92-14 Recommended Order, In re MARY MCCARTY

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

IN RE: MARY MCCARTY, )

) CASE NO. 92-5168EC

Respondent. )

_________________________)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, Mary Clark, held a formal hearing in the above-styled case on April 29, 1993, in West Palm Beach, Florida.

APPEARANCES

For Mary McCarty: Kenneth D. Stern, Esquire

Post Office Box 3878

Boca Raton, Florida 33427-3878

For Leslie F.

McDermott: James K. Green, Esquire

One Clearlake Centre

250 South Australian Avenue

West Palm Beach, Florida 33401

STATEMENT OF THE ISSUES

The issue for disposition is whether Mary McCarty, Respondent in a complaint to the Florida Commissions on Ethics, is entitled to costs and reasonable attorney's fees from the complainant, Leslie F. McDermott, pursuant to Section 112.317(8), F.S.

PRELIMINARY STATEMENT

On June 10, 1992, the Florida Commission on Ethics issued its Public Report finding no probable cause to believe that Mary McCarty violated Section 112.3148, F.S., as was alleged in a complaint filed by Leslie F. McDermott.

On June 30, 1992, Ms. McCarty timely filed her petition for costs and attorney's fees from the complainant. The case was referred by the Commission on Ethics to the Division of Administrative Hearings as provided in commission rule 34-5.029, F.A.C.

The case was set for hearing after consultation with the parties, and was continued once for good cause.

At the hearing, Mary McCarty testified in her own behalf and presented testimony of the following: Leslie F. McDermott, Jeanette (Jay) Slavin and Bob Romani. Four exhibits were received in evidence, including, without objection, the deposition testimony of Ben Director.

Leslie F. McDermott testified in his own behalf, examined each of the above witnesses, and presented the testimony of Malcolm Byrd. He offered no exhibits.

After the hearing, a partial transcript was filed. Each party submitted proposed recommended orders. These have been considered, and specific rulings on the proposed findings of fact are included in the attached appendix.

FINDINGS OF FACT

1. Mary McCarty has resided in Delray Beach, Florida for approximately twenty years. She is politically active as a Republican; she served as a Delray Beach city commissioner from 1987 until 1990, and now currently serves as chairperson of the Palm Beach County Commission.

2. William (Bill) Andrews, also a Republican, was elected to the Delray Beach City Commission approximately one year after Ms. McCarty. The two worked together on certain issues, including an issue regarding the firing of the city manager, and more often than not, they voted on the same side.

3. Leslie F. McDermott lives in Lake Worth, Palm Beach County, Florida. He has never resided in Delray Beach. He is employed as an engineer for a computer company and is well known and respected in the community as an active member of the NAACP. He served as president of the south county branch of the NAACP for seven or eight years until recently, and now serves on the executive board of that local branch.

4. Jeanette (Jay) Slavin is a "grass roots" political activist in the south county area. As a Democrat she has been very involved in political campaigns and has openly supported candidates and issues in heated opposition to Mary McCarty.

5. Malcolm Byrd, a Republican, served on the Delray Beach City Commission from 1979 until 1987, and was city manager from 1989-90. At first he supported Mary McCarty, but as city manager he had differing views of how the city should proceed and how the city manager should function.

6. In early 1990, Malcolm Byrd learned that Bill Andrews had attended a Republican fund-raiser in Orlando, with transportation by chartered jet and limousine provided by a third party. Bill Andrews openly discussed the trip and how lavish it was. Andrews displayed a photograph of himself at the event with President Reagan or other noted Republicans.

7. Malcolm Byrd became aware that Andrews had not reported that trip on his financial disclosure form, and shared that information with Jay Slavin. There was also some talk that Mary McCarty had attended the fund-raiser, as Andrews referred to "we" when discussing the trip. Mary McCarty's financial disclosure form for 1990 did not reflect the alleged gifts related to the trip.

8. Jay Slavin had lunch with Leslie McDermott and urged him to file ethics complaints against both Andrews and McCarty. Ms. Slavin had obtained the requisite forms from the commission. She felt that Leslie McDermott's complaint would have more credibility as she, Slavin, was known to be politically opposed to Andrews and McCarty.

