11-ORD-211

11-ORD-211

December 16, 2011

In re:        Ray Gough/Marshall County Clerk

Summary:        Marshall County Clerk subverted the intent of the Open Records Act by characterizing requester’s intended use of public records as a commercial purpose, notwithstanding requester’s assertion that he intended to use the records in preparation for litigation, and thereafter imposing an excessive fee for copies of those records.

Open Records Decision

        This matter having been presented to the Attorney General in an open records appeal, and the Attorney General being sufficiently advised, we find that the Marshall County Clerk subverted the intent of the Open Records Act, short of denial of inspection, by characterizing Ray Gough’s purpose in requesting copies of a specific deed, state tax lien, mortgage, and release as a commercial purpose and thereafter imposing excessive copying costs on him. Although Mr. Gough’s purpose in requesting other records might fall within the definition of a “commercial purpose” found at KRS 61.870(4)(a), he requested these records for use “in the preparation for prosecution or defense of litigation,” namely a foreclosure action on an unpaid certificate of delinquency he purchased, and therefore qualified under one of the exclusions to KRS 61.870(4)(a) found at KRS 61.870(4)(b)(3).¹

        Mr. Gough is a third party purchaser of certificates of delinquency on unpaid real property tax claims.  KRS 134.010(16). A certificate of delinquency arises when the sheriff does not receive payment on property taxes by December 31 and transfers the unpaid claims to the county clerk on April 15. KRS 134.122. Mr. Gough’s company, Hazel Enterprises, LLC, purchases these certificates at annual sales conducted by county clerks pursuant to KRS 134.128. If the delinquent taxpayer, or other person statutorily entitled, does not make payment on the certificate within one year of its purchase, Mr. Gough is authorized by KRS 134.490 to initiate a collection action that “may include foreclosure.”  Thus, “[a]ny property while owned by a delinquent taxpayer shall be subject to foreclosure or execution in satisfaction of a judgment pursuant to an action in rem or an action in personam, or both, to enforce the obligation.”  On August 4, 2011, Mr. Gough requested a precisely identified deed, state tax lien, release, and two mortgages “to prepare . . . for foreclosure litigation.”

        Prior to his August 4 request, Mr. Gough had questioned Marshall County Clerk Tim York about the propriety of his posted $1.00 copying charge and the fifty cent copying charge the clerk imposed on Mr. Gough on July 18. In defending his charges, Mr. York first relied on a document entitled “Copy Fee Up to Fifty (.50) Cents Per Page,” which Mr. Gough enclosed. That document referenced KRS 64.012, relating to certified copies, and KRS 116.095, relating to registration records, but stated generally:

The clerk’s association recognizes that charges for copies that are not certified vary across the state. While there is not a set fee for copy cost without going through a laborious cost analysis, the clerk’s association will support any county clerk that charges up to fifty cents per page.

Mr. Gough raised further written objection, and on July 24 Mr. York refused his request for a refund, asserting:

I contacted several other County Clerks to ask about this issue and to help determine what is proper. I was pointed to KRS 61.874 subsection (4)(a) which states “when public records are requested for commercial purposes, the public agency may establish a reasonable fee . . . .”

Mr. York quoted the commercial use fee provision found at KRS 61.874(4)(c)1. and 2. and concluded:

In light of this statute, it would appear to me that a “$0.50” charge to you for a copy of a deed or a mortgage would be extremely reasonable.

It was Mr. York’s position that “there is a fundamental difference between a citizen requesting a copy of a County Commissioner’s travel voucher and a commercial enterprise using the records of the County Clerk’s Office for personal gain.”

        While the Open Records Act recognizes this “difference” insofar as it establishes a separate fee structure for copies of records requested for a commercial purpose, the Act requires public agencies to ascertain the requester’s intended use, not by supposition or speculation, but by acquiring a certified statement of commercial purpose from the requester pursuant to KRS 61.874(4)(b).²  More importantly, it excludes from the purposes which may be characterized as commercial:

Use of a public record in the preparation for prosecution or defense of litigation, or claims settlement by the parties to such action, or the attorneys representing the parties[.]

