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HomeMy WebLinkAbout2001-05-17 - Agendas - Final l,Ucrx��� F� FAYETTEVI LLE THE CITY OF FAYETTEVILLE, ARKANSAS DEPARTMENTAL CORRESPONDENCE To: Policemen's Pension and Relief Fund Board of Trustees From: Fayetteville City Clerk's Office Date: May 17, 2001 Re: Hicks, et al. v. City of Fayetteville attorney fees. On May 17, 2001 a Joint Special Meeting of the Policemen's and Firemen's Pension and Relief Fund Boards was called. This was an informational meeting for the purpose of Kit Williams, City Attorney to inform the Boards of the court's order in the above referenced matter. An emergency meeting of the board has been called for Monday, May 21 , 2001 , at 1 :30 p.m., Room 326. The court has filed a order in the above referenced case. The order states the • amount the City of Fayetteville is to pay in attorney fees said amount will come from the Policemen's Pension and Relief Fund and the Firemen's Pension and Relief Fund. A quorum of your board is needed to take out the police fund share of the total amount. The city attorney will be present. cbp cc: John Maguire Steve Davis • Kit Williams f. Boards and Commissions . • April 16, 2001 POLICEMEN'S PENSION AND RELIEF FUND BOARD OF TRUSTEES Chairman Eldon Roberts Mayor Dan Coody Rt. 10 1418 E. Rodgers Drive Fayetteville, AR 72701 Fayetteville, AR 72701 521 -8050 H)443-6758 W)575-8330 Second term 01/01/01 to indef. 07/17/97 to 04/30/01 Treasurer Hollis Spencer Heather Woodruff P.O. Boz 267 P.O. Box 293 Fayetteville, AR 72702 Fayetteville, AR 72702 H)443-3044 W)444- 1807 H)575-9320 W)575-8323 - - --- First term 02/17/98 to indef. 05/01/96 to 04/30/02 Randy Bradley 16951 Dripping Springs Road West Fork, AR 72774 • H)761 -3515 W)4444739 Second term 07/17/97 to 04/30/01 Jerry Friend 1640 Stewart Fayetteville, AR 72703 H)443-9337 W)444- 1742 Second term 05/01/96 to 04/30/02 Dr. James Mashburn 236 Oakwood Ave. Fayetteville, AR 72703 442-8225 Second term 07/17/97 to 04/30/01 • 38 5 Boards and Commissions April 16, 2001 POLICEMEN'S PENSION AND RELIEF BOARD OF TRUSTEES DESCRIPTION: The Policemen's Board of Trustees was established pursuant to the Arkansas State Code. The Board was created to provide for the disbursement of the Firemen' s Relief and Pension Fund and shall designate its beneficiaries as directed in this act. The Board shall have the power to makeall rules and regulations needful of its guidance to implement the provision regarding Board composition. TERMS: Two=year terms, ending April 30. MEMBERS: The Board shall be composed of seven members as follows : The chief executive, who shall serve as chairman of the board — The city treasurer, who shall be the treasurer of the fund; — Four active or retired members of the pension fund; — One physician. APPOINTMENT: Active pension fund members shall elect the active members by secret written ballot in May of each year, with the member or members to be chosen in alternating years. The retired members shall be chosen in May of each year, by a method to be determined by the board, with the member or members to be chosen in alternating years. • CONTACT: Heather Woodruff, City Clerk, 575-8323 . PUBLIC NOTIFICATION: Meetings are published by the City Clerk on the weekly meetings list which is distributed to the media representatives with press boxes in the City Clerk's office and released via the internet on the City' s web site at: hqp://v;iArw .uark.edu/ALADDIN/cityinfo/cityweb, MEETING TIMES: Regular meetings are held the third Thursday of each quarter at 1 :30 p.m. at the City Administration Building. 37 • • Boards and Commissions April 16, 2001 r FIREMEN'S PENSION AND RELIEF FUND BOARD OF TRUSTEES John Dill Asst. Fire Chief Marion Doss HCR 63 Box 179 1125 Cato Springs Road Ozark, AR 72949 Fayetteville, AR 72701 M667-4566 H)521-8898 W)575-8365 First term/Replaced Bill Morris Replaced Mickey Jackson 05/01/99 to 04/30/01 05/31/91 to Indef. Pete Reagan City Clerk Heather Woodruff 1015 Lake Sequoyah Drive P.O. Box 293 Fayetteville, AR 72701 Fayetteville, AR 72702 H)521 -7542 . V)718-7622 H)444-7338 W)575-8323 Sixth term/Replaced Darrell Judy Replaced Traci Smith 05/11/96 to 04/30/02 02/17/98 to Indef. Ron Wood Mayor Dan Coody Rt. 5 Box 256 1418 E. Rodgers Drive Fayetteville, AR 72701 Fayetteville, AR 72701 • H)442-5925 W)718-7619 Cell)601-1580 H)443-6758 W)575-8330 Fourth term Replaced Fred Hanna 07/27/95 to 04/30/01 01/01/01 to Indef. Danny Farrar 2805 Brookshire Springdale, AR 72762 H)927-0336 W)575-8271 (mall) First Tenn/Replaced Pete Reagan 11/30/00 to 04/30/02 • 18 1 Boards and Commissions April 16, 2001 • FIREMEN'S PENSION AND RELIEF FUND BOARD OF TRUSTEES DESCRIPTION: The Firemen' s Board of Trustees was established pursuant to the provisions of Sub Chapter :8 of Arkansas State Code. The Board was created to provide for the disbursement of the Firemen's Relief and Pension Fund and shall designate its beneficiaries as directed in this act. The Board shall have the power to make all rules and regulations needful of its guidance to implement the provisions regarding Board composition. TERMS: Two-year terms, ending April 30. MEMBERS: The Board shall be composed of the following: The chief executive, who shall serve as chairman of the board; The city or district clerk or recorder, who shall serve as secretary of the board; — The fire chief, or if the fire chief is not a member of the fund, the highest ranking member of the fire department who is a member of the fund and who is willing to serve; Four active or retired members of the pension fund. APPOINTMENT: The Fire Department shall elect the active member ormembers by secret written