶ 2. The record indicates the following. The District has long had unsafe drinking water. To address this issue, the District's legislative body-the three-member Prudential Committee-sought to acquire the District's private water system and pursue state funding for its rehabilitation. By October 2013, the Prudential Committee members had agreed to seek a loan from the Vermont Drinking Water State Revolving Fund (SRF loan), which required issuance of a municipal bond.

¶ 3. To secure approval for the bond, the Prudential Committee was required by statute to take several steps. First, it needed to determine

at a regular or special meeting . . . by resolution passed by a vote of a majority of those members present and voting, that the public interest or necessity demands improvements, and that the cost of the same will be too great to be paid out of the ordinary annual income and revenue.

24 V.S.A. § 1755(a)(1). This is called a "necessity resolution." It was then required to "order the submission of the proposition of incurring a bonded debt to pay for public improvements to the qualified voters of such municipal corporation at a meeting to be held for that purpose." Id. "The warning calling the meeting [must] state the object and purpose for which the indebtedness is proposed to be incurred, the estimated cost of the improvements and the amount of bonds proposed to be issued." Id. § 1755(a)(2). The warning must also "fix the place where and the date on which the meeting shall be held and the hours of opening and closing the polls." Id.

¶ 4. The law includes a method by which defects in the bond process can be cured. After voters have approved the issuance of a bond and it is discovered that "such proceedings are defective because of failure to comply with any of the statutory requirements," the legislative body may cure a defect or omission through a resolution "by a vote of two-thirds of all its members at a regular or a special meeting called for that purpose, stating that the defect was the result of oversight, inadvertence, or mistake of law or fact." Id. § 1757(a). "When such omission has been so supplied by such resolution, all bonds . . . shall be as valid as if the statutory requirement had been complied with." Id. § 1757(b). The validation process is designed to prevent "the frustration and defeat of [the] vote of the electorate" in recognition that "the efforts of municipal government to accomplish public improvements are beset with legal intricacies" and "the fiscal affairs of our municipalities are rarely administered by legal technicians." Conn v. Town of Brattleboro, 120 Vt. 315, 322, 140 A.2d 6, 10 (1958).

¶ 5. In this case, the Prudential Committee did not strictly adhere to the statutory process for securing approval of a bond. The court found that the Committee members agreed on a plan to purchase and rehabilitate the drinking-water system and obtain funding through an SRF loan with a municipal bond, and held many meetings on this topic. The Committee did not have a motion before it, however, nor did it vote on a specific necessity resolution tailored to comply with the first requirement of 24 V.S.A. § 1755(a)(1). Instead, the Committee, composed of lay persons, agreed on the plan and proceeded to prepare for a bond vote.

¶ 6. At its December 2013 meeting, the Committee voted to set a date for "the Annual Meeting and Bond Vote" in January 2014 with individual notice provided to taxpayers via postcard. The Committee, on motion, voted to set the bond amount at $750,000. The agenda was prepared and postcards mailed to District voters. The notice of annual meeting included an article that read: "Shall the voters of Barnet Fire District #2 authorize the Prudential Committee to apply for a loan from the Drinking Water State Revolving Loan Fund and borrow an amount not to exceed $750,000.00 for the purchase of and improvements to the privately owned Barnet Water System Inc."

¶ 7. After consulting with an experienced bond attorney, the Committee learned that it could not hold the bond vote at the January 2014 meeting due to inadequate notice. The bond attorney suggested that, at the scheduled and warned meeting, the Committee could set new dates for a properly noticed informational meeting and subsequent bond vote, which it did. The attorney believed that the Committee had satisfied "in substance" the requirements of the necessity resolution because he understood that all Committee members agreed on the plan and terms of the bond to be submitted to the members for a vote.

¶ 8. At the January 2014 meeting, the article concerning the bond was tabled due to the procedural errors in its posting. The Committee members explained and discussed with attendees the purchase of the water system and the bond vote proposal. Following the meeting, the bond attorney prepared a new "Warning and Article," which stated erroneously that its contents were adopted and approved at the January 2014 Committee meeting. The warning notified District voters of the upcoming bond vote and an informational meeting. In February 2014, the article, with its "general obligation bond" provision, was approved by a vote of thirty to six. Plaintiff did not assert any claim of irregularity in the conduct of this vote or the manner in which the warning was posted.

¶ 9. Plaintiff disagreed with the plan to purchase and rehabilitate the drinking-water system; he advocated that District residents drill their own wells. In April 2014, the Committee instituted curb-stop fees, requiring property owners who abandoned the water system after December 31, 2013, to pay a fee for having a municipal-water valve servicing their property, regardless of whether they used it.

¶ 10. Plaintiff filed the instant suit in June 2014.^[1] The Committee thereafter took steps to ratify the bond vote and cure any procedural errors. At a Special Meeting in June 2014, the Committee voted unanimously to approve and adopt a validation resolution that sought to ratify, validate, and confirm "any claim of irregularity" related to the water system, related loans, the need for improvements, or the call, notice, and conduct of the February 19 meeting. When that attempt was deemed unsuccessful by the trial court on summary judgment, the Committee in April 2015 unanimously adopted another validation resolution in which it acknowledged that a preliminary finding of necessity did not occur in an open meeting as required by 24 V.S.A. § 1755(a), but sought to "avail itself of the provisions of 17 V.S.A. § [2662] and 24 V.S.A. § 1757 in order to correct the above-identified omission."^[2] It adopted by unanimous vote a resolution that "the actions of the voters at the February 19, 2014 special meeting of the Barnet Fire District No. 2 are hereby ratified, validated and confirmed."

¶ 11. The trial court ruled on partial summary judgment in January 2020 that "the second validation resolution complied with the statutory requirements in a manner in which the first validation did not." Plaintiff argued, however, that no cure was available under 24 V.S.A. § 1757(a) because the defects did not arise from "oversight, inadvertence, or mistake of law or fact" but instead represented a "wholesale attempt to circumvent an open meeting." The court found that, to the extent that plaintiff relied on an allegation of bad faith to void what otherwise appeared to be the Committee's statutorily authorized and valid cure of an acknowledged defect, plaintiff needed to establish specific facts to support such a claim at an evidentiary hearing. The court emphasized that plaintiff's request to void the bond vote represented an "extreme remedial it was omitted from the final judgment order by oversight and it asks that final judgment be entered in its favor. Plaintiff agrees that such relief is warranted. We remand to the trial court to enter final judgment in the bank's favor. measure," Putter v. Montpelier Pub. Sch. Sys., 166 Vt. 463, 467, 697 A.2d 354, 357 (1997), available only in the most extraordinary situations.

¶ 12. Following a two-day trial, the court found in an April 2021 decision that the ...