| Date: | 05/19/1988 |
|---|---|
| Organization: | State Ethics Commission |
| Docket Number: | 319 |
The Petitioner initiated these adjudicatory proceedings on December 8, 1986 by filing an Order to Show Cause pursuant to the Commission's Rules of Practice and Procedure, 930 CMR 1.01(5) (a). The Order alleged that Respondent Paul H. Sullivan had violated G.L. c. 268A, s.17(c) and s.19. Specifically, Respondent allegedly acted as agent for either FIC Carter and Sons or FIC Associates by personally appearing before the Tewksbury Planning Board (Board) on September 24 and 26, 1984, and by discussing particular matters in which the Town of Tewksbury (Town) was a party or had a direct and substantial interest. Further, the Order alleged that Respondent participated during the Board of Selectmen meeting on September 25, 1984 in discussions concerning the water and sewer availability for the Carter Green Condominiums (Carter Green) in which Respondent's father, Kevin Sullivan, had a financial interest.
The parties stipulated to a number of facts and documents which are included in the record. In addition to the stipulation of facts, an adjudicatory hearing was held on September 25, 1987. Respondent was the only witness to testify at the adjudicatory hearing.
Respondent has raised two procedural defenses. The first is that Petitioner's action is barred by a two year statute of limitations contained in G.L. c. 260, s.5. The other procedural defense is that Commission's failure to extend the preliminary inquiry within ninety days of the initiation of the preliminary inquiry entitles Respondent to an Order of Dismissal.[1]
The parties filed briefs and presented oral arguments before the Commission on April 13, 1988. In rendering the Decision and Order, the Commission has considered the evidence and arguments of the parties.
1. Respondent, at all relevant times, served as a member of the Tewksbury Board of Selectmen. In 1983 and 1984, he was Chairman of the Board of Selectmen.
2. Respondent, at all relevant times, worked for his father's real estate agency. Respondent's father is Kevin Sullivan and the name of the real estate agency is Sullivan Real Estate.
3. The Carter Green condominium development was being developed by FIC Associates, a partnership.[2] The development required a special permit by the Planning Board. In order for the Planning Board to approve FIC Associates application for a special permit, the Board required final assurance from the Department of Public Works (DPW) that Carter Green had adequate water and sewer availability.
4. In June 1984 Kevin Sullivan, at the request of the Board, sought a letter from the DPW certifying that there were adequate water and sewer hookups available for
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Carter Green.
5. The DPW superintendent issues certification letters certifying that there are adequate water and sewer hookups available at development sites, which letters are then subject to approval by the Selectmen who also serve as Commissioners of the DPW. On August 21, 1984, the DPW issued a letter certifying that adequate water and sewer hookups were available for Carter Green. This letter is a standard letter given to developers during the approval stage of a project.
6. On September 24, 1984 Respondent and John B. Hodges were present at a meeting of the Planning Board. Mr. Hodges is an attorney in private practice who, on previous occasions, has represented Carter Green. Mr. Hodges did not request Respondent to accompanying him to the Planning Board meeting for any specific purpose except that they were going out afterwards socially. Respondent was not given explicit authority to speak on behalf of FIC Associates at this meeting.
7. At the September 24, 1984 meeting, the substance of the DPW letter referred to in finding of fact s.4 and Carter Green were subjects of the discussion, Toward the end of the meeting Respondent asked the Manning Board whether "we" could expect to be on the agenda for the meeting two days later on Wednesday. Respondent stated "we'll expect that Wednesday we'll be here for a meeting". Respondent further stated that "we are just looking and you people are satisfied that we have complied and you people have stated that you are". The "we have complied" refers to the requirements set forth by the Planning Board regarding water and sewer requirements for Carter Green. Respondent further asked the Planning Board whether they had everything they needed from FIC Associates or from Jack Hodges. The "we" that Respondent was referring to was the development entity, Carter Green, or FlC Associates.
8. Jack Hodges did not address the Board relative to Carter Green or respond to questions at the September 24, 1984 meeting.