9. Leslie McDermott was reluctant at first to file the complaint against McCarty, as the only basis that Jay Slavin gave him was that Bill Andrews said "we" went on the trip, and everyone knew that Mary McCarty frequently attended fund-raisers and political events.

10. Leslie McDermott drafted the complaint based on information from Jay Slavin, and Ms. Slavin typed it for his signature, as he has a visual handicap. Before sending the complaint, McDermott spoke with Malcolm Byrd, who told him that he did not have the evidence on McCarty that he had on Andrews and that he could not encourage him to file on McCarty. McDermott heard rumors from other people who believed she had attended the function, but no one told him they had personal knowledge of the trip or had actually seen McCarty. At the hearing, and during the investigation by the commission, Leslie McDermott refused to divulge the names of those other persons who told him they believed Mary McCarty took the trip.

11. After sending the complaints, McDermott gave Jay Slavin permission to give them to three newspapers which he specified: the Palm Beach Post, the Sun Times and the Fort Lauderdale Sentinel. He personally called the papers and told them that the matters in the complaints needed to be investigated. He also told the reporters that the complaints had no official connection with the NAACP. He considered the three papers to be responsible, non-sensational publications and he had experience in the past with issuing press releases.

12. On February 6, 1992 the Sun-Sentinel published a story with the headline, "ETHICS COMPLAINTS FILED", stating that an NAACP official filed ethics complaints alleging that Mary McCarty and Bill Andrews attended a $1000 a plate fund-raiser paid for by a group of bond brokers, and failed to disclose the gifts.

13. Mary McCarty contacted the NAACP, and Leslie McDermott was chastised for involving the organization. He did not call the newspaper to demand a corrective article as he did not want to "add fuel to the fire". He avowed distress, however, that people associated the issue with the NAACP.

14. Meanwhile, the Ethics Commission conducted its investigation and found that, indeed, Mary McCarty did not attend the event.

15. That was a conclusion that should have been reached by Mr. McDermott prior to his filing the complaint. Instead, on the complaint form, he signed the following statement under oath:

COMPLAINT

THAT THE COMMISSIONER NAMED ABOVE, THEN A

DELRAY BEACH CITY COMMISSIONER DID VIOLATE

FLORIDA STATUTE 112 IN THAT THE COMMISSIONER

ACCEPTED GIFTS VALUED IN EXCESS OF $100.00

AND FAILED TO REPORT SAME IN ACCORDANCE WITH

STATE LAW. THE GIFTS WERE PROVIDED BY

MEMBERS OF A BOND UNDERWRITING GROUP HEADED

BY SMITH BARNEY. THEY INCLUDED: ROUND TRIP

TRANSPORTATION ON A CORPORATE JET FROM WEST

PALM BEACH TO ORLANDO AND BACK; AND, ROUND

TRIP LIMOUSINE SERVICE FROM THE ORLANDO

AIRPORT TO THE ORANGE COUNTY CONVENTION AND

CIVIC CENTER AND RETURN TO THE AIRPORT; AND,

A TICKET TO ATTEND THE $1000 PER PERSON FUND

RAISER DINNER BENEFITING GOV. MARTINEZ AND

FEATURING PRESIDENT GEORGE BUSH.

THE FOREGOING GIFTS HAVE AN ESTIMATED VALUE

OF $1350 TO 1500 WELL IN EXCESS OF THE

REPORTING REQUIREMENTS.

THE COMMISSIONERS FINANCIAL DISCLOSURE FORM

FOR THE CALENDAR YEAR 1990 WHICH COVERS THE

DATE OF THE SUBJECT EVENT ON FRIDAY APRIL 20

1990 SHOWS NO GIFTS RECEIVED.

IN ADDITION TO COMMENTS MADE TO VARIOUS

INDIVIDUALS ABOUT THE DETAILS OF THE TRIP,

INCLUDING THE FACT THAT ALL EXPENSES HAD

BEEN PAID BY THE BOND BROKERS, THE

COMMISSIONER WAS OBSERVED AT THE EVENT BY

NUMEROUS LOCAL OFFICIALS AND RESIDENTS.

