Schoof v. Nesbit

• Decision Date: 09 January 2014
• Docket Number: No. DA 13–0038.,DA 13–0038.
• Citation: 316 P.3d 831,373 Mont. 226
• Court: Montana Supreme Court
• Parties: Brian F. SCHOOF, Plaintiff and Appellant, v. Jack NESBIT, Gary Matthews, Milo Huber (deceased), Keith Holmlund, Doug Ellingson, Hazel Parker, Tony Harbaugh, and Wyatt Glade, Defendants and Appellees.

373 Mont. 226

316 P.3d 831

Brian F. SCHOOF, Plaintiff and Appellant,

v.Jack NESBIT, Gary Matthews, Milo Huber (deceased), Keith Holmlund, Doug Ellingson, Hazel Parker, Tony Harbaugh, and Wyatt Glade, Defendants and Appellees.

No. DA 13–0038.

Supreme Court of Montana.

Submitted on Briefs Aug. 7, 2013.

Decided Jan. 9, 2014.

For Appellant: Peter Michael Meloy; Attorney at Law; Helena, Montana.

For Appellees: Michael W. Sehestedt; MACo Legal Services; Helena, Montana.

Justice JIM RICE delivered the Opinion of the Court.

¶ 1 Brian F. Schoof (Schoof) appeals from the orders of the Sixteenth Judicial District Court dismissing claims made in his Third Amended Complaint against the named public officials (Defendants/Appellees). We reverse and remand for further proceedings, addressing the following issues:

¶ 2 1. Does Schoof have standing to pursue his right to know and right of participation claims?

¶ 3 2. Did the District Court err in dismissing Schoof's right to know and right of participation claims as time barred under § 2–3–213, MCA?

¶ 4 3. If the Commissioners' “cash in lieu” policy is determined to be void, does mandamus lie to compel recovery of illegal payments under § 7–4–2714, MCA?

FACTUAL AND PROCEDURAL BACKGROUND

¶ 5 Schoof, a resident of Custer County, brought this action to challenge a decision by the Custer County Commissioners ¹ (the Commissioners) to permit elected county officials to receive cash payments in lieu of county contributions on their behalf to a group health insurance program. Schoof alleges that the Commissioners unlawfully adopted the “cash in lieu” policy during an unannounced meeting held on July 26, 2007. He further alleges that “[n]either the meeting notice, nor the minutes of the proceeding provide sufficient notice of the change in policy such that the public would have any reasonable basis to understand the substance of the policy that was to be considered or had been adopted.” According to Schoof, neither he nor the public was advised of the decision until Deputy County Attorney Joni Oja revealed it during a public meeting on August 17, 2011, over four years later. On September 16, 2011, Schoof filed this action to invalidate the Commissioners' decision and compel the Custer County Attorney to recover the cash payments as illegally made.

¶ 6 Schoof's Third Amended Complaint sets out four counts: (1) violation of § 2–3–203, MCA, (Montana's open meetings statute) and Article II, Section 9 of the Montana Constitution (right to know); (2) violation of § 2–2–102, MCA,² and Article II, Section 8 of the Montana Constitution (right of participation); (3) request for declaration that the “cash in lieu” policy is unlawful; and (4) request for mandamus to issue compelling the Custer County Attorney to commence an action to recover any illegal payments.

¶ 7 Pursuant to Appellees' M.R. Civ. P. 12(b)(6) motion, the District Court dismissed Schoof's right to know and right of participation claims as time barred under the 30–day statute of limitations set forth in § 2–3–213, MCA. The District Court rejected Schoof's argument that the discovery rule provided in § 27–2–102(3), MCA, tolled the 30–day limitations period until Schoof discovered or should have discovered the facts underlying his claims, concluding that the statute did not apply in this case.

¶ 8 The District Court issued a second order dismissing Schoof's declaratory and mandamus claims on December 17, 2012. As to Schoof's claim for declaratory relief, the District Court determined that Schoof lacked standing because he had not alleged facts showing that he had suffered an injury distinct from the general public, and instead his injuries were coequal with all citizens and taxpayers. On the mandamus claim, the District Court noted that only ministerial acts, not discretionary, are subject to the writ, and reasoned that because Rule 3.1(a)(1) of the Rules of Professional Conduct requires a county attorney to exercise discretion in determining whether an action is meritorious, mandamus did not apply.

¶ 9 Schoof appeals, challenging the dismissal of his right to know, right of participation, and mandamus claims.

STANDARD OF REVIEW

¶ 10 We review de novo a district court's ruling on a motion to dismiss pursuant to M.R. Civ. P. 12(b)(6). Ming Da Situ v. Smole, 2013 MT 33, ¶ 11, 369 Mont. 1, 303 P.3d 747. “The determination of whether a complaint states a claim is a conclusion of law, and the district court's conclusions of law are reviewed for correctness.” Ming Da Situ, ¶ 11. We accept the complaint's factual allegations as true and consider the complaint in the “light most favorable” to the plaintiff. Tally Bissell Neighbors, Inc. v. Eyrie Shotgun Ranch, LLC, 2010 MT 63, ¶ 15, 355 Mont. 387, 228 P.3d 1134. “We will affirm a district court's dismissal of a complaint for failure to state a claim only if it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief.” Pederson v. Rocky Mt. Bank, 2012 MT 48, ¶ 8, 364 Mont. 258, 272 P.3d 663.

