CEO 82-88 -- October 29, 1982

CONFLICT OF INTEREST; VOTING CONFLICT OF INTEREST

TOWN COUNCIL MEMBER OWNING AND ACTING AS REAL ESTATE SALESMAN FOR REALTY COMPANY WHICH ALSO IS OWNED BY PERSON SEEKING TO HAVE STREETS ABANDONED BY TOWN AND TO HAVE REAL ESTATE DEVELOPMENT APPLICATIONS APPROVED

To: Jerome F. Skrandel, Town Attorney, Town of Jupiter

SUMMARY:

No prohibited conflict of interest exists where a town council member owns stock in a realty company together with an individual who is seeking to have a street abandoned by the town and to have real estate development applications approved by the town. Neither the town council member nor the real estate firm has any interest in the abandonment proposal or in the development project. No voting conflict of interest was created under Section 112.3143, Florida Statutes, where a town council member voted on the abandonment of a street and on real estate development applications involving an individual who owns stock in a realty company in which he also owns stock. CEO's 81-8, 79-33, and 78-58 are referenced.

No prohibited conflict of interest exists where a town council member is a licensed real estate salesman working for a real estate firm which is owned in part by an individual who is seeking to have real estate development applications approved by the town. While the council member has a contractual relationship with the real estate firm, he does not have such a relationship with the individual who has submitted the real estate development application. No voting conflict of interest was created under Section 112.3143, Florida Statutes, where a town council member voted regarding real estate development applications submitted by an individual who is a part- owner of the real estate firm for which the council member works as a real estate salesman.

QUESTION 1:

Does a prohibited conflict of interest exist where a town council member owns stock in a realty company together with an individual who is seeking to have a street abandoned by the town and to have real estate development applications approved by the town?

This question is answered in the negative.

In your letter of inquiry you advise that Mr. H. Gearl Gore is a member of the Jupiter Town Council. In addition, you advise that he is the president, a director, and a shareholder in a real estate brokerage firm, the remaining stock in which is owned by another individual, who serves as director, vice-president, and chairman of the board, and that individual's wife. You also advise that this individual, who owns other companies and has other business interests in addition to the real estate firm, was a party to a petition for the abandonment of a street located in the Town. Neither the Town Council member nor the real estate firm had any present or future interest in the abandonment proposal. In addition, you advise that this individual has applied to the Council for rezoning for part of a commercial development and has applied to the Council for a special exception and variance pertaining to that development project.

The Code of Ethics for Public Officers and Employees provides in relevant part:

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), Florida Statutes, (1981).]

The first part of this provision prohibits the subject Council member from having any contractual relationship with a business entity which is subject to the regulation of, or is doing business with, the Town. We previously have advised that a shareholder in a corporation has a contractual relationship with the other shareholders of that corporation. See CEO 80-11. However, it does not appear that the individual who owns stock in the realty firm is doing so as a "business entity." See Section 112.312(3), Florida Statutes, which defines that term to include any proprietorship or self-employed individual doing business in this state, as well as other types of business entities.

Nor do we find that under the circumstances presented the Council member's contractual relationship with the individual through the ownership of the realty corporation would present a continuing or frequently recurring conflict of interest or would impede the full and faithful discharge of his public duties. In this respect, we note that you advise that the Town is a rapidly growing area, and that the Town Council regularly has several requests for development approval on each agenda. The frequency and number of the individual's applications have not been unusually persistent, you advise.

Accordingly, we find that no prohibited conflict of interest exists where the subject Town Council member owns stock in a realty company together with an individual who has sought to have a street abandoned by the Town and to have real estate development applications approved by the Town.

QUESTION 2:

Was a voting conflict of interest created where a town council member voted on the abandonment of a street and on real estate development applications involving an individual who owns stock in a realty company in which he also owns stock?

This question is answered in the negative.

Regarding voting conflicts of interest, the Code of Ethics provides:

Voting conflicts. -- No public officer shall be prohibited from voting in his official capacity on any matter. However, any public officer voting in his official capacity upon any measure in which he has a personal, private, or professional interest and which inures to his special private gain or the special gain of any principal by whom he is retained shall, within 15 days after the vote occurs, disclose the nature of his interest as a public record in a memorandum filed with the person responsible for recording the minutes of the meeting, who shall incorporate the memorandum in the minutes. [Section 112.3143, Florida Statutes (1981).]

We find that this provision does not apply here. First, it does not appear that the abandonment of the street or the real estate development application would inure to the private gain of the subject Council member. Secondly, although these actions by the Town would benefit the individual involved in the real estate firm with the subject Council member, that individual is not a principal by whom the Council member is retained. See CEO's 81-8, 79-33, and 78-58, in which we advised that no voting conflict of interest is created under this provision where an official votes on the interests of a business partner.

Accordingly, we find that no voting conflict of interest was created under Section 112.3143, Florida Statutes, where the subject Council member voted on the abandonment of a street and on real estate development applications involving an individual who owns stock in the realty company together with the subject Council member.

QUESTION 3:

Does a prohibited conflict of interest exist where a town council member is a licensed real estate salesman working for a real estate firm which is owned in part by an individual seeking to have real estate development applications approved by the town?

This question is answered in the negative.

In your letter of inquiry you advise that Mr. Matthew Bressler is a member of the Jupiter Town Council. You also advise that after the abandonment issue discussed above came before the Town Council, this Council member became an independent real estate salesman at the real estate firm referenced earlier in this opinion. In that capacity, he is a licensed real estate salesman working as an independent contractor for the real estate firm.

Section 112.313(7)(a), Florida Statutes, quoted above in our response to your first question, does not prohibit the subject Council member's employment as a real estate salesman for the real estate firm. While the Council member has a contractual relationship with the real estate firm, he does not have such a relationship with the individual who has submitted the real estate development application.

Accordingly, we find that no prohibited conflict of interest exists where the subject Council member works as a licensed real estate salesman for a real estate firm owned by an individual whose real estate development application must be approved by the Town Council.

QUESTION 4:

Was a voting conflict of interest created where a town council member voted regarding real estate development applications submitted by an individual who is a part- owner of the real estate firm for which the council member works as a real estate salesman?

For the reasons expressed in our response to your second question, we find that no voting conflict of interest was created where the subject Council member voted regarding real estate development applications submitted by an individual who owns the real estate firm for which the Council member works as a licensed real estate salesman.