The rising cost of litigation

Like others, Cd'A splits city attorney duties from courtroom cases

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COEUR d'ALENE - The city of Coeur d'Alene will pay $108,434 in legal fees defending the 2009 general election challenge.

That total more than quadruples the $24,770 the city's legal department had budgeted for litigation in each of the last two years.

That's because the city agreed to pay the fees for two defendants, City Council seat 2 incumbent Mike Kennedy, who was sued personally for his then 5-vote victory, and the city of Coeur d'Alene, which was included in the yearlong suit as a potential remedy provider had the judge ruled for another election.

While paying Kennedy's tab was unique, hiring outside counsel to defend the city was not.

Coeur d'Alene, as other Idaho cities do, separates its city attorney office duties from courtroom cases.

"Trials and cases can be very time consuming," said Coeur d'Alene City Attorney Mike Gridley. "You can't tell the court, 'I have to work on this ordinance, I'll drop by tomorrow.' The court owns you."

The reason for separating the two is to ensure the city is represented by counsel that has the specialty, time and resources for a suit, without taking the city's legal department away from its daily responsibilities regarding ordinances, meetings, contracts, personnel and other issues.

Not an uncommon practice across the state, as some Idaho city attorneys compare it to a general practice doctor who checks a family, but then refers members to a specialist for special conditions.

Jerry Mason, whose office Mason and Stricklin is the city attorney for Post Falls, Hayden, Rathdrum, Spirit Lake and Worley, said his office tries to take care of smaller cases, but recommends cities engage outside counsel otherwise.

"It's a specialization," Mason said. "You take a case and say, 'that's your forte there,' while our strength is what we do on a day-to-day basis."

Post Falls, which hired outside counsel for its pending Department of Environmental Quality suit, spent $83,855 contracting Mason and Stricklin, and $89,183 on litigation. In 2011, it's spending $120,000 for the civil side but keeping the litigation budget open pending the case.

Idaho Falls, with a population approaching 60,000, anticipates spending $289,552 for its city attorney representation. It reserves $40,000 for hiring outside counsel, which City Attorney Dale Storer called a good way to bring in a "broader scope of expertise."

"You bring a lot more to the table," he said.

Coeur d'Alene expects to spend around $452,085 to operate its four-member civil department. It budgeted $24,770 for litigation, which has been exceeded since the city agreed to pay for Kennedy's fees Dec. 7.

"All you need to do is screw up one case and you're going to wish you paid a good lawyer. It's worth getting it right," Gridley said. "The bottom line is if I felt we could get a better result doing it another way, I would."

Bigger cities with more cases, such as Boise, keep lawyers on staff for litigation.

Coeur d'Alene typically only has two or three civil suits a year. It contracts with Haman Law Office and Carey Perkins law office, at $100 and $95 per hour, respectively. The offices use their own staff and resources once they take a case.

To pay Kennedy's Tort claim, Coeur d'Alene is using money from its self-insurance fund - a $1.8 million revenue fund used to pay comprehensive insurance premiums and liability claims.

The city agreed to pay the fees as a way to put the yearlong litigation behind it, it said.

Had the city denied the claim, Kennedy could have sued the city which, win or lose, would have meant more litigation.

Kennedy said he isn't sure whether he would have.

Part of the reason for the big legal bill was the case long past its original 30-day window. Kennedy had hired two lawyers on the assumption it would last that long. His first attorney, Peter Erbland, had other obligations after the first month at which point the second attorney, Scott Reed, came on. Reed ended up doing a bulk of the work, and his bill was nearly double Erbland's - $84,240 to $22,400 - who came back on at the end of the case. The $69,660 amount was a mediated total.

The City Council also said it was the right thing to do to show support for the incumbent who was personally sued for something over which he had no control.

"What is the price of having an election evaluated and the correct position being confirmed?" Gridley said. "What's the price of people having confidence in the election? The other side's objection is to take advantage of you. If you don't have competent counsel, the other side will take advantage."

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