Opinion
Opinion By: Jack Conway, Attorney General; Michelle D. Harrison, Assistant Attorney General
Open Meetings Decision
At issue in this appeal is whether the Stamping Ground City Commission violated the Kentucky Open Meetings Act by going into closed session "for proposed litigation purposes discussion" at its December 7, 2010, regular meeting. This office finds, in accordance with
Floyd County Board of Education v. Ratliff, 955 S.W.2d 921 (Ky. 1997) as well as prior decisions, that in failing to provide notice of the general nature of the business to be discussed, the reason for the closed session, and the specific provision of KRS 61.810 authorizing the session (KRS 61.810(1)(c) ), the City Commission violated KRS 61.815(1)(a). However, inasmuch as the Commissioners and City Attorney "discussed the City's options regarding its claim against [a named] property owner, including filing suit to collect the amount claimed, the defenses available to the property owner, and the relative strengths and weaknesses of the City's claim," KRS 61.810(1)(c), upon which the City Commission implicitly relied here, and which permits a public agency "to maintain the confidentiality of its litigation strategy when it is a party to litigation, is threatened with litigation, or anticipates initiating litigation on its own behalf," authorized the closed session. 01-OMD-41, p. 6, citing OAG 78-227 (emphasis added).
By undated letter directed to Mayor Bill Swartz, the presiding officer, Michael Bradley submitted his written complaint alleging that the City Commission's December 7 closed session was improper. Specifically, Mr. Bradley asserted that "placing a lien on property for work done on the owners [sic] behalf is not litigation" within the meaning of KRS 61.810(1)(c) . Mr. Bradley relied upon "public statements made by former Commissioner Holland that the closed meeting did not include any discussion of litigating this issue, [and] no proposals of litigation by any member of the Commission or its attorney" were made, but the discussion did include "reducing the amount Mr. Herlihy was indebted to the [C]ity of Stamping Ground, and that reasons to do this included his sale to a new business, specifically the leasing company Dollar General Stores use." 1 Due to Mayor Swartz's "public comments about [his] desire, and [that of] others on the [C]omission at the time, for Dollar General to locate" in Stamping Ground, Mr. Bradley believed that Mr. Holland's account was accurate. To remedy the alleged violation, Mr. Bradley proposed that the City Commission void the action taken regarding the agreement with Mr. Herlihy, "and that the agreement be ruled void until such time as the Stamping Ground Commission can enter into a new agreement as prescribed" by law. As "an act of good faith," Mr. Bradley asked that if his complaint was denied "that the Mayor of Stamping Ground stay the contract in question until the next regular meeting. "
By letter dated January 10, 2011, Mayor Swartz acknowledged receipt of Mr. Bradley's complaint; however, instead of addressing the merits of the complaint Mayor Swartz advised that he would ask the City Commission to hold a special meeting in order to consider his allegations. Mayor Swartz further indicated that the City Commission would "discuss an appropriate day and time for such special meeting at the previously scheduled special meeting set for Tuesday, January 11, 20[11] at 7:00 p.m. at Stamping Ground City Hall." Noting that Mayor Swartz did not issue a denial or agree to any remedial action, "except to schedule a future meeting," Mr. Bradley initiated this appeal by letter dated January 12, 2011.
Upon receiving notification of Mr. Bradley's appeal from this office, City Attorney Joseph M. Hoffman responded on behalf of the City Commission. Citing KRS 83A.140, Mr. Hoffman initially argued that Mayor Swartz "does not have the authority to take the action requested by Mr. Bradley." Because the City operates under a commission form of government, he continued, only it "can consider Mr. Bradley's allegations and, if a determination that the allegations are valid is made, take the action requested." Following this flawed line of reasoning, Mr. Hoffman asserted that doing this "requires a City Commission meeting, which, unless it's a regular monthly meeting, requires a special meeting with appropriate notice. " The Mayor's response "was timely and appropriate" under the circumstances presented in his view as the City Commission "must consider Mr. Bradley's complaint at the special meeting scheduled for January 24, 2011 before any appeal can arise." This office respectfully disagrees. KRS 61.846(1) applies equally to all public agencies (defined at KRS 61.805) and expressly provides that a "response shall be issued by the presiding officer, or under his authority, and shall constitute final agency action." Applied here this mandatory language means that whether the Mayor is authorized to take action to remedy a violation is not legally relevant in determining whether he, as presiding officer, is required to address the merits of Mr. Bradley's complaint in a timely manner. Mr. Bradley's appeal was not premature. To hold otherwise would create vast potential for abuse in the form of delays by public agencies in responding to complaints. See 99-OMD-133 (requirement of agency response "is not conditioned upon the meritoriousness of the charges . . . or the availability of the city attorney to offer advice on the matter").
