Just in time for "Sunshine Week," a divided Iowa Supreme Court today rejected a scheme by Warren County supervisors to evade Iowa's open meetings law by discussing a downsizing plan individually in turns with the county administrator. Four justices agreed, "the open meetings law does prohibit the majority of a governmental body gathering in person through the use of agents or proxies to deliberate any matter within the scope of its policy-making duties outside the public view."
Follow me after the jump for background on the case and excerpts from the majority and dissenting opinions. Three Iowa Supreme Court justices would have upheld the District Court ruling, which stated that using a county administrator as a "conduit" or "messenger" to discuss policy did not trigger state law's requirements for an open meeting with advance public notice.
The Des Moines-based weekly Cityview's "Civic Skinny" columnist described the key legal question last November:
Warren County is governed by three supervisors. A couple of years ago, the chairman, former Casey’s General Stores chief financial officer Doug Shull, decided the county was inefficient and needed to be run “more like a business.”
He told the county administrator of his ideas. She then told the other two supervisors, Steve Wilson and Dean Yordi, of his ideas. But she told them one at a time. She then reported back to Shull that the other two were in agreement. There was no public discussion of the plan that the three had individually agreed to, which included layoffs. And no two ever met with one another. Then, in March of last year , the administrator fired 12 employees as part of that effort to run the county like a business. They were sent packing the day they were told. They didn’t see it coming, and neither did the public.
Some of those employees signed severance agreements and went quietly. Six didn’t. They sued the supervisors and the board and the county, saying the one-on-one conversations were just a ruse to get around the letter of the open-meetings law. Indeed, Shull said the supervisors were very cognizant of the law and acknowledged that the individual conversations with the county administrator were done precisely to skirt the law — and its requirements for transparency.
Lawyer: Well, you knew, didn’t you, that if you had the discussion you had with [the county administrator] and another supervisor, that would have to be done in an open meeting?
Lawyer: So one of the reasons for having the discussion directly with [the administrator] and having her talk to the other supervisors was to avoid open meetings, right?
Lawyer: There was really no need for a middle person unless you did not want to have an open meeting.
Shull: We did not want to violate the Open Meetings Law.
Lawyer: The letter of it, right?
The letter of the law can be found Iowa Code Section 21. From Section 21.2 on definitions:
“Meeting” means a gathering in person or by electronic means, formal or informal, of a majority of the members of a governmental body where there is deliberation or action upon any matter within the scope of the governmental body’s policy-making duties. Meetings shall not include a gathering of members of a governmental body for purely ministerial or social purposes when there is no discussion of policy or no intent to avoid the purposes of this chapter.
Iowa Public Radio's Sarah Boden covered this story last October, when the Iowa Supreme Court heard oral arguments in Hutchison v Shull.
Patrick Smith, the attorney representing Warren County's board of supervisors, says the court should focus on the language in the statute which says a meeting occurs when a majority of members gather either in person or electronically. He says this would create a "bright-line rule," which would be easy to follow and understand.
But if Smith's argument is successful, that means the deliberations of elected and appointed officials in Iowa at all levels could be far less public as a result.
"Doesn’t it give a blueprint to a board of supervisors to take the most controversial and troublesome issues, all of them, and decide them without the ordinary public deliberation, outside the public view?" asks Justice Brent Appel.
"The public has the opportunity of course, at the ballot box and otherwise, to tell these supervisors how they feel about that decision," says Smith.
Justice David Wiggins wrote today's majority opinion, joined by Chief Justice Mark Cady and Justices Brent Appel and Daryl Hecht. You can read the full text here, along with dissents by Justices Thomas Waterman and Edward Mansfield, joined by Bruce Zager.
The first part of Wiggins' opinion reviews how Warren County supervisors developed a reorganization plan and considered it through one-on-one discussions with county Administrator Mary Jean Furler, in order to avoid any two supervisors meeting in person or talking about the downsizing via e-mail.
