CEO 77-14 -- February 1, 1977

CONFLICT OF INTEREST

CITY COUNCILMAN SERVING ON BOARD OF DIRECTORS OF BUSINESS ENTITY WHICH HAS BROUGHT SUIT AGAINST CITY

To: (Name withheld at the person's request.)

Prepared by: Phil Claypool

SUMMARY:

A city councilman who serves without compensation on the board of directors of a nonprofit corporation established to represent the interests of condominium owners is not prohibited from seeking election to a city council where the corporation has brought suit against the city. A public officer is prohibited by s. 112.313(7)(a), F. S. 1975, from having a contractual relationship that will create a continuing or frequently recurring conflict between his private interests and the performance of his public duties or that would impede the full and faithful discharge of his public duties. The provision is not applicable to the subject situation, however, because the director does not have a contractual relationship with the corporation. Nevertheless, if elected to the city council, he will have a voting conflict of interest whenever a measure relating to the corporation's suit against the city comes before the council. In those situations he should either abstain from voting, or, if he chooses to exercise his right to vote, should complete CE Form 4, Memorandum of Voting Conflict, pursuant to s. 112.3143, F. S. 1975.

QUESTION:

Would a prohibited conflict of interest exist were I to serve as a city councilman while sitting as a nonpaid member of a board of directors of a nonprofit corporation which has brought a suit against the city?

Your question is answered in the negative.

In your letter of inquiry you have stated that you serve without compensation on the board of directors of a condominium association, a nonprofit corporation. You presently are running for Councilman in the City of ____, although the condominium association has a class action suit pending against the city.

The Code of Ethics for Public Officers and Employees prohibits a public officer from selling any goods or services to his agency. Section 112.313(3), F. S. 1975. This provision does not apply to your situation, however, because you will not be "doing business" with your agency within the meaning of that section.

The Code of Ethics also provides as follows:

CONFLICTING EMPLOYMENT OR CONTRACTUAL RELATIONSHIP. -- No public officer or employee of an agency shall have or hold any employment or contractual relationship with any business entity or any agency which is subject to the regulation of, or is doing business with, an agency of which he is an officer or employee . . . ; nor shall an officer or employee of an agency have or hold any employment or contractual relationship that will create a continuing or frequently recurring conflict between his private interests and the performance of his public duties or that would impede the full and faithful discharge of his public duties. [Section 112.313(7)(a), F. S. 1975.]

This provision prohibits a public officer from having a contractual relationship that will create a continuing or frequently recurring conflict between his private interests and the performance of his public duties or that would impede the full and faithful discharge of his public duties. However, we do not find this provision applicable because you do not have a contractual relationship with the condominium association, either by virtue of your serving as a noncompensated director or by virtue of your ownership of stock in the association.

Accordingly, we find that if you are elected to the city council, the Code of Ethics does not prohibit your serving on the board of directors of a corporation which has brought a suit against the city.

Nevertheless, we feel obligated to point out that, if you are elected to the city council, you will have a voting conflict whenever a measure relating to your condominium association's suit comes before the council. In those situations you should abstain from voting or, if you vote, you should complete a CE Form 4, Memorandum of Voting Conflict, pursuant to s. 112.3143, F. S. 1975.

In addition, there are two other provisions of the Code of Ethics which should bear on your actions as a city councilman and as a member of the board of directors of an entity which is litigating with the city. These are s. 112.313(6), which prohibits a public officer from corruptly using his official position to secure a special benefit for himself or others, and s. 112.313(8), which prohibits a public officer from disclosing or using information gained by reason of his official position for the personal gain or benefit of himself or any other person or business entity. Therefore, we advise you to remove yourself as far as possible from all deliberations concerning the suit, if you are elected, in order to prevent even the appearance of impropriety.