Shell v. Beshear

• Docket Number: 2021-CA-1459-MR,2021-CA-1503-MR,2022-CA-0020-MR
• Decision Date: 08 March 2024
• Parties: JONATHAN SHELL, IN HIS OFFICIAL CAPACITY AS COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE; AND MARK LYNN, IN HIS OFFICIAL CAPACITY AS CHAIRMAN OF THE STATE FAIR BOARD APPELLANTS v. ANDY BESHEAR, IN HIS OFFICIAL CAPACITY AS GOVERNOR OF THE COMMONWEALTH OF KENTUCKY; BERTRAM ROBERT STIVERS, II, IN HIS OFFICIAL CAPACITY AS MEMBER OF THE STATE FAIR BOARD AND PRESIDENT OF THE KENTUCKY STATE SENATE; DAVID W. OSBORNE, IN HIS OFFICIAL CAPACITY AS A MEMBER OF THE STATE FAIR BOARD AND AS SPEAKER OF THE KENTUCKY HOUSE OF REPRESENTATIVES; LINDY CASEBIER, IN HIS OFFICIAL CAPACITIES AS THE SECRETARY OF THE KENTUCKY TOURISM, ARTS, AND HERITAGE CABINET AND A MEMBER OF THE STATE FAIR BOARD; AND COMMONWEALTH OF KENTUCKY EX REL. ATTORNEY GENERAL RUSSELL COLEMAN APPELLEES and ANDY BESHEAR, IN HIS OFFICIAL CAPACITY AS GOVERNOR OF THE COMMONWEALTH OF KENTUCKY; AND LINDY CASEBIER, IN HIS OFFICIAL CAPACITY AS SECRETARY OF THE KENTUCKY TOURISM, ARTS, AND HERITAGE CABINET AND AS A MEMBER OF THE STATE FAIR BOARD CROSS-APPELLANTS v. JONATHAN SHELL, IN HIS OFFICIAL CAPACITY AS COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE; BERTRAM ROBERT STIVERS, II, IN HIS OFFICIAL CAPACITIES AS MEMBER OF THE STATE FAIR BOARD AND AS PRESIDENT OF THE KENTUCKY STATE SENATE; COMMONWEALTH OF KENTUCKY, EX REL. ATTORNEY GENERAL RUSSELL COLEMAN; DAVID W. OSBORNE, IN HIS OFFICIAL CAPACITIES AS A MEMBER OF THE STATE FAIR BOARD AND SPEAKER OF THE KENTUCKY HOUSE OF REPRESENTATIVES; AND MARK LYNN, IN HIS OFFICIAL CAPACITY AS CHAIRMAN OF THE STATE FAIR BOARD CROSS-APPELLEES and COMMONWEALTH OF KENTUCKY, EX REL. ATTORNEY GENERAL RUSSELL COLEMAN APPELLANT v. ANDY BESHEAR, IN HIS OFFICIAL CAPACITY AS GOVERNOR OF THE COMMONWEALTH OF KENTUCKY; BERTRAM ROBERT STIVERS, II, IN HIS OFFICIAL CAPACITY AS A MEMBER OF THE STATE FAIR BOARD AND AS PRESIDENT OF THE KENTUCKY STATE SENATE; DAVID W. OSBORNE, IN HIS OFFICIAL CAPACITY AS A MEMBER OF THE STATE FAIR BOARD AND AS SPEAKER OF THE KENTUCKY HOUSE OF REPRESENTATIVES; DR. MARK E. LYNN, IN HIS OFFICIAL CAPACITY AS CHAIR OF THE STATE FAIR BOARD; LINDY CASEBIER, IN HIS OFFICIAL CAPACITIES AS THE SECRETARY OF THE KENTUCKY TOURISM, ARTS, AND HERITAGE CABINET AND A MEMBER OF THE STATE FAIR BOARD; AND JONATHAN SHELL, IN HIS OFFICIAL CAPACITY AS COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE APPELLEES
• Court: Kentucky Court of Appeals

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JONATHAN SHELL, IN HIS OFFICIAL CAPACITY AS COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE; AND MARK LYNN, IN HIS OFFICIAL CAPACITY AS CHAIRMAN OF THE STATE FAIR BOARD APPELLANTS
v.
ANDY BESHEAR, IN HIS OFFICIAL CAPACITY AS GOVERNOR OF THE COMMONWEALTH OF KENTUCKY; BERTRAM ROBERT STIVERS, II, IN HIS OFFICIAL CAPACITY AS MEMBER OF THE STATE FAIR BOARD AND PRESIDENT OF THE KENTUCKY STATE SENATE; DAVID W. OSBORNE, IN HIS OFFICIAL CAPACITY AS A MEMBER OF THE STATE FAIR BOARD AND AS SPEAKER OF THE KENTUCKY HOUSE OF REPRESENTATIVES; LINDY CASEBIER, IN HIS OFFICIAL CAPACITIES AS THE SECRETARY OF THE KENTUCKY TOURISM, ARTS, AND HERITAGE CABINET AND A MEMBER OF THE STATE FAIR BOARD; AND COMMONWEALTH OF KENTUCKY EX REL. ATTORNEY GENERAL RUSSELL COLEMAN APPELLEES

