Monday, November 14, 2011
Court of Appeal Upholds Citizen’s Right to Enforce Open-Meetings Provision of Government Contract
By KENNETH OFGANG, Staff Writer
A private citizen may enforce a contract’s requirement that the board of a corporation receiving government funds open its meetings to the public, the Court of Appeal for this district has ruled.
Div. Three ruled on Wednesday that members of the public were intended beneficiaries of an open-meetings provision in a contract between the state Department of Education and Options-A Child Care and Human Services Agency. As such, Justice Walter Croskey wrote, they may sue as third-party beneficiaries.
The ruling reverses a contrary decision by Los Angeles Superior Court Judge Mary Ann Murphy.
Options is a nonprofit corporation that provides subsidized childcare and education services to families in the San Gabriel Valley and in the Whittier area. Several contracts entered into between Options and the DOE for the fiscal year beginning July 1, 2007 incorporated requirements that the agency, to the extent it receives public funds, “comply with the Ralph M. Brown Open Meetings Act,” that board meetings “be open to the public,” except when discussing labor relations matters, and that minutes of those meetings “be available to the public.”
In 2008, Services Employees International Union, Local 99 and a member, Francisco Torres, sued Options. The plaintiffs claimed board members discussed publicly funded programs at a meeting held June 16 of that year, despite the fact that the agenda was not posted in a public place 72 hours before the meeting and did not indicate which items would be discussed in executive session, that no announcement was made during the public portion of the meeting as to which items would be discussed in executive session, and that written reports were distributed at the meeting that were not made available to the public.
The complaint included causes of action for violation of the Brown Act and breach of contract and sought declaratory and injunctive relief and attorney fees. Options moved for summary judgment or summary adjudication on the grounds that it was not a “legislative body” within the meaning of the Brown Act, and that the plaintiffs were merely incidental beneficiaries and lacked standing to enforce the contracts.
Murphy agreed with Options on both issues and granted summary judgment.
Croskey, writing for the Court of Appeal, said Murphy was correct about the Brown Act but that the plaintiffs have a viable cause of action for breach of contract.
“We believe that the purpose of the provisions requiring compliance with the Brown Act was to ensure that meetings of Options’s board of directors relating to publicly funded programs would be open to the public and to extend to the general public the right to be informed regarding the matters to be discussed at such meetings and other Brown Act protections,” the justice wrote.
“We conclude that the intended beneficiary of these contractual provisions was the general public,” Croskey continued. “A member of the public may enforce these provisions as a member of the class for whose benefit the contract was made. The enforcement of such a provision in a government contract should not depend on action by the public agency, which may have little incentive to enforce the provision.”
The jurist distinguished Martinez v. Socoma Companies, Inc. (1974) 11 Cal.3d 394, holding that a class of economically disadvantaged persons could not sue as third party beneficiaries of federal contracts with the defendant, which was supposed to establish manufacturing facilities in a low-income neighborhood and employee disadvantaged residents of the area, which it allegedly failed to do.
Martinez, Croskey explained, was based on the conclusion that the contracts were intended to benefit the community as a whole, rather than specific individuals, so that the plaintiffs were merely incidental beneficiaries. The Brown Act and the open meetings provisions of the contracts with Options, however, were obviously intended to benefit the general public and to confer on the citizenry the right “to enforce the Brown Act requirements as contractual obligations.”
The justice did, however, reject the plaintiffs’ argument that by entering into the contract, the defendant gave its board the status of a “legislative body” that could be sued directly under the Brown Act. The argument fails because the definition of a legislative body is narrowly set forth in the statute, he said.
“Options was privately created and there is no indication that any elected legislative body played any role in bringing the private corporation into existence,” Croskey wrote. “Options’s board of directors therefore is neither the governing body of a local agency or other local body created by state or federal statute...nor a commission, committee, board, or other body of a local agency...nor is it the governing body of a private corporation or other entity created by an elected legislative body....”
The action was remanded with directions to vacate the summary judgment, deny summary adjudication on the contract cause of action, and enter summary adjudication on the Brown Act claim.
Attorneys on appeal were Glenn Rothner, Jonathan Cohen and Anthony P. Resnick of Rothner, Segall & Greenstone for the plaintiffs and Roger M. Mansukhani, Joshua B. Wagner and Matthew G. Kleiner of Gordon & Rees for the defendants.
The case is Service Employees International Union, Local 99 v. Options—A Child Care and Human Services Agency, 11 S.O.S. 6072.
Copyright 2011, Metropolitan News Company