ballot in May of each year, with members to be chosen in alternate years by a method to be • determined by the Board. The number of active members or retired members to serve on the Board shall be determined by the proportionate number of active members to retired members; when the number of active members equals seventy-five percent of the total of retired members and active members, the Board shall be comprised of three active members and one retired member. When the number of active members equals fifty percent of the total of retired members and active members, the Board shall be comprised of two active member and two retired members. When the number of retired members equals seventy-five percent of the total of retired members and active members, the Board shall be comprised of one active member and three retired members. CONTACT: Heather Woodruff, City Clerk, 575-8323. PUBLIC NOTIFICATION: Meetings are published by the City Clerk on the weekly meetings list which is distributed to the media representatives with press boxes in the City Clerk's office and released via the intemet on the City's web site at: hqp://www.uark.edu/ALADDIN/cityinfo/cityweb. MEETING TIMES : Regular meetings are held the last Thursday of each month at 11 :00 a.m. at the City Administration Building. 17 • • MEDIAIPUBLIC NOTIFICATION .CHECKLIST Official Re nesting Meetin _ - p Purpose Lsa� G�ir�'-c Location - of 9 Meeting Date 0.4- -0 Meeting Tiroe //'nea ,�y�afC� L,r ***Calls must be made 2 hours or more in advance of the time of the meeting**" e Date Time Who Caller's Called Called Received Initials Northwest Arkansas Times Fax 442-1714 Phone 442-1700 x-191 Matt WagnedDon Michael / Morning News Fax 444-7289 Phone 872-5191 Charles Alison Arkansas Democrat Gazette / Fax 927-5284 V Phone 927-5261 Rob Smith / Channel 29 KHOG TV / Fax 521-1430 • Phone 521-1010 ' Channel 5T'V�� . Fax 521-65796579 V Phone 521-1330 KIX 104 / Fax 587-8255 T Phone 521-0104 News Room KKEG/KFAY Fax 521-0751 Phone 521-5566 Arkansas NBC Fax 571-8900 Phone 571-5100 Jim Bemis Mobile 841-0058 Email: NPUTL(a.AOL.COM Channel 3 Fax 444-3437 Phone 444-3436 Marvin Hilton • I AJ r. News Release City of Fayetteville May 16, 2001 Contact: John Maguire, Admin. Svs. Director 575-8330 There will be an emergency joint meeting of the Policemen's and the Firemen's Pension and Relief Fund Boards of Trustees on Thursday, May 17, 2001 at 11 :00 a .m. in Room 326 of the City Administration Building. The purpose of, the meeting is to discuss payment of the attorney's fees in the property tax lawsuit. _ _ Amami FAYETTEVLLLE City of Fayetteville CITY CLERK ' S . OFFICE 113 W. Mountain St. Fayetteville, AR 72701 Phone: (501 ) 575-8323 Fax #: (501 ) 718-7695 Fax Cover Sheet To: Company: Fax A ( 6t ( 5 From : L 'kkl . e 0 Date: 0 Number of Pages (including cover sheet): --a Notes : Oda If transmission cannot be read clearly, please call back as soon as possible. Thank you. • News Release City of Fayetteville May 16; 2001 Contact: John Maguire, Admin. Svs. Director 575-8330 ' There will be an emergency joint meeting of the Policemen's and the Firemen's Pension and Relief Fund Boards of Trustees on Thursday, May 1. 7, 2001 at 11 :00 a.m. in Room 326 of the City Administration Building. The purpose of the meeting is to discuss payment of the attorney's fees in the property tax lawsuit. I IN THE CIRCUIT COURT OF WASHINGTON COUNTY, ARKANSAS • JEANNE M. HICKS, et al. PLAT TIFFS vs. CONSOLIDATED NO. CIV 97-500 n r� and NO. CIV 98-1403 -, �3 a THE CITY OF FAYETTEVILLE, et al. DEFEND?d4TS 0 ORDER APPROVING SETTLEMENT FOR CITY OF FAYETTEVILLE On the 5'" day of September, 2000, comes on to be heard the joint presentation and request of Plaintiff Class Representatives, Jeanne Hicks and Tammy Lewis for themselves and all other taxpayers similarly situated, who have paid real and personal property taxes in i City of Fayetteville, and the Defendant City of Fayetteville, for the Court to grant final approval of the Stipulation of Settlement ("Settlement") and the petitioner Class appearing by and through their attorneys, Marshall Dale Evans and E. Kent Hirsch, and for City of Fayetteville appears Jerry Rose, Fayetteville City Attorney, and the remaining defendants being noticed through this Courts' Order dated August 9's, 2000 setting the date and time of said hearing and providing them the opportunity to be present and be heard. The parties to the Settlement desire to terminate all complex and protracted litigation between such parties regarding the issues of millage rollbacks, damages, attorney fees and refunds of monies found to be exacted on the terms and conditions set forth in the Settlement filed with the Court and preliminarily , approved by order of this Court dated August 9`s, 2000 and filed August 15`h, 2000. • The Court now having considered the file of this case maintained by the Washington County Circuit Clerk, as well as the decision of this Court rendered on November 29. 1999. arguments submitted by counsel and no objections to the settlement of taxpayers refund and rollback of millage or any other term of the settlement except for attorneys' fees from any of the parties or Class members hereto after due notice to each of them and after ample time and opportunity to respond or object; the only objections were to the attorney' s fee request, which were filed with the Circuit Clerk and which will be addressed by the Court commencing on September 6`h, 2000 which is the date set by the Court to consider any and all other settlement issues together with arguments submitted by counsel, all statements and submissions by interested persons appearing at the final approval hearing; and having no other filed objections to the settlements of the refund and rollback on or before August 31 '% • 2000, the court mandated cutoff date as set forth in the order of this Court dated August 9`s, 2000, and the Court being fully advised in the premises, the Court makes the following findings and orders in final approval of the Stipulation of Settlement and the entry of this order. 