The first and only hearing regarding the multi-year lawsuit between the City of Dahlonega and Lumpkin County finally occurred on Tuesday, March 18 in Lumpkin County Superior Court.
But no one could have anticipated that a mere two days later, at the annual State of the City & County Luncheon, County Chairman Chris Dockery would make a surprise announcement to the public that his side had come out on top in the protracted legal conflict.
“That issue has been going on for eight years,” he told the large crowd gathered at the Parks & Rec Community Center.
“I can tell you I received word today that the trial judge has ruled in the County’s favor on all issues related to Fire Station One,” Dockery declared.
The issue at the center of the lawsuit is shared ownership of the downtown fire station, located at 57A Pinetree Way.
‘BITTERSWEET’ VICTORY
Near the end of the joint luncheon Thursday afternoon, Dockery shocked the room by publicly addressing the outcome of the legal dispute, which has cost local taxpayers a combined total of $327,613.17.
Dockery declared that the contentious issue is laid to rest, prompting applause from the crowd.
“And I say that not to pound my chest or say the County prevailed, I say that to say that that issue is put to bed. We’re ready to move forward. We’re ready to look at more opportunities to work with the City. I think the Mayor has demonstrated those opportunities in her presentation. I think we have, too,” Dockery continued, adding that he looks forward to using public funds in a “more productive” way going forward.
According to the latest figures obtained by The Nugget, the lawsuit has cost the City of Dahlonega $171,995.88 in attorney fees, while the County has paid $155,618.29.
However, neither total includes the legal costs associated with last week’s court hearing.
The Nugget subsequently reached out to Dockery to ask if he could share any more details of the judge’s latest ruling, which, as of press time had not yet been officially recorded by the court.
“I don’t anticipate that the court order will affect the trust that is in place,” Dockery replied.
When asked if the judge will require the City to pay for both parties’ legal fees, Dockery said he doesn’t expect that to be part of the court’s order either.
“However, the County is still weighing its options as to whether to seek reimbursement of attorney fees. It would ultimately be a decision of the board,” he explained.
Dockery went on to describe the County’s victory as “kind of a bittersweet thing.”
“It’s resolution. I truly just want to put the issue behind us and move on,” he concluded.
LENGTHY LITIGATION
On March 29, 2023, the City filed the current suit against the County over the Fire Station.
However, tensions over ownership of the station have been slowly simmering since 1992, when the two acre property was purchased using money from the first SPLOST (Special Purpose Local Option Sales Tax).
One of the advertised purposes of that initial SPLOST collection was to build a new downtown station for the County and City.
But an apparent clerical error omitted the City’s name from the original printed deed to the property, creating a cloud of confusion over the title.
An attempt was made by City Attorney Doug Parks in 1998 to issue a “Corrective Warranty Deed,” but the County challenged the legality of that document in 2014.
On March 30, 2022, Senior Judge G. Grant Brantley affirmed the 2020 recommendation of Special Master Ralph L. Taylor, III that “it was the intent of the parties to the 1992 deed for both the City and the County to be grantees to the 1992 Deed.”
However, that recommendation also stated that “the 1998 deed was ineffective to convey an interest in the property to the City.”
In order to satisfy the equitable claims of the City without a new deed, the Special Master recommended granting the City’s request for a “constructive trust,” a trust in which a legal title is owned by one party, but some or all of the beneficial interest is held by another party.
But certain questions related to the property, such as who pays for maintenance of the property and administration of the constructive trust, were not explicitly addressed by the Special Master’s recommendation.
“The only evidence of an agreement by the parties in the record is limited … to joint ownership, not as to the operational costs for the operation of the fire station,” Taylor wrote.
The financial picture is further complicated by the fact that the County has also collected monthly income since 1998 from a cell phone tower lease on the same two-acre property.
HEATED HEARING
All of these issues came to a head at 10 a.m. last Tuesday morning, as attorneys for both sides appeared once again before Judge Brantley.
Representing the City in the hearing was Andrew J. Welch, III with the firm of Smith, Welch, Webb & White, while Ken E. Jarrard from Jarrard & Davis, LLP represented Lumpkin County.
“Déjà vu,” Brantley said upon taking his seat in court.
“Don’t assume I remember squat,” he advised the attorneys, referring to his involvement in the matter two years earlier.
Jarrard presented the County’s case to the judge first, pointing out that his 2022 ruling holds the property “in a trustee capacity, with the City being a 50 percent equitable beneficiary.”
He painted the City’s latest action as a defacto “appeal” of the County’s 2014 Quiet Title Action.
“The City is not entitled to the relief it is seeking today,” Jarrard said, referring to requests to terminate the constructive trust and distribute the property within it.
“The City wants a deed. They’re not happy with their equitable distribution,” he claimed.
Jarrard raised a number of legal objections to dissolving the trust, and also pushed back against the City’s request for back rent from the cell tower lease.
He said all of the plaintiff’s legal “weapons” should have been deployed during the 2014 Quiet Title Action that led to the Special Master’s decision.
“What is the unjust enrichment that you are claiming the County is receiving? You can’t raise it 364 days later,” Jarrard continued, referring to the date the City filed its latest complaints.
He brought up documents that purported to prove the City knew of the cell tower agreement during the original proceeding and did not bring it up to the court.
“The issue arose organically in the middle of the hearing, but those claims were never perfected,” he said.
When it was Welch’s turn to present to the judge, he criticized the constructive trust created by the court as vague and unable to deliver the equitable relief sought by the City.
Welch said the the 2022 ruling created an implied trust in which the County owns 50 percent interest in the subject property, but does not control all of the fee interest associated with leasing it.
He argued that a constructive trust is really a temporary device by which property may be recovered, and that unjust enrichment has resulted from the County overseeing the trust.
Welch bristled at the notion that the City’s latest action was only about collecting rent money from the County.
“[It’s] about securing joint tenancy and 50 percent interest,” he insisted, arguing that the actual intent of the constructive trust has not been fulfilled.
After both sides had concluded arguments, Judge Brantley indicated he would e-mail the attorneys within a couple of days with his decision.