Okla. v. The Lead-impacted Communities Relocation Assistance Trust

• Decision Date: 22 June 2010
• Docket Number: No. 107,833.,107,833.
• Citation: 237 P.3d 181,2010 OK 48
• Parties: Johnny and Patty LAFALIER and Missy Beets, individually and on behalf of residents and property owners and former residents and property owners of Picher, Oklahoma, Plaintiffs/Appellants, v. The LEAD-IMPACTED COMMUNITIES RELOCATION ASSISTANCE TRUST, Defendant/Appellee.
• Court: Oklahoma Supreme Court

237 P.3d 181

2010 OK 48

Johnny and Patty LAFALIER and Missy Beets, individually and on behalf of residents and property owners and former residents and property owners of Picher, Oklahoma, Plaintiffs/Appellants,

v.The LEAD-IMPACTED COMMUNITIES RELOCATION ASSISTANCE TRUST, Defendant/Appellee.

No. 107,833.

Supreme Court of Oklahoma.

June 22, 2010.

COPYRIGHT MATERIAL OMITTED.

ON APPEAL FROM THE DISTRICT COURT OF OTTAWA COUNTY; The Honorable J. Dwayne Steidley, Presiding

¶ 0 The plaintiffs filed a petition in the district court of Ottawa County alleging that the Lead-Impacted Communities Relocation Assistance Trust, the purpose of which is to administer relocation assistance funds under 27A O.S.Supp.2008, §§ 2201-2207, had undervalued their property and that the Trust had violated the Open Meeting Act, 25 O.S.2001, §§ 301-314. The plaintiffs also alleged that 27A O.S.Supp.2008, § 2203(M) is unconstitutional. The Trust responded that under 27A O.S.Supp.2008, § 2205, the plaintiffs could not complain about underevaluations of their property and the Trust had not violated the Open Meeting Act. The district judge found that 27A O.S.Supp.2008, § 2205, was an assertion of the state's sovereign immunity and that the Trust had not violated the Open Meeting Act. This Court retained the appeal for disposition.

AFFIRMED IN PART; REVERSED IN PART; REMANDED TO THE DISTRICT COURT WITH INSTRUCTIONS.

John Wiggins, Emily N. Kitch, Wiggins Sewell & Ogletree, and Jeff D. Marr, Marr Law Firm, Oklahoma City, OK, for the appellants.

Scott D. Boughton, Assistant Attorney General, Oklahoma Attorney General's Office, Oklahoma City, OK, for the appellee.

TAYLOR, V.C.J.

¶ 1 The questions presented in this appeal are (1) whether section 2205 of the Lead-Impacted Communities Relocation Assistance Act ¹ is unconstitutional, (2) whether section 2203(M) of the Lead-Impacted Communities Relocation Assistance Act is unconstitutional, and (3) whether section 307(D) of the Oklahoma Open Meeting Act (Open Meeting Act) ² authorizes a public body subject to its provisions to allow anyone who does not stand to profit from a purchase or appraisal of real property into an execution session wherein the purchase or appraisal is discussed. We find that the plaintiffs have failed to show that sections 2205 and 2203(M) of the Lead-Impacted Communities Relocation Assistance Act are unconstitutional. We also find that section 307(D) of the Open Meeting Act restricts attendance in executive sessions to the members of the public body, the public body's attorney, and the public body's immediate staff when the body is discussing the purchase or appraisal of real property. ³

I. LEAD-IMPACTED COMMUNITIES RELOCATION ASSISTANCE ACT AND TRUST AGREEMENT

¶ 2 The geographical area around and including Picher is known as the Tar Creek Superfund Site (Tar Creek). ⁴ On September 8, 1983, Tar Creek was placed on the National Priorities List as an area that posed a significant public health or environmental risk, or both. ⁵ The area had substantial lead and zinc contamination. ⁶ In response to the elevated health risk, particularly to children six years of age and under who resided in the contaminated area, the Oklahoma Legislature passed the Lead-Impacted Communities Relocation Assistance Act (Act), and, with the Governor's approval, it became law. ⁷

¶ 3 The 2004 legislation created a relocation assistance plan for renters and property owners with children six years of age and under. ⁸ Because a subsidence risk ⁹ was identified in 2006, the Legislature extended the assistance plan to most renters and home owners in an area of greatest subsidence risk as well as to commercial businesses, nonprofit organizations, and others. ¹⁰ Relocation assistance includes purchase of a home owner's property at an amount comparable to housing elsewhere in the county, a payment of an amount up to twelve months rent for comparable housing elsewhere in the county, and reimbursement for moving expenses. ¹¹ In exchange, those accepting the assistance cannot reside within one-half mile of the area until the Commissioner of Health determines it to be safe for habitation. ¹² Participation in the Act's assistance program is completely voluntary, and “[n]o person shall be required to relocate under the provisions of” the Act. ¹³

