Illegal appointment will cost Oceano
June 24, 2011
By LISA RIZZO
The Oceano Community Services District will likely be slapped with nearly $75,000 in fees after losing a civil lawsuit that found the board illegally appointed one of its directors.
In his tentative ruling released Tuesday San Luis Obispo County Superior Court Judge Charles Crandall awarded former Oceano board director, Pamela Dean, $74,441 in attorney’s fees after she obtained a ruling March 18 that found the district’s Board of Directors failed to follow the law when it appointed Lori Angelo to fill a vacancy.
In February 2010, after Barbara Mann resigned from the board, Lori Angello was appointed by a vote of 2-1 with one director abstaining.
Following the vote, Dean claimed the board violated its own rules of order by appointing Angello with only two votes. In addition the vote violated Government Code Section 61045, which stated “a majority of the total membership of the board of directors shall constitute a quorum for the transaction of business.”
After Angello refused to step down, Dean filed a civil lawsuit against the Oceano Community Service District and Angello.
In March, Judge Crandall ruled in Dean’s favor, agreeing that Angello’s appointment was not legal.
By that time, however, the issue was moot. Angello ran unopposed in the November election and won a seat on the board. She is now the district President.
Dean was able to go after the district to pay her attorney fees under the California Private Attorney General Statute because the court declared the lawsuit a “useful public service,” one that set “future precedent and guidance not just for this board but for other community services districts and public agencies.”
Tentatively, while the board has been ordered to pay Dean’s legal fees, the judge did not find Angello personally liable.
“Practically speaking, however, the court sees no reason why attorney’s fees should be awarded against Lori Angello, personally. Because the award runs against a public agency, there is little risk of insolvency.”
That may not be the case for Oceano, however, which is financially strapped and is facing insolvency, according to a district document titled, “Financial Challenges to Remain Solvent.”
Once July 1 arrives, the CSD will officially be three years behind on completing and turning in audits to the county. Without the financial reporting, Oceano is not able to refinance current loans, obtain new loans, or win available government grants.
“Our finances are already tight, so it is going to be another pinch on the budget,” Oceano CSD Board Vice President Matthew Guerrero told CalCoastNews. “We are working on a new budget and this will have to be factored in.”
Meanwhile, the CSD appointed a new interim general manager Wednesday following the dismissal of General Manager Raffaele Montemurro over findings of mismanagement of district funds.
The new interim general manager, Thomas Geaslen, will be tasked with getting the CSD’s finances in order until a permanent replacement is found.
In his tentative ruling, Crandall noted that it appears “the board has changed its appointment practices and is complying with applicable authority” in that regard.