For consideration should this office disagree with his assertion that Mr. Bradley's appeal was premature, Mr. Hoffman enclosed "copies of statements signed by former Mayor Jared Hollon, and former City Commissioners Frank Farr, Bill Swartz, and Jeremy Mullins, all of whom were present at the December 7, 2010, meeting." In relevant part, each statement reads as follows:
At that meeting the City Commission entered a closed session to discuss potential litigation regarding the Distillery Property. . . . The potential litigation concerned the City's claim against Jack Herlihy, the owner of the Distillery Property. In 2008 the City sought to remedy violations of local ordinances by entering the Distillery Property and removing structures and other conditions on the property which the City believed violated the ordinances. The City expended approximately $ 18,600.00 for this purpose. The property owner refused to reimburse the City for the amount expended.
In the executive session on December 7, 2010, the City Attorney reported that he had been contacted by the attorney for the property owner and that the property owner was offering $ 10,000.00 as a full settlement of the City's claim against him to be paid upon the closing of a contract the property owner had recently signed with people interested in building a Dollar General Store in Stamping Ground. The Commissioners and City Attorney discussed the City's options regarding its claim against the property owner, including filing suit to collect the amount claimed, the defenses available to the property owner, and the relative strengths and weaknesses of the City's claim. Upon conclusion of the discussion the City Commission came out of the closed session and, in open session, and after appropriate motion and second, voted unanimously to accept the property owner's settlement offer.
Based upon this evidence, the Attorney General finds that the "chance of litigation involving the agency [was] more than a remote possibility" and its reliance on KRS 61.810(1)(c), though not explicit, as the minutes of the meeting reflect, 2 was otherwise proper; however, the agency failed to provide "specific and complete notification" of the discussion topic prior to conducting the closed session and thus violated KRS 61.815(1)(a). Floyd County Board of Education v. Ratliff, above, at 924.
Our analysis necessarily begins with a review of the fundamental proposition codified at KRS 61.800:
The General Assembly finds and declares that the basic policy of KRS 61.805 to KRS 61.850 is that the formation of public policy is public business and shall not be conducted in secret and the exceptions provided for by KRS 61.810 or otherwise provided by law shall be strictly construed.
Recognizing that extraordinary circumstances occur which might justify a public agency in conducting public business during a closed session, the General Assembly created a number of exceptions to this general rule, which are codified at KRS 61.810(1)(a)-(n). To promote the goal of maximizing notice to the public, the General Assembly enacted KRS 61.815(1), which, in relevant part, reads:
[T]he following requirements shall be met as a condition for conducting closed sessions authorized by KRS 61.810:
(Emphasis added.) In construing KRS 61.815, Kentucky's highest courts have recognized that "the failure to comply with the strict letter of the law in conducting meetings of a public agency violates the public good."
Floyd County Board of Education v. Ratliff, 955 S.W.2d 921, 923 (Ky. 1997), above, citing
E.W. Scripps Co. v. City of Maysville, 790 S.W.2d 450 (Ky. App. 1990). Consequently, "the courts of the Commonwealth must narrowly construe and apply the exceptions so as to avoid improper or unauthorized closed, executive or secret meetings." Id.
Decisions issued by the Attorney General over the years relative to compliance with KRS 61.815(1) are consistent with Floyd County Board of Education, above, in which the Kentucky Supreme Court held that the Board failed to give proper notice in open session of the matters to be discussed in a closed session. Rejecting the Board's argument that it had substantially complied with requirements for conducting a closed session, the Court reasoned:
KRS 61.815 provides that prior to going into an executive session, the public body must state the specific exception contained in the statute which is relied upon in order to permit a secret session. There must be specific and complete notification in the open meeting of any and all topics which are to be discussed during the closed meeting. In this case, the minutes of the Board do not reflect any mention of the "proposed or pending litigation" exception to the Open Meetings Act. The specific reason given for a closed session must be the only topic of discussion while the Board convenes in such a secret session. See Fiscal Court v. Courier Journal and Louisville Times Co., Ky., 554 S.W.2d 72 (1977); Jefferson County Board of Education, supra, at 28. We agree with the language written by then Court of Appeals Judge Johnstone and concurred in by the panel composed of Judges Schroder and Wilhoit that "the exceptions to the open meetings laws are not to be used to shield the agency from unwanted or unpleasant public input, interference or scrutiny. Unfortunately, we believe that is precisely how they were used in this case."