Wiggins summarized Warren County District Judge Mary Pat Gunderson's findings on pages 12 and 13:
The district court tried the case in July . The judge declined to award relief to the terminated employees, finding the employees failed to prove by a preponderance of the evidence that a majority of the board deliberated about the reorganization in violation of the open meetings law.
The district court first addressed the employees’ allegations that a majority of the supervisors deliberated the reorganization during closed- door, in-person gatherings witnessed by the board secretary. Former board secretary Shelly Vander Tuig testified at trial that several closed- door meetings took place between a majority of the supervisors and Administrator Furler in January and February 2014. The court pointed out that on cross-examination, Vander Tuig admitted she was not present at those gatherings and was never told what was discussed during them. In addition, Administrator Furler and the supervisors all denied a majority of the supervisors had ever met to discuss county business and understood their doing so would have constituted a violation of the open meetings law. The court consequently found the employees failed to prove by a preponderance of the evidence that a majority of the board deliberated about the reorganization in person during those closed-door gatherings.
The district court next addressed the question of whether the supervisors violated the open meetings law by using Administrator Furler as a conduit to deliberate the details of the reorganization. The court concluded the evidence established the supervisors deliberated the reorganization through Administrator Furler, rejecting the notion that the board distributed the severance agreements before the supervisors engaged in discussions and evaluative processes in arriving at a decision or policy.
The district court then turned to the question of whether the evidence established a gathering of a majority of the board triggered the requirements of openness and public notice under the open meetings law. Interpreting Iowa Code section 21.2(2), the district court found the supervisors did not violate the open meetings law by using a third party to deliberate the reorganization because a majority of the supervisors did not gather as required by the definition of meeting in the Code.
On pages 13 and 14, Wiggins explained what the Iowa Supreme Court majority focused on in its review:
Neither party appealed the district court finding that the evidence established the supervisors deliberated the details of the reorganization through Administrator Furler. Therefore, we do not address that issue in this opinion. Rather, we address the following issues in this appeal. First, whether substantial evidence supports the district court finding that a majority of the supervisors never deliberated the reorganization during the closed-door, in-person gatherings observed by the board secretary. Second, whether the district court correctly interpreted section 21.2(2) when it concluded the gatherings attended by the individual supervisors and the county administrator did not constitute gatherings of a majority of the members of the board.
As described above, the supervisors admitted to devising this scheme to evade Iowa law. The central legal question is whether the court should adopt a narrow, literal reading of what a "meeting" is (page 17):
The supervisors argue a gathering within the meaning of section 21.2(2) occurs only when a majority of the members of a governmental body personally assemble in close temporal proximity. In contrast, the employees contend that in order to reach a solid consensus on the reorganization plan the supervisors necessarily had to gather in order to deliberate as a body. The amici curiae contend Administrator Furler acted as each supervisor’s agent by conveying his thoughts and opinions to the other supervisors. Thus, they contend each gathering between Administrator Furler and an individual supervisor was the legal equivalent of a gathering between two or three supervisors.
The Iowa Newspaper Association and Iowa Freedom of Information Council filed the friend of the court briefs (amici curiae) referenced here--a important point for the dissenting justices, as we shall see below.
A unanimous 1980 Iowa Supreme Court ruling in Telegraph Herald, Inc. v City of Dubuque held that Iowa law allows a series of private, in-person gatherings of less than a majority of a board's members. Attorneys for the supervisors argued that the precedent should apply to this case. Wiggins dismissed that argument on pages 18 and 19:
In Telegraph Herald, we recognized the “legislature’s apparent intent that temporal proximity exist among members of the governmental body” in order for a “meeting” subject to the open meetings requirements to take place. Id. at 534. However, the question we faced in that case is distinguishable from the question we face in this case. In the former, we considered whether an open meetings violation occurred when members of a city council interviewed applicants for the position of city manager during a series of gatherings at which less than a majority of the council members were present at various times and places. [...]
