Thursday, July 02, 2009

Ousted Official Loses Suit

By Rosalie Rayburn
Copyright © 2009 Albuquerque Journal
      Rio Rancho doesn't owe its former city manager a dime in back pay.
       A District Court judge ruled Wednesday that steps Rio Rancho's City Council took to correct an Open Meetings Act violation also ratified its previous vote to fire Jim Palenick.
       Palenick, who served as city manager from August 2003 to December 2006, spearheaded efforts to build the Santa Ana Star Center and new downtown area.
       Judge George P. Eichwald's ruling means Rio Rancho won't have to cough up more than $120,000 in back pay and benefits Palenick claimed the city owed him because he was terminated illegally in December 2006.
       Palenick, who filed a lawsuit against the city in January 2008, left Rio Rancho and later took a job as city manager in Gastonia, N.C. He came to New Mexico for the trial in Sandoval County's 13th Judicial District Court and was clearly upset by the outcome, saying he's thinking about an appeal.
       “It's highly likely, yeah,” Palenick said after the trial.
       The ruling came as a relief to James Jimenez, Rio Rancho's current city manager.
       “For now, it's certainly good news for the community,” Jimenez said in a phone interview. “We still have a very tight budget, but it's something of a relief that we won't have to use general fund dollars to pay a judgment.”
       Eichwald spent about three hours listening to arguments from lawyers and two witnesses: City Councilor Michael Williams, who participated in the vote to fire Palenick; and Rio Rancho City Attorney Jim Babin, who helped draft the city manager's employment contract.
       Palenick's lawyer Daniel Faber maintained his client's termination was rendered invalid by an Attorney General's Office opinion that deemed discussions between Jackson and Councilors Williams, Patty Thomas, Howard Balmer and Larry Naranjo prior to Palenick's termination constituted a violation of the state Open Meetings Act.
       Faber said the city's action 11 months later, in November 2007, to correct the violation and re-fire Palenick could not be valid retroactive to the date of his termination. That meant Palenick would still be employed for those months and therefore was owed compensation.
       Palenick's salary when he was terminated was $10,000 per month.
       Randy Bartell of Montgomery & Andrews, the Santa Fe law firm representing the city, countered that Palenick waived his right to claim back pay by demanding and accepting a severance package worth around $100,000.
       “He had a choice to make. He could have said to the council that their action was invalid,” Bartell said.
       Babin testified that there was no indication that Palenick regarded his termination as invalid or that he planned to sue the city. The city also agreed, at Palenick's request, to split severance payments into several checks to minimize the tax impact.
       Babin said he disagreed with the attorney general's opinion and that Palenick's claims were “completely unfounded.”
       Williams echoed Babin's position in his testimony. Williams was the city's acting mayor when the attorney general issued the opinion and presided over the meeting where councilors voted again to terminate Palenick.
       Eichwald also dismissed a counterclaim from the city saying Palenick should return the severance package.
       

---

You also can send comments via our comment form