Martin v. Thornburg

• Decision Date: 03 September 1987
• Docket Number: No. 729PA86,729PA86
• Citation: 359 S.E.2d 472,320 N.C. 533
• Court: North Carolina Supreme Court
• Parties: James G. MARTIN, Governor of the State of North Carolina, and Grace J. Rohrer, Secretary of Administration v. Lacy H. THORNBURG, as Attorney General and as a member of the Council of State; Robert B. Jordan, III, Lieutenant Governor of the State of North Carolina; Thad Eure, Secretary of State; Edward Renfrow, State Auditor; Harlan E. Boyles, State Treasurer; Dr. A. Craig Phillips, Superintendent of Public Instruction; James A. Graham, Commissioner of Agriculture; John C. Brooks, Commissioner of Labor; James E. Long, Commissioner of Insurance, as members of the Council of State; and Lois Carlyle Berry.

Page 472

359 S.E.2d 472

320 N.C. 533

James G. MARTIN, Governor of the State of North Carolina and Grace J. Rohrer, Secretary of Administration v. Lacy H. THORNBURG, as Attorney General and as a member of the Council of State; Robert B. Jordan, III, Lieutenant Governor of the State of North Carolina; Thad Eure Secretary of State; Edward Renfrow, State Auditor; Harlan E. Boyles, State Treasurer; Dr. A. Craig Phillips Superintendent of Public Instruction; James A. Graham Commissioner of Agriculture; John C. Brooks, Commissioner of Labor; James E. Long, Commissioner of Insurance, as members of the Council of State; and Lois Carlyle Berry.

No. 729PA86.

Supreme Court of North Carolina.

Sept. 3, 1987.

Brooks, Pierce, McLendon, Humphrey & Leonard by Hubert Humphrey, and Smith, Helms, Mulliss & Moore by Stephen P. Millikin and Alan W. Duncan, Greensboro, for plaintiff-appellants.

Lacy H. Thornburg, Atty. Gen., by Charles M. Hensey, Sp. Deputy Atty. Gen., Raleigh, and McCoy, Weaver, Wiggins, Cleveland & Raper by Richard Wiggins, Fayetteville, for defendant-appellees.

FRYE, Justice.

The factual situation presented in this case requires determination of the following questions: (1) Once the Department of Administration has submitted to the Council of State the lowest lease proposal in accordance with requirements set forth in lease specifications, does the Council of State have the authority to examine all lease proposals and to require the Department of Administration to negotiate and enter a lease other than the lease proposal submitted by the Department of Administration; (2) does the duty of the Attorney General to appear for the State in any court proceeding in which the State may be a party as provided in N.C.G.S. § 114-2(1) violate Art. III, § 1, of the North Carolina Constitution; and (3) may the Governor, pursuant to N.C.G.S. § 147-17(a), employ special counsel in a proceeding in which the State is interested without first being advised by the Attorney General that it is impracticable for the latter to represent the interest of the State? We answer the first two questions in the negative while giving an affirmative answer to the third question.

Plaintiffs brought this declaratory judgment action to determine the rights and duties of the Governor and Council of State with respect to the entry of leases on behalf of the State and the rights and duties of the Governor and Attorney General in connection with lawsuits filed against the State.

The trial judge's findings of fact are summarized as follows:

Defendant Lois Carlyle Berry is the owner of a building and parking area located in Lumberton, North Carolina. For some time prior to 1980 the Employment Security Commission [ESC], through the Department of Administration [DOA], leased the building and parking area from defendant Lois Carlyle Berry [lessor]. During the period of time between 1980 and 1985, the manager of the Lumberton ESC office experienced considerable difficulty with both the location of the office and his dealings with the lessor. In early 1985, prior to the end of the 1980 lease, the ESC advised the DOA that it was dissatisfied with the Berry lease location in the downtown area adjacent to the courthouse, because of inadequate parking, parking and traffic congestion, and other problems. The ESC requested that a new lease be entered into for a more desirable facility at a better location. Pursuant to the provisions of N.C.G.S. § 146-25.1, DOA obtained information and specifications from the ESC as to its needs in Lumberton and investigated relevant aspects of the matter. The DOA prepared a public advertisement, which the ESC properly ran in the Lumberton newspaper, soliciting proposals and stating, "Cut off time for receiving proposals is 2:00 p.m., Friday, May 17th, 1985." The DOA received proposals from four prospective lessors by the deadline. They were from Mrs. Berry, J.D. Herring, Biggs-Baker, and LOBB. On 12 June 1985, Mrs. Berry submitted a proposal to DOA revising her previously submitted bid. After due consideration, the DOA state property officials concluded, in good faith, that because of the lower proposed leasing cost, including utilities and janitorial services of $6.25 per square foot, and the preferable location, the LOBB proposal best served the public interest and the interest of the ESC in Lumberton.

