Andy's Ice Cream v. Salisbury

• Citation: 724 A.2d 717,125 Md. App. 125
• Decision Date: 24 February 1999
• Docket Number: No. 80,80
• Parties: ANDY'S ICE CREAM, INC. v. CITY OF SALISBURY, et al.
• Court: Court of Special Appeals of Maryland

724 A.2d 717

125 Md. App. 125

ANDY'S ICE CREAM, INC. v. CITY OF SALISBURY, et al.

No. 80, Sept. Term, 1998.

Court of Special Appeals of Maryland.

February 24, 1999.

Alfred L. Scanlan, Jr. and Timothy C. Lynch (Scanlan, Rosen & Shar, LLC, Batimore, Robin R. Cockey and Cockey, Brennan & Maloney P.C., Salisbury, on the brief), for Appellant.

Robert A. Eaton of Salisbury, for appellee, City of Salisbury. William J. Chen, Jr. (Chen, Walsh, Tecler & McCabe, LLP, Rockville, on the brief), for Appellee, Salisbury Zoo Comm. (Donald C. Davis and Perdue, Rayne, Davis & White, Salisbury, on the brief), for Appellee, Flannery's Inc.

Argued before WENNER, DAVIS, and KENNEY, JJ.

KENNEY, Judge.

Appellant/cross-appellee, Andy's Ice Cream, Inc. ("Andy's"), bid unsuccessfully for a contract to sell food in an area within the City Park adjacent to the Salisbury Zoo. Andy's asserts that the Salisbury Zoo Commission, Inc. (the "Zoo Commission"), which made the contract decision, is both a public body and a unit or instrumentality of the City of Salisbury (the "City"), which, in turn, is a political subdivision of the state government. Based upon this assertion, Andy's contends that the Zoo Commission, during its review of the contract bids, should have complied with both the Public Information Act,¹ Md.Code (1984, 1997 Cum.Supp.), §§ 10-611 to 628 of the State Government Article ("S.G."), and the Open Meetings Act, Md. Code (1984, 1997 Cum.Supp.), S.G. §§ 10-501 to 512, which, respectively, detail procedural requirements for public access to government documents and to the meetings of public bodies. Andy's also argues that the City improperly delegated to the Zoo Commission the authority to award the contract.

Andy's sought a declaratory judgment and an injunction against the Zoo Commission's decision to award the contract to Flannery's, Inc., the successful bidder. All parties sought attorneys' fees. After a hearing on cross motions for summary judgment, the Circuit Court for Wicomico County ruled for Andy's on the Public Information Act issue, and for the City, the Zoo Commission, and Flannery's on the issues of delegation and the Open Meetings Act. No party was awarded attorneys' fees. Andy's appeals from the delegation, Open Meetings Act, and attorneys' fees decisions; the City and Zoo Commission appeal from the Public Information Act and attorneys' fees decisions. Flannery's, an appellee to Andy's appeal, has not appealed.

Facts

In 1983 Walter Anderson, the City's Solicitor at the time, filed Articles of Incorporation creating a non-profit, non-stock corporation to be called the "Salisbury Zoo Commission, Inc." The Articles named Patrick Fennell, the City's Executive Secretary, as Resident Agent, and listed the City's "Government Office Building" as the Resident Agent's address.²

The Zoo Commission's Articles provide that "[t]he members of the Corporation shall be appointed by the Mayor and City Council and shall ... include a member of the City Council." The Zoo Commission's By-Laws and Articles both identify its purpose as: "[t]o assist the City of Salisbury in the operation, management and promotion of the Salisbury Zoological Park as a wildlife conservation facility for the enjoyment and education of the citizens of the City of Salisbury and the regional area...." (Emphasis added.) The By-Laws specify a non-exclusive list of the Zoo Commission's functions, including: retaining persons or organizations to provide consultation or assist in the Zoo's operation; planning, recommending, and funding new Zoo exhibits and improvements, in collaboration with the City's Department of Public Works; soliciting, training, and managing volunteers for the Zoo's educational programs; raising funds and encouraging monetary contributions to the Zoo; developing, funding, and managing publicity programs; maintaining an accurate inventory of the animal collection; managing Zoo Commission funds for the purchase and sale of animals as personal property of the Zoo Commission; collaborating with professional Zoo staff in the acquisition, care, breeding, and disposition of the animals; and recommending to the Mayor and City Council long-term plans and improvements to the Zoo.

