Sounds all too familiar to the situation a woman I know is in.
She shows/breeds/grooms. She co-owns a dog from one of her litters, the agreement with the owner was that this dog would be shown and bred in the future. All right, that's fine. One day the owner drops the dog off to be groomed, and she's in an awful state. Breeder calls owner, owner says nothing is wrong with the dog, so breeder has her checked out by a vet and such-and-such is wrong with her. Breeder doesn't give the dog back, and tells the owners that the dog ran away. That was about a year ago, breeder is just now being sued for it.
I don't know. Maybe the situation could have been handled better, but I have a hard time faulting both this mayor and the woman I know, if all they were trying to do was help a poor dog.