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Settlements cause concern

Councilwoman, auditor question costly payouts

By Daniel J. Chacon, Rocky Mountain News (Contact)

Published November 17, 2008 at 12:05 a.m.

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Denver Auditor Dennis Gallagher

Photo by © The Rocky

Denver Auditor Dennis Gallagher

Denver Councilwoman Jeanne Faatz

Photo by © The Rocky

Denver Councilwoman Jeanne Faatz

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Denver taxpayers have forked over more than $2 million so far this year to settle lawsuits and claims against the city.

The 2008 payouts are expected to balloon to more than $5 million in one swoop today when the City Council considers a proposed $3 million settlement with the family of Emily Rae Rice, who bled to death in the Denver city jail after pleading for help for hours.

The series of high-dollar settlements approved by the city in recent months has grabbed the attention of a fiscal conservative on the council and Denver City Auditor Dennis Gallagher, who is mulling a performance audit on the city attorney's settlement process.

"I don't know that there's anything there that we would find, but clearly there's a large number of them, and what is the reason for them?" said Denis Berckefeldt, the auditor's spokesman.

City Councilwoman Jeanne Faatz said the "rising tab" for individual cases is worrisome.

"I'm very concerned about the message these very high settlements send out," she said. "You keep setting the bar higher and then everybody keeps thinking that there are deeper and deeper pockets (and) they better get in on the action."

Consider some of the payouts in recent weeks:

* On Nov. 6, the council approved a $439,000 settlement with a former firefighter who alleged age discrimination. The total payout was $850,000, with $411,000 paid by the fire department.

* Also on Nov. 6, the council settled for $210,000 a lawsuit stemming from an improperly issued billboard permit. About $156,000 worth of work had been done to construct the billboard before the city realized its mistake and rescinded the permit.

* On Oct. 20, the city agreed to pay $885,000 to a teenager who claimed he was beaten by police, including an officer who allegedly jumped up and down on his back.

City Attorney David Fine said each case is assessed on its own set of facts. The process is "fairly complicated" and involves a thorough review by his office, he said.

"You do your best to reach a resolution that makes sense for everyone concerned," he said.

Expecting the unexpected

Most of the cases against the city are dismissed by the courts for various legal reasons, he said.

"In the same week where we had (the proposed Rice settlement become public), we also had three cases that the Court of Appeals ruled in our favor," he said.

The city is proactive, too, Fine said. Denver's Litigation Section works "very hard" to protect the city and advise departments on how to limit their liability, he said.

"But it's a big city. There are a lot of things happening every day, and you're never going to have a situation where there won't be claims against the city," he said.

Every year, the city typically transfers $2 million from the general fund into a liability and claims fund, said Ed Scholz, Denver's budget director.

If the council approves the proposed settlement with the Rice family, the fund will have a balance of about $3 million, he said.

"Any business, including governments, has to account for and prepare for unexpected claims," Scholz said.

Damage limits don't apply

Government agencies in Colorado have some financial protection from lawsuits through governmental immunity laws that cap payouts at $150,000 for one person for one incident and $600,000 for one incident involving multiple people.

"The governmental immunity statutes in Colorado are onerous, some of the most restrictive in the country, and are unfair," said John Sadwith, executive director of the Colorado Trial Lawyers Association.

There are exemptions, however, such as the dangerous condition of a public building.

In the Rice case, which also included a separate $4 million settlement with Denver Health Medical Center, the claims were based on federal law, so the state's damage caps don't apply.

A lot of people have asked why the cap didn't apply in the Rice case, said attorney Darold Killmer, who represents Rice's parents.

"Even lawyers have been e-mailing me (asking), 'What about the damage caps?' " he said.

Serious money The city of Denver has paid out some large amounts over the years.

* $900,000 - paid in 2007 to the family of Frank Lobato, an unarmed man who was killed July 11, 2004, after police officers kicked in his door looking for a kidnapping suspect.

* $1.3 million - paid in 2004 to the family of Paul Childs, a knife-wielding developmentally disabled 15-year-old who was shot and killed July 5, 2003, in a confrontation with a Denver police officer.

* $643,000 - paid in 2003 to three women who were sexually assaulted by officer Daniel Pollack.

* $3.5 million - paid in 2002 to the family of Randy Bartel, a 22-year-old college student killed in June 1989 when a Denver police officer ran a red light at 65 mph.

* $1.2 million - paid in 2001 to DeShawn Hollis, who was 12 years old when a Denver police officer shot and paralyzed him during a botched burglary.

* $822,500 - paid in 2001 to Clinton Brown, who was shot and wounded by an off-duty officer after a 1994 traffic altercation.

* $400,000 - paid in 2000 to the family of Ismael Mena, who was shot and killed in September 1999 during a botched no-knock raid.

* $250,000 - paid in 1998 to the estate of Jeffrey Truax, 25, who was killed in a confrontation with Denver police outside a nightclub.

* $499,361 - paid in 1993 to the family of Leonard Zuchel, 26, who was shot and killed by a Denver officer who thought he had a knife. He actually had a pair of fingernail clippers.

Comments

  • November 17, 2008

    10:19 a.m.

    Suggest removal

    gyardeny writes:

    I find it surprising that Auditor Gallagher is raising his voice now. After all, as a former auditor, I found that the City had made an improper payment in the amount of $125,000 to RTD during an audit of the now defunct "Mayor's Office of Contract Compliance (MOCC). In my audit report (which the Rocky did report on), I advised contacting RTD in order to reclaim the improper payment and was told by Gallagher that I was naive to think that RTD would ever return these funds. In fact, my audit report was changed without my knowledge by "Team Gallagher" which, in effect, amounted to a slight hand slap to the head of MOCC. Gallagher is NOT the watchdog he represents himself to be. His only thought is to stay in office as long as he can get a paycheck. Look at his reign as Auditor objectively and you will see a depleted workforce, corrupt politicians and Gallagher and his cronies getting fat by collecting a huge paycheck paid for by the citizens he professes to help.

  • November 18, 2008

    9:09 a.m.

    Suggest removal

    CapnPoon writes:

    I really find it ironic that Gallagher wants to audit the DA's office, instead of looking at the root of the matter. There are nine incidents listed above, each attributable to DPD, and yet the auditor wants to question the DA's tactics? Is he afraid the cops will shoot him if he digs too deep?