9. Respondent did not attend the September 24, 1984 Planning Board meeting as a member of the Board of Selectmen, The purpose of his comments was to ascertain whether the Planning Board would give a decision on that evening as to whether the requirements in connection with the application for a special permit had been met.[3]
10. Respondent spoke at the September 24, 1984 meeting on behalf of FIC Associates.
11. The discussion between Respondent and the Planning Board at the September 24, 1984 meeting was in connection with requirements set forth by the Planning Board regarding water and sewer availability for Carter Green. These requirements in turn were in connection with an application for special permit by FIC Associates.
12. The discussion of Carter Green and water and sewer requirements were continued to a scheduled meeting of September 26, 1984.
13. On September 25, 1984 Respondent attended a regularly scheduled Board of Selectmen meeting. Respondent was sitting as a Selectman that evening. Respondent requested that the Board forward a letter to the Planning Board relative to FIC Associates.
14. At the September 25, 1984 meeting the Board of Selectman unanimously voted, with Respondent abstaining, to forward correspondence to the Planning Board confirming that FIC Associates, developers of Carter Green, had access to and would be allowed to tie in to the municipal Main Street sewer system, and that upon completion and acceptance of the plans by the DPW Commissioners, work would commence.[4]
15. On the same evening, the Board of Selectmen went into executive session.[5] After the executive session had ended, Respondent was asked by another Selectman whether he had the DPW letter certifying the availability of water and sewer with him. Respondent stated that he did not have the letter with him, having no reason to have it, but would bring it in the following day. The letter was correspondence dated August 21, 1984, signed by Philip Pattison, the Superintendent of Public Works, relative to the availability of water and sewer to Carter Green. Respondent also requested that the Board agree with the correspondence contingent upon production of the letter to the Board the following day. The Board informally agreed to this. No vote was recorded.
16. Respondent's suggestion that the Board of Selectmen agree with the correspondence contingent upon production of the letter to the Board on the following day was included in the minutes at the suggestion of Respondent. He was concerned about possible violations of the Open Meeting Law. He intended to avoid the Board of Selectmen voting on a decision at a time when they were not permitted to conduct public business under the Open Meeting Law.
17. Respondent subsequently delivered the letter to the Board of Selectmen, pursuant to s.15.
18. On September 26, 1984, Respondent attended a scheduled Planning Board meeting. At that meeting the Planning Board continued a discussion from September 24, 1984, regarding Carter Green and the availability of adequate water and sewage.
19. Present at the September 26 meeting was Kevin Sullivan, Respondent's father. Kevin Sullivan had a financial interest in FIC Associates, and had represented FIC Associates in the past.
20. Respondent accompanied his father to the meeting after encountering him outside Respondent's home which was adjacent to his father's office. At the meeting Respondent submitted and the Planning Board reviewed two letters from the Board of Selectmen dated September 26, 1984 regarding water and sewer availability for Carter Green. The substance of one letter was that
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the Board of Selectmen had voted at its meeting of September 25, 1984 to concur with the correspondence dated September 21, 1984 signed by Philip Pattison, Superintendent of Public Works, relative to the availability of water, The second letter stated that the Board of Selectmen, at its meeting of September 25, 1984, had voted to concur that the developers of Carter Green had access and would be allowed to tie into the municipal main street sewer system.
During the meeting, Respondent submitted a sketch showing the sewer route from Carter Green and pointed on the sketch to the proposed route. Respondent also stated that the sewer route had been approved by the Board of Selectmen. At the same meeting Respondent also stated that the building inspector, in order to issue building permits, would like a letter from the Planning Board, saying that "we have complied with the conditions" listed in the building inspector's letter to the Planning Board.
21. Respondent spoke at the Planning Board meeting of September 26, 1984 on behalf of FlC Associates.
22. No Vote was taken at the September 26, 1984 meeting. The matter was continued to a later meeting.[6]
23. Respondent had knowledge that Kevin Sullivan had a financial interest in the decision by the Tewksbury Planning Board regarding adequate availability of water and sewer at Carter Green.
