ALBANY – The city of Albany is not obligated to pay a law firm $85,000 in fees and expenses it said it incurred to represent a city police sergeant who aimed a loaded gun at a coworker, an appeals court decided Thursday.

A unanimous panel of the Appellate Division, Third Department, ruled in DerOhannesian v. City of Albany, 515875, that the city did not create a “unilateral contract” to pay the DerOhannesian & DerOhannesian firm of Albany through an exchange of correspondence in which the city’s corporation counsel discussed the firm’s fees with Paul DerOhannesian II.