and

ANDY BESHEAR, IN HIS OFFICIAL CAPACITY AS GOVERNOR OF THE COMMONWEALTH OF KENTUCKY; AND LINDY CASEBIER, IN HIS OFFICIAL CAPACITY AS SECRETARY OF THE KENTUCKY TOURISM, ARTS, AND HERITAGE CABINET AND AS A MEMBER OF THE STATE FAIR BOARD CROSS-APPELLANTS
v.
JONATHAN SHELL, IN HIS OFFICIAL CAPACITY AS COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE; BERTRAM ROBERT STIVERS, II, IN HIS OFFICIAL CAPACITIES AS MEMBER OF THE STATE FAIR BOARD AND AS PRESIDENT OF THE KENTUCKY STATE SENATE; COMMONWEALTH OF KENTUCKY, EX REL. ATTORNEY GENERAL RUSSELL COLEMAN; DAVID W. OSBORNE, IN HIS OFFICIAL CAPACITIES AS A MEMBER OF THE STATE FAIR BOARD AND SPEAKER OF THE KENTUCKY HOUSE OF REPRESENTATIVES; AND MARK LYNN, IN HIS OFFICIAL CAPACITY AS CHAIRMAN OF THE STATE FAIR BOARD CROSS-APPELLEES

and

COMMONWEALTH OF KENTUCKY, EX REL. ATTORNEY GENERAL RUSSELL COLEMAN APPELLANT
v.
ANDY BESHEAR, IN HIS OFFICIAL CAPACITY AS GOVERNOR OF THE COMMONWEALTH OF KENTUCKY; BERTRAM ROBERT STIVERS, II, IN HIS OFFICIAL CAPACITY AS A MEMBER OF THE STATE FAIR BOARD AND AS PRESIDENT OF THE KENTUCKY STATE SENATE; DAVID W. OSBORNE, IN HIS OFFICIAL CAPACITY AS A MEMBER OF THE STATE FAIR BOARD AND AS SPEAKER OF THE KENTUCKY HOUSE OF REPRESENTATIVES; DR. MARK E. LYNN, IN HIS OFFICIAL CAPACITY AS CHAIR OF THE STATE FAIR BOARD; LINDY CASEBIER, IN HIS OFFICIAL CAPACITIES AS THE SECRETARY OF THE KENTUCKY TOURISM, ARTS, AND HERITAGE CABINET AND A MEMBER OF THE STATE FAIR BOARD; AND JONATHAN SHELL, IN HIS OFFICIAL CAPACITY AS COMMISSIONER OF THE DEPARTMENT OF AGRICULTURE APPELLEES

Nos. 2021-CA-1459-MR, 2021-CA-1503-MR, 2022-CA-0020-MR

Court of Appeals of Kentucky

March 8, 2024

NOT TO BE PUBLISHED

Appeal from Jefferson Circuit Court Honorable Mary M. Shaw, Judge Action No. 21-CI-002234

Cross-Appeal from Jefferson Circuit Court Honorable Mary M. Shaw, Judge Action No. 21-CI-002234

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Briefs for Commonwealth, ex rel. Attorney General Russell Coleman:

Matthew F. Kuhn Brett R. Nolan Heather L. Becker Michael R. Wajda Frankfort, Kentucky

Briefs for Jonathan Shell, Commissioner of the Department of Agriculture and Mark Lynn, Chairman of the State Fair Board:

Joseph A. Bilby Frankfort, Kentucky

Ellen Benzing Louisville, Kentucky

Oral Argument for Commonwealth of Kentucky, ex rel. Attorney General:

Matthew F. Kuhn Frankfort, Kentucky

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Briefs for Governor Andy Beshear and Secretary Lindy Casebier:

S. Travis Mayo Frankfort, Kentucky

Sarah Grider Cronan Frankfort, Kentucky

Mitchel T. Denham Erin M. Shaughnessy Louisville, Kentucky

Oral Argument for Governor Andy Beshear and Secretary Lindy Casebier:

S. Travis Mayo Frankfort, Kentucky

Before: Acree, Caldwell, and Cetrulo, Judges.