The Commission has promulgated a three-year statute of limitations pursuant to its regulatory authority. G.L. c. 268B, s. 3(a); 930 CMR 1.02(10).[7]
There is no dispute that the Order to Show Cause was issued within three years after the violations alleged therein, as required by the regulation. Nor does Respondent allege as a defense that the three year statute of limitations promulgated in 930 CMR 1.02(10) has run. Therefore, there was no need for Petitioner to show that a disinterested person learned of the violation no more than three years before the Order was issued by affidavit or otherwise. See, 930 CMR 1.02(10) (c).
Respondent argues that 930 CMR 1.02(10) is unlawful because it is inconsistent with G.L. c. 260, s.5, which establishes a two year statute of limitations in actions for penalties under penal statutes if the penalty "is given ... to the Commonwealth." The Commission concludes that this statute does not apply because an enforcement proceeding pursuant to G.L. c. 268B, s.4 is not reasonably construed as enforcement of a penal statute.
The essence of a civil enforcement action under G.L.c. 268B is a breach of official duty or fiduciary obligation of a public employee. In upholding the use of a civil standard of proof, and rejecting the application of a criminal standard in Commission proceedings, the Supreme Judicial Court has held, "The sanctions which the Commission may impose do not implicate particularly important individual interests or rights." Craven v. State Ethics Commission, 390 Mass. 191, 200 (1984). The controlling purpose of an adjudicatory proceeding under G.L.c. 268B, s. 4 is not punishment. The Commission's mandate is remedial in nature, to enforce civilly the provisions of G. L. c. 268A, to provide advice and education, (see, G. L. c. 268B, s. 3(g)), and to act as a repository of disclosures and other information. See, c. 268A, s. 6, s. 7(d). Although G. L. c. 268A provides for a criminal penalty enforceable by criminal law enforcement agencies, as well as civil relief, the existence of an alternate criminal penalty does not defeat the broad civil remedial purposes given to the Commission in G. L. c. 268B. The fact that the Commission may potentially impose a civil fine after an adjudicatory hearing does not render the proceeding penal. The Commission's regulation, establishing a three year statute of limitations, reasonably rejects the application of G.L. c. 260, s.5 to a civil administrative agency which has no criminal enforcement authority.
The reasonableness of the regulation is further supported by examination of precedents. The Supreme Judicial Court held in the case of Beinecke v. Nantucket, 379 Mass. 345(1979) that the essence of an action under G.L. c. 268A, s.21 is a breach of official duty which sounds in tort, and therefore the three year statute of limitations applies.[8]
A regulation by a duly constituted administrative agency has the full force and effect of law and is entitled to all rational presumption in favor of its validity..." Levy v. Board of Registration, 373 Mass. 519,525(1979) cited in Borden v. Commissioner of Public Health, 388 Mass, 707(1984). Given the broad civil remedial nature of an enforcement proceeding under G.L.c. 268B, s.4 and relevant prior case law, there is no inconsistency between 930 CMR 1.02(10) and G.L.c. 260, s. 5 so as to render the regulation void.
There is no merit to Respondent's contention that the delay in the vote to extend the preliminary inquiry, which took place 97 days after the initial vote to initiate the preliminary inquiry, requires dismissal of the case. Dismissal is not required as a matter of law because the 90 day rule derives from internal enforcement policy, and not by statute, regulation or other authority having the force of law; therefore, the policy is not jurisdictional.
It is well established that "a statute imperative in phrase... where it relates only to the time of performance of a duty by a public officer and does not go to the essence of the thing to be done ... is only a regulation for the orderly and convenient conduct of public business and
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not a condition precedent to the validity of the act done." Chencey v. Coughlin, 201 Mass. 204,211 (1909).Accord, Cullen v. Building Inspector of North Attleborough, 353 Mass. 671, 679-680 (1968) (decision of appeal from issuance of a building permit filed five days late); Monico's Case, 350 Mass. 183,185186(1966) (decision of Industrial Accident Board filed over 10 months late); Amherst-Pelham Regional School Committee v. Department of Education, 376 Mass. 480, 496-497 (1978) (failure of Department of Education to issue timely decision in contravention of own internal procedure).
