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New Orleans’ refusal to pay judgments hurts victims

NEW ORLEANS (WVUE) – Angela Stewart recalls rushing to the scene of an accident in 2003. A speeding police car, driving without a siren on, hit her 7-year-old brother, Lance, while that he was walking near Charity Hospital.

“He flipped in the air, out of his shoes, landed on the pavement and was in a coma (for) over a month and a half,” Stewart said.

She says her brother had to relearn the basics: how to walk, how to talk, the names of common objects, and that he suffered brain damage.

Now 26, Lance works part-time at a local Walmart as part of a disability assistance program.

“Lance is not the same,” Stewart said. “We really didn’t worry about the money. I just wanted my brother back, I just wanted to have some kind of normalcy.

But the medical bills piled up. The Stewarts eventually filed a lawsuit against the city of New Orleans. In 2006, a judge awarded them $4 million. But 16 years later, they are still waiting for the city to pay its debt.

“It was like, ‘Yeah, we’re going to give you judgment. Good luck getting it,'” Stewart said.

The Stewarts are not alone. In nearly 500 separate cases, the city of New Orleans owes more than $36 million in unpaid judgments. Four of these judgments date from 1996.

The reason for this is an obscure provision of the Louisiana constitution that essentially allows government entities to be sued and lose, but not to pay judgments.

The constitution states that the funds cannot be seized and can only be disbursed if the government appropriates the money. In other words, if the city of New Orleans doesn’t budget the funds for the judgments, no judge can force the city to pay.

As a result, while Lance Stewart may have been a millionaire on paper, for several years after the accident he and his family were left homeless.

His attorney, Bob Manard, said the decision not to pay the family also hurt Lance’s recovery. Without money, they could not afford to provide Lance with proper medical care.

“This boy – he was a 7-year-old boy from a single mother living in the projects – when his life was practically destroyed. And even though he had this great judgment against the city, they had been living under a bridge for a few years. So not only was he not receiving care, he was homeless,” Manard said. “Everyone knows how hard it is to get doctors to take any case on Medicaid, let alone a sophisticated case of brain damage that requires a lot of expensive tests and things like this. But he couldn’t understand that.

In 2018, New Orleans only paid the Stewarts and others 10% of what they were owed. For Lance Stewart, that barely covered medical expenses.

“What’s ironic is if you owe the city money and you say, ‘Well look, I’m going to pay you, but can you wait 15 years and then I’ll pay you 10 cents on the dollar? I mean, they would laugh at you outside of court,” Stewart said.

The cases for which the city owes money are very varied. New Orleans also refused to pay a contract amount to a company that helped the city recover millions of dollars.

George White’s company, Municipal Administrative Services, Inc., audits public services. From 1996 to 1998 he audited the former Bell South Telephone Company and its agreement with the City of New Orleans. After the audit, the city sued Bell South based on the work and was awarded approximately $33 million.

In exchange for the savings, the city refused to pay White a penny for his work. White says the city owes him about $1.3 million. In 2005, a judge ruled that the city owed the money to Municipal Administrative Services, Inc., but White is still on a long list of unpaid judgments.

White estimates he spent $600,000 in legal fees. But he says part of the reason he’s still fighting after 20 years is for the other people on the list, who are also owed money.

“I think part of me wanted to pursue that, too, for the voice of all of us who’ve tried to do what’s right,” White said. “I understand how the world works. But if you are doing everything right, at some point you would expect the government to want to do the right thing.

Over the years, White’s company has done work for about 100 cities across the country. He says New Orleans is the only city that hasn’t paid its bill.

Angela Stewart says while the city refuses to do the right thing for her brother, she also feels ignored by officials since the crash. She says no one has ever contacted them.

“It’s not about the money. It’s that nobody cared. Nobody cared that this cop ran over a kid. Nobody cared that that kid had brain damage. Nobody cared. “Cared. And the only way to make anyone care is to let them know we’re coming for your money,” Stewart said.

The city’s decision not to pay the money owed to the Stewarts left them with their bank accounts depleted, unable to pay their bills and, at one point, homeless.

“I want the city to realize that people are really hurting here. And it’s not like we don’t love our city. We could have left the state, but we came back. We have jobs and pay taxes. We love our city, but at the same time the city doesn’t show the love back,” Stewart said.

The City of New Orleans sent a statement to Fox 8 that read, “The city continues to make significant progress in reducing the number of unpaid claims on the judgment list. In addition to annual budget appropriations for the Judgment Fund, the City remains committed to identifying other sources of funding available to help address the backlog without impeding the ability to provide essential public services.

But according to budget documents, the city isn’t spending all the money it has in the judgment fund. In 2020, 2021 and 2022, the city has budgeted $2 million to pay off judgments. So far this year, the city has donated just $146,000. In 2021, she contributed $1.5 million, and in 2020, the city only paid $500 from the fund.

Either way, the annual expenditure of $2 million is not enough to pay off all the judgments against the city.

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