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Lawsuit settled between Natchez Water Works, Adams County Water Association

Published 12:15am Thursday, July 18, 2013

NATCHEZ — After nearly two-and-a-half years in litigation and thousands of dollars in legal fees, Natchez Water Works and Adams County Water Association settled Tuesday a lawsuit over a longstanding disagreement.

In 2010, Adams County Water filed a lawsuit against Natchez Water Works, claiming the city-based water company’s supposed plans to provide non-potable water beyond the city limits infringed on ACWA’s state-certified territory.

The two parties met for a pre-trial conference Tuesday and were provided U.S. Southern District Court Judge David Bramlette’s opinion and order regarding summary judgment requests from both entities. Summary judgments are used when there is no dispute as to the material facts of the case and a party is entitled to judgment as a matter of law.

One of the issues addressed in the summary judgment order arose after Rentech Inc. came to town, and Natchez Water Works gave the company a quote on the cost of non-potable water, specifically sewer effluent, because Rentech was originally looking at locating on the former Belwood Country Club property. That property,  Water Works’ attorney Walter Brown said, is in Natchez Water Works’ allowed service area. When Rentech decided to move to the former International Paper Company site, Brown said that complicated things because that area is not in Natchez Water Works’ service area.

Bramlette concluded that ACWA has not convinced the court that it suffered, harm from Water Works preliminary discussions with Rentech, which eventually abandoned its proposed Natchez project. Bramlette added that ACWA had not proved it would suffer harm if the court did not grant an injunction related to Water Works providing sewer effluent in ACWA’s certificated area.

“While Adams County fears that its interests are in danger of imminent harm, there is no evidence that (Water Works has) any plans to provide sewer effluent … to Adams County Water’s certificated areas,” Bramlette said in the order.

“It is not inconceivable that (Water Works) would choose to collaborate with Adams County Water rather than become embroiled in an expensive lawsuit, as the one now before the court.”

And that is exactly what ACWA and Water Works have agreed to do.

If a future need for sewer effluent arises in the future in Adams County Water’s certificated area, Water Works has agreed to sell it to ACWA at wholesale price. ACWA will then provide it to the customer at a retail price.

Other issues addressed in the lawsuit included areas where ACWA believed Water Works had encroached on ACWA’s territory.

That issue hinged on whether, Bramlette said in the order, the court believed ACWA “made service available” by simple possessing the certificates of the area.

Bramlette concluded that, according to Mississippi law, ACWA did not make services available just because they had the certificates. Whether ACWA in fact made services available by having pipes in the ground before Water Works began providing services in those areas would have to be resolved at trial.

The areas are the Homewood subdivision, the location of the Natchez campuses of Alcorn State University and Copiah-Lincoln Community College, the former IP property and Mount Carmel Church, specifically an annex added to the church.

Instead of going to trial, Water Works and ACWA agreed that Homewood would remain with Water Works’ service.

The higher education site is to be split between ACWA and Water Works. Water Works will keep the front portion of the site, and ACWA will get the back, undeveloped, portion.

ACWA will get the entire IP area, but Water Works will continue to provide service until ACWA is ready to initiate service in the area.

ACWA will get both portions of the church presently served by Water Works. Water Works will continue to provide service until ACWA is ready to initiate service to the church.

ACWA Director Ken Herring said he believes Bramlette’s order and opinion opened up the floor again for settlement discussions. The two parties had a settlement conference in June, but nothing was resolved prior to the pre-trial conference. Herring said he was happy to see the lawsuit settled.

Herring said ACWA had no choice but to file the lawsuit.

“(ACWA’s) board of directors have a fiduciary duty to protect our property rights,” he said.

Herring said he did not know off the top of his head how much money has been spent on the lawsuit, but Brown estimated that it was approximately $500,000 between ACWA and Water Works.

“The lesson to be learned here is that we should work together, the two utilities,” Brown said. “We both represent people in Adams County. Going to court should be a last resort, not a first resort.”

Brown, a former city attorney, provided legal counsel for Natchez Water Works on the case, along with City Attorney Hyde Carby, William Hussey and John Maxey, both of Jackson.

ACWA was represented by Jim Herring on Canton, who Ken Herring said is not related to him.