Valley Realty & Development, Inc. v. Town of Hartford

Valley Realty & Development, Inc. v. Town of Hartford  (95-412); 165 Vt 463;
685 A.2d 292

[Opinion Filed 02-Aug-1996]

[Motion for Reargument Denied 25-Sep-1996]


       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.


                                 No. 95-412


Valley Realty & Development, Inc.                 Supreme Court

                                                  On Appeal from
    v.                                            Windsor Superior Court

Town of Hartford, et al.                          April Term, 1996


Alan W. Cheever, J.

Christopher Dye, Bradford, for plaintiff-appellant

Maureen Ragan of Welch, Graham & Manby, White River Junction, for
  defendants-appellees


PRESENT:  Allen, C.J., Gibson, Dooley, Morse and Johnson, JJ.


       DOOLEY, J.   Plaintiff Valley Realty & Development, Inc. brought this
  action against the Town of Hartford, alleging that the board of selectmen
  violated the open meeting law, 1 V.S.A. § 313, by deciding to purchase a
  parcel of land in an illegal executive session.  The Windsor Superior Court
  dismissed the claim, holding that plaintiff lacked standing to pursue his
  open meeting claim because he was not aggrieved by the violation.  We hold
  that the action taken in executive session was ratified by later action of
  the board taken in public session, and affirm.

       The context for this case is set out in Robes v. Town of Hartford, 161
  Vt. 187, 636 A.2d 342 (1993).  On December 29, 1986, the Town of Hartford's
  board of selectmen passed a resolution imposing a plant impact fee on all
  residential structures not occupied before January 1, 1987, and on existing
  residential structures requiring additional demand for sewage services
  after January 1, 1987.  The revenue from this measure was to be placed in
  the Sewage Impact Fee Fund.  Id. at 188, 636 A.2d  at 344.

       In February 1988, plaintiff began paying into the Fund.  After having
  contributed a total

 

  of $38,000 to the Fund, plaintiff became part of a lawsuit filed in Windsor
  Superior Court challenging the legality of the plant impact fee.  On
  December 6, 1991, the court held that the Town had the proper authority to
  impose the plant impact fee, and that the fee rate was rationally related
  to the Town's purpose of financing new construction of sewage facilities. 
  Id. The court also held that the Town must return funds unused after a
  reasonable amount of time. Id. at 188-89, 636 A.2d  at 344.  The Town
  subsequently amended the resolution to allow a refund of funds not used
  within six years.  We affirmed the trial court's determination that the
  fund was valid, as long as it provided a refund of funds not spent within
  six years.  Id. at 195, 197, 636 A.2d  at 348, 349.

       In January 1993, while the Robes appeal was pending before this Court,
  plaintiff filed this suit in Windsor Superior Court, alleging that the Town
  had used the Fund to purchase a parcel of land by a procedure that violated
  the Vermont open meeting law.  The suit sought to void the purchase by the
  Town of a parcel of land adjoining the Town's sewage treatment plant. The
  selectmen voted to purchase the land on May 16, 1989 from Jerry and Alda
  Terino for $150,000 for the purpose of expanding the Town's plant.  At a
  regular meeting of the selectboard of the Town, the board went into
  executive session and accepted the Terino's offer to sell by countersigning
  a letter containing the offer.  On May 30, 1989, the Town paid the Terinos
  $25,000 from its general fund.  On July 6, 1989, the Town paid the $125,000
  balance to complete the transaction, and the Terinos gave the Town the deed
  to the property.  In late September of 1989, the Town transferred $150,000
  from the Sewer Impact Fee Fund to its general fund.

       On May 4, 1993, while this action was pending in the superior court,
  the board voted in open session at a regularly scheduled meeting to ratify
  the purchase of the Terino property and the expenditure of $150,000 from
  the Fund for that purpose.

       Plaintiff's complaint contended that the decision to purchase the land
  was done illegally in an executive session, see 1 V.S.A. § 313(a), and that
  he was damaged by the action because the money in the Fund, if not used for
  the purchase of the Terino land, would revert to him in

 

  part.  He sought declaratory relief and a mandatory injunction requiring
  the Town to put the $150,000 back into the Fund with interest.

       On June 28, 1995, the trial court dismissed plaintiff's claim for lack
  of standing.  The court held that the executive session action on May 16,
  1989 was in violation of the open meeting law and was void.  The court also
  held that the subsequent revote on May 4, 1993 did not serve to ratify the
  original illegal action.  It held, however, that the May 4, 1993 action was
  sufficient to bind the municipality prospectively, even though the action
  did not cure the original open meeting violation.  Since plaintiff's
  entitlement to a refund from the Fund would not accrue until February 1994,
  six years after the original payments in February of 1988, the court found
  that plaintiff was not prejudiced by the illegal 1989 action and was
  prevented by the 1993 action from obtaining any part of the $150,000 paid
  to the Terinos.  The court dismissed plaintiff's complaint because it was
  not "aggrieved" by the violation of the open meeting law and, therefore,
  lacked standing.(FN1)  See id. § 314(b) (private enforcement action may be
  brought by person "aggrieved by a violation" of open meeting law).

