ARNOLD W. CARTER v. JAMIE D. SMITH AND BOURBON COUNTY BOARD OF EDUCATION
Annotate this Case
Download PDF
RENDERED:
October 8, 2004; 2:00 p.m.
TO BE PUBLISHED
Commonwealth Of Kentucky
Court of Appeals
NO. 2003-CA-001054-MR
ARNOLD W. CARTER
APPELLANT
APPEAL FROM BOURBON CIRCUIT COURT
HONORABLE PAUL F. ISAACS, JUDGE
ACTION NO. 02-CI-00359
v.
JAMIE D. SMITH AND
BOURBON COUNTY BOARD
OF EDUCATION
APPELLEES
OPINION
REVERSING AND REMANDING
** ** ** ** **
BEFORE:
GUIDUGLI AND KNOPF, JUDGES; EMBERTON, SENIOR JUDGE.1
GUIDUGLI, JUDGE:
Arnold W. Carter has appealed from the portion
of the Bourbon Circuit Court’s May 13, 2003, Opinion and Order
denying his motion to intervene as a matter of right pursuant to
CR 24.01.
Carter had moved to intervene, both as a matter of
right and permissibly, in a lawsuit filed by Jamie D. Smith
against the Bourbon County Board of Education alleging
1
Senior Judge Thomas D. Emberton sitting as Special Judge by assignment of
the Chief Justice pursuant to Section 110(5)(b) of the Kentucky Constitution
and KRS 21.580.
violations of the Open Meetings Act.
Because we have determined
that the denial of the motion to intervene as a matter of right
was immediately final and appealable and that the circuit court
should have granted the motion, we reverse and remand.
On December 3, 2002, Smith, a resident of Paris,
Kentucky, filed a two-count complaint in Bourbon Circuit Court
against the Bourbon County Board of Education alleging six
violations of the Open Meetings Act2 in 2001 and 2002.
In late
January, Smith moved the circuit court to file an amended
complaint.
Following a hearing, the circuit court granted
Smith’s motion and her amended complaint was filed on February
4, 2003.
In her amended complaint, Smith included a third
count, alleging that the Board went into a closed session at a
December 19, 2002, meeting for a stated purpose of discussing
pending litigation and personnel without giving notice of the
specific provision of KRS 61.810 authorizing the closed session.
Immediately following the closed session, the Board accepted the
resignation of Superintendent Arnold W. Carter effective
December 31, 2002, and hired him as a consultant through
December 31, 2003, at a cost of approximately $133,000, as well
as $3,000 in moving expenses.
The Board and Carter entered into
an agreement regarding his retention as a consultant on December
23, 2002.
2
Smith requested that the circuit court declare the
KRS 61.805 to 61.850.
-2-
action at the December 19, 2002, meeting null and void and that
any funds Carter was paid be turned over to Bourbon County
Schools.
In a related motion, Smith moved for a temporary
injunction to enjoin the Board from making any additional
payments to Carter under the contract.
Following a hearing in
March, the circuit court entered a temporary injunction against
the Board and enjoined it from making any further payments
pursuant to the December 23, 2002, contract.
The Board was
ordered to pay all money due into an escrow account pending a
final decision as to the validity of the contract.
The circuit
court allowed the parties sixty days from March 4, 2003, to take
additional proof, after which it would decide whether to issue a
permanent injunction or a judgment in favor of the Board.
At an April 9, 2002, hearing, Carter made motions to
intervene as a defendant and to obtain a restraining order to
prevent the hiring of a new superintendent.
These motions were
eventually filed with the clerk twenty days later.
Carter first
filed a motion to intervene as a matter of right pursuant to CR
24.01, and later amended his motion to include a request for
permissive intervention pursuant to CR 24.02.
In his original
motion, Carter stated that he had signed an employment contract
with the Board on June 5, 2001, providing that he would serve as
Superintendent from July 1, 2001, through June 30, 2005.
-3-
He
resigned this position on December 30, 2002, conditioned on a
new consulting contract he signed with the Board.
Because the
circuit court issued a temporary injunction in March, Carter was
no longer being paid for his consulting services under his
contract.