1 . NOTICE OF SETTLEMENT: The consolidated civil action, Hicks, et al. v. City of Fayetteville, et al., CIV 97-500, (hereinafter Hicks I) was certified as a Class Action pursuant to Rule 23 of the Arkansas Rules of Civil Procedure by order of this Court dated February 12, 1998. The case of Hicks, et al. v. City of Fayetteville, et al., CIV 98- 1403 , (hereinafter Hicks II) was initiated as an illegal exaction case and sought relief for illegal exactions allegedly occurring during any tax years after 1997. • 2 • This Court stayed .any. action in Hicks 11 pending the resolution of Hicks I . The Plaintiffs and City of Fayetteville have agreed.to settle, resolve and compromise their several claims and disputes raised by the pleadings of Hicks I and Hicks Il on the terms .and conditions set forth in the Stipulation of Settlement which has been previously approved and filed of record in this cause. Even though Hicks II has not been certified as a class action, the recent decisions of the Arkansas Supreme Court suggest that an illegal exaction case brought pursuant to Ark. Const. art. XVI § 13 needs not be certified as a class .but that such cases should \vhen practical follow Rule 23 of the Arkansas Rules of Civil Procedure. As the parties have proposed, the Court finds that the notice given as provided in the Stipulation of Settlement is in accordance with state law, ARCP Rule 23 , and due .process. Hicks I was certified as a class action on behalf of all taxpayers in City of Fayetteville • and the other taxing units who are defendants herein, by this Court's Order of February 12th, 1998 and notice was sent to all members of this Class as approved and Ordered by the Court. This case had a trial on liability in May and June of 1999 and it was set for trial on damages for September 6t', 2000. The Court was advised a settlement had been reached and the Court' s Order of August 9th, 2000, preliminarily approved the Settlement and set a final approval hearing for September 5th, 2000. A Notice of Settlement was presented to the Court and the Court in its exercise of discretion found that notice by publication was the best notice practicable under the circumstances after two conference calls concerning such notice and after all parties to .this action had had an opportunity to participate in the process determining the Notice and all objections raised were satisfied, the Court determined the notice satisfies the requirements of Rule 23 of the Arkansas Rules of Civil Procedure and due process. The • 3 • Court in approving the notice was particularly mindful of the fact "that all taxpayers of Washington County had received the original notice of the class action and therefore the Court ordered that the Notice of Settlement should be published twice in the Legal Notices Section of the Morning News of Northwest Arkansas and the Northwest Arkansas Times advising the Class that the .Court would consider the Stipulation of Settlement and determine whether it should be approved and the members of the Class could file their objections to the settlement and appear and be heard at the hearing set to consider the settlement on September .5'", 2000. The Notice of publication advised Class members of the terms of the settlement, the amount of the refund, rollback, and that Class counsel will request 33 1 /3 % of the refund amount as attorney's fees . At the final approval hearing held on September 5". 2000, City of Fayetteville and Plaintiffs' counsel presented undisputed evidence that the Notice of Settlement had been • published in the Legal Notices Section of the Morning News of Northwest Arkansas on . August 11a', 2000 and August 18th, 2000 and the Northwest Arkansas Times on August 11 `s, 2000 and August 18a , 2000. Both proofs of publication were filed in the official court file on September 5t', 2000. This Court has approved the Notice to the Class as published and determines it to have constituted due and sufficient notice of the Hearing set for September 5'", 2000. 2. OBJECTIONS TO SETTLEMENT. By the Court's order of August 9th, 2000 the Court ordered that August 31St, 2000, be set as the cut-off date by which any and all objections to the Settlement must be filed with the Washington County Circuit Clerk, and further that only members of the Class filing an objection with the clerk on or before August 31S`, 2000, would be heard. • 4 At the final approval hearing held on September 5t°, 2000, the Court was duly informed that no objections to the rollback or refund or any other term of the settlement except for attorneys' fees from any person to the Settlement or member of the Class had been filed with the Washington County Circuit Clerk on or before August 3151, 2000. There were three thousand thirty-one (303 1 ) objections to the attorneys fees filed. Further, at the Court' s final approval hearing held on September 5t', 2000, the Court received evidence and was available to any person in attendance to make his or her objection. No person or party including the intervenors came forward with any objection at the final approval hearing to the refund or rollback of the settlement, or any other term of the settlement except the attorneys' fees issue which had been reset for September 6's, 2000, after