City attorney says judge dismissed contract claim in annexation suit; appeal possible

The Lenoir City attorney updated the council on a multi‑year lawsuit over the annexation of two parcels, saying a judge ruled in the city’s favor on the interlocal/contract claim. “So we win. It’s a good day for the city of Lenoir City,” the city attorney said, summarizing the ruling that the 2005 interlocal agreement does not clearly apply to parcels that are partly inside and partly outside growth boundaries.

Why it matters: Council members have spent several years and tens of thousands of dollars litigating whether the city followed the agreement and applicable statutes when annexing two properties. The ruling narrows the suit to remaining declaratory/statutory questions but removes a key contract‑based claim that the county had pressed.

What the attorney told the council: The city attorney described motions to dismiss that resolved procedural claims and left substantive declaratory matters for the court; he said motions for summary judgment were filed and that Judge Pemberton issued a ruling focused on whether the interlocal agreement applied to parcels partially inside a planned/urban growth boundary. Because the contract language addressed parcels either fully inside or fully outside those boundaries and said nothing about split parcels, the judge dismissed the breach‑of‑contract allegation against the city. The attorney listed the outside counsel and opposing counsel involved and said an appeal by the county is likely.

Context and next steps: Council members asked about remaining deadlines and the amount the city has spent on the case; a council member and city staff reported the city’s legal expenses are on the order of about $98,000 and that the county’s reported spending is substantially higher. The attorney said other motions remain pending — including motions relating to declaratory relief and statutory claims — and that the litigation is not yet fully concluded.

The council did not take formal action on the legal update itself; the attorney said staff will continue to monitor filings and report back to the council as the court resolves the remaining issues.