City of Jacksonville v. Smith

• Court: Arkansas Supreme Court
• Writing for the Court: JOHN DAN KEMP, Chief Justice
• Citation: City of Jacksonville v. Smith, 540 S.W.3d 661 (Ark. 2018)
• Decision Date: 15 March 2018
• Docket Number: No. CV–17–634,CV–17–634
• Parties: CITY OF JACKSONVILLE, Arkansas ; Gary Fletcher, Mayor of the City of Jacksonville, Arkansas, in His Official Capacity; Susan Davitt, City Clerk/Treasurer of the City of Jacksonville, Arkansas, in Her Official Capacity; and Chief of Police Geoffrey Herweg, Appellants v. Tara SMITH, Appellee

540 S.W.3d 661

CITY OF JACKSONVILLE, Arkansas ; Gary Fletcher, Mayor of the City of Jacksonville, Arkansas, in His Official Capacity; Susan Davitt, City Clerk/Treasurer of the City of Jacksonville, Arkansas, in Her Official Capacity; and Chief of Police Geoffrey Herweg, Appellants

v.Tara SMITH, Appellee

No. CV–17–634

Supreme Court of Arkansas.

Opinion Delivered: March 15, 2018

Robert E. Bamburg, Jacksonville, for appellants.

Steel, Wright, Gray & Hutchinson, PLLC, Little Rock, by: Nate Steel and Alex T. Gray, for appellee.

JOHN DAN KEMP, Chief Justice

Appellants City of Jacksonville, Arkansas; Gary Fletcher, Mayor of the City of Jacksonville, Arkansas, in his official capacity; Susan Davitt, City Clerk and Treasurer of the City of Jacksonville, Arkansas, in her official capacity; and Chief of Police Geoffrey Herweg (collectively "the City") appeal an order of the Pulaski County Circuit Court granting a preliminary injunction requested by appellee Tara Smith, individually and on behalf of a class of similarly situated Arkansas taxpayers. For reversal, the City argues that the circuit court erred in its ruling that (1) a public office of trust includes an appointed municipal chief of police; (2) Herweg is ineligible to hold the appointed position of Jacksonville police chief because of his 2002 Texas conviction; and (3) article 5, section 9 of the Arkansas Constitution applies to both elected and appointed public offices. The City also generally asserts that the circuit court erred in granting the preliminary injunction. Alternatively, the City contends that the circuit court lacked subject-matter jurisdiction because Smith did not exhaust her administrative remedies. Pursuant to Arkansas Supreme Court Rule 1–2(a)(1) (2017), we have jurisdiction of this appeal because it involves the interpretation or construction of the Arkansas Constitution. We affirm.

I. Facts

In 2000, Herweg served as a police officer with the Taylor Police Department in Williamson County, Texas. On Christmas Eve 2000, Herweg drove his patrol vehicle and became involved in an accident that damaged a house and a car. Herweg left the vehicle at the scene and told police that it had been stolen. Herweg was arrested after he wrecked and abandoned the vehicle and knowingly lied to the police officers who investigated the accident. He claimed that he gave a false statement to one officer while he was off duty. On March 4, 2002, Herweg pleaded guilty to, and was convicted of, the offense of giving a false report to a police officer, a Class B misdemeanor, in the Williamson County Court in Texas.¹ Herweg was sentenced to three days in jail; he paid a $2,000 fine and permanently surrendered his Texas law-enforcement certification as a term of his guilty plea. Herweg subsequently moved to Arkansas. He claimed to have been "in and out of law enforcement for over thirty years, also with security work and such."

On April 1, 2017, Kenny Boyd retired as the City's chief of police. Before Boyd's retirement, Mayor Fletcher identified Herweg as the leading candidate to replace Boyd. On April 8, 2017, the Arkansas Democrat–Gazette published an article stating that Herweg had pleaded guilty in 2002 to giving a false statement to a police officer in Texas. Mayor Fletcher, with knowledge of this prior conviction, appointed Herweg as the City's new police chief on April 14, 2017. Treasurer Davit made payments toward Herweg's salary and other expenses, and Herweg received these payments.

On April 26, 2017, Smith, individually and on behalf of similarly situated Arkansas taxpayers, filed a complaint for declaratory judgment, illegal exaction, and emergency temporary restraining order. In her complaint, she alleged that Herweg had been convicted of knowingly lying to a police officer, that he was ineligible to hold the office of police chief, that Herweg's appointment to an office of public trust violated Arkansas law, and that he must be removed from office. Specifically, in her prayer for relief she sought the entry of (1) a declaratory judgment that Herweg be prohibited from holding the office of chief of police; (2) a declaration that the City was illegally and improperly making payments to Herweg that constituted an illegal exaction; (3) an accounting; (4) the establishment of a trust or an escrow account into which these funds could be reimbursed and deposited; (5) an order that the City pay into this account the amount of funds determined to have been illegally exacted; (6) an emergency temporary restraining order immediately removing Herweg from the office of chief of police; and (7) reasonable attorney's fees, costs, and all other relief. On May 18, 2017, the City filed a motion to dismiss for lack of jurisdiction and for failure to state a claim, pursuant to Rules 12(b)(1) and 12(b)(6) of the Arkansas Rules of Civil Procedure. The circuit court held a hearing on Smith's petition and on the City's motion to dismiss; after arguments from counsel, the circuit court took the matter under advisement.

