Mo. Chamber Commerce & Indus. v. Mo. Ethics Comm'n

• Citation: 581 S.W.3d 89
• Decision Date: 09 April 2019
• Docket Number: WD 81805
• Parties: MISSOURI CHAMBER OF COMMERCE AND INDUSTRY, Appellant, v. MISSOURI ETHICS COMMISSION, et al., Respondents.
• Court: Court of Appeal of Missouri (US)

581 S.W.3d 89

MISSOURI CHAMBER OF COMMERCE AND INDUSTRY, Appellant,

v.MISSOURI ETHICS COMMISSION, et al., Respondents.

WD 81805

Missouri Court of Appeals, Western District.

OPINION FILED: April 9, 2019

Application for Transfer Denied October 1, 2019.

Lowell D. Pearson and R. Ryan Harding, Jefferson City, MO, Attorneys for Appellant.

Eric S. Schmitt, Attorney General, Emily A. Dodge, Assistant Attorney General, and Julie M. Blake, Deputy Solicitor General, Jefferson City, MO, and Peter T. Reed, Deputy Solicitor General, St. Louis, MO, Attorneys for Respondents.

Before Division Four: Karen King Mitchell, Chief Judge, and Alok Ahuja and Thomas N. Chapman, Judges

Karen King Mitchell, Chief Judge

The Missouri Chamber of Commerce and Industry (the Chamber) appeals the denial of its request for a declaratory judgment to the effect that the Missouri Campaign Contribution Reform Initiative of 2016 (Amendment 2) allows contributions from a corporation’s treasury to a political action committee (PAC) established, administered, or maintained by the corporation. In its sole point on appeal, the Chamber argues that the trial court erred in concluding that Amendment 2 prohibits contributions from a corporation to such a PAC. Because we conclude that the plain and ordinary meaning of the language of Amendment 2, read in its entirety, prohibits contributions from a corporation to a PAC established, administered, or maintained by the corporation, we affirm.

Background

On November 8, 2016, Missouri voters passed Amendment 2, which became effective at the end of the 30th day after the election. Amendment 2 added a new section to the Missouri Constitution, titled the "Missouri Campaign Contribution Reform Initiative." Mo. Const. art. VIII, § 23. Amendment 2 imposes restrictions on the types of campaign contributions that corporations like the Chamber may make. The Chamber is a not-for-profit corporation organized pursuant to 26 U.S.C. § 501(c)(3) of the Internal Revenue Code and is registered as a nonprofit corporation with the Missouri Secretary of State. The Chamber established, administered, and maintained a PAC called the "We Mean Business PAC."

Following passage of Amendment 2, the Missouri Ethics Commission (MEC), which investigates and enforces the laws governing campaign finance disclosure, issued two advisory opinions. In Advisory Opinion No. 2017.03.CF.010, dated March 27, 2017, MEC concluded that "because [§ 23.3(3)(a) ] expressly authorizes specific types of individual contributions but does not specifically authorize the contributions from the entity’s treasury or funds, a corporation ... may not contribute its own funds to its connected^{[1 ]} political action/continuing committee." In Advisory Opinion No. 2017.07.CF.014, dated July 14, 2017, MEC reaffirmed its earlier conclusion about connected PACs. There, MEC stated, "The Commission discussed the application of [§§ 23.3(3)(a) and 23.3(12) ] as they relate to corporate ... contributions to PACs in MEC No. 2017.03.CF.010. The Commission stated that a corporation ... may not contribute its own funds to its connected PAC, but that it may contribute direct corporate ... funds to an ‘unconnected’ PAC."

The Chamber filed a petition for declaratory judgment challenging MEC’s conclusion that Amendment 2 prohibits contributions from a corporation to its connected PAC. The case was tried and submitted on stipulated facts. The trial court entered judgment in favor of MEC, concluding that Amendment 2

make[s] clear that while a corporation may not make direct contributions to committees tied to candidates or political parties, it may create, support and control its own PAC that may, in turn, make such contributions, provided the PAC is not funded with the corporation’s own money. The connected PAC, in turn, may make various election-related expenditures—such as contributing to candidate committees—that a corporate connected organization may not. If a corporation wishes to "maintain" or "administer" a connected PAC, it may not contribute its own funds to that PAC, but it may solicit contributions to the PAC from its own directors, officers, employees, members, and shareholders.

By permitting connected PACs to receive contributions from corporate directors, officers, employees, members and shareholders but not the corporation itself, Amendment 2 prevents corporations from circumventing the prohibition on corporate contributions to candidates and political parties. Without that important limitation, corporations could evade [Amendment 2’s] prohibitions by simply creating a connected PAC, contributing corporate funds to that PAC, and then directing the PAC to contribute to candidates or political parties of the corporation’s choice.

The Chamber appeals.