We concluded the serial submajority gatherings did not violate the open meetings law because they did not constitute gatherings to which open meetings requirements applied for two reasons. First, the council members obviously did not deliberate regarding whom they would actually hire during the interviews.1 Id. at 532–33. Second, in interpreting section 21.2(2), we concluded that in order for serial submajority gatherings to collectively constitute a meeting of the majority of a governmental body and trigger the open meetings requirements, a majority of the members must deliberate in temporal proximity to each other. Id. at 533–34. [...]
Our resolution to the question we faced in Telegraph Herald does not answer the question we face in this case. First, in this case, there is no question that the board members collectively deliberated during the meetings between the individual board members and the county administrator. As previously noted, the district court found that they did, and the parties do not dispute that finding. Second, the employees do not claim the open meetings requirements were triggered by serial submajority gatherings or assert that serial meetings attended by the individual board members collectively constituted a meeting within the meaning of the statute.
Rather, the employees claim the open meetings requirements were triggered when a majority of the board intentionally deliberated the reorganization using the county administrator as their conduit because doing so was legally equivalent to deliberating the reorganization during a gathering at which a majority of the board was personally present.
The majority opinion then delved into case law on "agency principles" to assess whether the Warren County administrator was acting as an "agent" for other supervisors in her one-on-one meetings with them (as the amici curiae contend). From pages 20 and 21:
Were we to assume the legislature was unfamiliar with agency principles when it enacted the open meetings law, we might construe the term “gathering” narrowly to conclude the open meetings requirements apply only to face-to-face deliberations during which a majority of the members of a governmental body are personally physically present and to electronic or serial submajority deliberations among a majority of members occurring in close temporal proximity. However, such a narrow construction of the term would clearly be at odds with the intended scope and purpose of our open meetings law “to assure, through a requirement of open meetings of governmental bodies, that the basis and rationale of governmental decisions, as well as those decisions themselves, are easily accessible to the people.” See id. § 21.1. Adopting the interpretation of section 21.2(2) urged by the board and its members would result in absurd consequences undermining the clear purpose of the open meetings law. We therefore conclude the statute is ambiguous with respect to the question of whether governmental bodies may utilize agents to deliberate on their behalf without triggering the open meetings requirements. See Sherwin-Williams, 789 N.W.2d at 427.3
Continuing the argument on pages 22 and 23:
We believe resolving this ambiguity requires us to consider whether the common law of agency influences the proper interpretation of section 21.2(2). The legislature clearly instructed that ambiguities arising in construing the open meetings law should be resolved in favor of openness. [...]
We have long recognized the general principle that members of a public board “may authorize performance of ministerial or administrative functions” but cannot delegate “matters of judgment and discretion.” [...]
The open meetings statute reflects the reality that deliberation upon matters of public policy involves judgment and discretion. See Iowa Code § 21.2(2). Thus, our conclusion that public bodies cannot use agents to deliberate matters of public policy without triggering the open meetings law is consistent with this principle. In contrast, were we to reach the opposite conclusion, we would encourage members of governmental bodies to enlist agents to deliberate matters of public policy on their behalf outside the public view in order to purposefully evade the open meetings law.
Because we conclude agency principles are relevant to determining whether a gathering satisfies the statutory definition of meeting in section 21.2(2), we conclude the legal equivalent of an in-person gathering of a majority of the members of a public body takes place whenever a majority of the members of a governmental body meet, whether each member attends personally or through an agent.
On pages 24 and 25, Wiggins noted that the Iowa Supreme Court accepts the district court's fact-finding but not its interpretation:
Here, the record amply supports the district court finding that the supervisors intentionally developed a “sophisticated methodology of communicating effectively with one another” about county business outside the public view “by using Administrator Furler as a conduit.” As the district court found, the record shows Administrator Furler and the supervisors understood that it would trigger the open meetings requirements if two or more supervisors met in person to discuss the reorganization or other county business. Thus, the record clearly supports the district court’s conclusion that the supervisors deliberately used Administrator Furler to flesh out the details of the reorganization plan and resolve conflicts among themselves about how best to accomplish the reorganization outside the public view.