Discussions between Board members concerning matters not identified in the open meeting with proper notice are a violation of the Open Meetings Act and constitute illegal conduct.
Id. at 924 (emphasis added).
Of particular significance, this office has observed 3 that "the Open Meetings Act, and in particular KRS 61.815(1)(a), contemplates more than agency recitation of language of the exception authorizing the closed session, but less than a detailed description of the matter to be discussed." 00-OMD-64, p. 6. Referring to language employed by the Supreme Court in Floyd County Board of Education, above, this office concluded:
In view of the disparate nature of the [thirteen] exceptions, there can be no bright line test for determining if specific and complete notification has been given. However, consistent with the right of the people to "remain[] informed so that they retain control over the instruments they have created" (1974 HB 100, Preamble), we believe that the notification must include both a statement of the exception authorizing the closed session and a description of the business to be discussed couched in sufficiently specific terms to enable the public to assess the propriety of the agency's actions.
Id. (Emphasis added.) To summarize, "a notification which does not include a statement of the specific exception relied upon to conduct a closed session [KRS 61.810(1)(c) here], a description of the general nature of the business to be discussed in [proposed or pending litigation] , and the reason(s) for, [nature of the litigation or indication that disclosure of the identity of the party or parties to litigation would somehow compromise the agency's position] the closed session is inadequate." 03-OMD-221, p. 4.
The copy of the minutes attached to Mr. Bradley's appeal does not contain any reference KRS 61.810(1)(c) nor did the City Commission belatedly reference this provision in responding to it; rather, the minutes vaguely indicate that a motion was made to enter into closed session "for proposed litigation purposes discussion." This office has recognized that a reference to "litigation" standing alone and "litigation" accompanied by a reference to KRS 61.810(1)(c) are both inadequate to satisfy the standard of KRS 61.815(1)(a). 03-OMD-221, p. 4. It logically follows that "proposed litigation" with no reference to KRS 61.810(1)(c) does not suffice. KRS 61.815(1)(a) requires more. To the extent the City Commission failed to strictly comply with all requirements of KRS 61.815(1) prior to conducting the December 7, 2010, closed session, those omissions were contrary to Floyd County Board of Education v. Ratliff, the fundamental policy of the Open Meetings Act codified at KRS 61.800, and prior decisions of this office.
In light of this determination, the remaining question is whether the City Commission properly relied upon KRS 61.810(1)(c) , pursuant to which public agencies may have "[d]iscussions of proposed or pending litigation against or on behalf of the public agency" in closed session. " In Floyd County Board of Education v. Ratliff, above, the Kentucky Supreme Court interpreted KRS 61.810(1)(c) as follows:
[T]he drafters of the legislation clearly envisioned that this exception would apply to matters commonly inherent to litigation, such as preparation, strategy or tactics. Obviously, anything that would include the attorney-client relationship would also fall within this exception. The statute expressly provides that the litigation in question need not be currently pending and may be merely threatened. However, the exception should not be construed to apply "any time the public agency has its attorney present" or where the possibility of litigation is still remote. See Jefferson County Board of Education v. The Courier-Journal, Ky. App., 551 S.W.2d 25 (1977). As properly noted in Jefferson County Board of Education, supra, the matters discussed under KRS 61.810(1)(c) must not be expanded to include general discussions of "everything tangential to the topic."
Floyd County Board of Education at 923, 924 (emphasis added). Numerous decisions by this office which predate Floyd County Board of Education v. Ratliff adopted this view. As previously indicated, this office has long recognized that KRS 61.810(1)(c) was intended to permit a public agency to "maintain the confidentiality of its litigation strategy when it is a party to litigation, threatened with litigation, or anticipates initiating litigation on its own behalf." 01-OMD-41, p. 6 (citation omitted)(emphasis added).