Therefore, he requested permission to intervene as a
matter of right pursuant to CR 24.01(1)(b), because he was so
situated that the disposition of the action may have as a
practical matter impaired or impeded his ability to protect his
interests, which neither Smith nor the Board could be expected
to do.
In another motion, Carter requested a restraining order
to prevent the Board from hiring a new Superintendent in case
the circuit court decided that his consulting contract with the
Board was void.
The circuit court passed the motion to
intervene to allow the parties to brief the issue, and denied
his motion for a restraining order because Carter was not a
party in the action.
In his memorandum in support of the motion to
intervene, Carter asserted that he had a contractual right in
the December 23, 2002, consulting contract as well as in his
Superintendent contract, should the consulting contract be
declared void.
He also argued that his interests would not be
adequately protected by the existing parties; Smith wanted to
enjoin the Board from paying him, and the Board had a financial
interest in not paying any money to him and had refused to
-4-
ratify the December contract in a later open meeting.
The Board
filed a response in opposition to Carter’s motion and amended
motion to intervene, arguing that Carter’s resignation was not
conditioned on the consulting contract, that it was his duty to
correctly post the agenda and ensure conformity with the Open
Meetings requirements, and that the motion to intervene was
untimely.
The Board indicated that Carter and his attorney had
attended the original January hearing, but did not attempt to
intervene until April.
Because he was aware of the lawsuit and
could have intervened prior to the March 4, 2003, hearing, but
chose not to do so, his motion was not timely filed.
On May 13, 2003, the circuit court entered an Opinion
and Order denying Carter’s motion to intervene pursuant to CR
24.01 and his amended motion to intervene pursuant to CR 24.02,
the pertinent parts of which read as follows:
This case involves allegations by
Plaintiff that the Bourbon County Board of
Education (“Board”) violated the open
meetings statute of the Commonwealth of
Kentucky on several occasions. Plaintiff
sought a temporary injunction concerning the
resignation of Mr. Carter as superintendent
and the awarding of a consultant contract to
him at that same meeting. A hearing was
conducted by this Court on March 4, 2003,
and a temporary injunction was entered by
this Court at that time.
Mr. Carter now seeks to intervene into
this action pursuant to CR 24.01, which
states as follows:
-5-
Upon timely application anyone
shall be permitted to intervene in
an action (a) when a statute
confers an unconditional right to
intervene, or (b) when the
applicant claims an interest
relating to the property or
transaction which is the subject
of the action and is so situated
that the disposition of the action
may as a practical matter impair
or impede the applicant’s ability
to protect that interest, unless
that interest is adequately
represented by existing parties.
Obviously, the right to intervene where a
statute conveys an unconditional right to
intervene is not applicable in this case
since this is an action pursuant to
Kentucky’s Open Meetings Act, KRS 61.805
through 61.850, and nothing in that statute
grants anyone any unconditional right to
intervene. Section (b) of CR 24.01 provides
for intervention as a right: when the
applicant claims an interest relating to the
property or transaction, which is the
subject of this action, and is so situated
that practically its disposition should be
determined in the suit. This would appear
to be the section under which Mr. Carter
seeks to intervene as a matter of right.
However, there is no action that this Court
can take which would impair his ability to
protect his interests. The Court has
ordered the funds to which he claims an
entitlement to be placed in escrow until
such time as the Court rules on this motion.
If the Court finds that the action[s] of the
Board were valid, those funds would still be
available to pay him for his services. If
the Court were to declare the actions of the
Board improper, then this contract would be
void ab initio as a violation of public
policy and he would not be entitled to those
funds. There is a whole separate issue as
to whether he would be entitled to any funds
-6-
on a quantum meruit basis, and that would be
an independent action between Mr. Carter and
the Board. Intervention as a matter of
right does not involve cases where one
person’s rights are contingent on a
resolution of another person’s rights. As
the Court said in Gayner v. Packaging Serv.
Corp. of Kentucky, Ky.App., 636 S.W.2d 658,
660 (1982): “CR 24.01(b), like its federal
counterpart, Fed.R.Civ.P. 24, does not
permit a contingent interest such as the
Gayner claim to be placed in issue by
intervention.” Therefore, Mr. Carter does
not have a right to intervene in this
matter.
. . . .