The record also supports the district court finding that the supervisors used Administrator Furler to deliberate the reorganization plan in that manner because they knew the plan would be controversial and anticipated conflict and discomfort would result if they discussed it in a public forum. As the testimony recounted at length by the district court clearly demonstrates, the supervisors actively avoided discussing the reorganization in public meetings by having Administrator Furler meet with them individually to gather and convey information they intentionally shared with her in order to allow her to facilitate their communication with each other. By this method, the supervisors compromised regarding key details of the reorganization plan, including which positions to eliminate and the terms of the severance packages to be offered to eliminated employees.
Wiggins then explained how the lower court got it wrong and how it can correct the error (pages 25 and 26):
Although we agree with the district court’s assessment of the facts, the court made a legal error in interpreting section 21.2(2). Consequently, it did not apply agency principles in determining whether the actions of the supervisors and the county administrator violated the open meetings law. The employees urge us to conclude the district court implicitly found the administrator acted as an agent of one or more supervisors in conducting shuttle diplomacy among them on their behalf. After all, if the administrator never acted as an agent of one or more of the supervisors during any of her conversations with the other supervisors, how could the supervisors have deliberated every detail of the reorganization plan and implemented it prior to the public meeting?
We would be well within our power to find an agency relationship existed on a de novo review. However, in this appeal we review the district court’s ruling for correction of errors at law. Because the district court erroneously interpreted section 21.2(2) and did not make the factual findings necessary to determine whether the gatherings attended by the individual supervisors and the county administrator constituted meetings subject to the open meetings requirements under a proper interpretation of the statute, we must remand the case to the district court.
On remand, the district court should determine the nature and extent of the actual authority the supervisors granted Administrator Furler when they intentionally used her to deliberate the reorganization plan outside the public view in an attempt to avoid triggering the open meetings requirements. See Mayrath Co. v. Helgeson, 258 Iowa 543, 547, 139 N.W.2d 303, 305–06 (1966) (acknowledging that “usually the nature and extent of the authority of an agent, and whether his acts . . . are within the scope of his authority, are questions of fact”). If the court finds an agency relationship existed and Administrator Furler acted within the scope of her authority in helping the supervisors to deliberate the details of reorganization, it should apply section 21.2(2) in accordance with this opinion to conclude that a violation of the open meetings law occurred.
Wiggins made clear that this ruling is not meant to apply only to this case. Iowa's lower courts should apply the same reasoning to similar circumstances (page 28):
In fact, the supervisors concede they intentionally used the county administrator to facilitate discussion amongst themselves concerning various aspects of the reorganization and to negotiate an agreement concerning the precise details of the reorganization plan, as evidenced by the fact that the board never discussed the plan at an open meeting before they actually implemented it. The legislature clearly intended public bodies subject to the open meetings law to deliberate the basis and rationale for important decisions such as these, as well as the decisions themselves, during open meetings. Iowa Code § 21.1.
Thus, we conclude district courts must apply agency principles in determining whether an in-person gathering satisfies the statutory definition of meeting in section 21.2(2). Accordingly, the open meetings requirements apply to all in-person gatherings at which there is deliberation upon any matter within the scope of the policy-making duties of a governmental body by a majority of its members, including in- person gatherings attended by members of a governmental body through agents or proxies.
Justice Waterman wrote the longer of the two dissents, joined by Justices Mansfield and Zager. His dissent begins on page 30 of this pdf file. Waterman argued that the district court
correctly applied the plain language of Iowa Code section 21.2(2) (2013) and our precedent. The majority opinion today replaces a clear, easy-to-follow rule with a vague standard that will invite costly litigation and deter diligent public officials from conferring with administrators to prepare for public meetings. The majority adopts a new agency theory at odds with Iowa municipal law and never adopted by any other appellate court. This agency theory treats an unelected administrator as an elected county supervisor in order to find the “majority” required to trigger the open meetings law. This untested and novel agency theory was not raised by plaintiffs in district court or on appeal. We should not change the rules after the game is played and then allow a retrial on a theory that was not preserved.