KRS 61.870(4)(b)3. Mr. Gough requested the records identified in his August 4 request in preparation for a foreclosure action on an unpaid tax lien pursuant to KRS 134.490. In response to our questions, Mr. Gough stated that those records were intended to be used “to put other third parties who have a financial interest on notice as required by law.”  He acknowledged that the delinquent taxpayer/defendant “paid the outstanding bill before the action was filed.”  Nevertheless, Mr. Gough’s purpose in requesting the records was noncommercial per KRS 61.874(4)(b)3.  But for the payment of the certificate of delinquency, the records would have been used in preparation for prosecution of litigation in the form of a foreclosure action, and it was for this reason that Mr. Gough requested them.

        We are not persuaded by the County Clerk’s argument that 10-ORD-192, in which we held that Mr. Gough’s purpose in requesting records from the Letcher County Property Valuation Administrator was a commercial purpose, is controlling.  There, the question presented centered on the reasonableness of the fee imposed for on-line access to the PVA’s records rather than Mr. Gough’s intended use of the records. Mr. Gough indirectly acknowledged that he has, in the past, and may, in the future, request records for a commercial purpose when he advised Mr. York:

The copies I made a few weeks ago and the copies I will be making in the near future will all be for the purpose of preparation for foreclosure. If I make copies for any reason of a commercial nature I will be sure to disclose it up front.

Records acquired for the purpose of facilitating the purchase of certificates of delinquencies may be reproduced at a rate calculated on the factors found at KRS 61.874(4)(c) since Mr. Gough will “turn[ ] a profit (off of fees and interest) when the tax bills are settled.”  Records acquired for the purpose of giving notice to third parties with a financial interest in the property against which foreclosure action is contemplated may not.  In either case, the County Clerk may require Mr. Gough to indicate whether his purpose is noncommercial or commercial, and, in the latter case, the County Clerk may require him to submit a certified statement of the commercial use to which the records will be put.³  The County Clerk may not, however, reach “a reasonable conclusion” about his intended use based on past practice. Nor may he treat Mr. Gough’s intended use of records in a foreclosure action as “merely incidental to the business that Mr. Gough is conducting. . . .”  That use falls squarely within the parameters of KRS 61.870(4)(b)(3) and is excluded from the definition of “commercial purpose” found at KRS 61.870(4)(a).

        Having so concluded, we find that the fifty cent reproduction fee that the Marshall County Clerk attempted to impose on Mr. Gough for copies of records requested for a noncommercial purpose was excessive and subverted the intent of the Open Records Act within the meaning of KRS 61.880(4).⁴  In a recent open records decision the Attorney General strongly disapproved a fifty cent reproduction fee imposed by the Whitley County Clerk, citing 02-ORD-218 and 01-ORD-136 and declaring that “the widely accepted ten cents per page copying fee ‘strikes a reasonable balance between the agency’s right to recover its actual costs, excluding staff costs, and the public’s right of access to copies of records at a nonprohibitive charge.’”  11-ORD-166, p. 5 (enclosed) citing 02-ORD-218, p. 1 and 01-ORD-136, p. 6. While the County Clerks Association has indicated a willingness to “support any county clerk that charges up to fifty cents per page,” presumably by litigation, it did not do so in the case of the Whitley County Clerk by appealing 11-ORD-166 to the circuit court per KRS 61.880(5)(a). The clerk now stands in direct defiance of a binding decision of the Kentucky Attorney General that has the full force and effect of law. KRS 61.880(5)(b).⁵  The Marshall County Clerk should discharge his statutory duty to make copies of nonexempt records requested for a noncommercial purpose available for a reasonable fee not to exceed his actual costs⁶ and both judicially and legislatively deemed to be ten cents per page. Friend v. Rees, 696 S.W.2d 325 (Ky. App. 1985); 200 KAR 1:020 Section 6(2).

        A party aggrieved by this decision may appeal it by initiating action in the appropriate circuit court pursuant to KRS 61.880(5) and KRS 61.882. Pursuant to KRS 61.880(3), 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 proceeding.

                                                Jack Conway

                                                Attorney General

                                                Amye L. Bensenhaver

                                                Assistant Attorney General

#339

Distributed to:

Ray Gough

Tim York

Jeffrey G. Edwards