However, even if the Court were to
determine that intervention as a matter of
right or by permission of the Court were
appropriate in this case, the Court would
not grant the motion for its failure to be
timely. The issues involved in this case
were initiated in December of 2002 and, as
the Court pointed out before, has been
subject to several motions and hearings
since then. Mr. Carter has been aware of
those issues, and counsel for both Plaintiff
and the Board have asserted that he was
present at some of the hearings on this
matter. However, he chose not to intervene
until there was a newspaper article
indicating that the Board was considering
hiring a new school superintendent. As soon
as this article appeared in the paper, Mr.
Carter, with his attorney, filed a motion to
intervene and an accompanying motion for a
temporary injunction to prevent said hiring.
This is the real purpose of this matter.
This Court finds that it is inappropriate
and untimely to sit back and wait until the
ninth hour before trying to intervene,
especially when the party seeking
intervention was well aware of the
litigation. Therefore, this Court finds
that the motion was also untimely filed.
-7-
This appeal from the portion of the order denying Carter’s
motion to intervene pursuant to CR 24.01 followed.
As an initial matter, we shall address Carter’s
response to the show cause order this Court issued regarding
whether the circuit court’s order was presently final and
appealable in light of the fact that a final judgment disposing
of the suit has not yet been entered.
In his response, Carter
relies upon the Supreme Court of Kentucky’s decision in Ashland
Public Library Board of Trustees v. Scott3 for the proposition
that an immediate appeal lies from the denial of a motion to
intervene as a matter of right pursuant to CR 24.01.
We agree.
In City of Henderson v. Todd,4 the former Court of Appeals held
that an order denying a motion to intervene as a matter of right
is immediately appealable.
The Ashland Public Library court
relied upon the City of Henderson case and expounded upon that
case to note its adoption of the rule in 7A Wright & Miller,
Federal Practice and Procedure section 1923:
“(A) Prior to
judgment disposing of the whole case, any denial of intervention
of right should be regarded as an appealable final order but the
appellate court should affirm unless such intervention of right
was erroneously denied.”5
While the circuit court in this case
ruled upon both motions to intervene, Carter limited his appeal
3
4
5
Ky., 610 S.W.2d 895 (1981).
Ky., 314 S.W.2d 948, 951 (1958).
Ashland Public Library, 610 S.W.2d at 896.
-8-
to the denial of his motion to intervene as a matter of right.
Therefore, we shall permit his appeal to proceed.
CR 24.01(1) provides for a four-prong test regarding
rulings on motions to intervene when a statute has not conferred
an unconditional right to intervene:
Upon timely application anyone shall be
permitted to intervene in an action . . .
(b) when the applicant claims an interest
relating to the property or transaction
which is the subject of the action and is so
situated that the disposition of the action
may as a practical matter impair or impede
the applicant’s ability to protect that
interest, unless that interest is adequately
represented by existing parties.
We shall first address the timeliness issue.
The circuit court found that Carter’s motion to
intervene was not timely filed, noting that the suit was filed
in December 2002, and that several motions had been filed and
hearings held prior to the filing of the motion to intervene, of
which Carter was aware and at which he was present.
However,
the circuit court found that Carter chose not to intervene until
after the publication of a newspaper article regarding the
hiring of a new superintendent.
This, the circuit court found,
was the real reason for the intervention.
On appeal, Carter
argues that his motion to intervene was timely, in that he had
no reason to intervene until the amended complaint brought his
consulting contract into dispute and further payments under the
-9-
contract were enjoined.
His goal in intervening was to protect
his interest in the consulting contract.
Carter also argues
that the parties to the suit were not prejudiced as there had
been little discovery and that no unusual circumstances
militated against intervention.
On the other hand, both Smith
and the Board argue that the circuit court did not abuse its
discretion in finding the motion to be untimely filed.
There is some dispute between the parties about the
standard of review applicable to the issue of timeliness.
We
have determined that our review of the circuit court’s finding
of untimeliness is governed by an abuse of discretion standard,
based upon both state and federal law.
In Ambassador College v.