hearing all the evidence the Court approved the settlement: • 3. STANDARDS OF REVIEW OF SETTLEMENT. The authority to approve a settlement of a class action is entrusted to the sound dis- cretion of the trial court. That the Court has recognized this action as one arising under the Arkansas Constitution Article 16 Section 13 as an illegal exaction suit and as such is a constitutional class action. Frank v. Barker, 341 Ark. 557, 20 S.W.3d 293 (2000); Carson v. Weiss, 333 Ark, 561 , 972 S.W.2d 933 ( 1998). Since few Arkansas cases exist where the parties have settled the cause and appellate review occurred, it is reasonable for this Court to review federal law for guidance in determining whether .the settlement is in the best interest of the Class. Such cases include: Miller v. Woodmoor Corp., 619 F.2d 65 ( 101" Cir. 1980); American Employers Insurance Co. v. King Resources Co. , 556 F.2d 471 ( 10' Cir. 1977), and the cases cited therein; Grunin v. International House of Pancakes, 513 F.2d 114, at 123 (8`s Cir. 1975), quoting ,a Third Circuit decision in stating: 5 • "Such a [settlement] determination is committed to the sound discretion of the trial judge. Great weight is accorded his views because he is exposed to the litigants, and their strategies, positions and proofs. He is aware of the expense and possible legal bars to success. Simply stated. he is on the firing line and can evaluate the action accordingly." The United States District Court for the District of Colorado described the rule for reviewing settlements in the case of In Re King Resources Co. Securities Litigation, 420 F.Supp. 610 (D. Col. 1976), at page 625. Within judicial discretion, the well-settled rule is that a settlement should be approved if it is fair, reasonable and adequate. (Citations omitted). In assessing the fairness, reasonableness and adequacy of a proposed settlement, the Court should "compare the terms of the compromise with the . likely rewards of litigation." (Citations omitted). This comparison requires consideration of two main elements. First, although the Court need not, and should not, decide the merits of the controversy, it should consider the exis- tence of serious questions of law and fact. which place the ultimate outcome of the litigation in doubt. (Citations omitted). • Second, the Court should consider the vagaries of litigation and com- pare the significance of immediate recovery by way of the compromise to the mere possibility of relief in the future, after protracted and expensive litiga- tion. In this respect, "it had been held proper to take the bird in the hand instead of a prospective flock in the bush." (Citations omitted). In applying the above test to a proposed settlement, the Court should also consider the judgment of counsel and the presence of good faith bargain- ing between the contending parties. (Citations omitted). In American Employers Insurance Co. v. King Resources Co. , 556 F.2d 471 (10' Cir. 1977), the Tenth Circuit Court of Appeals noted ten factors, seven of which are favorably relevant to this litigation, in considering the Settlement Agreement in the case at bar to be fair, reasonable and adequate, 556 EM 471 , at pages 475 and 478 : (2) The prospect of complex and protracted litigation if the settlement is not approved. In Re Four Seasons Securities Litigation, 58 F.R.D. 19 (W.D. Okla. 1972). • 6 • (3) The proportion of the Class members who do not object or . who affirmatively support the proposed settlement. Cannon v. Texas Gulf Sulphur Co. , 55 F.R.D. 308 (S.D.N.Y. 1972). (4) The competency and experience of counsel who support the set- t tlement. Percodani v. Riker-Mason Corp. , 50 F.R.D. 473 (S .D.N .Y. 1970). (6) The relative benefits to be received by individuals or groups within the Class, Norman v. McKee, supra; (8) The current and projected financial condition of KRC in reorgani- zatioh (in the instant case, UDLP and John Sanders) [in the Hicks litigation the ability and financial condition of the taxing units to pay the settlement amount]. : . . Fox v. Glickman, supra; (10) The extent to which the settlement is truly the product of "arms length" bargaining and not of fraud or collusion. Young v. Katz, 447 F.2d 431 (5w Cir. 1971 ). In the Seii er v. Topay 's International, .Inc. , 70 F.R.D. 622 D. Kan. 1976) the Court stated 70 F.R.D. 622, at 626-627: • [We] next consider the proposed settlements in light of the requirement set forth in Rule 23(e) of the Federal Rules of Civil Procedure. 'In evaluating the terms of the settlement agreements we are mindful of the rule that we are not to substitute our own business judgment for that of counsel, absent evidence of fraud or over reaching, which is completely absent on the record before us. (Citations omitted). Instead, we are to exercise our discretion in a reasonable manner with full realization that approval of a settlement should be given if the settlement is fair, reasonable and adequate. These terms, of course, are general, and cannot be measured scientifically. In Re Four Seasons Securities Litigation, Opinion No. 2, M.D.L. No. 55, 58 F.R.D. 19 (W.D. Okla. 1972). The Court has discretionary authority to approve compromises. Protective Committee v. Anderson, 390 U.S. 414, 88 S.Ct. 11572 20 L.Ed.2d 1 (1958), rehearing denied, 391 U.S. 9099 88 S.Ct. 16492 20 L.Ed. 2d 425 (1968); Case v. Los Angeles Lumber Co. , 308 U. S. 1063 60 S.Ct. 13 84 L.Ed. 110 (1939), rehearing denied, 308 U.S. 637, 60 S.Ct. 258, 84 L.Ed. 629 ( 1939); Grunin v. International House of Pancakes, 513 F.2d 114 (8`s Cir. 1975), cert. denied, 423 U.S. 864, 96 S.Ct. 124, 46 L.Ed.2d 93 (1975); Elliott v. Sperry Rand Corp. , 680 • F.2d 1225, 1227 (8`" Cir. 1982); In re: Flight Transp. Cotp. Securities Litigation, 730 F.2d • 11289 1135 (8`" Cir. 1984). 