STATE OF FLORIDA
DIVISION OF
ADMINISTRATIVE HEARINGS
IN RE:
JAMES R. ENGLISH, )
) CASE
NO. 93-1523EC
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 July 12, 1993, in Tallahassee, Florida.
APPEARANCES
The Advocate for the Virlindia
Doss, Esquire
Florida Commission on Assistant
Attorney General
Ethics: Department
of Legal Affairs
The Capitol, PL-01
Tallahassee, Florida 32399-1050
For Respondent: Bruce A.
Minnick, Esquire
Mang, Rett & Collette, P.A.
660 East Jefferson Street
Post Office Box 11127
Tallahassee, Florida 32302-3127
STATEMENT OF THE ISSUES
On October 20, 1992, the State of Florida Commission on Ethics issued its
order finding probable cause that
...Respondent, as City Attorney for the City
of Tallahassee and an employee of the City,
violated Section 112.313(3) by assigning
legal work to the law firm in which he was a
partner and for which legal work the City
paid the law firm, and Section 112.313(7)(a)
by holding a one-sixth ownership interest in
a law firm doing business with the City.
The issue is whether those violations occurred and, if so, what
discipline or penalty is appropriate.
PRELIMINARY STATEMENT
On March 17, 1993, the Executive Director of the Commission on Ethics
forwarded this case to the Division of Administrative Hearings for conduct of a
public hearing and for a recommended order.
After consultation with counsel for the parties, the hearing was
scheduled as set forth above.
At the hearing, the Advocate presented one witness, the Respondent, and
submitted the following exhibits, received in evidence without objection: Advocate's exhibits #1-4, 6-7, 12-16, 19-27.
Respondent testified in his own behalf and presented the additional
testimony of Hurley Rudd, Jack McLean and Harry Morrison. Respondent's exhibits #3-5, 8-11 and 17 were
received in evidence. Respondent's
motion to supplement record exhibits, filed August 24, 1993, is DENIED as
moot. The proposed supplemental exhibit
was already received as Advocate's #21 (agenda and task force report).
The complainant, Eugene Danaher, attended the hearing and made a
statement at the close of the parties' cases.
A transcript was filed and both parties submitted proposed recommended
orders. The findings of fact proposed by
each party are addressed in the attached appendix.
FINDINGS OF FACT
1. The charter of the City of
Tallahassee was adopted in 1919, and its provisions for a city attorney have
remained basically unchanged since then.
Section 29 of the City of Tallahassee Code states that the city
commission shall appoint a city attorney.
The code also authorizes the city attorney, with the advice and consent
of the city commission, to appoint one or more assistant city attorneys to
serve at his pleasure and under his direction and supervision. (Advocate's exhibit #16)
2. Until recent years there was
no full-time city attorney. The city
commission appointed an attorney who was not an employee of the city, but
rather was a member of a law firm. The
city and the firm had an arrangement under which the firm was paid a monthly
retainer for forty hours work at a set hourly rate. The firm billed the city for any work over forty hours each month
at the approved hourly rate.
3. Bryan Henry was appointed
city attorney in the early 1970s, around 1971 or 1972. He was a principal and founder of the firm,
Henry and Buchanan, which later became Henry, Buchanan, Mick & English.
4. Respondent, James A.
"Jim" English (English), worked as a law clerk during law school for
Roy Rhodes, the prior city attorney, and then for Bryan Henry. He was hired by the Henry and Buchanan law
firm as an associate after law school in 1975.
Beginning early in his career, English was involved almost exclusively
in legal work for the city; even then, the volume of work exceeded the capacity
of any single individual. Between 1974
and 1984, from three to five lawyers in the firm did some work for the city,
based on their expertise and experience and based on their assignments from
Bryan Henry, the city attorney.
5. In 1977 English became a
shareholder in the firm, Henry, Buchanan, Mick & English, P.A., a Florida
professional corporation. From that
time until he left the firm in 1992, he received distributions of his share of
the firm's profits.
