The most bizarre case for Kauai since the notorious lawsuit filed in 2004 in which the county sued the county seeking to invalidate the voter-approved Charter Amendment for residential taxpayers is surely the federal district court action filed in September
The most bizarre case for Kauai since the notorious lawsuit filed in 2004 in which the county sued the county seeking to invalidate the voter-approved Charter Amendment for residential taxpayers is surely the federal district court action filed in September 2012 by Kauai County Councilman Tim Bynum against the county and two county employees (both individually and in their official capacity) seeking damages principally for alleged violations of his civil rights.
When Mr. Bynum took office he swore under oath to serve the county of Kauai and its people. His case is the only known instance where a council member has sued the county. It strains credulity to believe that suing the county and seeking damages from it for mental anguish is serving its people. While Mr. Bynum may have felt aggrieved by the actions of the two employees he named in his complaint, he well knew that the county and its citizens would bear the economic burden of defending his case when it was named a defendant. If his desire for financial compensation exceeded his obligation to serve, wouldn’t it have been more in keeping with honoring his oath for him to end his service as a council member and bring his suit as a private citizen?
Other strange aspects of the case involve the actions of the office of the county attorney in regard to the liability insurance the county maintains.
In broad, the county’s policy specifies a per case liability coverage against judgments, settlements and litigation costs up to $10 million with a $500,000 deductible.
Annual premium is over $500,000. Defense of a case is assumed by the insurer when the deductible is met and thereafter the insurer is authorized to settle the case within policy limits.
At the outset, the county attorney recognized that the attorneys in his office would not be able to adequately defend the case and he arranged for three major Honolulu law firms to defend the county and the two employees in their official capacity.
Under county practice, estimated costs for such special counsel are approved by the county council and the firm’s advice is considered in executive sessions. Under this routine, important information is withheld from the public.
Since last summer counsel for the county and its employees had prepared customary summary judgment motions to dismiss the case, but when counsel costs soared, it appears that the county attorney maneuvered to have the motions hearing deferred and for the insurer to assume responsibility for the case and to look for a settlement.
As counsel costs approached the incredible amount of $750,000, a settlement was negotiated between the insurer and Bynum only a day before the frequently deferred date for hearing the motions for summary judgment. It called for the payment to Bynum and his attorneys the sum of $290,000.
Although the insurer had the absolute right to consummate a settlement, it asked the county council to ratify what it had done and apparently the council was threatened that if it failed to ratify it would violate the insurance contract. The request to the council seems unjustified. If the insurer had plenary authority to settle, the ratification sought was unnecessary and if the insurer did not, the failure to ratify would not be a violation.
On April 11, the council held a special meeting to consider the position. The public testimony opposing the settlement was, as is customary for the council, ignored. Following the public testimony an executive session was held. Its content was veiled from public view, but its significance was dubious except that it gave council members additional cause to complain about county attorney office actions.
Although the April 11 meeting was probably futile, the remarks and action by the council members were interesting. Two of the six members present (Bynum was recused) reasonably believed that approval of the settlement amounted to a council judgment on the case which they felt was inappropriate and they wanted the case resolved by the judicial proceedings. The remarks of the other members were mostly of a resigned nature oriented to the view that it would be best to get the odious matter behind them.
The council voted 4 to 2 to ratify the settlement made by the insurer. So the bottom line for this unprecedented instance of the county being sued by an incumbent council member is that the taxpayers of the county and the liability insurer will initially share more or less equally the over $1 million bill for the case. Taxpayers will also bear the burden of the experience adjusted insurance premiums that will doubtless ensue. So much for Bynum’s oath to serve the county and its people.
Bynum will not likely net anything of significance from the settlement after paying his legal costs and the two county employees will have to meet the costs related to their defense of the suit individually. All in all it was a sorry episode. Perhaps the only silver lining was that it allowed the council a closer look at the manipulative operations of the county attorney’s office which may enable some badly needed improvement to be made.
• Walter Lewis is a Lihue resident and retired attorney who writes a regular column for The Garden Island.