Combs,6 the Supreme Court of Kentucky stated, “[t]imeliness is a
question of fact, the determination of which should usually be
left to the judge.”7
Looking to the federal level, the Sixth
Circuit Court of Appeals has used an abuse of discretion
standard to review the district court’s ruling on timeliness for
a motion to intervene as a matter of right pursuant to
Fed.R.Civ.P. 24(a)(2), the federal counterpart to Kentucky’s CR
24.01.8
6
Ky., 636 S.W.2d 305, 307 (1982).
See also Rosenbalm v. Commercial Bank of Middlesboro, Ky.App., 838 S.W.2d
423, 427 (1992).
8
Cuyahoga Valley Ry. Co. v. Tracy, 6 F.3d 389 (6th Cir. 1993); Grubbs v.
Norris, 870 F.2d 343 (6th Cir. 1989).
7
-10-
In Grubbs v. Norris,9 the Sixth Circuit Court of
Appeals relied upon the five-factor test as set forth in Triax
Co. v. TRW, Inc.10 to determine whether a motion to intervene was
timely.
Those factors are:
(1) [T]he point to which the suit has
progressed; (2) the purpose for which
intervention is sought; (3) the length of
time preceding the application during which
the proposed intervenor knew or reasonably
should have known of his interest in the
case; (4) the prejudice to the original
parties due to the proposed intervenor’s
failure, after he or she knew or reasonably
should have known of his or her interest in
the case, to apply promptly for
intervention; and (5) the existence of
unusual circumstances militating against or
in favor of intervention.[11]
In Monticello Electric Plant Board v. Board of Education of
Wayne County,12 the former Court of Appeals went so far as to
hold that intervention may be allowed under certain
circumstances even after the judgment has been entered, although
the court indicated that the applicant would have to overcome a
special burden to justify the apparent lack of timeliness.
In the present matter, the circuit court based its
decision that the motion to intervene was untimely upon findings
that Carter inappropriately waited to file his motion until
reading a newspaper article about the possible hiring of a new
9
870 F.2d 343 (6th Cir. 1989).
724 F.2d 1224 (6th Cir. 1984).
11
Grubbs, 870 F2d at 345. See also Cuyahoga Valley Ry. Co., 6 F.3d at 395–
96.
12
Ky., 310 S.W.2d 272, 274 (1958).
10
-11-
superintendent, even though he was aware of the pending lawsuit
and had been present at several hearings with this attorney.
Applying the Grubbs factors to this case, we note that at the
time intervention was sought, no final judgment had been entered
and the parties had completed little, if any, discovery.
Carter
was seeking intervention to protect his interests in the
consulting contract, which was not raised in the original
December complaint, but in the amended complaint filed in early
February.
Regarding the length of time preceding his motion,
Smith did not move to file her amended complaint until the end
of January, and the circuit court did not grant her motion until
February 4, 2003.
Furthermore, the circuit court did not enter
the temporary injunction ordering the funds Carter was to be
paid into escrow until March 18, 2003.
Carter first raised his
desire to seek intervention less than one month later at a
hearing on April 9, 2003.
Any possible prejudice to the parties
in the lawsuit would be minimal, if any existed at all, because
the suit was still in its early stages.
Lastly, there were no
unusual circumstances militating against intervention.
Based
upon our review of the applicable law, we hold that the circuit
court abused its discretion in determining that Carter’s motion
to intervene was not timely filed, and that its decision on this
issue must be reversed.
-12-
Although the circuit court held that his motion to
intervene was not timely, the circuit court also reviewed the
merits of the motion and held that Carter should not be
permitted to intervene as a matter of right.
The circuit court
reasoned that there was no action it could take to impair or
impede his interests and that the right to payment under the
contract he was seeking to protect was merely contingent on the
resolution of another person’s rights.
Carter argues that he
did have a substantial interest in the subject matter of the
lawsuit because Smith’s amended complaint and temporary
injunction made his consulting contract a central issue, and
that his interests would not be adequately protected by the
Board.
He asserts that it would financially benefit the Board
to circumvent its contract with him so that it would not have to
pay him for the months of services he performed, and that the
Board failed to ratify the consulting contract in a later open
meeting.
In her brief, Smith argues that disposition of her
action would not impair or impede Carter’s interest because
there was nothing in the record, other than his affidavit, to
establish that he was performing under the contract, and because
other remedies existed.
Likewise, the Board argues that
Carter’s interest was completely contingent and fully protected
by the escrow account.
