E.S. & C.M. “recklessly asserted without any knowledge of the truth” that the city would receive funding from the TWDB, according to court filings.
“The defendant was fraudulently induced to enter into the purported contract with the plaintiff and the contract should not be enforced,” the counterclaim states, adding both parties were mistaken in believing the state would provide funding.
However, E.S.&C.M. disputes that, stating that the company fulfilled the contract, producing preliminary design and feasibility reports provided to the city and the TWDB in 2008. The work and invoices were not the subject of complaint until 17 months into litigation, according to E.S. & C.M.
The company’s attorneys characterized the counterclaim as an “unnecessary delay” in recovering damages for the city’s breach of contract.
E.S. & C.M. also stated that the record of evidence shows no representation on the part of E.S. & C.M. that funding was guaranteed, though one company official did tell the city that they had never had a funding application denied.
Jeff Smith, attorney representing E.S. & C.M. along with John DeVoss, said Monday his client was pleased the judgment showed the court’s view of the case was consistent with his client’s.
“Obviously, there are some additional steps that need to be taken,” Smith said, referring to the counterclaim and an open motion to severe that from the original claim.
An attempt Monday to contact Keith Hamilton of E.S. & C.M. was not successful.
Neverdousky said the judge’s ruling came as a big surprise to the city.
“Obviously, we going to pursue an appeal and we’ll go on from there,” Neverdousky said. “From our standpoint, we don’t think they did what the contract said they would do.”