Even assuming that Respondent has suffered expense, humiliation, anxiety and public suspicion as a result of Petitioner's proceedings,[9] there has been no showing that Respondent suffered prejudice as a result of the seven day delay in initiating the preliminary inquiry. This case is thus indistinguishable from the case of In the Matter of Thomas W. Wharton, 1984 Ethics Commission 182, where we held
The 90-day rule is not based on any statute, but reflects the Commission's desire that inquiries be conducted as expeditiously as possible. Its principle purpose is to make the Commission aware of the length of inquiries and to require its acquiescence for them to go beyond 90 days. That purpose is satisfied whether the extension is granted before or after the initial 90-day period ends. With respect to the time period after the finding of reasonable cause, it should be noted that neither the provisions of c. 268B dealing with investigations (see s.4) nor the Commission's procedures impose any requirement as to when the Order to Show Cause must issue. Here again, there is no showing that Mr. Wharton was prejudiced or that the Petitioner gained any undue advantage by the delay ... Accordingly, this Motion to Dismiss is denied.
Accordingly, the seven-day delay in extending the preliminary inquiry does not require dismissal.
The portion of s.17(c) applicable to this case states that no municipal employee shall, otherwise than in the proper discharge of his official duties, act as agent for anyone in connection with any particular matter inn which the same town is a party or has a direct and substantial interest. Respondent has stipulated to all the elements of a s. 17(c) violation, except the element of acting as agent.
The basic principle set forth by s.17(c) is that public officials should not in general be permitted to step out of their official rules to assist private entities or persons in their dealings with government." Perkins, The New Federal Conflict Law, 76 Harv. L. Rev. 113,1120(1963). Regardless of whether any evil results from the conduct, "confidence in government is undermined because the public cannot be sure that no [evils] will result." Buss, The Massachusetts Conflict of Interest Statute:An Analysis, 45 B.U.L. Rev. 299,322 (1965). Buss suggests that "merely speaking or writing on behalf of a non-state party would be acting as agent." Buss, supra, at 326. Consistent with the above remedial purpose, the Commission has concluded that the distinguishing factor of acting as agent within the meaning of the conflict law is "acting on behalf of some person or entity, a factor present in acting as spokesperson, negotiating, signing documents and submitting applications. EC-COI-84-116.
Upon reviewing the facts, the Commission concludes Respondent was acting on behalf of FIC Associates. Respondent's consistent use of the term "we" in his discussions with the Board demonstrates that he was not speaking on his own behalf at the September 24th or 26th meeting of the Board. He had no interest in FIC Associates nor had he received any benefits from that entity. Logically, if Respondent was not speaking for himself, he must have been speaking for DC Associates. There is no evidence that the Respondent was acting on behalf of his own interest, as opposed to the interest of FIC Associates. In fact, Respondent denied that he had any present or future interest in Carter Green on the applicable dates. The Planning Board required some evidence that there was adequate water and sewer availability at the projects. That requirement was placed on FIC Associates and not the Respondent.
Respondent's primary defense, as advanced in oral argument, was that Respondent was not given explicit authority by his father to speak on behalf of FIC Associates, nor was Respondent subject to the "direction and control" of FIC Associates at the September 24th and 26th meetings. The defense has no merit. If the conduct of the party is such that an inference is warranted that one is acting on behalf of and with knowledge and consent of another, an agency exists as a matter of law, irrespective of the party's [scope] of actual authority. Choates v. Board of Assessors of Boston, 304 Mass, 298,300 (1939),[10] In this case, Respondent spoke on behalf of FIC Associates and thus it would reasonably appear to members of the Planning Board that he had authority to further the interests of his father or his father's partnership. This is especially true given that Respondent worked for his father's real estate business.