The recommended LOBB proposal, along with several other recommended acquisitions by lease, was submitted by the DOA to the Council of State and was on the agenda for the 2 July 1985 meeting of the Council of State for its decision. The Governor did not attend the 2 July 1985 meeting of the Council of State due to his absence from Raleigh and presence in other cities within the state on state business. The Chief of the Property Section of DOA, Charles Holliday, his assistant, Mr. Rupert Conyers, and the Lumberton representatives, Mr. Singleton and Mr. Bittle, were all present at the 2 July meeting to answer questions and to explain DOA's recommendations as to all lease acquisitions recommended by them. After some questioning by its members, the Council of State disapproved the DOA's recommendation to award the Lumberton ESC contract to the LOBB partnership. Immediately thereafter, a discussion was had by the Council of State regarding the Berry proposal. Mrs. Berry's agent (her husband) was present and he was asked if he would re-lease the building to the ESC at $6.25 per square foot and he responded by nodding his head in the affirmative. A motion was made by the Attorney General to the Council of State that the current lease with defendant Berry "be renegotiated at a cost of $6.25 per square foot," which was the same figure as the low proposal of LOBB including utilities and janitorial services. This motion was unanimously approved by the Council of State. The Council of State notified DOA's representatives present at the meeting that DOA should renegotiate the State's acquisition by lease of its office space requirements for the Lumberton ESC office with Mr. Berry at $6.25 per square foot.

After the 2 July 1985 meeting, no final action was taken by the DOA regarding the Lumberton ESC lease.

The Governor did not attend the 6 August 1985 meeting of the Council of State because of his absence from the State on State business. While the Lumberton ESC lease matter was not on the Agenda, the DOA representative present at the meeting was questioned about the progress DOA was making toward execution of the contract with Mrs. Berry for the Lumberton ESC office pursuant to the 2 July action of the Council of State. Mr. Pugh advised the Council of State that the Governor's office and DOA had received some information about the lease which they believed the Council of State would want to take into consideration. At the 3 September 1985 Council of State meeting the Governor was present and stated he wanted to discuss the matter concerning a lease for the ESC in Lumberton. During the course of the meeting, the Governor expressed his position that (1) statutory authority given to the Council of State was to approve or disapprove a lease transaction that was recommended and submitted by the DOA; (2) statutory authority given to the Council of State did not go so far as to allow the Council to initiate a new lease transaction or to direct the DOA to cause a lease transaction not submitted by the Department to be implemented; (3) the approval of both the Governor and Council of State was statutorily required for the lease transaction to be implemented after submission by the DOA; and (4) the Governor did not approve the Berry proposal or any negotiation of a lease with Berry to the exclusion of other parties who had submitted bids. There ensued a lengthy discussion during which the majority of the members of the Council of State disagreed with the positions stated by the Governor. A motion to reconsider the Council's 2 July action was defeated.

On 6 September 1985, Mr. Charles Holliday, Deputy Director of the State Property Office with DOA, requested new proposals from each of the four parties who had previously submitted a proposal for the Lumberton ESC offices. On 13 September 1985, Mrs. Berry notified the Governor and other State officials that she had formally accepted the offer by the State through the Council of State's action at its 2 July meeting. On 17 September 1985, Mrs. Berry filed an action in the Superior Court of Cumberland County alleging she had been awarded the contract with the State for the Lumberton ESC office lease and obtained a temporary restraining order against Secretary Rohrer restraining her from soliciting or receiving additional bid proposals for the Lumberton ESC office lease. Having discussed the respective positions of the Governor and the other members of the Council of State with a representative of the Governor, the Attorney General unilaterally determined he should enter his appearance in Mrs. Berry's action in Cumberland County; move for an extension of time to file answer or otherwise plead; and take such action as necessary to maintain the status quo between the State and Mrs. Berry for sixty days to enable him to advise and consult with the Council of State members, including the Governor. However, the Governor opened the 1 October 1985 Council of State meeting by announcing that he had commenced this action before the Attorney General could advise and consult with the Council of State (which includes the Governor) regarding the Berry action. With the knowledge and consent of the Governor and the Secretary of Administration, through counsel, the Attorney General on 2 December 1985 obtained a second extension of time for filing answer in the Cumberland County action. An order allowing a motion made by the Governor and the Secretary of Administration was filed and entered on 6 January 1986, staying proceedings in the Cumberland County action until the Wake County action has been...