City of Atlanta v. Black

Decision Date30 May 1995
Docket NumberNo. S95Q0248,S95Q0248
Citation265 Ga. 425,457 S.E.2d 551
PartiesCITY OF ATLANTA et al. v. BLACK et al.
CourtGeorgia Supreme Court

Joe M. Harris, Overtis Hicks Brantley, Asst. City Attys., June D. Green, Asst. City Atty., City of Atlanta Law Dept., Clifford E. Hardwick, IV, City Atty., Robin J. Shahar, Amy R. Snell, Asst. City Attys., Willie J. Lovett, Jr., Clark, Paul, Hoover & Mallard, Atlanta, for City of Atlanta et al.

Andrew J. Ekonomou, Boyce, Howell A. Hall, Boyce, Ekonomou & Atkinson, Atlanta, Jay Alan Sekulow, John David Etheriedge, Decatur, James M. Henderson, Sr., Washington, DC, Keith A. Fournier, Virginia Beach, VA, for Black et al.

HUNSTEIN, Justice.

This case comes to us from the United States Court of Appeals for the Eleventh Circuit, wherein the City of Atlanta and certain officers of the City's police department are challenging the district court's denial of their motion to set aside a consent order, entered in resolution of a suit in which they were the named defendants. The consent order incorporated a settlement agreement executed by two assistant city attorneys (on behalf of defendants) and counsel for plaintiffs. The consent order provides for the payment of $37,500 to plaintiffs and also requires the City to place limitations on its police officers' arrest powers, dictates revisions to the police department's field manual, and mandates changes to be made both in the police academy training program for recruits and in the in-service training for regular officers.

Defendants moved to set aside the consent order on the basis that the city attorneys who executed the settlement agreement were without authority to do so and the Atlanta City Council had refused to adopt the agreement. Defendants filed in the district court a certified copy of the applicable provisions of the Code of Ordinances of the City of Atlanta, including § 4-2007, which sets forth the sole power conferred by the City on its attorneys as to settlement of claims against the City. That ordinance provides:

The city attorney shall have authority, without approval of the council, to settle all claims and suits for sums not to exceed $500 in each instance. Settlement of claims and suits in excess of $500 shall first be approved by the council.

The Eleventh Circuit certified the following question to this Court:

Does an express restriction on a City attorney's right to settle a cause of action embodied in a municipal ordinance, which is not specifically communicated by the City or its attorney to an opposing party, circumscribe the City attorney's apparent authority to bind his client to a settlement agreement?

Although the Eleventh Circuit stressed that "[n]othing in this certification, including the particular phrasing of the foregoing question, is intended to limit the Supreme Court of Georgia in its consideration of the problem presented," Black v. City of Atlanta, 35 F.3d 516, 518 (11th Cir.1994), we address solely the monetary aspect of the challenged order 1 and, for the reasons set forth below, we answer the certified question in the affirmative.

Powers of all public officers are defined by law and all persons must take notice thereof. The public may not be estopped by the acts of any officer done in the exercise of an unconferred power.

OCGA § 45-6-5. This Court has applied that principle for over a century. Penitentiary Co. v. Gordon, 85 Ga. 159, 171, 11 S.E. 584 (1890). See, e.g., City of Warner Robins v. Rushing, 259 Ga. 348, 381 S.E.2d 38 (1989) (city not bound by utility rate structure set by mayor); City of Atlanta v. Bull, 161 Ga.App. 648, 288 S.E.2d 335 (1982) (City of Atlanta not bound by court reporting services contract approved by assistant city solicitor who was chairman of committee formed to investigate the City's use of such services). See generally White v. United States Dept. of Interior, 639 F.Supp. 82(IV), (V) (M.D.Pa.1986); City of Jersey City v. Roosevelt Stadium Marina, 210 N.J.Super. 315, 509 A.2d 808, 815(I) (1986); McQuillin, The Law of Municipal Corporations, § 48.18 (3rd ed.); Apparent Authority of Agent of Municipality, 77 ALR3d 925.

