Marion board votes to accept settlement in decade-long lawsuit

JASPER, Tenn. – The Marion County Commission has agreed to settle a decade-long lawsuit over the Sequatchie Pointe development on Ladds Mountain near New Hope, Tennessee.

When the Sequatchie Pointe developer filed for bankruptcy in 2009, the county sued Lexon Insurance Company in Mt. Juliet, Tennessee, which issued the bonds guaranteeing improvements to roads and utilities on the Tennessee side, for not paying up.

At the board’s September meeting, Thomas Hickey, Marion’s lawyer in the matter, said he received a “best and final offer” of $1.5 million from the insurance company last week.

“I had a fairly lengthy conversation with their attorney,” he told the board. “He said there would be no additional offers.”

Accepting the settlement means the county releases Lexon from any current or further claims regarding Sequatchie Pointe.

County Mayor David Jackson said the entire $1.5 million should be put into the subdivision to make whatever improvements to the site could be made.

“Once we can get something done, there will be some more homes built up there, and we will garner that money back through property tax for years to come,” he said.

The board’s finance committee recommended accepting the offer.

James Kent, one of the lot owners in Sequatchie Pointe, said landowners have been “pretty much kept in the dark” throughout the lawsuit’s process.

“Everything we’ve heard has been rumor,” he said. “The fact that we haven’t been allowed to have any input or have any information in this proceeding is, I think, pretty bad.”

Kent said the development doesn’t have needed roads and water access, and it lacks fire and police protection.

“We have a lot of needs up there,” he said. “It’s not a good situation.”

The original total bond amount owed by Lexon was about $4.35 million.

Kent said that bond money was supposed to make landowners “as close to whole as we could get,” but that seems unlikely now.

He asked board members why the county would settle for less than the full bond amount.

Hickey said the chance Marion would win the case and a follow-up appeal was “somewhat favorable – not terribly great” and could drag on for many more years.

The case has been mediated four times, and that, among other issues, has contributed to the lawsuit’s lengthy time frame.

“It’s not an unreasonable number,” Hickey told Kent about the settlement proposal.

“It’s not unreasonable if you don’t live there,” Kent said.

Hickey said the risk of losing and the additional time had to be considered.

“When they tell me this is the best and final [offer], I believe it,” he said. “I don’t think that’s posturing. A lot of times it is, but I don’t think so in this case.”

Kent said he appreciated Jackson bringing residents up to speed on the lawsuit and its issues recently, but the settlement “wouldn’t even pay for the roads.”

“I don’t know how everybody else feels about it, but one member of the [homeowners’] association wouldn’t be in favor of accepting this small of an amount,” he said.

Commission Chairman David Abbott said county leaders “hate” the situation they’re in concerning Sequatchie Pointe, but they had to make a decision to move forward and “do the best we can.”

Ryan Lewis is based in Marion County. Contact him at ryanlewis34@gmail.com.