6. Bryan Henry became ill in
1980, and most of the duties of the city attorney were performed by
English. In September 1983, Bryan Henry
resigned and recommended that English be appointed to succeed him. On September 13, 1983, the city commission
voted to appoint Jim English as the city attorney.
7. Discussion accompanying the
appointment reflected the commission's continued interest in the manner of
delivery of legal services to the city.
Earlier, in 1981, the commission had discussed alternative methods and
had requested research and reports on the experience of other Florida cities.
8. The appointment of Jim
English in September 1983 did not immediately change the status quo; that is,
the parties continued to operate on the retainer plus fee arrangement and
English received no salary nor other benefits from the city. The agreement or arrangement was not
evidenced by a written contract.
Rather, the commission voted on the hourly rate in its annual budget
deliberations.
9. In May 1984, after the city
elections, the commission established its priority issues. By this time, there were three lawyers on
the commission: Carol Bellamy, Kent
Spriggs and Jack McLean. The delivery
of legal services was designated a priority or "target" issue. A task force or committee was appointed on
June 26, 1984, to study the issue and report back to the commission. The committee, chaired by Commissioner
Bellamy, included Commissioner Rudd, the city manager, the director of employee
relations, the director of the office of management and budget, and the city
attorney (English). Its charge was to
report back to the commission on its study of three options: in-house counsel, outside counsel (the
existing structure), or a blend of the two (minimal in-house staff,
supplemented with outside contract counsel).
10. The task force report is
dated September 24, 1984. It compared
Tallahassee's legal costs with those of eight other cities in Florida. Tallahassee's costs were ranked second to
lowest in "per capita cost", "cost per employee", and
"percent of total operating budget".
The report detailed advantages and disadvantages of each of the three
options it studied, and the report provided a detailed analysis of the legal
department's scope of work derived from three months of the city attorney's
time slips.
11. The report was placed on the
city commission agenda for the October 2, 1984 meeting, but was deferred for
the next meeting when the commissioners received a proposed agreement from
English. The proposed agreement was
adopted by a 4-1 vote on October 9, 1984.
12. The professional services
agreement, effective October 15, 1984, provided for English to become a full-time
employee of the City of Tallahassee with the same benefits as other appointed
officials, except the city manager.
With the exception of pro bono work, his professional time was to be
exclusively devoted to "the legal work and other obligations of the
charter office of the city attorney."
(Advocate's exhibit #7) His salary
was set at $61,500 per year, and $3,430 per month was established as
compensation to his firm for overhead.
The salary increased to $7,327.67 per month in 1991, while the overhead
covering English's office and support staff at the firm remained constant.
13. The agreement clearly
contemplated continued use of the Henry, Buchanan, Mick & English
firm. It provided: "All other work performed by the City
Attorney's law firm shall be paid for at the hourly rate established by the
commission". (Advocate's exhibit
#7, p. 2) It also required that the
monthly billing of the law firm include the percentage of work actually
performed by minority professionals in the firm in that given month. It provided that the number of assistant
city attorneys would not be increased without commission approval and that
their supervision and performance was the responsibility of the city
attorney. The agreement described a
mechanism for review by the city attorney of each new case form opened by the
firm to insure that no conflict existed between the new client matter and the
city. It required that the city
attorney continue to file annual statements of financial interests for the law
firm indicating clientele of the firm which generated over 10 percent of the
firm's income.
14. Nothing in the agreement
specified how much city work the firm should get; that was substantially left
to English's discretion. The commission
was aware of the type of work the firm had been providing and what work was
typically performed by other firms; for example, utilities-related legal work
and the prosecution of cases before various city regulatory boards were being
contracted out to other firms.