DISCUSSION

¶ 11 1. Does Schoof have standing to pursue his right to know and right of participation claims?

¶ 12 Standing is a threshold requirement that must be decided in every case. Baxter Homeowners Assn. v. Angel, 2013 MT 83, ¶ 14, 369 Mont. 398, 298 P.3d 1145. Questions of standing must be addressed sua sponte even if not raised by a litigant. Angel, ¶ 14. The parties did not raise the issue of standing on appeal. Accordingly, this Court determined sua sponte to order supplemental briefing on whether Schoof has standing to assert his right to know and right of participation claims. The parties' supplemental arguments primarily boil down to a dispute over the application of this Court's holding in Fleenor v. Darby Sch. Dist., 2006 MT 31, 331 Mont. 124, 128 P.3d 1048.

¶ 13 Appellees argue that “there is nothing in Mr. Schoof's Complaint which would take it out of the clear holding in Fleenor.” We concluded in Fleenor that the plaintiff (Fleenor) lacked standing to pursue her right to know and right of participation claims because she failed to allege a sufficient personal stake in, or injury from, the decision of the Darby School District Trustees to hire a new Superintendent. Fleenor, ¶¶ 9–12. Appellees contend that Schoof has similarly failed to allege “any personal interest [in] or injury [from]” the challenged action of the Commissioners“beyond the common interest or injury of all citizens or taxpayers.”

¶ 14 Schoof argues that he has shown “a particularized interest” in the Commissioners' actions because he has been closely following the fiscal decisions of the County for several years. He asserts that to deny standing in this case would “strike a blow to the enforceability of the rights to observe and participate.” Schoof “respectfully submit[s]” that Fleenor should be reexamined—at least insofar as it required Fleenor “to distinguish herself from the general citizenry and other taxpayers.” SeeFleenor, ¶ 10. Schoof argues that “requiring Ms. Fleenor to show an injury different from the general public as an incident of standing will, in many open government cases like the instant one, shield a governmental entity from liability.”

¶ 15 There are two elements to standing: the case-or-controversy requirement imposed by the Montana Constitution, and judicially created prudential limitations imposed for reasons of policy. Heffernan v. Missoula City Council, 2011 MT 91, ¶ 31, 360 Mont. 207, 255 P.3d 80 (citing Olson v. Dept. of Revenue, 223 Mont. 464, 469–70, 726 P.2d 1162, 1166 (1986)). The constitutional requirements have been described as “absolute,” while the prudential limitations contrasted as “malleable.” United Food & Com. Workers v. Brown Group, 517 U.S. 544, 551, 116 S.Ct. 1529, 1533–34, 134 L.Ed.2d 758 (1996). It is not always clear whether particular features of the standing requirement are constitutionally mandated or prudential. Valley Forge Christian College v. Ams. United for Separation of Church & State, 454 U.S. 464, 471, 102 S.Ct. 752, 758, 70 L.Ed.2d 700 (1982). However, at an “irreducible minimum,” the Constitution requires the plaintiff to show that he has suffered a past, present, or threatened injury to a property or civil right, and that the injury would be alleviated by successfully maintaining the action. Heffernan, ¶ 33;Valley Forge, 454 U.S. at 472, 102 S.Ct. at 758. A “personal stake in the outcome of the controversy at the commencement of the litigation” is required in every case. Heffernan, ¶ 30.

¶ 16 Our holding in Fleenor was premised on two facets of the “injury” requirement. First, we indicated that Fleenor had simply failed to identify an injury. Although she had alleged that “the District failed to properly notify her of votes and decisions leading to the Superintendent's hiring,” we observed that she had not alleged “that the District's faulty notice somehow injured or threatened to injure her.” Fleenor, ¶¶ 3, 11. Second, we indicated that Fleenor also had failed to “distinguish herself from the general citizenry and other taxpayers.” Fleenor, ¶ 10. We noted that, “other than establishing that Fleenor resides within the Darby School District, attends some school board meetings, and has no children in school, the record is completely silent as to her personal stake or interest in the matter of the hiring of the Superintendent.” Fleenor, ¶ 11.

¶ 17 We now conclude that, first, Fleenor misconstrued the nature of the “injury” at issue in a right to know or right of participation case by requiring the plaintiff to allege an injury beyond failure to receive proper notice or to allege a personal stake in the particular governmental decision taken, there, the Superintendent's hiring. We believe such requirements impose standing thresholds that are incompatible with the nature of the particular constitutional rights at issue. The right of participation is defined as “the right to expect...