FORT SMITH -- A judge has rejected a request by the city to dismiss a lawsuit that accused the city of wrongly using sanitation fees to cover up a nearly three-year interruption of its recycling program.
Sebastian County Circuit Judge Stephen Tabor said there were questions of fact in the lawsuit for a jury to sort out in determining whether the city was guilty of illegal exaction and unjust enrichment as charged in a lawsuit filed last June by attorneys for city sanitation customer Jennifer Merriott.
Tabor ruled earlier that Merriott is the representative of a class of city sanitation customers for the purposes of the unjust enrichment issue.
Attorneys for the city filed for summary judgment, arguing that there were no questions of fact for a jury to decide, leaving only the judge to rule on the law in the case.
Attorneys argued that illegal exaction was not applicable to the case because illegal exaction referred to illegal taxes. The sanitation revenue did not come from a tax but from a fee for sanitation service.
In his four-page ruling, the issue to Tabor was whether the fee was a tax regardless of what it was called. The court leaned toward the legitimacy of the difference between a fee for services versus a tax to support local government.
But a government fee must be fair and reasonable with the expectation for services in return, he wrote.
The question of reasonableness of the fee was put in question, Tabor said, when the city unnecessarily used recycling trucks to pick up recyclable material that was then sent to the landfill "at tremendous expense for the purpose of giving a false impression."
"The court finds there remains a genuine issue of material fact as to whether the fee charged was fair and reasonable in light of the fact the public was required to pay an assessment which, in part, was utilized to pay for services not rendered and to pay for the operation of recycling trucks that were not being used in recycling efforts," Tabor wrote.
Attorneys for Merriott argued that it cost the city more than $1 million to use its recycling trucks to pick up recyclable material from September 2014 to June 2017 even though the recyclables were not going to a recycler but to the landfill. Tabor wrote that the regular trash trucks could have handled the load.
The city's attorneys argued that the city was not unjustly enriched by landfilling its recyclables because the recycling service was free, and there was no separate designation for revenue that went to recycling services.
Tabor interpreted the city's argument as citizens having no right to complain about the assessment because their trash left the curb, regardless of whether it was recycled or sent to the landfill.
"Again, the court finds it to be a genuine issue of material fact as to whether a portion of the sanitation fee was used to pay for the recycling program," Tabor wrote.
State Desk on 05/13/2018