15. Between 1986 and 1991, the
Henry, Buchanan, Mick & English firm received the bulk of the city's legal
business:
Fiscal Year Henry, Buchanan, Mick & English Other Legal Counsel
1986
$230,332.75
$ 133,697.00
1987
301,583.47
194,034.56
1988 476,484.66 216,212.95
1989
510,821.82
873,470.61
1990
684,472.55
1,000,368.48
1991 993,384.45 1,434,548.80
(Advocate's exhibit #4)
The city was one of the firm's
largest clients. (Respondent's exhibit
#5, Statements of Financial Interests, Part B)
16. Between 1985 and 1991,
English's share of profit distributions from the law firm totaled
$86,157.00. He did not receive a salary
from the firm.
17. After the complaint was
filed in this case, English resigned from the firm and sold his stock shares
back to the firm. The resignation was
effective May 1, 1992.
18. Although English was
familiar with the ethics code, had lectured on it, and had helped draft a city
policy based on the code, neither he nor any of the three lawyers on the
commission at the time apparently contemplated that his employment status
created in 1984 violated the code.
Debate and discussion on the provision of legal services was open and
vigorous in the years and months immediately preceding the agreement in 1984. In the view of the two former commissioners
who testified in this proceeding, Hurley Rudd and Jack McLean, the agreement
represented a fair and reasonable solution to the variety of concerns raised by
the individual commissioners. Those
concerns included accountability, avoidance of conflict with other clients of
the firm, the use of minority businesses, quality of services, and, of course,
economy.
19. No evidence in this
proceeding suggests that the city was, in fact, ill-served by the agreement
over the years. The city has more
recently authorized the creation of an in-house legal department and has
staffed it; and English remains the city attorney and an employee of the city.
CONCLUSIONS OF LAW
20. The Division of
Administrative Hearings has jurisdiction in this proceeding pursuant to section
120.57(1), F.S., and Rule 34-5.010, F.A.C.
21. The burden of proof, absent
a statutory directive to the contrary, is on the party asserting the
affirmative of the issue in the proceeding.
Antel v. Department of Professional Regulation, 522 So.2d 1056 (Fla. 5th
DCA 1988); Department of Transportation v. J.W.C. Co., Inc., 396 So.2d 778
(Fla. 1st DCA 1981); and Balino v. Department of Health and Rehabilitative
Service, 348 So.2d 249 (Fla. 1st DCA 1977).
In this proceeding, it is the commission, through the Advocate, that is
asserting the affirmative that Respondent violated sections 112.313(3) and
112.313(7)(a), F.S. Therefore, the
burden of proving the elements of Respondent's alleged violations is on the
Advocate.
The standard of proof in cases before the Ethics Commission requires
proof of the charges by a preponderance of the evidence. In re Michael Langton, 14 F.A.L.R. 4175
(1992). See also In re Leo C. Nichols,
11 F.A.L.R. 5234 (1989).
22. Section 112.313(3), F.S.,
provides, in pertinent part:
(3) DOING
BUSINESS WITH ONE'S AGENCY.--No
employee of an agency acting in his official
capacity as a purchasing agent, or public
officer acting in his official capacity,
shall either directly or indirectly purchase,
rent, or lease any realty, goods, or services
for his own agency from any business entity
of which he or his spouse or child is an
officer, partner, director, or proprietor or
in which such officer or employee or his
spouse or child, or any combination of them,
has a material interest.
Nor shall a public
officer or employee, acting in a private
capacity, rent, lease, or sell any realty,
goods, or services to his own agency, if he
is a state officer or employee, or to any
political subdivision or any agency thereof,
if he is serving as an officer or employee of
that political subdivision.
* * *
This subsection shall not affect or be
construed to prohibit contracts entered into
prior to:
(a) October 1,
1975.
(b) Qualification
for elective office.
(c) Appointment
to public office.
(d) Beginning
public employment.
Section 112.313(7), F.S. provides, in
pertinent part:
(7) CONFLICTING
EMPLOYMENT OR CONTRACTUAL
RELATIONSHIP.--
(a) 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,
excluding those organizations and their
officers who, when acting in their official
capacity, enter into or negotiate a
collective
bargaining contract with the state
or any municipality, county, or other
political subdivision of the state; nor shall
an officer or employee of any 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.