Standard of Review

This case was submitted on stipulated facts and, thus, "did not involve the trial court’s resolution of conflicting testimony." Ritter v. Ashcroft , 561 S.W.3d 74, 84 (Mo. App. W.D. 2018) (quoting Chastain v. James , 463 S.W.3d 811, 817 (Mo. App. W.D. 2015) ). Therefore, "the only question before this court is whether the trial court drew the proper legal conclusions from the facts stipulated." Id. (quoting Chastain , 463 S.W.3d at 817 ). Here, the trial court’s ruling was based on the interpretation and application of Amendment 2 to the stipulated facts; "[t]hus, our review is de novo. " Id. (quoting Chastain , 463 S.W.3d at 817 ).

Analysis

In its sole point on appeal, the Chamber argues that the trial court erred in granting judgment in MEC’s favor because Amendment 2 does not prohibit contributions from a corporation to its connected PAC when the corporation is acting as a connected organization because (1) § 23.3(3)(a) does not list "connected organization" among the entities to which a corporate contribution is prohibited; and (2) § 23.3(12) expressly permits contributions from a corporation to a PAC. We disagree. Although the Chamber’s descriptions of two isolated provisions of Amendment 2 are accurate, the plain and ordinary meaning of the language of Amendment 2 in its entirety does, in fact, prohibit contributions from a corporation to its connected PAC when the corporation is acting as a connected organization.

In construing a constitutional provision, we follow the same rules we apply when interpreting statutes. Mo. State Emps.' Ret. Sys. v. Salva , 504 S.W.3d 748, 751 (Mo. App. W.D. 2016). "Words used in constitutional provisions are interpreted to give effect to their plain, ordinary, and natural meaning." Wright-Jones v. Nasheed , 368 S.W.3d 157, 159 (Mo. banc 2012). "The primary goal in interpreting a constitutional provision is to ascribe to the words of the provision the meaning that the people understood them to have when the provision was adopted." Salva , 504 S.W.3d at 751. "[D]ue regard is given to the primary objectives of the [constitutional] provision in issue as viewed in harmony with all related provisions, considered as a whole." Mo. Prosecuting Attorneys v. Barton Cty. , 311 S.W.3d 737, 742 (Mo. banc 2010) (quoting Boone Cty. Court v. State , 631 S.W.2d 321, 324 (Mo. banc 1982) ). Every word in the Missouri Constitution must be given meaning and cannot be ignored as mere surplusage. State Highways & Transp. Comm'n v. Dir., Mo. Dep't of Revenue , 672 S.W.2d 953, 955 (Mo. banc 1984). Courts should avoid constructions of the Missouri Constitution that are unreasonable or would lead to absurd results. Salva , 504 S.W.3d at 752. And, "where one statute deals with [a] subject in general terms and the other deals in a specific way, to the extent they conflict, the specific statute prevails over the general statute." In re Gardner , 565 S.W.3d 670, 676 (Mo. banc 2019) (quoting Turner v. Sch. Dist. of Clayton , 318 S.W.3d 660, 668 (Mo. banc 2010) ).

Amendment 2 establishes a set of rules that govern corporate contributions. Section 23.3(3)(a) of Amendment 2 makes it unlawful for a corporation

to make contributions^{[2 ]} to a campaign committee, candidate committee, exploratory committee, political party committee or a political party; except that a corporation ... may establish a continuing committee which may accept contributions or dues from members, officers, directors, employees or security holders.

Mo. Const. art. VIII, § 23.3(3)(a).³ Section 23.3(12) of Amendment 2 authorizes PACs to receive contributions from, among others, "corporations, associations, and partnerships formed under chapters 347 to 360, RSMo, as amended from time to time...." Id. at § 23.3(12). A corporation that spends its own funds or provides services to either "establish, administer or maintain" a PAC or solicit contributions for that PAC (referred to by MEC in its opinions and the parties as a "connected PAC") is a "connected organization." Id. at § 23.7(6)(d).

Under Amendment 2, the definition of a PAC is almost identical to the definition of a "continuing committee,"⁴ with the only substantive difference being that, in addition to candidate and campaign committees (excluded from the definition of continuing committees), PACs also do not include political party, exploratory, or debt service committees. Id. at § 23.7(20). In other words, PACs are a subset of continuing committees.

In passing Amendment 2, Missouri voters declared that "political contributions from corporations ... can unfairly influence the outcome of Missouri elections[,]" making limits on corporate contributions necessary. Id. at § 23.2. To that end, the first clause of § 23.3(3)(a) bars a corporation from contributing to committees associated with candidates or political parties. The second clause of § 23.3(3)(a), however, provides that "a corporation may establish a continuing committee which may accept contributions ... from members, officers, directors, employees or security holders." As noted, supra , a PAC is, by definition, a continuing committee. Id. at §§ 23.7(6)(c) and (20). Thus, pursuant to § 23.3(3)(a), a corporation may establish a PAC.

When a corporation...