CHELSEA — Residents at a special town meeting will decide tonight whether to pay a former clerk $25,000 to avoid a lawsuit.

Former Town Clerk Flavia “Cookie” Kelley has threatened to sue the town in a dispute about the validity of her contract.

Town attorney Stephen Langsdorf said it could cost the town $125,000 to defend the case, which includes legal fees and, if the town loses, $90,000 due to Kelley under a three-year contract Langsdorf has repeatedly said is invalid.

Former Town Manager Angela Gordon signed a three-year contract with Kelley without the authorization of selectmen. Langsdorf has said there is nothing in law giving Gordon the authority to offer a three-year pact. In particular, Langsdorf said, a town manager is not authorized to bind a town to a contract.

His legal citation is Sirois v. Frenchville — a 1982 case in which the court stated: “The Legislature has listed … fourteen specific acts which the town manager is authorized to do; absent from that list is the power to contract on behalf of the town.”

Kelley’s attorney, Clifford Goodall, has offered as proof of Kelley’s contract a “certificate of appointment” dated July 19, 2010.

The document bears the signatures of Selectmen Carole Swan and Michael Pushard and was to be in effect for one year, through June 30, 2011.

Goodall has said that document proves “the majority of the Board of Selectmen appointed Cookie Kelley to be the Chelsea town clerk for a one-year appointment ending June 30, 2011” and that a three-year contract subsequently tendered by Gordon on Sept. 15, 2010, “is a valid legal contract” and “supplements the one-year appointment from the Board of Selectmen.”

Some residents at last week’s selectmen’s meeting expressed anger about the proposed settlement. Some felt Kelley is undeserving, but many also agreed it would be better to pay $25,000 than $125,000.

Tilton said money for the settlement, if approved, would come from the town’s wood lot account, which is a reserve account.

Richard Condon, a resident, said the town doesn’t owe Kelley anything.

“She went out on medical leave (in May) because of work-related stress,” Condon said. “If she can’t do the work because of stress, why should we be paying her? That’s how I feel about it. I think we ought to be looking into that. They should build a case rather than give her $25,000. See if workman’s comp will take care of it.”

Former selectman Rick Danforth said he doesn’t want to pay Kelley a dime, but doesn’t see how the town can get out of it. “With all that’s been going on and with what’s going to be coming down the road, this is tough to take,” Danforth said. “With the uncertainty of legal action, this is the most economical way to do this.

“We have to approach this logically, instead of emotionally. A lot of people don’t want to see her get a red cent, but I don’t want to see her continue to tear this town apart.”

Danforth said Chelsea selectmen have never offered a contract like the one Kelley received.

Kelley was given a pay package in 2010 that exceeds that of clerks in most neighboring towns. With no municipal experience, she was given four weeks of vacation and 12 paid sick days a year during her first year, plus full health insurance benefits and a salary of $17.50 per hour, with automatic annual wage increases.

“We have to make sure this doesn’t happen again,” Danforth said. “If people want to direct their anger at what we have to pay in the settlement, (they should) direct the anger at the root cause of the problem, which is Carole Swan and how she maneuvered Kelley and (Gordon) back into the Town Office.”

Swan was arrested Feb. 10 for allegedly accepting kickbacks from a contractor. She was charged with aggravated forgery, criminal attempt and two counts of improper compensation for services.

Town Manager Scott Tilton said the settlement with Kelley appears as Article 2 on the warrant. Copies are available at the Town Office. Messages left for Kelley’s attorney, Clifford Goodall, were unreturned.

Voters also will be asked tonight to amend the Chelsea Floodplain Management Ordinance to fix a clerical error in a measure adopted by voters at a special town meeting in March. Tilton said he expects tonight’s meeting — 6:30 p.m. at the Togus Veterans Theater — to be lengthy, with a lot of opinions about the proposed Kelley settlement.

Mechele Cooper — 621-5663

mcooper@centralmaine.com

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