Whereas the majority did not find the Telegraph Herald ruling applicable to the Warren County situation, Waterman disagreed (page 31):
The majority acknowledges “our legislature twice considered, but failed to pass, proposed bills that would have amended section 21.2(2) to address serial submajority gatherings.” Yet, the majority effectively rewrites the statutory definition of “meeting” to prohibit informal practices that the legislature has allowed to continue since our unanimous decision thirty-five years ago in Telegraph Herald, Inc. v City of Dubuque, 297 N.W.2d 529, 533–34 (Iowa 1980) (interpreting the statute to allow private in-person gatherings of less than a majority).
I would defer to the elected branches to redefine the requirements of the open meetings law. That is their policy decision to make. The Iowa legislature has clearly acquiesced in our interpretation of chapter 21 in Telegraph Herald.
Whereas the majority worried that allowing the Warren County practice "would result in absurd consequences undermining the clear purpose of the open meetings law," Waterman worried about the consequences of banning the practice (page 32):
Unfortunately, no amici curiae briefs were filed on behalf of the Iowa State Association of Counties, the Iowa League of Cities, the Iowa Association of School Boards, or the executive branch of state government to address the practical problems that may result from the majority’s new interpretation. Today’s decision can be and should be limited to its facts—a fait accompli arranged behind closed doors. My concern, however, is that the decision will have a chilling effect on well- intentioned public officials who consider themselves duty-bound to get up to speed on pending matters before public meetings. Let us consider the dilemma now faced by public officials who want to do their homework by sitting down with an administrator privately, rather than prolonging a public meeting. May they continue to confer privately with staff or in small groups? Or, if they do, could someone sue them for violating chapter 21, putting their personal assets at risk for a judgment for attorney fees?
The dissenters were not convinced by the majority's reading of "agency principles" (page 38):
We have never held that an administrator acting as an agent for a board member can be counted to reach a majority that triggers the requirements of chapter 21. Iowa law distinguishes between elected supervisors and administrators employed by the county. I would not count an unelected administrator as a stand-in for an elected supervisor regardless of whether he or she is engaged in shuttle diplomacy between supervisors. The majority’s new agency theory rests on a legal fiction that treats the county administrator as a supervisor. The agency theory conflicts with our precedent limiting the ability of supervisors to use agents. As the majority recognizes, it is a general principle that public board members “may authorize performance of ministerial or administrative functions” but cannot delegate “matters of judgment and discretion.” Bunger v. Iowa High Sch. Athletic Ass’n, 197 N.W.2d 555, 559–60 (Iowa 1972). The principle that an elected county supervisor cannot delegate matters of judgment precludes the legal conclusion that Administrator Furler, who is not a supervisor, could act as one.
Waterman also noted that the "agency" argument emerged in the friend of the court brief--not during the District Court trial (pages 40 and 41):
The majority’s agency theory has not been adopted by any other appellate court interpreting equivalent sunshine laws. Perhaps for that reason, the plaintiffs in this case did not argue an agency theory in district court or on appeal. Nor did their pleadings allege Administrator Furler acted as an agent or proxy for any supervisor.6 Rather, the agency theory appears for the first time in this case in the amicus curiae brief filed by the Iowa Newspaper Association and Freedom of Information Council.
Not only is the agency theory a misreading of chapter 21, I would hold that the theory was not preserved. We have repeatedly held that amici cannot preserve issues for a party or raise new issues on appeal. [...]
Plaintiffs are not entitled to a retrial because they never raised or otherwise preserved an agency or proxy theory in district court. The existence of an agency relationship and the extent of the agent’s authority are questions of fact. [...]
