Lansford Borough Council on Wednesday did not ratify the $100,000 check sent as the first payment to settle a federal lawsuit filed by a part-time police officer.

Councilwoman Gwyneth Collevechio moved to approve all the bills and expenditures, except the payment to the Hanchulak Law Offices.

The law firm represents Gilbert Diaz, the part-time officer who claimed he was denied due process when removed from the police schedule without explanation.

In May, council approved the $230,000 settlement with Diaz, who worked for the borough for about six months.

As part of the terms, the first payment of $100,000 was due June 30 and the borough sent the check, as required under the agreement.

The funds came from the borough’s own coffers, as its insurance company denied coverage for the case, saying borough officials failed to report the intent to sue in a timely manner.

Residents questioned the payment during public comment which led to finger-pointing regarding who was to blame for the lawsuit and the lack of insurance coverage.

Court agreement

Council President Joe Genits explained the borough was obligated to make the payment as part of the approved settlement. With the motion, Genits explained, council was ratifying the payment.

“That was all part of the agreement through the courts, and part of that agreement was that the plaintiff would be paid by June 30 to his law firm,” he said. “So, we had to comply with that.”

Councilman Bruce Markovich said that council received the agreement after Diaz signed the document, which was in June.

“We did not see any agreement prior,” he said, and Councilwoman Michele Bartek agreed they saw nothing prior.

Councilwoman Collevechio added that they only discussed the amount of the settlement in executive session, and Genits countered that they also discussed making four payments.

Genits added that her request to have their attorney present at the executive session to explain the terms cost the borough another $1,000.

“Everything was explained to council in executive sessions before that,” he said.

Markovich, Bartek and Collevechio were the no votes on the settlement in May. The motion passed 4-3. Voting for the settlement were Genits and Councilmen Jack Soberick, Joseph Butrie and John Zym.

Diaz sued the borough, as well as these individuals, Soberick, Butrie and former council members George Gilbert and Jennifer Staines, who voted against holding a hearing to allow the officer to answer any allegations against him.

Lack of insurance

Current Mayor Denise Leibensperger then submitted the June 19, 2025, letter from Diaz’s attorney which she said showed why the borough didn’t have insurance to cover the suit.

The letter states that Diaz was entitled to due process under state and federal law, and could not be taken off the schedule without an opportunity to contest the allegations.

“He should not be suspended at all based upon the allegation, in the absence of written charges,” Gerald Hanchulak wrote. “I am requesting that he be immediately reinstated with back pay.

“If you will not reinstate officer Diaz, I am asking that you provide written allegations/charges against him, so officer Diaz can take advantage of the rights provided him under state federal law,” he wrote. “If I am not in receipt of a written response within 10 days appropriate legal action will be taken.”

The letter was sent to Vrablic and copies were sent to the borough solicitor, Bob Yurchak, as well as Bartek, who was in charge of public safety, and Markovich, who was council president.

“This is why we didn’t have insurance,” Leibensperger said, saying that those council members didn’t fulfill their obligation to report this intent to sue to the insurance company promptly.

Pointing blame

Markovich said that anything that came to the borough office went to the solicitor.

“He’s in charge of legal affairs,” he said.

Markovich earlier this week said that Yurchak and Attorney Michael Miller, who represented the borough in labor matters, had said that letter was not an intent to sue.

Genits pointed the blame for lack of insurance back at Markovich, questioning who signs documents and contracts for the borough, implying the council president does.

“The insurance company was not informed in due time to process and defend the borough. Plain and simple,” Genits said about the insurance denial in October when Markovich was in charge of the borough administration.

Resident Tommy Vadyak wanted to know why the borough wasn’t going after their solicitor for the settlement money, saying he made mistakes reviewing contracts and other matters.

“Why aren’t you people going after Yurchak to pay this $230,000, plus the legal liabilities?” he asked. “(Council members) went off the advice of the solicitor not to have a hearing for Diaz.”

In August, council voted against holding a hearing for Diaz. The council members voting against the hearing were all named as defendants in the federal suit. Also named as defendants in the suit were former Mayor Hugh Vrablic and police Sgt. Shawn Nunemacher.

“Yurchak should be fired. He should be in front of the disciplinary review board,” Vadyak said. “Go off the agenda and fire him.”

Yurchak was not in attendance at the meeting due to a scheduling conflict. No action to dismiss the solicitor was taken or brought to the floor.

Leibensperger again pointed to the June 19 letter in which Diaz’s attorney threatened suit, if the allegations weren’t presented to him and he be allowed to answer them.

“The former mayor never disclosed why he was investigating that officer. It had nothing to do with council,” she said.

“The federal lawsuit is based on the fact that the former mayor never gave him the reason he was under investigation — that was his due process,” Leibensperger said.

Auto payment

Later, when council went to pay the bills and expenditures. Bartek questioned the $100,000 payment to Diaz’s attorney, because council never voted on it, she said.

Treasurer Maria Ahner explained that council passed a resolution when she started that allowed for payments to be made automatically, such as electricity, utilities and legal fees.

“There’s a list. I think you guys forgot about that resolution,” she said. “Some of this has already been pre-approved.”

Ahner explained that council approved a settlement agreement and payment plan on May 13, and she had the signed settlement as well as confirmation from both attorneys.

“I did follow protocol,” she said, adding that council had also budgeted for the legal fees and costs for the ongoing lawsuit, noting it during budget meetings through the fall and into December.

Ahner explained that council had earmarked $98,000 from insurance to cover the ongoing lawsuit and related legal fees, and consulted with the auditor to ensure it was correctly allocated. The funds came from the borough’s general fund, she said.

Collevechio moved to pay the bills and expenditures with the exception of ratifying the $100,000, which she was opposed to paying. Bartek seconded the motion.

Council voted to approve the bills and expenditures, except for ratifying the $100,000 payment, on 4-2 vote. Bartek, Butrie, Collevechio and Markovich voted yes. Genits and Councilman John Zym voted no. Councilman Soberick, who is the chief county detective in Carbon County, was absent due to work.

Ahner noted that the payment had already been made. Bartek said it’s just on the record that they’re opposed.

It is not clear what happens now regarding the payment. Ahner said that she would have to check to see how council’s action affected the payment.

The borough still has three more equal payments of $43,333.33 due to Diaz in the settlement. One is due the end of this year and the other two in June and December 2027.