4. THE STIPULATION IS FAIR, REASONABLE AND ADEQUATE. On November 29, 1999, this Court delivered its opinion finding that Washington County had indeed engaged in a countywide reappraisal subject to Amendment 59 to the Arkansas Constitution. That further this Court found that each taxing unit sued as a defendant was subject to the provision of that Amendment. Therefore, City of Fayetteville was subject and upon the stipulation filed herein, this Court found that City of Fayetteville had not rolled back the millage rate according to law as required by that Amendment for the year 1997 following the reappraisal that occurred in Washington County in 1994 through 1997. Further, due to the reappraisal increase in real property, values were put on the tax rolls for City of Fayetteville and the defendant taxing units comprising said County for the • years 1994, 1995, 1996 and 1997 without a rollback as required by the Arkansas law. The parties agree and the Court concurs that the general rule is that funds which have been acquired through an illegal exaction and create a common fund or common benefit to the Class on whose benefit the action is brought are to be returned pro rata to the various taxpayers who initially paid them after a reasonable portion of the illegally exacted monies are awarded and apportioned to attorneys of record in the meritorious litigation. See common fund and benefit cases; Lake View Sch. Dist. No. 25 v. Huckabee, 340 Ark. 481 , 10 S.W.34 . 892, (2000); Millsap v. Lane, 288 Ark. 439, 706 S.W.2d 378 (1986); Powell v. Henry, 267 Ark. 484, 592 S.W.2d 107 ( 1980) See also, U. S. Supreme Court recognition of common fund awards of attorneys fees. Boeing Co. v. Van Gemert, 444 U.S. 472 ( 1980), Sprague v. Ticohic • 8 National Bank, 307 U. S . 161 , ( 1939). See Ark. Const. XIV § 13 and ARK. CODE ANN,. §26- 35-902(a). There is always the potential that should the Settlement not be approved the parties would appeal any order of this Court and as such the litigation would continue. The continued litigation of these matters and their attendant delays and costs is a motivation to the Settlement and the Settlement represents the desire of these parties to end the litigation in as far as it relates to them. These parties and their counsel even though they possess differing years of experience all have demonstrated professional competence, and as officers of the Court, have represented to the Court that all settlement negotiations were conducted and the settlement was reached in a manner which was at absolutely arms length and not in any way collusive. No evidence to the contrary was presented at the hearing on September 5`s, 2000. Further, this Court is satisfied that counsel for both parties have conducted substantial discovery and have done extensive review of applicable law regarding the Plaintiffs' claims and the Defendant's defenses. Both parties to this settlement have demonstrated that they fully recognize the time and expense necessary to continue this case through the damages stage of the trial and possible appeals that might result. This Court has overseen the pleadings, motions, evidence, and arguments of counsel presented in a 4-day trial on the merits concerning the defendants' liability under this suit. The Court notes the vigorous and aggressive activity on behalf of both sides of this controversy, and the Court is satisfied if settlement was not reached the litigation would surely continue. 9 • This Court heard evidence from Mr. Andrew Breuer. CPA retired, of the rollback benefits obtained from the settlement for the Class, acid the total of the refunds being presented to this Court by the settlement that *will be administered for the benefit of the. taxpayers Class and which will now come under the direction and jurisdiction of this Court due to the approval of this settlement. The Court is aware that the settling party, City of Fayetteville, is a govermnental taxing unit and as such will be able to pay the settlement refund sum contained in the settlement agreement. This Court, having presided over this litigation since November .23, 1998 and having become well acquainted with the issues contained in this case involving interpretation and compliance with Amendment 59 to the Arkansas Constitution, is of the judgment that due to the highly complex and difficult issues developed in this case this Court concludes there are • real risks to both parties to this settlement of continuing the litigation insofar as the outcome . . could be adversely decided to either side by an appellate court. It is for all of the foregoing reasons that: THE COURT SO FINDS THAT, City of Fayetteville has specifically approved the Settlement Agreement by resolution of their City Counsel, Resolution No. 113=00 on August 1 , 2000. The Stipulation of Settlement was filed for record in this matter on 5,3, day of September, 2000. The Plaintiffs as Class Representatives and the attorneys who represent the Class have agreed to settle these issues and claims pursuant to the terms and provisions of the Settlement Agreement after taking into account the substantial benefits that the Class has received as a result of the prosecution of this action and will receive as a result of the Settlement Agreement, the attendant risks of continued litigation, the likelihood of protracted • 10 • proceedings and substantial costs and delays. The attorneys for the Class and the attorney for City of Fayetteville have conducted a thorough study and investigation of the facts and law