Minutes 04/12/1927 - Laserfiche WebLink

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April strongly urged upon the Department the justice of our claim. However, the Judge Advocate Gen- eral would not recommend the settlement, motwithstanding the settlement was ~gree~ble to the Department of Justice and as we understood the Qu~rtermaster's Department of the~Army and the Secretary of War followed his findings in the matter. TbS two cases then came on for'trial. The 0ity filed~uequitable plea alleging mmtual mistake in the contract. Oouusel for the United State-s moved to reject the pleas$ which motion the court overruled, and transferred the two cases to the chancery side of the court, and consolidated the suits. A jury was impar~eled to hear the case, but after the evidence h~d been submitted the judge stated there was no material conflict in the testimony and he discharged the jury and stated he would decide the case. The city proved on the trial the annual revenue for the calendar year 19la was $355,205.09, and on this b~sis we would owe the United States after deducting the $58,362.18 alres~ty paid, the sum of $~52Y.20. For the year from October 15, 1917, to October 15, 1918, (the date of the contract) the revenue was $356,820.?7, and on this basis we would owe the United States $1%288.63, according to our auditor, ~ud $21,530.82 according to the Government auditor. Another question raised in the suit was whether a reduction should be made by re~son of the sale of the Berkley-South Norfolk part of the system. The Government contended the figures $32~,000 should be reduced by the s~me ratio tD~t the total gross revenue of the Berk~y SYstem bears ~o the total gross revenue of the whole plant during the time o~ the contract period. The City contended that the s~le of th~ Berkley plant was occasioned by a recorded contract giving the City of Norfolk the right to purchase the plant, which contract existed prior to the contract with the United States, and the less of the Berkley plant was therefore beyond the control of the City of Portsmouth and a thing which the United States should hmve taken into consideration when the improvements were made to the pl~n~. The reduction of the basi~ r~venue made a difference of about $15,O00 due to the United States, and in favor of the ~nited States. The Oity also contended that no interest should be charged on the expenditures m~de by the United States for the period from November 15 to December 3l, 191S, for the reason that the Oity derived no revenue during that period, the pl&nt then being owned by the Ports- mouth, Berkley, and Suffolk ~ater 0ompany. The United States claimed $1~2~.58 for this period. The United States in its pleadings asked for interest on the amount claimed by it at the rate of six per cent per annum from July l, 1923, im the ~irst suit, s~d from November 1~, 1925, in the second suit. The City.contended that the interest should run only from the date of judgment for the reason that whatever was due was a disputed question and no acco,~ut stated had been made, and there was no p~eviSus demand. The court, on '~rch 30, 1927, entered a decree in the consolidated causes,~ directed that the United States may recover~rom the City of Portsmouth the ~m of $78,566.08 with interest thereon at six per centumper annum from the d~te of j~dgment until paid. The Oou~t decided the principal issue of m~tual mistake in the contracm ~gainst the City. It permitted an adjustment ~o be m~de for the loss of Berkley and decided the plan adopted by the Government auditor was equitable. - The Court deducted from the $83,~5.33 claimed by the Government $1~2~.58 claimed for the period from November 15, 1918, to December 3l, 1918, and $3~56.67 for one half of the interest on the funds derived from the sale of the Berkley plant. Judgment was givem for the remainder of $78,566.08. On the day the decree was entered dounsel ~or the United States insisted on interest at 5~ on pa~ of this amount, $62,~O9.3~, from the date the firsm suit w~s instituted, October 3, 1~23, and on the remaining amount,$15, E56.70 f~om the date the secondsuit was instituted, July l~, 1925. The court allowed interest at b~ from the date of judgment, whichwas approximately $15,328. O0~less than that contended for by counsel for piaintiff. The oonrm in its order al±owed the Oity sixty days to perfect an appeal to the UnitedStmtes Oir,~it Court of Appee~l. Asnear as I can determine the costs of au.~ appeal would be' from $1OOO to ~1500. Y~f the _city should win en an appeal we would ~xpect ~ jmdgment against us for either $$527.20 or $1~,2~8.63 as the least amounts. If the Oityshould lose we would r~ the risk of the court charging the $1425.5~ eliminated by the District 0curt, and changing the interest data on a cross petition. The appeal would probably be tried in July in Ashvilts, N.O. It is doubtful if we can reverse the District Oou~t. ! will ask that the Council take immediate action in this m~tter, determining whether it will pay the j~igment.or perfect the .~ppesl. In my opinion I do not think an appeal advisable, and recom- mend that ~he m~tter be settled. A bill for costs is attached. Yours very trGly, R. C. BAROLAY? 0i~y Attorneyos On motion of Mr. White, the communication was referred to the Finance Committee. T~e follow~ng report was read from the Commissioner of the Revenue: "Portsmouth, Va., April 12th, 1921. I To the Hon. City Oo~oil. Gentlemen~ I hereWDth report the following values of Real Estate and Personal Preperty, as reported by Corporation Commission, ~on Seaboard Air Line~ailway, and Real Estate omitted by AsSessors f0~ y~r 1926: Seaboard .Air Line Railway: Real Estate, Vs~lue, Personal P~operty,~Vat. $1,~O~,031.O0 Tax $30,100.78 8~0 /,~.oo~ 22 os .-o