On June 29, 2017, the circuit court entered an order granting a preliminary injunction in Smith's favor. Specifically, the circuit court denied the City's motion to dismiss, finding that the office of chief of police is a public office and an "office of trust or profit" as contemplated by article 5, section 9 of the Arkansas Constitution. The court also found that Herweg's 2002 Texas conviction rendered him incapable of holding the office because his guilty plea involved an "infamous crime" under article 5, section 9 of the Arkansas Constitution. Accordingly, the circuit court granted a preliminary injunction and found that Smith had met her burden of establishing both a likelihood of success on the merits and the existence of irreparable harm in the absence of injunctive relief. After the City's motion for stay was deemed denied by the circuit court, the City filed a timely notice of appeal. From the June 29, 2017 order, the City now brings its appeal.

II. Preliminary Injunction

The City's first three points on appeal involve this court's interpretation of the Arkansas Constitution. The City argues that the circuit court erred in ruling that (1) article 5, section 9 applied to an appointed municipal chief of police; (2) Herweg was incapable of holding his appointed position as the City's chief of police because of his 2002 Texas misdemeanor conviction; and (3) article 5, section 9 applies to both elected and appointed public offices. For its fourth point on appeal, the City makes a general allegation that the circuit court abused its discretion in granting the preliminary injunction. And for its fifth point, the City alternatively argues that the circuit court lacked subject-matter jurisdiction because Smith failed to exhaust her administrative remedies.

Rule 65 of the Arkansas Rules of Civil Procedure governs the issuance of preliminary injunctions. In determining whether to issue a preliminary injunction pursuant to Rule 65, the circuit court must consider two issues: (1) whether irreparable harm will result in the absence of an injunction or restraining order and (2) whether the moving party has demonstrated a likelihood of success on the merits. Ark. Dep't of Human Servs. v. Ledgerwood , 2017 Ark 308, 530 S.W.3d 336.

This court reviews the grant of a preliminary injunction under an abuse-of-discretion standard. Baptist Health v. Murphy , 365 Ark. 115, 226 S.W.3d 800 (2006). When an appeal reaches an appellate court via an order granting a preliminary injunction, the appellate court will not delve into the merits of the case further than is necessary to determine whether the circuit court exceeded its discretion in granting the injunction. Id. , 226 S.W.3d 800. The sole question before the appellate court is whether the circuit court departed from the rules and principles of equity in making the order and not whether the appellate court would have made the order. Id. at 121–22, 226 S.W.3d at 806–07.

A. Subject–Matter Jurisdiction

We first address the alternative argument raised by the City. The City contends that the circuit court did not have subject-matter jurisdiction because Smith failed to exhaust her administrative remedies. Specifically, the City asserts that because Smith failed to exhaust her administrative remedies, the circuit court lacked subject-matter jurisdiction, and this court must dismiss the appeal.

The City's argument is actually an argument involving a plaintiff's standing to bring an illegal-exaction lawsuit. Article 16, section 13 of the Arkansas Constitution provides that "[a]ny citizen of the county, city or town may institute suit, in behalf of himself and all others interested, to protect the inhabitants thereof against the enforcement of any illegal exactions whatever." An illegal exaction is defined as any exaction that either is not authorized by law or is contrary to law. Wilson v. Walther , 2017 Ark. 270, 527 S.W.3d 709. In a "public funds" illegal-exaction case, such as the one before us, the plaintiff contends that public funds generated from tax dollars are being misapplied or illegally spent. Id. , 527 S.W.3d 709. We have explained that citizens have standing to bring a "public funds" case because they have a vested interest in ensuring that the tax money they have contributed to a state or local government treasury is lawfully spent. Id. This court has explained that

the only standing requirements we have imposed in public-funds cases [are] that the plaintiff be a citizen and that he or she have contributed tax money to the general treasury. We have not required the plaintiff to trace his or her individual tax contribution to the tax money that is allegedly being spent in an illegal manner, nor have we required the plaintiff to establish a significant tax contribution to the state treasury. Hence, in public-funds cases we have given the word "interested" as used in article 16, section 13, a very broad construction.

2017 Ark. 270, at...