relating to these issues. Such study revealed serious disputed and unique questions of law remaining on the amount of refund damages that might be awarded and the outcome of an appeal should one be had. The Plaintiff Class Representatives, Jeanne Hicks and Tammy Lewis, and the attorneys who represent the Class are of the opinion that the settlement provided for in the Settlement Agreement and this Order is fair, reasonable, and adequate. as far as it concerns City of Fayetteville and the Class, and is in the best interests of the Class. On balance, the Settlement Agreement provides a compromise and settlement which in the Court's opinion, is fair, reasonable, and adequate under all of the circumstances between these parties. The Court hereby approves the settlement of the Class action as set forth in the Stipulation as being in all respects fair, reasonable and adequate, and hereby directs that the • settlement of the class action be consummated in accordance with its terms and conditions. 5 . SPECIAL MASTER. The Court's Preliminary Order of August 9ih, 2000, appointed Sidney H. McCollum of Bentonville, Arkansas as a Master and directed him to supervise the refund process, resolve refund disputes and make a final report. The parties agree the money to be refunded shall be refunded in accordance with the Stipulation of Settlement agreed to among the settling parties. 6. ORDERS. NOW, THEREFORE, IT IS ORDERED, that the Notice of Settlement as approved in this Court's Order of August 9`", 2000 was determined by the Court to be the best notice practicable under the circumstances and after a phone conference call with the attorneys for • 11 • the parties on July 20, 2000. The notice was approved by all counsel involved. A phone conference was conducted and on August 2"d, 22000 the notice as modified and re-approved by the Court was published and directed to all members of the Class as specified by this Court, without any other objections to the content or manner of said Notice of Settlement, the Notice as duly and timely given. IT IS FURTHER ORDERED, that the taxpayers be given the opportunity to receive a pro rata refund of all illegally exacted property taxes paid up to the sum of the settlement ' amount of $213 ,469.50 as set forth in the settlement agreement and City of Fayetteville is hereby ordered to pa $213,469.50 damages on a claims made basis as a result of this settlement and it shall be the Judgment of this Court that said sum shall be paid to the Class members claiming their refund in the sum, so claimed according to the terms of the Stipulation of Settlement less the award of attorney fees and costs set forth by this Court after • a fairness hearing on attorney' s fees to be held at a later time and the cost of administration of the refund through the refund claims process shall be bome by the City of Fayetteville as set forth iit the. Stipulation of Settlement, all for which the Court shall retain and continue to exercise its jurisdiction. IT IS FURTHER ORDERED, that said settlement amount shall come exclusively within the control and jurisdiction of this court for the actual distribution of the refunds to the claiming Class members, and the rollback which is detailed in the Stipulation of Settlement shall also be carried out under the supervision of the Court, all over which the Court retains continuing jurisdiction and direction until the refund process and rollback are completed. 12 • IT IS FURTHER ORDERED, that the Court finds that the settlement effects a rollback of the millage rate from 1 .00 to 0.80 until changed by appropriate legal action. This Court hereby approves the plan of allocation of the refunds and rollback of the millage rates contained in the Stipulation of Settlement. IT IS FURTHER ORDERED, that all disputes as to taxpayer refunds, shall be resolved by the Master, unless a violation of law is asserted by the aggrieved party and then the dispute will be resolved by the Court with full consideration being given to the Master's determinations and recommendations to the Court. IT IS FURTHER ORDERED, that Sidney H. McCollum, as Master, shall make . any and all necessary or appropriate decisions and take necessary or appropriate action in order to discharge and perform his duties, responsibilities and functions on a day-to-day basis without further order of this Court. • IT ISTURTHER ORDERED, that Sidney H. McCollum, as Master, shall be compen- sated in such amount as will be later determined by the Court and such compensation shall be paid proportionately by the City of Fayetteville with the other settling defendants at a rate of not to exceed $ 150.00 per hour. IT IS FURTHER ORDERED, that all illegally exacted property taxes which remain after all efforts specified in the settlement agreement are utilized to get a claim form to each member of the Class in a timely manner have been used, and after such efforts have been made to refund such monies are approved by this Court. and after the final report of the Master, shall become the property of City of Fayetteville according to the Stipulation of Settlement. 