Respondent argues that the presence of a recognized spokesperson, Jack Hodges, negates agency. The existence of a recognized spokesperson might negate a finding that someone other than the spokesperson is an agent. In the Robert Sullivan Decision and Order, the Commission stated "the presence of a recognized spoken person for the corporation, other than Respondent, such as an attorney might dispel the appearance of an agency (at footnote 7, p.20). This assumes, of course, that the
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spokesperson participates in the discussion in some way. In this case Jack Hodges remained silent. Furthermore, just as a company can have more than one employee, or hire more than one independent contractor, it can have more than one agent. 2A C.J.S. Agency, s. 31(1985), at p. 593. The mere presence of a recognized spokesperson, without more, does not prevent a finding that someone else is also acting as agent.
In conclusion, the preponderance of evidence is that Respondent was speaking on behalf of FIC Associates at the September 24th and 26th meetings. Speaking on behalf of another entity constitutes acting as agent within the meaning of s.17.[11]
Section 19 of the conflict law prohibits a municipal employee from participating as such an employee in a particular matter in which to his knowledge his family member has a financial interest. Participate is defined in s.1 (j) as to participate in a particular matter "personally and substantially." Although there is no doubt that Respondent participated in the discussion to forward the certification letter to the Planning Board, the Commission concludes his participation was not substantial. Not all participation by a municipal employee will be deemed personal and substantial. In the Matter of John Hickey, 1983 SEC 158,159 the Commission stated:
[N]ot every action by a public official satisfies the substantiality requirement. In those instances where a government employee is involved in ministerial activity not directly affecting a particular matter, the conduct may not constitute substantial participation as defined in the statute.
There are certain terms by which the Commission has described non-substantial participation. These terms are ministerial, pro forma, preliminary, after the fact, or not part of or integral to a decision-making process. See, e.g. EC-COI-82-46 (the filing of an appearance by an attorney is not personal and substantial involvement); EC-COI-82-138 (submission of a non-binding list of qualified contractors, absent any order or indication of preference, to someone other than the ultimate decision-maker does not constitute participation in the contract award); EC-COI- 82-82 (providing general information to decision-makers may not constitute participation in the decision; "your role was more in the nature of providing information than decision-making, and somewhat peripheral to the decision-making process"); EC-COI-82- 62 ("[e]diting alone [of a procedural order] does not constitute participation"); and EC-COI-82-58 (explanation of agency regulations in connection with a licensing determination does not constitute participation in that determination).
In the Matter of John Hickey, 1983 SEC 158, the Commission found the Respondent not to have participated "personally and substantially." The Commission stated that as a selectman, Hickey's announcement of a board of selectmen vote "was ministerial and after the fact." Id. The Commission went on to state that Hickey's presiding over the board of selectmen's meeting was also not substantial. The Commission characterized his presiding as "pro forma." Id. The Commission distinguished Graham v. McGrail, supra, on the grounds that the presiding in McGrail was more significant:
At a subsequent meeting where the opponents to the budget were absent, the abstaining member and the other member alternated disqualifying themselves from the actual vote but presiding [sic] over the process until a budget reflecting salary increases to their family members was passed. Presiding over the vote was the mechanism used to ensure completion of the budget process at a time when those who contested the budget were absent. Id. n. 9.
A majority vote of a qualified quorum was necessary to approve the items. Apparently a quorum required three members present, and Hickey's presence was not necessary to the result.
The Hickey case can be contrasted with a recent case, In the Matter of James Geary, 1987 SEC October 6, 1987, Adjudicatory Docket No. 323, at 5. In Geary, the subject voted for his brother's appointment as police chief and signed his contract. His participation was not determinative because his brother had the unanimous support of the other members of the board of selectmen. The Commission concluded that:
By voting for his brother's appointment and signing his brother's contract, Mr. Geary's participation was "more than a casual or incidental encounter" but involved a "decision- making role." Buss, The Massachusetts Conflict of Interest Statute, Analysis, 45 B.U.L. Rev. 299,335 (1965).