The By-Laws and Articles provide that the Mayor and City Council appoint the members of the Zoo Commission for three year terms, and can remove them.³ For new appointments and vacancies, the Zoo Commission "shall submit a list of names to the Mayor and City Council for consideration for appointment and in order to fill any vacancy." (Emphasis added.) The members of the Zoo Commission, during the events that gave rise to this case, were appointed by the Mayor and City Council in December 1996, pursuant to Resolution No. 549.

The By-Laws state that the Zoo Commission shall have a Board of Directors composed of at least five voting members, who shall elect a Chairman. The City's Director of Public Works and the Zoo Director are ex-officio members. The Zoo Commission Chairman and the board member who is also on the City Council are to act as liaisons between the Zoo Commission and the City.

Andy's avows that the Zoo Commission is funded principally by hotel room taxes assessed by the City; in turn, the Zoo Commission states in its brief that "[t]he record does not show that it [the Zoo Commission] receives any funding from the City." The record extract does not resolve this possible factual dispute, but the Zoo Commission's By-Laws, written on City of Salisbury letterhead, dictate that the Zoo Commission shall present an annual budget to the City Council "consistent with the City of Salisbury procedures on budgets," from which "[a]ny major departures ... shall be approved by the Mayor and [City] Council"; shall be audited by an auditor selected by and at the expense of the City; and shall submit meeting minutes to the City "to be summarized in the Quarterly Report."⁴

Any changes that Zoo Commission members suggest in the By-Laws or Articles must be submitted to the Mayor and City Council for approval. The Mayor and City Council, however, have the independent power to "make, alter, and repeal" the By-Laws. The Zoo Commission may be dissolved by the Mayor and City Council, or by its own members. Upon dissolution, all funds and property would pass to the City. Although the Zoo Commission asserts that "the activities and decision-making authority of the corporation [the Zoo Commission] are not subject to the control of the Mayor and Council," the By-Laws state that "[t]he Mayor and City Council shall have veto power over proposals presented for approval by the Corporation."

In July 1996, the City awarded a license to Andy's, the sole bidder, to sell ice cream and food in the City Park adjacent to the Zoo. The ordinance granting that license apparently expired on October 31, 1996. In March 1997, the City's Purchasing Agent,⁵ using a City Purchasing Department form, issued a "Request for Proposals" for concession services "in the City Park at the Zoo," to be received "by the City" in the Government Office Building. The request was entitled "Advertisement—City of Salisbury." In the Request for Proposals documents, the Zoo Commission was rarely mentioned separately from the City; rather, they generally appeared together either as "the City and the Zoo Commission" or as "the City/Zoo Commission." The Zoo Commission is mentioned separately, however, as the party that will evaluate all proposals.

The bid request included a discussion of a bidder's compliance with the City's Equal Employment Opportunity policy and stated that "the relationship of Vendor [the successful bidder] to City of Salisbury/Salisbury Zoo Commission shall be that of an `independent contractor.'" The instructions also stated that the Zoo Commission, in its evaluation of the bids, would consider the bidders' performance records in contracts with the City and "[p]revious and existing compliance with laws and ordinances relating to contracts with the City...."

In a March 20, 1997 memo to the Mayor and City Council, John Pick, the City's Executive Officer, addressed the concession issue in his "Management Report" about various City concerns:

Request for Proposals—Zoo Concession Stand

The Purchasing Department has released the Request for Proposals (RFP) for the Concession Stand at the Zoo based on the guidance given by the Council at your March 12 work session. Responses are due on Monday, April 14 at 10:30 a.m. The Purchasing Department is making an effort to make sure that notification is made to a wide range of individuals and companies ... so that we receive competitive proposals. If any member of the Council knows of anyone who may be interested in submitting a proposal, please contact the Purchasing Department.

Pursuant to the direction given by the Council, a number of changes and clarifications were made in the RFP before it was issued. Some of the most significant are:

a) the RFP has been changed to clarify that the Zoo Commission is the party that will be awarding the contract....

c) a sentence has been added clarifying that, in the event the City has to suspend or terminate the contract, the vendor will not be paid for the loss of anticipated revenues.... [Emphasis added.]

In April 1997, two food-service corporations, Andy's and Flannery's, Inc., submitted proposals. On April 16, the Zoo Commission held a closed meeting, during which it decided to award the concession to Flannery's.

On April 28, 1997, the Mayor and City Council approved a resolution leasing a 4,795.31 square foot area in the City Park near the Zoo to the Zoo Commission for $1.00 a year, to be used for concession sales. The City Council minutes indicate that revenue from the Zoo Commission's vending arrangement would go to the Zoo's Education Department. At the same meeting, the Zoo Commission's Chairman, Ronald Alessi, informed the City Council that the Zoo Commission had reviewed two bids for the food service...