Santa Cruz County Superior Judge John Gallagher last week handed Terry Vierra, a former director of the San Lorenzo Valley Water District, another courtroom defeat, this one with the highest price tag yet.
Rejecting pleas for leniency, Gallagher ruled after a 15-minute hearing on June 16 that Vierra must pay $116,647.47 in legal bills owed by Bruce Holloway, the successful plaintiff in a conflict-of-interest lawsuit that Gallagher ruled on six months ago.
Vierra’s lawyer, Leonard Aslanian, presented a variety of arguments, but Gallagher dismissed all of them, saying the law was clear in this case.
Gary Redenbacher of Scotts Valley is representing Holloway in the case, which Vierra said he is appealing.
In court documents, Aslanian raised new questions about the advice that Vierra received from both his previous lawyer, Marc Hynes, and from his former colleagues on the water district board.
He portrayed Vierra as an innocent victim who should not be penalized because he followed bad advice.
Gallagher, after announcing his decision, acknowledged that this was a difficult ruling, one that imposed a signficant penalty on an individual to preserve government transparency and ethics.
The judge repeated his contention that while Vierra acted “without malice” he nonetheless violated state law.
Gallagher ruled in December in a lawsuit brought by Holloway that Vierra had violated state conflict-of-interest statutes when he failed to adequately separate himself from a real estate deal in 2010 when he was a water district director.
Gallagher ordered Vierra at that time to pay $9,346.67, half to the state and half to Holloway, for his conflict-of-interest transgressions. That judgment has not been paid and is accumulating interest.
Vierra’s own legal bills – upwards of $150,000 – were paid by ratepayers in the SLV Water District, whose board of directors had claimed they were obliged to pay the former director’s legal bills, including hiring an appellate firm to unsuccessfully seek a new trial, claiming he acted illegally as a district employee.
The directors said Vierra had asked them in writing to pay his legal bills.
In an about-face in response to a public outcry, the directors in April decided not to pay any more of Vierra’s legal bills, after initially filing a notice of appeal to the Court of Appeal. The directors also said they wouldn’t pay Vierra’s fine.
Aslanian argued that Vierra should only have to pay $19,027.68 of Holloway’s legal bills, despite receiving an itemized list of legal expenses from Redenbacher.
Vierra himself submitted two documents, some of which represented renewed attempts to declare his innocence of wrongdoing.
In one declaration, he contended that when he gave former SLV water district general manager Jim Mueller information about the price history of the property that led to the conflict-of-interest case, he was “unaware that the district had interest in acquiring the property.”
He also defended his voting on bill lists that paid bills related to the property purchase, saying such votes always were routine and unanimous.
He described those votes as “ministerial actions.” Gallagher in December ruled otherwise.
Gallagher said he had no choice but to award paying of legitimate legal bills of a successful plaintiff, especially in lawsuits won under the Political Reform Act.
Aslanian said it would be “inequitable” to award legal fees after ordering him to pay the initial penalty in the case.
He also claimed Vierra should receive leniency because he was a “volunteer” director.
SLV Water Districts pays its elected directors $100 per board meeting.
Vierra had argued in the initial case that, in contrast to being a volunteer, that he was in fact an employee, simply doing his job.
The district had used this argument to justify paying his legal bills with taxpayer money.
Vierra also claimed several times that he was a victim of bad advice.
“That the district may have been wrong on the law and its counsel may have wrongly advised Vierra are not reasons to penalize him in six figures,” his attorney wrote in the court filing.
“He is not the district nor the guarantor of its policies or legal advice,” Aslanian wrote.
He also said that his law firm of Colantuono, Highsmith and Whatley was providing legal services to Vierra at a discount, $225 to $250 per hour.
The firm charged the water district $310 to $350 per hour.
