Presiding Over: The City of Utica vs. City Comptroller Mike Cerminaro
Utica, NY (WIBX) - The case between The City of Utica vs. City Comptroller Mike Cerminaro was brought to court this morning. It was another heated debate over the Growest investigation and the unpaid bill but this time the matter was heard in Supreme Court Justice Bernadette Clark's court room.
Justice Clark presided over the lawsuit brought on by the City of Utica against Cerminaro for refusing to pay the JK Hage bill. Justice Clark asked both sides tough questions about the merit of the law suit and the basis for not honoring the bill. Charles Brown the attorney representing the City of Utica explained that the work was performed--a report was made--the funds are available and the only reason why the law suit exists is because one person chose to take it upon himself to not pay the bill. He said, "We have a contract. Duly authorized by all the city officials that are required to authorize it and the bill should be paid." He said it's suspicious to say the least that this is the first time in Cerminaro's term as Comptroller that he has asked for an audit of a professional bill, and added that he questions the legitimacy of his request to audit the bill.
Cerminaro explained to Justice Clark that he is requesting the audit for the first time in him term as Comptroller because this is the first time he has received such a large bill that went from $368,000.00 to $177,000.00 and now is at $210,000.00. He said, "Let me do my audit. If they don't agree with my findings let them go back to the board of E&A--there's a mechanism for that." On the matter of Cerminaro requesting the City of Utica pay his legal fees, Brown said, "He doesn't have the authority to hire an outside attorney. He was denied the request to hire an outside attorney because the City should not be compelled to pay for an attorney in a lawsuit against the City. We are prohibited by law from paying Cerminaro's legal fees."
Defense attorney Richard Fry said the real issue is whether this investigation should have happened in the first place and said Cerminaro's position is an administrative act. He said, "He has an obligation to protect the citizens of Utica. To flush out the argument of whether or not the investigation was to benefit Growest." Cerminaro claims the investigation was a "gift" to Growest. Fry said what needs to be uncovered is if Growest came to the City to help them pay for the investigation because they ran out of money to carry out their own investigation.
Fry said, "This was an investigation that was instigated by Growest and these are the issues that have to be explored to see if it was a proper contract with the City. Does the City benefit? Was it done at the behest of Growest?" Cerminaro said, "There is very important information that I need. There were charges for phone calls made that were hang-ups. Anyone can say I'm looking at Microsoft Office for 8 hours. I have to question some of those charges in the bill." Brown said JK Hage offered to meet with Cerminaro to explain the charges but the Comptroller did not get back with him. Cerminaro said it was because the legal actions were already starting.
When Justice Clark asked about the issues surrounding a conflict of interest Fry said, "To employ an outside agency to do something the Corporation Council's Office could have done." Brown countered with, "You need more than attorney's. Hage & Hage, they do corporate law. They're familiar with these types of issues--most of it is accounting and they have a forensic accountant on staff that they can use. Most of it is going over books and records--It's not something our office is really designed to handle."Justice Clark asked Brown, "If you are alleging a conflict of interest and Mr. Hage is reporting to you--how does that wash? Brown said they are simply following standard procedures.
Cerminaro said he wrote a letter dated May 5th about the conflict of interest addressed to Corporation Council Linda Sullivan Fatata--the legal advisor who brought on the law suit--and Utica Mayor David Roefaro. Fatata said she does not remember the letter but did not contest that Cerminaro sent the letter, which was including as evidence to the Judge. Another issue brought up in court by Cerminaro is the coincidence that the amount in the City's account matched the amount JK Hage ultimately agreed to accept after the substantial discount he provided. Fatata explained that there were transfers made to show the City could honor the bill.
Brown said, "We have been made a laughing stock all over the world because of this matter."
Justice Clark said she will reserve her decision on the matter in order to "digest" what she heard today. She said her written decision will come at a later date. She also gave both parties one week to give a final written statement, which can include additional documents. She said her decision will follow after she receives the written final statements from Brown and Fry.