-13-
Our standard of review as to whether intervention
should have been granted is a clearly erroneous standard.13
An
applicant must meet a four-prong test before being entitled to
intervene in a lawsuit pursuant to CR 24.01(1).14
We have
already determined that the motion was timely filed.
Therefore,
Carter must establish the three remaining prongs: that he has an
interest relating to the subject of the action, that his ability
to protect his interest may be impaired or impeded, and that
none of the existing parties could adequately represent his
interests.
We hold that Carter satisfied each of these
requirements and should have been permitted to intervene as a
matter of right.
First, we shall address whether Carter had a
substantial interest in the lawsuit.
In Baker v. Webb,15 the
Supreme Court of Kentucky stated, “[i]n order to intervene, the
party’s interest relating to the transaction must be a ‘present
substantial interest in the subject matter of the lawsuit,’
rather than an expectancy or contingent interest.”16
Based upon the facts of this case, we hold that Carter
had a substantial interest in the subject matter of the lawsuit
in that his consulting contract was being called into question.
13
Gayner v. Packaging Service Corp. of Ky., Ky.App., 636 S.W.2d 658, 660
(1982); Grubbs, 870 F.2d at 345.
14
See Washington Electric Cooperative v. Massachusetts Municipal Wholesale
Electric Co., 922 F.2d 92 (2nd Cir. 1990).
15
Ky., 127 S.W.3d 622 (2004).
16
Id. at 624 (citing Gayner, 636 S.W.2d at 659).
-14-
Smith was seeking to invalidate his consulting contract, and on
her motion the circuit court entered a temporary injunction
causing Carter’s future payments under the contract to be placed
into an escrow account.
In addition to his contract rights,
Carter also wanted to protect his interest in his former
superintendent position should his contract be declared void.
Although both Smith and the Board argue that Carter’s interest
was merely contingent upon the final outcome, we disagree that
this makes his interest any less substantial.
Carter had a
present and substantial interest in protecting both his
consulting contract, regardless of the fact that the funds
payable to him were in escrow, and in protecting his former
position.
In addition, we believe that intervention in this
case would allow for judicial economy and prevent piece-meal
litigation.
Next, we shall address whether Carter’s ability to
protect his interests would be impaired or impeded if not
permitted to intervene.
Carter states that he would be
prevented from protecting his contract interest if the circuit
court were to declare the contract null and void because of the
presence of the injunction preventing the Board from paying him.
He asserts that his only remedy would be to intervene and move
the circuit court to lift the injunction.
Smith and the Board
each argue that Carter’s interests would not be impaired because
-15-
other adequate remedies exist.
We agree with Carter that the
possibility exists that his ability to protect his interests may
be impaired unless he is permitted to intervene.
Last, we shall examine whether Carter’s interests are
adequately represented by the existing parties.
While Smith and
the Board argue that his rights are adequately represented,
presumably, by the Board, we agree with Carter that neither
party to the action has any reason to represent or protect his
rights.
There is nothing to prevent the Board from admitting to
the Open Meetings Act violation, thereby voiding the consulting
contract and negating its need to pay Carter under the terms of
the contract.
Further, the Board never ratified its decision
concerning the consulting contract in a later open meeting.
Smith’s argument in her brief that there is nothing in the
record regarding whether Carter performed under the contract is
irrelevant because the fact remains that he should be permitted
to protect his interest in the contract itself, as opposed to
the actual collection of funds due under the contract.
Based upon our de novo review of the circuit court’s
denial of Carter’s motion to intervene, we hold that the
decision was clearly erroneous and, as with the ruling on
timeliness, must be reversed.
For the foregoing reasons, the portion of the Bourbon
Circuit Court’s Opinion and Order denying Carter’s motion to
-16-
intervene as a matter of right is reversed, and this matter is
remanded for further proceedings consistent with this opinion.
ALL CONCUR.
BRIEF FOR APPELLANT:
Joe F. Childers
Lexington, KY
BRIEF FOR APPELLEE, JAMIE D.
SMITH:
Neil Duncliffe
Georgetown, KY
BRIEF FOR APPELLEE, BOURBON
COUNTY BOARD OF EDUCATION
Sam P. Burchett
Lexington, KY
-17-
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.