(Exhibit 1, Complaint dated February 2, 1992)

16. Leslie McDermott did not ask Bill Andrews or Mary McCarty whether she attended the function. He did not contact anyone, including the sponsor of the event, who would likely have personal knowledge of her attendance. Instead, he relied on rumors and indirect reports, all which he knew were based on these tenuous connections:

(a) Bill Andrews used the term "we" in

bragging about the trip.

(b) Mary McCarty frequently attended

political events and was politically active.

Republicans (but not the only Republicans

on the city council), often voted alike.

(d) Some unnamed persons overheard

conversations which made them believe that

Bill Andrews and Mary McCarty were on the trip

together.

17. Leslie McDermott's explanation that he released the complaint to the press so that an investigation could be conducted is simply not persuasive. He is an educated, articulate and experienced individual. He knew or should have known that public exposure of his complaint would injure the reputation of Ms. McCarty. Despite his own initial misgivings, Mr. McDermott allowed himself to be used by individuals who could only benefit from that injury. His failure, due to hubris or extraordinarily bad judgment, to make a reasonable attempt to check the veracity of the rumors, constitutes the reckless disregard by which malicious intent may be proven.

18. In defending against the complaint and in pursuing relief in this proceeding, Mary McCarty has incurred costs and attorneys fees in the total amount of $12,876.55. Exhibit #4a), b), and c) appropriately itemizes the 50.9 hours and $2696.55 costs incurred.

The hourly rate of $200.00 was stipulated as reasonable. Leslie McDermott contests the reasonableness of any time spent and costs incurred after the commission's order finding no probable cause was issued. Based upon the unrefuted testimony of Robert V. Romani, Esquire, an experienced litigator, past-president of the Palm Beach County Bar Association and member of the Board of Governors of the Florida Bar; and after considering relevant case law discussed below, I find that the hours and costs both before and after dismissal of the complaint are reasonable.

CONCLUSIONS OF LAW

19. The Division of Administrative Hearings has jurisdiction in this proceeding pursuant to section 120.57(1), F.S. and rule 34-5.029, F.A.C.

20. Section 112.317(8), F.S. provides:

(8) In any case in which the commission

determines that a person has filed a

complaint against a public officer or

employee with a malicious intent to injure the

reputation of such officer or employee and in

which such complaint is found to be frivolous

and without basis in law or fact, the

complainant shall be liable for costs plus

reasonable attorney's fees incurred by the

person complained against. If the complainant

fails to pay such costs voluntarily within

30 days following such finding and dismissal

of the complaint by the commission, the

commission shall forward such information

to the Department of Legal Affairs, which

shall bring a civil action to recover such costs.

21. Rule 34-5.029(3), F.A.C., provides:

(3) The respondent has the burden of

proving the grounds for an award of costs

and attorney's fees by a preponderance of

the evidence presented at the hearing.

"Malicious intent to injure the reputation"

may be proven by evidence showing ill will

or hostility as well as by evidence showing

that the complainant intended to bring

discredit upon the name or character of the

respondent by filing such complaint with

knowledge that the complaint contained one

or more false allegations or with reckless

disregard for whether the complaint contained

false allegations of fact material to a

violation of the Code of Ethics for Public

Officers and Employees. Such reckless

disregard exists where the complainant

entertained serious doubts as to the truth

or falsity of the allegations, where the

complainant imagined or fabricated the

allegations, or where the complainant filed

an unverified anonymous tip or where there

are obvious reasons to doubt the veracity of

the information or that of the source of the

information.

22. The complaint was frivolous and without basis in law or fact. It was grounded on a false premise that the respondent took the trip at issue.

23. Nothing in Chapter 112, F.S. places the burden on a complainant to conduct an elaborate investigation and there is no requirement that a complaint be based upon personal knowledge of the complainant. Yet the language cited above, describing "reckless disregard", amply warns of the hazard of reliance on rumors.