The district court made no finding that Furler acted as an agent for any supervisor. Rather, the district court found each supervisor retained his authority to approve or veto the reorganization while Furler merely acted as a “conduit” between them. A conduit who relays information differs from an agent with authority to negotiate policy decisions for her principal, as Justice Mansfield explains today in his separate dissent, which I join. The district court never found that Furler was authorized to act in the place of one supervisor when she met with another. Nor can the court’s actual findings be interpreted to include an implicit finding of agency. Appellate courts may only use implicit findings to affirm a judgment. [...] We have never used implicit findings to reverse a judgment.
Footnote 6If the agency theory had been raised in district court, the defendants would have had the opportunity to respond and rebut it with testimony on Furler’s actual authority, or lack of it.
Waterman summed up on page 42,
The majority makes too much of the district court’s conclusion that the supervisors “deliberated” by using Furler as a conduit. Individual supervisors deliberated separately with Furler communicating between them.7 The district court never found that Furler deliberated in the place of a supervisor; rather, Furler relayed information between them. Furler’s deliberations are not those of a supervisor. Missing is the requisite real time temporal proximity for the supervisors’ private deliberations, as well as the requirement that two supervisors meet in person. [...]
Today’s departure from our precedent is all the more egregious because the majority reverses the district court to grant a new trial under a fact-bound theory the plaintiffs never raised. Giving the plaintiffs a second bite at the apple under these circumstances is unfair to the district court judge and to the defendants. Our practice until now has been that new liability rules are applied prospectively and in pending appeals in which the issue had been preserved.
Mansfield wrote a short additional dissent, beginning on page 45.
I write separately to discuss the majority’s blurring of concepts regarding the law of agency.
To say that an individual may be an agent merely begins the analysis. We need to consider the scope of that person’s agency. See In re Estate of Waterman, 847 N.W.2d 560, 574–75 (Iowa 2014). In particular, what was the agent’s authority?
The record supports the conclusion that Administrator Furler was one kind of agent. That is, she had authority to carry messages from one supervisor to another. This fact, however, does not establish that a quorum of the supervisors ever held an illegal meeting. [...]
A different question would be presented if Administrator Furler were another kind of agent—that is, if she were empowered with decision- making authority. For example, if one of the supervisors delegated to her the authority to work out a restructuring plan with another supervisor, this would be more problematic. In that case, Administrator Furler would be a proxy rather than a conduit.
I see no logic in allowing public officials to employ the Warren County proxy scheme to evade open meetings rules. But Mansfield viewed that point differently (page 46):
In my view, our legislature made a logical decision when it allowed members of state and local boards and governing bodies to communicate privately in advance of public meetings, so long as the communications do not amount to a real-time meeting. It is inherently difficult for decision-making bodies to do all of their business in public. This observation holds true whether the body is a board of supervisors, a legislature, an appellate court, the board of directors of a charity, or the management of a news media organization.
Charity organizations and media outlets are not elected by the people to manage public affairs. Here's an idea for people who prefer not to do the public's business in public: don't run for county supervisor.
When the Iowa Supreme Court heard oral arguments in this case, Justice Zager commented,
"Clearly this doesn't meet the spirit [or] the intent of the statute here, and I don't think anyone would disagree with that," says Justice Brace Zager, "but I'm still having a problem with finding that this meets the definition of meetings, and the concept of a coming together of our minds or ideas, and that equals a gathering."
Since Zager and the other dissenting justices would allow elected officials to violate the intent of the statue, and this case was decided by only a 4-3 majority, Iowa lawmakers should amend the relevant portion of state code to explicitly ban the use of a proxy to avoid open meetings.
UPDATE: The brief on behalf of the Iowa Newspaper Association and the Iowa Freedom of Information Council is available here.
Commenting on Waterman's lament that other organizations did not file friend of the court briefs supporting the Warren County supervisors' position, a Bleeding Heartland reader who used to serve on a school board posited,
Perhaps one of the reasons the Iowa School Board Association did not file a brief supporting the county is that their training for new school board members tells them not to do what Warren County did. Clearly they have felt for years that actions such as this violated the spirit of the law and were poor practice.
I am seeking written materials from the association to that effect and if possible will post a link or excerpts from the training documents.