       We reach the trial court's result but based on different reasoning. 
  The Town argued to the trial court that the subsequent public vote of the
  selectboard ratified the original action taken in executive session in
  1989.  Plaintiff argued in response that the original action was void and
  could not be revived by a proper vote, and the trial court accepted this
  position.  We conclude that the trial court was in error, and that the 1989
  vote was valid, once ratified in public session in compliance with the open
  meeting law.(FN2)

 

       As a general rule, "whatever acts public officials may do or authorize
  to be done in the first instance may subsequently be adopted or ratified by
  them with the same effect as though properly done under previous
  authority."  10A McQuillan, Municipal Corporations § 29.104, at 60 (3d ed.
  1990); see also Stalbird v. Town of Washington, 106 Vt. 213, 216, 172 A. 623, 624 (1934) (selectmen have "power of ratification" if they act in good
  faith and for best interests of town as they see it).  Ratification does
  not apply, however, where the contract is "void by reason of noncompliance
  with some mandatory provision of the law."  10A McQuillan, supra, § 29.103,
  at 54; see Massachusetts Municipal Wholesale Elec. Co. v. State, 161 Vt.
  346, 353, 639 A.2d 995, 1000 (1994) (municipality cannot ratify contract
  that is ultra vires).  The trial court held that the exception to the power
  of ratification applies here because the contract was void for
  noncompliance with the open meeting law.

       The remedy provision of the open meeting law does not provide that
  actions taken in violation of the law are void.  See 1 V.S.A. § 314(a). 
  Instead, it provides only for "appropriate injunctive relief or for a
  declaratory judgment" at the request of the attorney general or a person
  aggrieved by the violation.  Id.  Plaintiff relies, however, on an earlier
  section of the law, which states:  "No resolution, rule, regulation,
  appointment, or formal action shall be considered binding except as taken
  or made at such open meeting, except as provided under section 313(a)(2) of
  this title."(FN3)  Id. § 312(a).  Plaintiff argues, and the trial court held,
  that if action is not considered "binding" it is void and cannot be
  ratified.

       In construing a statute, our objective is to implement the intent of
  the Legislature. Central Vermont Hosp., Inc. v. Town of Berlin, ___ Vt.
  ___, ___, 672 A.2d 474, 478 (1995).

 

  If the statute is unambiguous, we first look to the plain, ordinary meaning
  of the language.  Id. We look to the whole of the statute and every part of
  it, its subject matter, the effect and consequences, and the reason and
  spirit of the law.  Id.

       The plain meaning of the language does not support plaintiff's
  interpretation.  The language says only that a formal action taken in an
  improperly closed meeting will not be effective, by itself.  Cf. Estate of
  Girard v. Laird, 159 Vt. 508, 513, 621 A.2d 1265, 1268 (1993) (the word
  "operative" under homestead statute does not render conveyance void, but
  merely makes it ineffective).  This does not mean that action of the public
  body "will always be void and incurable merely because the topic of the
  final public action was previously discussed at a private meeting."  Tolar
  v. School Bd. of Liberty County, 398 So. 2d 427, 428 (Fla. 1981)
  (interpreting virtually identical language of Fla. Stat. Ann. § 286.011(1)
  (West 1991) (amended 1995)).  The statute expresses the common requirement
  of open meeting laws that any formal action, whether or not discussed or
  initially voted in an executive session, must be voted in a public session
  to be effective.

       This interpretation is also supported by the overall construction of
  the open meeting law. Open meeting laws now exist in every state.  See
  Note, The Changing Weather Forecast: Government in the Sunshine in the
  1990s -- An Analysis of State Sunshine Laws, 71 Wash. U. L.Q. 1165, 1165
  (1993).  When the Legislature has intended that the effect of a violation
  of the law is that the action of the public body is void, it has generally
  stated that directly in a separate section or subsection.  See, e.g., Wyo.
  Stat. § 16-4-403(a) (1995) (action taken at meeting not in conformity with
  open meeting law is "null and void and not merely voidable").  The language
  on which plaintiff relies is in a section that defines the public's rights,
  rather than the remedy for a violation of those rights.  It is far from
  comprehensive -- for example, it does not define the effect of a failure to
  give the required notice of a public meeting.  The language chosen is more
  consistent with a definition of the public right than the creation of the
  remedy plaintiff seeks.

       We are also influenced by the effect and consequences of plaintiff's
  position.

 

  Invalidation of public action is often an "extreme remedy" that may be
  inappropriate for the underlying violation.  See Liebeskind v. Mayor and
  Mun. Council, 627 A.2d 677, 679 (N.J. Super. Ct. App. Div. 1993); see
  generally Comment, Invalidation as a Remedy for Open Meeting Law
  Violations, 55 Or. L. Rev. 519, 524-25 (1976).  "Mechanistic vacation of
  decisions made in nonconformity with the sunshine law may do more
  disservice to the public good than the violation itself."  Alaska Community
  Colleges' Fed'n. of Teachers v. University of Alaska, 677 P.2d 886, 891
  (Alaska 1984).  Without an effective way of curing a violation, necessary
  public action may become gridlocked.  See Lawrence County v. Brenner, 582 A.2d 79, 84 (Pa. Commw. Ct. 1990).