Applying these general principles to a series of appeals initiated under KRS 61.846(2), this office held that the Highland Heights City Council properly conducted a closed session to discuss strategy, tactics, and the possible settlement of a condemnation proceeding against the City (92-OMD-1728); that Kentucky Employers' Mutual Insurance Authority properly conducted a closed session to discuss whether to appeal a decision by this office, but improperly made the final determination in closed session (97-OMD-96); that a public agency properly invoked KRS 61.810(1)(c) as it appeared that it would be named as a party in a pending legal action, "and/or w[ould] initiate legal action against the developer, if settlement [was] not reached" (01-OMD-41); that a public agency properly invoked KRS 61.810(1)(c) as this exception "is broad enough to extend to closed session briefings by agency counsel on the strengths and weaknesses of a case, actual or threatened . . . [and the] fact that the actual or threatened litigation relates to an ordinance does not deprive the agency of the right . . . to shield its litigation strategy from public scrutiny" (04-OMD-039); and that the Scott County Board of Education "properly relied on KRS 61.810(1)(c) in conducting a closed session discussion with its attorney of the status and defense of the reopened [Office of Civil Rights] complaint" (09-OMD-208). See also 10-OMD-217.
Based on this line of decisions, the following guidelines have been established:
When the public agency has become a party plaintiff or defendant in a lawsuit, when a public agency has been threatened with litigation, or when the chance of litigation involving that agency is more than a remote possibility, the agency can then legally and properly invoke the exception set forth in KRS 61.810(1)(c). The public agency can at that time discuss in a closed session such matters as strategy, tactics, possible settlement and other matters pertaining to that case or that anticipated or probable case.
93-OMD-119, p. 3, 4. Given the statements provided in support of the City Commission's reliance on KRS 61.810(1)(c) as the basis for the December 7, 2010, closed session, this office believes that the chance of litigation "was more than a remote possibility. " Although the context in 09-OMD-208 and 10-OMD-217, above, was otherwise different, in relevant part this office concluded that "discussion of 'strategy' and 'tactics' [was] broad enough to extend to discussions concerning the advisa[bility of] proceed[ing] toward early resolution or . . . defend[ing] against the allegations" in the complaints and thus KRS 61.810(1)(c) was properly invoked. 10-OMD-217, p. 11. See 01-OMD-41. Similarly, discussion of the City's "options regarding its claim against the property owner, including filing suit to collect the amount claimed, the defenses available to the property owner, and the relative strengths and weaknesses of the City's claim" in this case fell within the parameters of KRS 61.810(1)(c). With the exception of the noted violation of KRS 61.815(1)(a), the actions of the City Commission did not violate the Open Meetings Act.
A party aggrieved by this decision may appeal it by initiating action in the appropriate circuit court pursuant to KRS 61.846(4)(a). The Attorney General should be notified of any action in circuit court, but should not be named as a party in that action or in any subsequent proceedings.
Footnotes
Footnotes
1 Mr. Holland served as a Commissioner from January 2007 until December 2010 according to his personal statement, a copy of which Mr. Bradley attached to his appeal, but apparently did not include with his original complaint. According to Mr. Holland, the City Commission held a closed session to discuss "the sale of the distillery property to Dollar General Stores and concession of the debt owed by Mr. Herlihy, the property owner, to the City Stamping Ground as per our telcon with the city attorney, Joe Hoffman, earlier that week [hopefully this discussion of public business complied with requirements of the Act if a quorum was present]." The discussion concerned the "sale of 1.8 acres of Mr. Herlihy's property, known as the distillery, to Dollar General. Also, [the Commission] discussed Mr. Herlihy's [a]ttorney's request to forgive $ 8600 of the $ 18600 he owed." The majority of the discussion, he continued, "was that we should do that for the reason of bringing new business to town," specifically a Dollar General store.
2 Mr. Bradley attached a copy of the minutes from the December 7 meeting.
3 In 00-OMD-114, this office declined to view a violation of the Open Meetings Act as "technical." At page 3 of that decision, the Attorney General reasoned that "[t]he Act itself does not recognize a class of violations of lesser gravity than the remaining violations, and therefore capable of being dismissed as merely 'technical.'"