Christopher Warfel et al.
Town of New Shoreham.
County Superior Court (WC 16-550), Associate Justice Bennett
Plaintiffs: Lauren Balkcom, Esq.
Defendant: Katherine A. Merolla, Esq.
Present: Suttell, C.J., Goldberg, Flaherty, Robinson, and
GILBERT V. INDEGLIA ASSOCIATE JUSTICE.
plaintiffs-certain New Shoreham residents, taxpayers, and
Block Island Power Company (BIPCO) ratepayers-appeal a
Washington County Superior Court hearing justice's
decision to grant the motion to dismiss of the defendant, the
Town of New Shoreham (the town). This matter came before the
Supreme Court on February 15, 2018, pursuant to an order
directing the parties to appear and show cause why the issues
raised in this appeal should not be summarily decided. After
considering the arguments set forth in the parties'
memoranda and at oral argument, we are convinced that cause
has not been shown. Thus, further argument or briefing is not
required to decide this matter. For the reasons outlined
below, the Superior Court's judgment is affirmed.
case derives from a dispute between the New Shoreham town
council and plaintiffs.On June 6, 2016, the town council held a
meeting to consider the prospective purchase of two-thirds of
the shares of BIPCO for $1.8 million. Three members of the
town council voted in favor of authorizing the execution of
the Stock Purchase Agreement (the agreement). However, two
in early July 2016,  the town executed the agreement
memorializing the sale. Thereafter, on July 16, 2016, counsel
for the town wrote to the Division of Public Utilities and
Carriers (the division) requesting an opinion from the
division as to whether any approvals were required by the
division before the town could purchase a majority share of
stock in BIPCO. The division responded on July 22, 2016,
informing counsel that the division's approval was not
required because the transaction was not between public
utilities and, further, the division declined to exercise its
discretionary authority to review the transaction. Three
months later, during a September 26, 2016 financial town
meeting, voters authorized the town treasurer to issue the
funds in consideration of the stock.
with the outcome of the financial meeting, especially as it
pertained to environmental concerns, on October 18, 2016,
plaintiffs filed a motion in the Superior Court seeking to
enjoin the closing of the stock sale. Subsequent to that
filing, on October 24, 2016, plaintiffs filed a complaint in
which they enumerated three grievances against the town: (1)
the town's actions were ultra vires; (2) the
agreement was voidable by operation of law; and (3) equitable
estoppel should be applied. In their complaint, plaintiffs
requested that the Superior Court "enjoin the closing
of the transaction, " as well as "any other such
relief [the court saw] fit to grant, until such time as a
full, independent, public hearing can be conducted by the
Public Utilities Commission pursuant to RIGL 39-1-38[.]"
after plaintiffs filed their complaint, the town moved to
dismiss. The town presented myriad reasons to support its
contention that plaintiffs' claims should be dismissed:
(1) under Rule 12(b)(1) of the Superior Court Rules of Civil
Procedure, the Superior Court did not have subject-matter
jurisdiction; (2) the controversy was moot; (3) plaintiffs
did not have standing to sue; (4) plaintiffs' complaint
failed under Rule 12(b)(6) of the Superior Court Rules of
Civil Procedure to state a claim upon which relief could be
granted; (5) plaintiffs' complaint violated Rule 8 of the
Superior Court Rules of Civil Procedure; and (6) plaintiffs
violated Rule 19 of the Superior Court Rules of Civil
Procedure by failing to join indispensable parties.
November 1, 2016, a Washington County Superior Court justice
heard, and granted, the town's motion to dismiss,
agreeing that plaintiffs violated Rules 8 and 19 of the
Superior Court Rules of Civil Procedure, and also ruling that
the Superior Court did not have subject-matter jurisdiction
to hear the dispute. The hearing justice did not decide the
case's potential mootness, plaintiffs' questionable
standing to file suit, or their alleged failure to state a
claim upon which relief could be granted. Following that
decision, the stock sale closed on November 7, 2016.
November 22, 2016, a final judgment was entered in the
Superior Court in favor of the town. The plaintiffs filed a
notice of appeal on November ...