Applying the above precedent to the facts, the Commission concludes that Respondent's participation was not substantial. Respondent requested the Board of Selectmen to forward a letter to the Planning Board relative to FIC Associates. Forwarding the letter is best described as ministerial the physical act of forwarding. The letter would have been forwarded in any event. At best the request was superfluous. These facts do not, by themselves, rise to the level by "substantial participation." The participation was ministerial and after the fact and, therefore, not substantial.
With respect to the events that occurred after the Board came out of executive session, Respondent was drawn into the conversation by other Board members who carried on public business after the termination of an executive session meeting. The other Board members had previously voted to forward the DPW letter to the Planning Board. Therefore, as a practical matter, it was
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necessary for the Board to obtain possession of that letter and to accomplish this the Board members requested Respondent to play a role of messenger. Therefore, Respondent's statement that he did not have the letter with him, but would bring it in the next day, after the executive session had terminated, cannot be deemed to be participation in an official capacity.
Respondent's later comment, however, requesting that the Board of Selectmen agree with the DPW Superintendent's letter contingent upon his producing it the next day is more problematic.[12] Although no formal vote was taken, the Board decided that it would agree with the letter contingent upon seeing it. Since the Board of Selectmen had already voted to forward its consent to the Planning Board, it is unclear why the Respondent asked the Board to agree to the correspondence contingent upon seeing the letter. It appears Respondent was undertaking to assure that the Board of Selectmen would forward the correspondence to the Planning Board. Not only was the discussion and decision informal, it was also superfluous. As noted in Geary, infra, the Commission has previously drawn a line between casual or incidental encounters and involvement in the decision-making role. Although a close question, Respondent's participation here appears to be casual discussion.
Petitioner argues that the communication was substantial by inferring that there was some question whether the correspondence was actually going to be sent to the Planning Board pursuant to the earlier discussion. Petitioner's inference however is not supported by any evidence in the record and in any event is not persuasive. Therefore, the Commission finds there is insufficient evidence in the record to find that the communication was substantial within the meaning of s.1 (j) of the conflict law.
The Commission may require a violator to pay a civil penalty of not more than two thousand dollars for each violation of G.L. c. 268A G.L. c. 268B, s.4(j)(3). Although the potential maximum fine in this case is $2,000, the Commission believes that the imposition of the maximum fine is not warranted. Respondent made an effort to comply with G.L. c. 268A by not participating as a member of the Board of Selectmen in particular matters in which his father had a financial interest. See G.L. c. 268A, s.19. There is insufficient evidence for the Commission to assume that Respondent's participation had any determinative effect on the outcome of decisions made by the Board of Selectmen acting as the Department of Public Works, whereby they determined there "was adequate water and sewerage for Carter Green. Finally, there was no effort by Respondent to conceal his participation; Respondent on one occasion made his participation a matter of public record in an effort to comply with the Open Meeting Law.
The violation in this case, on the other hand, cannot be viewed as technical. Forwarding of the letter was a necessary precondition to the granting of a subdivision. Expediting the forwarding of that letter was, therefore, of advantage to Respondent's father even if there was no controversy over its contents.[13] As Chairman of the Board of Selectmen, Respondent was in a position to exert consciously or unconsciously undue influence upon the actions of the Planning Board. The public could reasonably ask how members of the Planning Board could make an objective unbiased decision when a request for action was made by the chairman of the Town's governing body.[14] Moreover, there is no evidence Respondent sought advice as to the propriety of his actions prior to engaging in what an ordinary person would understand to be questionable conduct.
In conclusion, Respondent sought to intervene himself on behalf of a private development effort in which his immediate family had a financial interest. Seeking to expedite a determination which is critical to a private development is not inconsequential. A fine reflecting this fact is appropriate.
On the basis of the foregoing pursuant to its authority under G.L. c. 268B, s.4, the Commission orders Mr. Sullivan to pay five hundred dollars ($500.00) to the Commission as a civil penalty for violation of G.L. c. 268A, s.17(c).