23. When he was appointed city
attorney in 1983, English became a "public officer" as defined in
section 112.313(1): "...the term
'public officer' includes any person elected or appointed to hold office in any
agency, including any person serving on an advisory body." In this regard, his circumstances are
distinguished from those of the city attorney in CEO 81-61 whom, according to
that opinion, was not "appointed" to the office.
24. As city attorney, English
"directly or indirectly" purchased services from his own firm. He also, in his private capacity, sold the
firm's services to the city. These
facts establish a violation of section 112.313(3), F.S. See, Howard v. State Commission on Ethics,
421 So.2d 37 (Fla. 3rd DCA 1982). The
grandfather provisions of section 112.313(3), F.S., are not applicable. Although the city commission periodically
approved hourly rates for the firm, no contract required that any quantity of
work be referred to the firm. The
arrangement was open-ended, with some degree of oversight by the commission in
its budget review. Whatever agreements
or arrangements existed prior to 1984, it is obvious from the minutes of the
commission meetings and the testimony in this proceeding that the commission in
1984 insisted on a new approach, made a complete and thorough review of
available options and did not consider itself bound to any prior
arrangement. The relevant
"contract" for purposes of applying the grandfather clause is the
October 15, 1984 contract.
25. The evidence also
establishes a violation of section 112.313(7), F.S. English's firm did business with the agency of which he was an
officer; he had the authority to generate that business at the same time that
he received distributions of the firm's profits. Without any suggestion of ill intent, that status falls within
both proscriptions of section 112.313(7)(a), F.S. The status created a situation which "tempt[ed]
dishonor". Zerweck v State
Commission on Ethics, 409 So.2d 57 (Fla. 4th DCA 1982).
26. Contrary to Respondent's
assertion, the escape provision of section 112.313(7)(b), F.S., does not apply:
(b) This
subsection shall not prohibit a
public officer or employee from practicing in
a particular profession or occupation when
such practice by persons holding such public
office or employment is required or permitted
by law or ordinance.
English was obviously required to be
a lawyer, but that is not the issue. He
was not required nor permitted by any law or ordinance to remain a partner in
the law firm and reap its benefits.
Penalty
27. Section 112.317, F.S.,
provides, in pertinent part:
112.317
Penalties.--
(1) Violation
of any provision of this
part, including, but not limited to, any
failure to file any disclosures required by
this part or violation of any standard of
conduct imposed by this part, or violation of
any provision of s. 8, Art. II of the State
Constitution, in addition to any criminal
penalty or other civil penalty involved,
shall pursuant to applicable constitutional
and statutory procedures, constitute grounds
for, and may be punished by, one or more of
the following:
(a) In the case
of a public officer:
1. Impeachment.
2. Removal from
office.
3. Suspension
from office.
4. Public censure
and reprimand.
5. Forfeiture of
no more than one-third
salary per month for no more than 12 months.
6. A civil
penalty not to exceed $5,000.
7. Restitution of
any pecuniary benefits
received because of the violation committed.
Pursuant to section 112.324(7), F.S.,
the Commission on Ethics, upon finding a violation of the ethics code, must
report its findings and recommend appropriate action to the proper disciplinary
body, in this case, the city.
28. English should have known
that his dual status created violations of the ethics code. The two cases cited above, Howard and Zerweck,
were decided in 1982, prior to the agreement between English and the city. Both cases appear in annotations to the
Florida Statutes. English is a seasoned
and highly respected local government attorney. It does not matter that other attorneys on the commission may
have failed to recognize the problem; he, not they, had the responsibility to
advise the city. Whether his oversight
was deliberate or the result of myopic zeal to address the commission's
expressed concerns is immaterial. Both
Howard and Zerweck, supra, expressly acknowledge that sections 112.313(3) and
(7) proscribe conduct without regard to allegations of impropriety or
"dishonor".