13 • IT IS FURTHER ORDERED, that except for any specified rights granted to the Class by any further order ,of this Court, any claims, demands, and causes of action of the Class, and each and -every member thereof, of any kind or nature in connection with directly or indirectly any subject matter decided in this litigation or in connection with directly or indirectly, are forever acquitted, discharged and released as between the Plaintiff Classi by and through its Representatives, and City of Fayetteville. IT IS FURTHER ORDERED, that the Court shall retain jurisdiction as is appropriate for a class action to administer the refund claims process, the award of attorneys fees and associated costs, the final approval of the cost of administration of the refund claims, determine whether defendants have fully complied with the Stipulations of Settlement thus entitling them to a return of unclaimed refund monies, and any taxpayer claims and rights r and certain other events that may occur not set forth in this Order, and all other claims not yet • decided. IT IS FURTHER ORDERED, this Court has carefully considered all of the matters presented at the Hearing and all of the provisions of the Stipulation, the plan of allocation of the refund and as such the compromise and settlement as set forth in the Stipulation of Settlement filed September 5's, 2000 is hereby approved and the provisions thereof are hereby adopted by reference as Order of this Court. IT IS FURTHER ORDERED; the claim form contained in the Stipulation of Settlement as Exhibit " B " ' is approved. Defendant Washington County shall cause the claim form to be mailed to all persons who can be identified through reasonable effort as members of the Class. Such mailing shall be completed on or before October 2, 2000. 14 z IT IS FURTHER ORDERED, any member of the Class who wishes to share in the proceeds of the settlement of the class action must submit a claim form in person at the Washington County Courthouse (with an exception made for persons who are disabled or live outside of Washington County , any such persons may claim their refund by mailing their claims form to a designee or to George B . Morton whose address is listed on the claim form with a written statement certifying that they are disabled or live outside of the County) between October 2 and November 30. Any member of the Class who fails to submit a claim form between those dates will be barred from sharing in the proceeds of this Settlement under the class action, but will be bound by this Final Judgment. IT IS FURTHER ORDERED, Proof of mailing the claim forms shall be filed with the Court on or before October 15 , 2000 with a statement of the steps taken to deliver the claim forms to all members of the Class . IT IS FURTHER ORDERED, notwithstanding the acceptance of and approval of this Stipulation of Settlement the Court hereby resets the consideration of the appropriate award of attorneys' fees from the common fund produced as a result of this proceeding and common benefit conferred on the Class by this proceeding and judgment of damages and the Court retains jurisdiction over said fund for the express purpose of -determining the adequate and reasonable compensation of the Plaintiffs' attorneys pursuant to the pendency of the plaintiffs' attorneys' petition for attorneys fees and costs. IT IS FURTHER ORDERED, the hearing for determining the amount of fees and costs shall commence on September 6°i, 2000. 1 IT IS FURTHER ORDERED, to the extent appropriate, the findings of fact herein shall be deemed to be conclusions of law, and the conclusions of law shall be deemed to be 15 findings of fact. IT IS, THEREFORE, CONSIDERED, ORDERED, AND THE JUDGMENT OF THIS COURT, that this Order shall constitute a final judgment in accordance 'Mth the statements, findings, directions and orders of the Court set forth herein as to the Plaintiff Class and City of Fayetteville only. IT IS SO ORDERED, this L' " day of M,41&W 2001 . Honorable Paul Danielson Circuit Judge on Assignment O D: Marshall Dale vans Attorney for aintiff Class E. Kent ch Attorney for Plaintiff Class Kit Williams Attorney for City of Fayetteville W&I I Iain i C c on ut , Attorney o Intervenors - «sn�<i.xn.�< ew��ec+we<�.s�..•<�aewNe�en. d�nrz- e-0o . 16 IN THE CIRCUIT COURT OF WASHINGTON COUNTY, ARKANSAS JEANNE M . HICKS, ET AL PLAINTIFFS VS. CONSOLIDATED NO. CIV 1997-500 CITY OF FAYETTEVILLE, ET AL DEFENDANTS-_ r , WILLIAM JACKSON BUTT, 11 and BUTT N BUCK HARDWOOD PLANTATION, LC INTERVENORS FINDINGS OF FACT, CONCLUSIONS OF LAW AND ORDER FOR AWARD OF ATTORNEY'S FEES On September 6, September 29, October 30, October 31 , November 2, November 3, November 16 and November 17, 2000, came on for hearing the fourteen separate Petitions for the Award of Attorney's Fees and Class Costs of Counsel for the Plaintiff Class with the named representatives and the certified plaintiff class appearing by and through their attorneys, Dale Evans, E. Kent Hirsch, and David Nixon; the Intervenors William Jackson Butt, 11 and Butt-N-Buck Hardwood Plantation, LC appearing by and through their attorneys, Woody Bassett, Tim Brooks, Howard Brill, and Peter Estes; and the class counsel appearing by and through their attorney, Timothy Davis Fox, and from the pleadings filed herein, argument of counsel, the testimony of the witnesses, the evidence introduced, and all other things and matters properly before the Court, the Court doth issue the following findings of fact and conclusions of law pursuant to Rule 52 of the Arkansas Rules of Civil Procedure, as follows: FINDINGS OF FACT . 1 . This proceeding is a consolidated case arising from five illegal exaction 2001 12766 actions filed in April , 1997. • 2. The class representatives and Class Counsel were certified in this action in February of 1998 in accordance with Rule 23 of the Arkansas Rules of Civil Procedure. 3 . Approximately 1 ,400 taxpayers opted out of the class in accordance with the class certification notice. 4. William Jackson Butt, Il and Butt N Buck Hardwood Plantation, LC, intervened on the issue of attorney's fees. 5 . After four days of trial on the liability issues an order was entered finding in favor of the certified plaintiff class on November 29, 1999. 