Cadiz Mayor Lyn Bailey, Cadiz City Clerk Lisa Rogers, Cadiz Public Works Director Kerry Fowler, City Attorney Allen Wilson and Robert Moore, attorney for Madisonville Disposal, also a defendant in the suit, were present. James Coltharp, the attorney representing Freedom Waste, was also present.
Wilson, who filed a motion to dismiss the suit, and Coltharp, who filed a motion for a summary judgment, presented their various arguments to Woodall.
Wilson said that according to the Kentucky Constitution, a city, county, taxing district or other municipality cannot make a contract for franchise agreement a term of more than 20 years, and that bids must be received publicly after due advertisement.
Wilson argued this means the bidding requirement is mandatory for every new term, and that the automatic renewal provision in the city’s contract is unconstitutional, which, he said, is why the case should be dismissed.
Wilson also argued that merely having a government contract that has an automatic renewal provision goes against section 164 of the state’s constitution. He added that without the 20-year provision, a contract could conceivably continue “in perpetuity.”
The original contract, drafted in 1998, was renewed in 2001, 2004 and 2007, said Coltharp, who argued that the automatic renewal clause in the contract did not violate the state constitution since bids for the waste collection franchise were well-advertised.
J. Duncan Pitchford, also representing Freedom Waste, wrote in a legal response dated last Thursday that the automatic renewal doesn’t violate the “due advertisement” requirement and “does not afford the Plaintiff the right of private contracting disapproved of by OAG 80-258.”
Wilson, who has been the city attorney for Cadiz since 2006, wasn’t employed by the city when the original contract was drafted in 1998, but he said he couldn’t say whether the City of Cadiz erred in allowing the automatic renewal provision in the first place.
“To my understanding, it hasn’t come up until now,” he said. However, he added that section 164 has been in the state constitution since its adoption in 1891.
A letter from Rogers dated Thursday, Dec. 17, of last year to Joe Buchanan of Freedom Waste stated that the city didn’t want to renew the contract and instead wanted to “consider other bids.” Rogers, in the letter, stated that the contract would have otherwise automatically renewed on Sunday, March 21.
Pitchford argued that the contract specified and end date of Tuesday, March 2, meant that the any non-renewal notice would have to have been sent no later than Thursday, Dec. 3. A copy of the contract confirms that end date.
Freedom Waste is seeking damages against the City of Cadiz for breach of contract and “an award of specific performance” to compel the city to honor its contract with Freedom Waste, Pitchford said in the suit.
In the original complaint dated Thursday, Feb. 18, Pitchford argued that the city’s contract with Freedom Waste states that their contract automatically renews for another three years unless either party declares in writing that they want to terminate the contract at least 90 days before the contract is supposed to end.
The copy of the contract states that the three-year contract automatically renews unless either party notifies the other in writing at least 90 days before the end date of the contract that they don’t want to renew the contract.