       The purpose of open meeting laws is to give public exposure to
  governmental decision-making.  The purpose is not to create "vehicles for
  individuals displeased with governmental action to obtain reversals of
  substantive decisions."  Alaska Community Colleges, 677 P.2d  at 891. 
  Although such reversals may sometimes be a side effect of open meeting law
  enforcement, we must be careful to administer the law with its purposes and
  the public interest in mind.

       This is exactly the kind of case where a "mechanistic" voiding of the
  Town's decision would be inappropriate.  There is no indication that
  plaintiff has any debate with the Town's decision to buy the Terino
  property or its plans to expand the sewage treatment facility.  Nor is
  there any indication that it was in any way affected by the private nature
  of the decision-making process.  Indeed, there is no indication in this
  litigation that the land purchase decision was controversial or that
  citizens who wanted to comment on it were excluded from the decision-
  making process.  Plaintiff's strategy is to use the open meeting law
  violation as a means to the end of requiring that the Fund money be
  returned to it and other developers, rather than being used for the public
  purpose.

       The original land purchase occurred seven years ago.  It was
  implemented by the public recording of a deed as well as whatever activity
  the Town has conducted on the land.  For all we know, the Town has already
  expanded the sewage treatment plant on the land that plaintiff now seeks to
  have returned to the prior owners.  Without any participation in this
  decision, these

 

  prior owners would lose the benefit of their bargain and have to return the
  purchase price.  The remedy has little to do with the policies underlying
  the open meeting law, but has great, negative consequences for the citizens
  of the Town.

       We do not believe that the Legislature intended to bring about these
  kinds of consequences by making actions taken in violation of the open
  meeting law void and uncorrectable.  By allowing correction at a properly
  noticed public meeting, we can implement the purposes of the law and
  minimize undesirable consequences.  Consistent with its language, we hold
  that § 312(a) provides only that actions taken outside of an open meeting,
  with the one exception provided by the language, are ineffective unless
  ratified in an open meeting.  Once so ratified, however, such actions are
  effective and binding on the public body.  This holding is consistent with
  the majority of decisions from other jurisdictions.  See, e.g., id.; McLeod
  v. Chilton, 643 P.2d 712, 717 (Ariz. Ct. App. 1981); Monroe County v.
  Pigeon Key Historical Park, 647 So. 2d 857, 860 (Fla. Dist. Ct. App. 1994);
  Board of Educ. Sch. Dist. 67 v. Sikorski, 574 N.E.2d 736, 740 (Ill. App.
  Ct. 1991); Wagner v. Beauregard Parish Police Jury, 525 So. 2d 166, 170
  (La. Ct. App. 1988); B.P.O.E. Lodge No. 65 v. City Council of Lawrence, 531 N.E.2d 1254, 1256 (Mass. 1988); Lawrence County, 582 A.2d  at 84; Neese v.
  Paris Special Sch. Dist., 813 S.W.2d 432, 436 (Tenn. Ct. App. 1990).

       The trial court found that the town properly reconsidered the original
  land purchase at a public meeting in full compliance with the open meetings
  law.  Plaintiff does not contest in this Court the finding that the
  ratification occurred at a legal meeting, arguing instead that the Town
  could not ratify a void contract.  We hold that the selectboard cured the
  open meeting law violation by ratifying the land purchase in a subsequent
  open meeting.

       Affirmed.


                              FOR THE COURT:


                              _______________________________________
                              Associate Justice


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                                  Footnotes


FN1.  Because we base our decision on an alternative ground, we do not
  decide whether plaintiff had standing in this case.

FN2.  Plaintiff argues that the Town cannot raise this argument,
  because it did not cross-appeal and the relief is broader than what the
  Town obtained below.  Specifically, it claims that the trial court's order
  will still require the Town to refund interest to the Fund because the Town
  illegally withheld the purchase price from the fund for almost four years. 
  A cross-appeal is unnecessary where the appellee is "content with the final
  order in the case" but raises alternative grounds to support it.  Staruski
  v. Continental Tel. Co., 154 Vt. 568, 571 n.3, 581 A.2d 266, 267 n.3
  (1990).  In this case, the Town obtained a judgment in its favor, and no
  interest was awarded to plaintiff.  The Town is content with the result and
  seeks to support this exact result on grounds of ratification.  The fact
  that plaintiff might have obtained further relief, or might still obtain
  some relief in new litigation, does not create the need for a cross-appeal.

FN3.  The exception provided by § 313(a)(2) is for "negotiating or
  securing of real estate purchase options."  The trial court held that the
  exception was inapplicable, and the Town has not contested that point here.