¶ 4 The assistance program is funded, in part, by the Oklahoma Department of Environmental Quality (ODEQ) making grants from appropriated monies to a public trust. ¹⁴ The Legislature specifically provided that the Trust “shall be subject to the Oklahoma Open Meeting Act and the Oklahoma Open Records Act.” ¹⁵ Further a majority of trustees cannot come from the most affected area, and any trustee having a direct pecuniary interest in any pending decision cannot participate in the decision under the Act's terms. ¹⁶

¶ 5 Section 2205 of the Act provides:

A. Neither the enactment of this act nor the grant of funds to a trust shall create any property right or right in action. The courts shall have no jurisdiction to entertain any action against a recipient trust, the State of Oklahoma, their officers or agents founded on a claim that the claimant should have received different or better treatment from the trust.

B. The determinations made by the trust pursuant to this relocation assistance program including, without limitation, determinations as to what constitutes the most affected area of the site, the area of greatest subsidence risk, the average rental cost of comparable housing, the average cost of comparable properties, the eligibility of any person for assistance, and the determination of the proper amount of such assistance, if any, shall be committed to the sole discretion of the trust based on the information available to it and shall not be subject to judicial review.

¶ 6 At least in part due to a tornado which hit Picher on May 10, 2008, damaging a large number of houses and completely destroying others, the Legislature again amended the Act. ¹⁷ The most significant change made by the 2008 legislation for purposes of the issues presented here is the addition of subsection M in section 2203. Subsection M provides:

Any person eligible to receive assistance under the provisions of the Lead-Impacted Communities Relocation Assistance Act prior to May 10, 2008, shall remain eligible to receive the same amount of assistance adjusted for the amount of any private insurance payments for storm related damage if applicable. Any property valuation or other type of relocation assistance assessment made for the purposes of the Lead-Impacted Communities Relocation Assistance Act shall be based on the value of property as it existed no earlier than January 31, 2006, and not later than May 10, 2008, and comparable to property elsewhere in the county. The trust shall be authorized to enact or amend any of its procedures or deadlines as necessary to implement the provisions of this subsection.

¶ 7 In September of 2004, the Secretary of the Environment, as trustor, and the trustees signed the Lead-Impacted Communities Relocation Assistance Trust (Trust) agreement, and the Governor accepted the beneficial interest in the Trust on behalf of the State of Oklahoma (State). The Trust agreement generally follows along the Act's lines and includes general trust provisions.

II. THE PARTIES AND OTHERS INVOLVED WITH THE TRUST

¶ 8 At the time the petition was filed in the district court, the plaintiffs Johnny and Patty Lafalier had signed a contract with the Trust for the purchase of their property and were in the process of receiving relocation assistance. Their property was damaged by the tornado, and they received private insurance for the damage. At the time the petition was filed, the plaintiff Missy Beets had transferred ownership of her property to the Trust and had received relocation assistance. The plaintiffs sought class action certification, but, at the time the petition in error was filed, the class had not been certified.

¶ 9 Larry Roberts is the Trust's operations manager and its only employee. J.D. Strong is the Secretary of the Environment. In Executive Order 2007-07, Governor Henry designated the Secretary of the Environment as having “responsibility” for the Trust. After the enactment of the 2006 amendments, the Trust contracted with Cinnabar Service Company to provide the appraisals and retained Van Tuyl and Associates to review the appraisals. ¹⁸ Roberts, Strong, and representatives of the appraisal companies attended the Trust's executive sessions.

III. HISTORY

¶ 10 On April 2, 2009, the plaintiffs filed a petition in the district court in Ottawa County, Oklahoma, stating two causes of action: (1) The Trust had willfully violated the Open Meeting Act by allowing J.D. Strong and representatives of Cinnabar and Van Tuyl into its executive sessions with the result that their properties were undervalued, and (2) the plaintiffs were treated unequally due to the deduction of insurance proceeds from the relocation assistance offer pursuant to title 27A, section 2203(M) of the 2008 Oklahoma Statutes. The plaintiffs sought (1) class certification, (2) the appointment of an administrator to audit the Trust, to reappraise the properties, to fairly compensate the plaintiffs, to compensate for past under-payments, and to oversee the Trust's future management, (3) reimbursement of amounts deducted for private insurance or FEMA payments, (4) an order finding title 27A, sections 2203(M) and 2205 of the Oklahoma Statutes unconstitutional, (5) an order for disclosure of all minutes and other records from executive sessions which violated the Open Meeting Act, and (6) attorney fees and costs. The Trust responded asserting the affirmative defenses of sovereign immunity and estoppel, among other things.

¶ 11 The Trust filed a motion for summary judgment arguing (1) that title 27A, section 2205 is constitutional, (2) that under section 2205, the plaintiffs cannot contest...