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Judge denies motions to dismiss RSU 1 lawsuit

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Judge denies motions to dismiss RSU 1 lawsuit

BATH — A judge has denied the motions of Regional School Unit 1 and fellow defendants to dismiss West Bath's lawsuit against them, according to a June 7 order.

West Bath is suing RSU 1 to recover $1.9 million the town believes it overpaid in the first four years of the school district's existence. A hearing on a motion to dismiss the case was held May 7.

In an e-mailed statement this week regarding Superior Court Justice Andrew Horton's decision to deny the motions, West Bath Town Administrator Jonathan Davis wrote that the lawsuit "may proceed to the pre-trial discovery phase," a fact-finding process.

"The Superior Court will schedule a conference of counsel shortly at which time a case schedule will be set," Davis added.

West Bath's lawsuit, filed last October, claims it should have been assessed a total of $8.2 million over the course of four years, but instead paid $10.1 million. The suit claims RSU 1 owes West Bath $1.9 million, plus interest.

Horton allowed Bath to join RSU 1 in its defense of the lawsuit, and West Bath also included Arrowsic and Woolwich as defendants in the case. All the defendants filed motions to dismiss the case.

West Bath claims that Bath, Arrowsic and Woolwich underpaid in the first few years of RSU 1's existence.

Davis noted that the defendants "made three principal arguments in their attempt to have the Superior Court dismiss the case in its entirety," and that they "argued that West Bath's claims were brought too late, that West Bath did not have 'standing' to challenge the overcharges in court, and that West Bath had no remedy, i.e., that this was a wrong without a remedy. The Superior Court rejected all of these arguments in its 15-page decision."

David Ray, one of the attorneys representing Bath in this case, said Wednesday that "we were mildly disappointed by (Horton's) decision, but it's not a final decision on the merits of the issues."

Ray noted that under Rule 80B of the Maine Rules of Civil Procedure, anytime a governmental body makes an administrative, non-discretionary kind of decision, any party that is aggrieved by that decision has 30 days to challenge it – in this case, West Bath's claim that it was overcharged.

The defendants argue that West Bath had a chance each year, once it received its tax bill, to challenge its assessment, but that it did not do so until too late, hence the motions to dismiss the case, Ray explained.

He noted that West Bath does not consider the case an 80B kind of action, but that Horton considers much of it to be so. Still, Horton is allowing West Bath the chance to show that there is evidence to justify the delay, Ray said.

Horton stated in his order that "West Bath's counsel during oral argument indicated that West Bath had made efforts to investigate whether the correct formula was being used, and was given false or misleading information in response."

He also noted that the defendants' claim that the entire case should be dismissed due to West Bath's not filing within the Rule 80B deadline "is not necessarily correct. Not all of West Bath's claims would necessitate a Rule 80B review of the validity of RSU 1's assessments."

Many of the town's claims in two complaints are equitable against the defendant communities instead of against RSU 1, Horton explained, noting that restitution due to "unjust enrichment and/or mistake is clearly recognized as a cause of action."

The West Bath Board of Selectmen is "pleased" with the court decision, and "glad that all of these procedural motions have been taken care of such that the parties can now proceed to litigate the merits of the case," Davis wrote.

He expressed regret that West Bath had to turn to litigation to have the town's claim "taken seriously," but added that the Board of Selectmen hopes "the case will now proceed at a faster pace, and perhaps even settle, so that all parties can ultimately put this matter behind them."

"It's up to the judges and the lawyers right now," RSU 1 Chairman Timothy Harkins said Wednesday. "I hope we see resolution sooner than later."

Alex Lear can be reached at 781-3661 ext. 113 or alear@theforecaster.net. Follow him on Twitter: @learics.