Haddix pay cut headed to court?
The Peachtree City Council’s decision to severely cut the salary of Mayor Don Haddix in June — in retribution for a dispute over $10,000 in legal fees — appears headed for a challenge in court.
A notice of intent to file a lawsuit has been filed by Haddix’s attorney, former Georgia Attorney General Michael Bowers. The notice was served on the four council members who unanimously voted to cut Haddix’s pay from $750 a month to $75: George Dienhart, Kim Learnard, Vanessa Fleisch and Eric Imker.
In the letter, Bowers urged council to avoid a lawsuit by restoring Haddix’s back pay and his salary for the rest of his term in office. If that doesn’t happen within 30 days, the matter will be headed to court, Bowers wrote.
“If this dispute is not resolved, it is the citizens of Peachtree City that will suffer because their already limited resources will be wasted in defending the unlawful actions of the City Council taken on June 7, 2012,” Bowers said in the letter.
Bowers said city ordinance forbids adjusting salaries for the mayor and council members in mid-term, because the city charter requires they be established “during the proceeding term for which such officials shall have been appointed or elected.”
“The City Council had no authority to reduce Mayor Haddix’s salary by ‘budget amendment,’” Bowers wrote.
When council voted to cut Haddix’s pay, they did so to recoup nearly $10,000 in city funds spent to defend and settle a libel lawsuit filed against Haddix as a private citizen by former Mayor Harold Logsdon.
The city had to pay the legal bill after its risk management insurance carrier determined it qualified for coverage due to the fact that the alleged libelous statement in question was contained in an email from Haddix to a city staffer and thus was considered “official business.”
Although the risk management company had the final say on coverage of the legal matter, the city had to pay for the $9,969 in legal fees including the settlement because the amount was under the city’s $25,000 deductible.
The lawsuit was settled in December for a $3,000 payment to Logsdon and a written apology.
In his letter putting the city on notice of a potential lawsuit, Bowers noted that Haddix’s pay cut, as authorized by his fellow council members, was tantamount to a “legislatively enacted punishment” constituting a bill of attainder.
“If the City Council does not authorize the payment of the salary currently owed and restoration of Mr. Haddix’s salary, the members of the city council will be acting oppressively, maliciously, corruptly, without authority of law, and in bad faith by knowingly violating the law and acting outside the scope of their discretionary authority,” Bowers wrote. “Such actions may subject each member to personal liability.”
Haddix’s pay is currently established by budget at $9,000 a year even though by ordinance the mayor is entitled to a salary of $18,000 a year.
Following below is the entire text of the notice of intent to sue that was transmitted to the city:
Dear Peachtree City Council Members,
Balch & Bingham LLP has been retained by Mayor Don Haddix to challenge the reduction of his salary from $750.00 per month to $74.70 per month, which was approved by the Peachtree City Council on June 7, 2012 and implemented in Mr. Haddix’s July 19, 2012 check.
On behalf of Mr. Haddix and pursuant to O.C.G.A. § 36-33-5 et seq., the purpose of this letter is to provide you with formal written notice that a suit will be instituted against Peachtree City, Georgia and the Peachtree City Council by Mr. Haddix arising out of above-referenced matter unless the dispute described herein is resolved within the next thirty (30) days.
Mr. Haddix intends to assert, among other things, claims for declaratory judgment, injunction, conversion, breach of contract, attorneys’ fees and litigation expenses under O.C.G.A. § 13-6-11 and all other remedies allowed by law.
While the City Council may have disagreed with the Georgia Interlocal Risk Management Agency (“GIRMA”) decision to reimburse Mr. Haddix, the City Council has no authority to use self-help methods to collect the amount of the reimbursement and other legal expenses from the salary of Mr. Haddix.
First, the City Council has no authority to reduce Mr. Haddix’s salary during his term.
As you are aware, state law authorizes city councils to set salaries for various individuals including mayors. Pursuant to that authority, the Peachtree City Charter explains that salaries “shall be established by ordinance during the proceeding term for which such official shall have been appointed or elected. Said salaries shall be paid in twelve (12) equal monthly installments on or before the last day of each month.” See Charter Sec. 2.10 (emphasis added).
In accordance with the Charter, the City Council adopted ordinances specifically setting salaries for the mayor and council members. See Ord. No. 2-23. Ordinance No. 2-23(a) specifically sets the salary of the mayor at $18,000 effective January 1, 2010. See Ord. No. 2-23(a).
Due to budget constraints, Mr. Haddix previously approved budgets allocating only $9,000 per year for the mayor’s salary. Such budgets, however, were not the proper means by which to alter the salary of the mayor, which is required by the Charter to be established by ordinance. See Charter Sec. 2.1 0.
The City Council’s recent purported “budget amendment” is improper because the City Charter requires the mayor’s salary to be set by ordinance during the term preceding his election and to be paid in twelve equal installments. The City Council had no authority to reduce Mayor Haddix’s salary by “budget amendment.”
Second, approval of the annual budget and all amendments thereto are required to be “approved by the mayor and council.” See Ord. Nos. 34-61, 34-66, 34-67. Mr. Haddix did not approve the purported “budget amendment” or “budget adjustment.” Thus, the salary reduction is improper for this additional reason.
Additionally, both the United States and Georgia Constitutions prohibit bills of attainder. U.S. Const. Art. I, §110, cl. 1; Ga. Const. Art. I, §1, para. 10.
The purported “budget amendment” singles out Mr. Haddix and penalizes him for GIRMA’s decision to reimburse him; therefore, it is a legislatively enacted punishment constituting a bill [of] attainder and is void.
Ordinance No. 2-23 sets Mr. Haddix’s salary as mayor. Based upon the unauthorized actions of the City Council, the City has not paid Mr. Haddix in accordance with the Ordinance. Therefore, the City is liable for the unlawful conversion of Mr. Haddix’s salary.
If the City Council does not authorize the payment of the salary currently owed and restoration of Mr. Haddix’s salary, the members of the city council will be acting oppressively, maliciously, corruptly, without authority of law, and in bad faith by knowingly violating the law and acting outside the scope of their discretionary authority.
Such actions may subject each member to personal liability.
Mr. Haddix will fully pursue his rights as described herein if this dispute cannot be resolved.
It is the sincere hope of Mr. Haddix that given the authorities cited above that Peachtree City and its City Council will remedy immediately the unlawful reduction in his salary by issuing a check for past due amounts and restoring his salary for the month of September and going forward to the end of his term.
If this dispute is not resolved, it is the citizens of Peachtree City that will suffer because their already limited resources will be wasted in defending the unlawful actions of the City Council taken on June 7, 2012.
I look forward to working with you to resolve this matter quickly and in the best interests of all involved.
Michael J. Bowers
Balch & Bingham LLP