24. There was nothing complicated about the facts or the law in this case, no arcane theories, no covert alliances. There was nothing in the result of the Ethics Commission investigation that could not have been discovered with a few telephone calls by Leslie McDermott or his cohorts. Instead, he was drawn into the partisan grapevine and, after expressing some concern about the validity of the charge as to Mary McCarty, plunged ahead with a sworn complaint which on its face reflects no equivocation whatsoever.

25. Malicious intent, more manifest than simple recklessness, is inferred from the complainant's release of his statement to the press. This action belies any credible argument that Leslie McDermott sought only to have proper authorities perform an investigation.

26. The simplicity of this case distinguishes it from Taunton v. Tapper, 396 So.2d 843 (Fla. 1st DCA 1981) cited by the complainant, in which the court reversed the commission's award of fees. In Taunton, as here, the finding of no probable cause was made after a factual investigation when the complaint on its face was sufficient. The finding of no probable cause in Taunton, however, was made only after factual and legal research and after the commission adopted a novel construction of the statute defining the alleged violation. There, unlike here, a substantial justiciable question could be spelled out. See Treat v. State ex rel. Mitton, 121 Fla. 509, 163 So. 883 (Fla. 1935), cited id, at 484.

27. A complaint may still be frivolous, even if legally sufficient on its face, when the underlying facts are utterly baseless. See, In Re: Steven B. Feren, #92-2458EC (Order of Remand, on other basis, entered 4/30/93). Respondent, Mary McCarty met her burden of proof described in Rule 34-5.029, F.A.C., above.

28. Leslie McDermott argues that, assuming entitlement, no fees should be allowed for any hours spent after dismissal of the complaint, because the time was not "reasonably spent." (p. 10, Complainant's proposed findings of fact and conclusions of law) As found above, those hours after the order finding no probable cause were reasonably incurred in the pursuit of fees in this attendant proceeding.

29. The prevailing view in Florida is that attorney's fees are recoverable for the time spent litigating entitlement to the fees, as long as those fees are incurred. State Farm Fire and Casualty Co. v. Palma, 585 So.2d 329, (Fla. 4th DCA 1991), and the authorities cited at p. 333. To conclude otherwise would render the relief offered in section 112.317(8), F.S. utterly meaningless. As McDermott recognizes, the time spent prior to dismissal was negligible in comparison to the time properly and necessarily expended in pursuing fees. This fees case, of course, presented substantial, justiciable issues of law and fact, as reflected by the day-long hearing and the thorough and competent presentations by counsel for both parties. The language of section 112.317(8), F.S., cited above, is interpreted as embracing all the costs and fees incurred by the person complained of, including the costs and fees for the proceeding contemplated in that section.

RECOMMENDATION

Based on the foregoing, it is

RECOMMENDED:

That the Commission on Ethics issue its final order awarding fees and costs in the total amount $12,876.55 to Mary McCarty from Leslie McDermott.

DONE AND RECOMMENDED this 23rd day of August, 1993, in Tallahassee, Florida.

_________________________________

MARY CLARK

Hearing Officer

Division of Administrative Hearings

The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the

Division of Administrative Hearings

this 23rd day of August, 1993.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-5168EC

The findings of fact proposed by both parties are substantially adopted here, with the exception of the following findings proposed by Leslie McDermott.

Paragraph 13. The "reasonable" appearance or belief as to Ms. McCarty's guilt is rejected as unsupported by the weight of evidence.

Paragraph 15. The reason Mr. McDermott presents for signing the complaint is rejected as not credible, in the face of his inconsistent action in presenting the complaint to the press.

Paragraphs 16-18 are rejected as contrary to the weight of evidence.

COPIES FURNISHED:

Bonnie Williams, Executive Director

Ethics Commission

Post Office Box 6

Tallahassee, Florida 32302-0006

Phil Claypool, General Counsel

Ethics Commission

Post Office Box 6

Tallahassee, Florida 32302-0006

Kenneth D. Stern, Esquire

Post Office Box 3878

Boca Raton, Florida 33427-3878

James K. Green, Esquire

One Clearlake Centre

250 South Australian Avenue

West Palm Beach, Florida 33401

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.