Public sector attorneys, such as the assistant city attorneys in this case, are public officers. See Smith v. Mueller, 222 Ga. 186, 187(1), 149 S.E.2d 319 (1966); Templeman v. Jeffries, 172 Ga. 895, 901(2), 159 S.E. 248 (1931). "All persons dealing with a public officer must at their peril ascertain the extent of his authority." (Emphasis supplied.) Penitentiary Co., supra 85 Ga. at 171, 11 S.E. 584. See also Malcom v. Webb, 211 Ga. 449, 86 S.E.2d 489 (1955). It is

the duty of any person dealing with [a] municipality in a contractual relation to see that there has been a compliance with the mandatory provisions of the law limiting and prescribing its powers[,]

Wiley v. City of Columbus, 109 Ga. 295, 296, 34 S.E. 575 (1899), a duty which includes determining that the public officer who executed a contract has the requisite authority. Cole v. City of Atlanta, 195 Ga.App. 67(2), 392 S.E.2d 283 (1990); City of Atlanta v. Bull, supra. In this regard, parties are presumed to know the law, OCGA § 1-3-6, which includes not only statutes like OCGA § 45-6-5 but also the provisions of municipal ordinances. City Council of St. Marys v. Crump, 251 Ga. 594(2), 308 S.E.2d 180 (1983).

The district court, in denying defendants' motion to set aside the consent order, relied on Brumbelow v. Northern Propane Gas Co., 251 Ga. 674(2), 308 S.E.2d 544 (1983), a case in which this Court addressed the apparent authority of a private sector attorney in negotiating a private settlement between private parties. We held therein that

[u]nder Georgia law an attorney of record has apparent authority to enter into an agreement on behalf of his client and the agreement is enforceable against the client by other settling parties. [Cits.] ... The authority may be considered plenary unless it is limited by the client and that limitation is communicated to opposing parties. [Cits.]

Id. at 674-675, 308 S.E.2d 544.

While this Court has limited the application of Brumbelow, particularly in those situations where the contract of settlement negotiated by counsel can become the judgment of a court, e.g., Bridges v. Bridges, 256 Ga. 348, 350(1), 349 S.E.2d 172 (1986), we have never considered its application in the context of public sector attorneys negotiating settlements of claims of public interest.

While the authority of private sector attorneys negotiating private settlements between private parties may be considered plenary under Brumbelow, the same cannot be said of public sector attorneys. We recognize and reiterate that at all times, an attorney at law is an officer of the court. Sams v. Olah, 225 Ga. 497, 504(7), 169 S.E.2d 790 (1969). However, the presumption of plenary authority that attaches to private sector attorneys, as set forth in Brumbelow, cannot apply to those attorneys who are also public officers since pursuant to OCGA § 45-6-5, public sector attorneys can exercise only those powers "defined and conferred by law." 2 Penitentiary Co. v. Gordon, supra 85 Ga. at 171, 11 S.E. 584. Nothing in Brumbelow can be construed as expanding by case law the power of those public officers who are public sector attorneys or as carving out solely for the legal profession an exception to OCGA § 45-6-5. Clearly, nothing in Brumbelow compels this Court to redefine the powers of those public officers who are public sector attorneys, in that " '[i]t is well settled that no consideration of public policy can properly induce a court to reject the statutory definition of the powers of an officer.' [Cit.]" Gruber v. Fulton County, 111 Ga.App. 71, 77, 140 S.E.2d 552 (1965). Rather, it is apparent that the holding in Brumbelow is not applicable to public sector attorneys.

This Court is not called upon in this case

to draw a sharp line between incidental matters which a municipality, as other clients, in the handling of a lawsuit must [necessarily] leave to the discretion of its attorney, guided by such informal counsel as personal contact may supply, and matters more importantly affecting the rights of the client and the objectives of the suit.

Town of Bath v. Norman, 226 N.C. 502, 39 S.E.2d 363, 365 (1946). However, to the extent the authority of an attorney conflicts with the defined authority of the attorney-as-public-officer, the authority of the public officer must prevail. Hence, we conclude that the law remains that the authority of public sector attorneys, as with all other public officers, must be deemed limited by the laws that define and prescribe their authority and that it is the duty of parties dealing with those public officers who are public sector attorneys to determine there has been compliance with all laws limiting and prescribing their powers.

In this case, plaintiffs were presumed to know that the authority conferred on the assistant city attorneys to enter into the monetary settlement of plaintiffs' claim was limited to $500. Furthermore, plaintiffs were under a duty to determine that the Council had preapproved the settlement terms as to monetary amounts in excess of $500.

That does not end the inquiry, however, because it is well-established that

an estoppel arises as against the denial of agency when a principal places a purported agent in a position of apparent authority so that a person of ordinary prudence conversant with business usages and the nature of the particular business is justified in assuming that such agent has the authority to perform a particular act and deals with the agent upon that assumption. [Cits.]

Intl. Indem. Co. v. Odom, 174 Ga.App. 6, 7, 329 S.E.2d 307 (1985). However, this Court has recognized that

"[t]he doctrine of estoppel is not applied as freely against a municipal corporation as against an individual. Municipalities act in both a governmental and a proprietary capacity, and an estoppel is not asserted if such will...

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