Palmertree ordered to stop using public money for defense

Published 10:36 am Wednesday, March 5, 2014

Warren County supervisors’ pointed concerns last month over how Circuit Clerk Shelly Ashley-Palmertree is paying her attorneys in her civil case is now in the form of an order by the Hinds County Chancery bench.

Judge Dewayne Thomas on Tuesday ordered the clerk to stop using taxpayer money to pay her attorneys’ fees in the case she filed two weeks shy of a year ago. At issue is whether she owed back to the county $671,751.75 in excessive salary and subcontractor fees paid to her father and predecessor in office, Larry Ashley, from 2006 to 2011 and were noted in one form or another on official state audits of county government. The state and county contends the payments the state were improper.

In addition, Judge Thomas ordered Palmertree to provide a full accounting of all funds received and disbursed by her office to the Court and the Warren County Board of Supervisors, as previously ordered, within 25 days. If she fails to do so, Thomas stated he will direct the State to file a petition for contempt, State Auditor Stacey Pickering said in a news release Tuesday.

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“We are pleased with today’s rulings from Judge Thomas which will protect the taxpayers of Warren County,” Pickering said in a statement. “My Office will continue to hold those in elected office accountable for their actions.”

Mediation talks ordered after Thomas abruptly halted testimony after three days of trial in December broke down in January. A second civil trial is set for April 15,16 and 18. Palmertree also faces a criminal trial March 24 on three felony counts of embezzlement. That case is being prosecuted by the Attorney General’s Office.

In recent weeks, county officials have indicated her former insurer, CNA Surety, was a stumbling block in securing some kind of settlement in the civil case due to how much financial exposure it would have in the deal. In filings since the trial, the surety company has argued back and forth with the county about how much it did or didn’t know about six years worth of auditors’ questions about Palmertree’s accounting practices. Western Surety, a subsidiary of CNA, has argued it needs more time to file a formal answer in the case because of sworn testimony during the trial that the company says confirmed it was kept out of the loop by the county board.

Filings in the case show $49,547.20 in expenses listed as professional services from an account at BancorpSouth. Of that, $21,497.20 has gone to lead attorney, Frank Vollor, $8,050 to attorney James L. “Buck” Penley, $9,500 to Donna Ingram, who was an expert witness  and $15,000 to Ridgeland-based Pace & Associates, which Palmertree dropped as an expert witness in favor of Ingram last July.

About $65,000 in legal fees the county has paid its attorney, Marcie Southerland, since August has been attributed to the Palmertree civil case. Supervisors and Southerland have asked the court to reimburse the county for all the legal fees associated with the case.

“The Warren County Board of Supervisors is taking all available measures to recover the taxpayer funds that have been misappropriated by Shelly Palmertree,” Warren County Board Attorney Marcie Southerland said in the release. “We look forward to a resolution into this matter in the near future.”