29. The Advocate suggests a
penalty of restitution in the amount of $5,000.00 and a civil penalty of
$5,000.00 per violation, for a total of $15,000.00. This is consistent with the commission's final order and
recommendation in In re J.G. Spicola, (order rendered June 11, 1992). Although it is not possible to ascertain how
much of the profit distributions to English were based on work done for the
city, it is obvious that some portion was so derived. The city was one of the firm's largest clients. (See finding of fact #15, above)
RECOMMENDATION
Based on the foregoing, it is, hereby,
RECOMMENDED:
That the Florida Commission on Ethics issue its public report and final
order finding that Respondent, James R. English, violated sections 112.313(3)
and (7), F.S., and recommending a penalty of $5,000.00 restitution, and a civil
penalty of $10,000.00, for a total of $15,000.00.
DONE AND RECOMMENDED this 19th day of November, 1993, in Tallahassee,
Leon County, Florida.
__________________________________
MARY CLARK
Hearing Officer
Division of Administrative Hearings
The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-1550
(904)488-9675
Filed with the Clerk of the
Division of Administrative Hearings
this 19th day of November, 1993.
APPENDIX TO RECOMMENDED
ORDER, CASE NO. 93-1523EC
The following constitute specific rulings on the findings of fact
proposed by the parties as provided for in section 120.59(2), F.S.
The Advocate's Proposed Findings
1.-2. Adopted in paragraph 1.
3.-4. Adopted in paragraph 2. and paragraph 4.
5.
Adopted in paragraph 8.
6.
Adopted in substance in paragraph 2.
7.
Adopted in paragraph 4.
8.
Adopted in substance in paragraph 5.
9.-11. Adopted in paragraph 6.
12.
Adopted in paragraph 8.
13.-15. Adopted in paragraph 9.
16.
Adopted in substance in paragraph 10.
17.
Adopted in substance in paragraph 11.
18.-19. Adopted in substance in paragraph 12.
20.
Rejected as unnecessary.
21.
Adopted in paragraph 11.
22.-23. Adopted in paragraph 12.
24.
Adopted in paragraph 15.
25.-26. Rejected as cumulative and unnecessary.
27.
Adopted in paragraph 16.
28.
Addressed in paragraph 13. The
agreement addressed
work to be done by the firm, but did not mandate
that the firm be used for any given amount.
29.
Adopted in paragraph 14.
30.
Adopted in paragraph 13.
31.-33. Addressed in paragraph 18.
34.-38. Rejected as argument or unnecessary. The
provisions of the ethics code at issue here do not
require intent for a violation.
Respondent's Proposed Findings of Fact
1.
Adopted in paragraphs 1. and 2.
2.
Adopted in paragraphs 2. and 3., in substance.
3.
Adopted in paragraph 4.
4.
Adopted in substance in paragraph 7.
5.
Adopted in substance in paragraph 5.
6.-9. Addressed in paragraph 7., otherwise rejected as
unnecessary.
10.
Adopted in paragraph 6.
11.-12. Adopted in substance in paragraph 9.
13.-14. Adopted in part in paragraph 11., otherwise
rejected as misleading or unnecessary.
15.
Adopted in paragraph 13.
16.
Adopted in paragraph 9.
17.
Rejected as overbroad. If anyone
did recognize a
conflict, it was not addressed in the commission
meeting minutes.
18.
Adopted in part in paragraph 17, otherwise rejected
as unnecessary.
19.
Adopted in substance in paragraph 19.
20.-21. Rejected as unnecessary.
22.
Adopted in material part in paragraphs 12.-13. and
18.
COPIES FURNISHED:
Virlindia Doss, Esquire
Assistant Attorney General
Department of Legal Affairs
The Capitol, PL-01
Tallahassee, Florida 32399-1050
Bruce A. Minnick, Esquire
Mang, Rett & Collette, P.A.
660 East Jefferson Street
Post Office Box 11127
Tallahassee, Florida 32302-3127
Bonnie Williams, Executive Director
Ethics Commission
Post Office Drawer 15709
Tallahassee, Florida 32317-5709
Phil Claypool, General Counsel
Ethics Commission
Post Office Drawer 15709
Tallahassee, Florida 32317-5709
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.