6. Subsequent to the issuance of such order all fourteen defendant taxing entities entered into proposed Settlement Agreements with the certified class representatives. • 7. While each of the fourteen Settlement Agreements contain many similar provisions all of the Settlement Agreements are different with respect to certain tetras and conditions. 8. There were approximately thirty-one depositions taken prior to the execution of the Settlement Agreements. 9. All of the fourteen Settlement Agreements provide for a Settlement Amount to be made available for refund to the plaintiff taxpayers having paid real and personal property taxes to the defendant taxing entities for the period of time for the tax years from 1994 through 1999 and for the payment of costs and attorney's fees. 10. All of the Settlement Agreements, except for the Farmington School District Settlement Agreement, contain a provision requiring a millage rollback. • 2 2001 12767 11 . All of the Settlement Agreements contain a provision that the issue of attorney' s fees and costs would be submitted to the Court for determination and that the defendant taxing entities will not object to requested fees and costs up to 33 1 /3% of the Settlement Amount set forth in each Settlement Agreement. 12. Class Counsel filed fourteen separate petitions for the award of attomey ' s fees and costs with respect to each of the fourteen proposed Settlement Agreements. 13 . Notice of a fairness hearing to consider the Settlement Agreements and for objections to the requested attorney's fees. and costs was published in accordance with court order. 14. William Jackson Butt, II, together with a number of other attorneys, filed an Entry of Appearance on behalf of approximately 3, 100 taxpayers objecting to the requested attorney's fees and costs. 15 . Other than the objections to the requested attorney's fees, no objections to the settlements were filed. 16. A fairness hearing to consider the fourteen separate Settlement Agreements between the plaintiff class and the defendant taxing entities was conducted on Tuesday, September 5, 2000. At the conclusion of such fairness hearing the Court approved all of the Settlement Agreements. No member of the plaintiff class appeared at the Tuesday, September 5, 2000 fairness hearing to object to the settlements. 17. " The hearings on objections to attorney's fees continued for eight days, being September 6, September 29, October 30, October 31 , November 2, November 3 , November 16, and November 17, 2000. 2001 12768 3 .r .i 18. There were forty-four witnesses presented and forty-seven exhibits • introduced at such hearings. 19. Two of the named representatives, Tammy Lewis and Richard Mayes, testified in support of the work of Class Counsel in this litigation in favor of the award of attorney's fees and costs of 33 1 /3% of each of the Settlement Amounts set forth in the fourteen Settlement Agreements. 20. Three other members of the plaintiff taxpayer class testified in favor of the requested 33 1 /3% fees. 21 . William Jackson Butt, 11 and nine other members of the plaintiff taxpayer class testified against the requested attorney's fees and costs. 22. Subsequent to the approval of the fourteen Settlement Agreements at the annual school elections in September, 2000, the voters voted to increase all of the school district millages to the pre-settlement millage level. Accordingly, although the illegal portion of the millage was rolled back under the Settlement Agreements the tax levy for .the plaintiff taxpayers paying taxes to the defendant school districts will be the same amount for the tax year 2000 taxes as it was for the tax year 1999 taxes. 23 . Subsequent to the execution of the Settlement Agreement , the City of Prairie Grove also voted to increase the property .tax millage to the pre-settlement level. Accordingly, although the illegal portion of the millage was rolled back under the Settlement Agreement the tax levy for the plaintiff taxpayers paying taxes to the defendant City of Prairie Grove will be the same amount for the tax year 2000 taxes as it was for the tax year 1999 taxes. • 2001 12769 4 24. The City of Elkins, the City of Fayetteville, and the City of Springdale left • the levy of 2000 real and personal property taxes at the settlement millage rollback level. Washington County increased its millage by approximately one-half of the settlement millage rollback level. 25. Over 20, 000 claims for refunds were filed during the refunding procedure, such claims representing over 59,000 parcels of property. 26. The amount to be refunded is over $5 ,500,000.00. 27. For the period of time through October 13 , 2000 Class Counsel expended approximately 6,337 hours of attorney time in the prosecution of this action on behalf of the plaintiff class. Such attorney time does not include the time spent associated with the proceedings to determine a reasonable fee and costs under the fourteen Settlement Agreements. 28. Class Counsel have expended or will expend approximately $ 150,000.00 for costs advanced in connection with the prosecution of this action on behalf of the plaintiff class. 29. Class Counsel have expended additional time and costs on behalf of the plaintiff class since October 13, 2000 and may continue to expend attorney time and costs through the completion of the refunding procedures set forth in the Settlement Agreements. 30. ' Class Counsel in this case are experienced and competent attorneys in the area of illegal exaction law. 31 . The estimated administrative costs of the refund process are approximately $300,000.00. 2001 1 2770 5 1 .