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OPINION

CETRULO, JUDGE

These consolidated appeals arise from a November 2021 Jefferson Circuit Court order ("November 2021 Order") finding various aspects of House Bill ("HB") 518 to be unconstitutional. After review, we find that HB 518 - as codified within Kentucky Revised Statute ("KRS") Chapter 247 - is constitutional, in part, and violates the Kentucky Constitution, in part. We affirm the circuit court.

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I.BACKGROUND

During its 2021 regular session, the Kentucky General Assembly passed HB 518. This legislation made several changes to the composition, mode of operation, and method by which members are selected to the State Fair Board. These changes, now within KRS Chapter 247, went into effect on March 29, 2021.

In April 2021, Governor Andrew Beshear and former Secretary Michael Berry^[1] (together, "the Governor") filed a legal action in Jefferson Circuit Court to challenge the constitutionality of select portions of KRS Chapter 247. The Commonwealth, through then Kentucky Attorney General Daniel Cameron, intervened to defend KRS Chapter 247, alongside Kentucky Agriculture Commissioner Jonathan Shell, State Fair Board Chair Dr. Mark Lynn, Kentucky Senate President Robert Stivers, and Speaker of the Kentucky House of Representatives David Osborne (collectively, "the Appellants").

Senate President Stivers and House Speaker Osborne moved to dismiss under Kentucky Rule of Civil Procedure ("CR") 12.02(a) and (f), but the motion was denied. Ultimately, the circuit court granted in part, and denied in part, the Governor's motion for summary judgment; and granted in part, and

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denied in part, motions for summary judgment brought forth by the Agriculture Commissioner, the Attorney General, and State Fair Board Chair Lynn.

In the circuit court action, the Governor argued KRS Chapter 247 would "effectively prevent the Governor from fulfilling his constitutional duty to take care that the laws be faithfully executed." More specifically, the Governor argued that the passed legislation unconstitutionally infringed upon his executive powers under §§ 27, 28, 69, 76, and 81 of the Kentucky Constitution and violated Kentucky's strong separation of powers doctrine. To the contrary, the Appellants argued that the General Assembly acted within its powers to alter KRS Chapter 247 in order "to rein in unchecked executive action by the Governor."

A.History of the State Fair Board

In 1902, the General Assembly made an appropriation to a private entity to oversee the state fair. The State Fair Board was created in 1906 as an Executive Branch board. The Governor has maintained the ability to appoint the majority of members to our State Fair Board since 1906. Still, there have been frequent modifications over the years and various iterations of the agency. The State Fair Board now oversees dozens of events each year, far beyond the state fair, and generates millions of dollars in revenue for the Commonwealth.

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However, at least in recent years, the State Fair Board has also been appropriated millions of dollars from the Commonwealth's General Fund.^[2]

Again, prior to the changes of KRS Chapter 247 in 2021, the State Fair Board was administratively attached to the Kentucky Tourism, Arts, and Heritage ("TAH") Cabinet, and the Governor provided financial oversight, through the Finance and Administration Cabinet. Compliance with KRS Chapter 45A, the Kentucky Model Procurement Code, was required. Prior to the changes, the State Fair Board consisted of 18 members, with 15 voting members. The Governor appointed 12 of those 15 members.

The current changes to KRS Chapter 247, in part, shifted oversight of the State Fair Board from only the Governor to joint oversight between the Governor, Agriculture Commissioner, and certain members of the Legislature. It also allowed the State Fair Board to operate more independently from the TAH Cabinet, such as allowing it to promulgate its own procurement code. Finally, the recent KRS Chapter 247 modifications changed how and by whom members of the State Fair Board were appointed.

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B.Circuit Court's Ruling

In its November 2021 Order, the Jefferson Circuit Court did not strike down the entirety of the 2021 modifications to KRS Chapter 247, but - finding the provisions severable - held certain provisions to be unconstitutional. The circuit court found KRS Chapter 247 unconstitutionally (1) appointed legislators (or their designees) as ex officio, non-voting, members to the State Fair Board; (2) shifted the power to appoint the majority of voting members from the Governor to the Agriculture Commissioner; and (3) prohibited the Governor from appointing voting members whose terms expired in 2021. The circuit court found all other modifications to KRS Chapter 247 constitutional. Additionally, the circuit court entered a permanent injunction preventing the Appellants from enforcing the unconstitutional provisions. However, in December 2021, the circuit court entered a separate order - staying the effect of its November 2021 Order - allowing the parties to continue to enforce the other provisions of KRS Chapter 247 as enacted. Three separate notices of appeal or cross-appeal were filed.

In February 2022, the Governor moved this Court to lift the circuit court's stay of its temporary injunction pursuant to CR 65.08 (now Kentucky Rule of Appellate Procedure 20(B)). In June 2022, a motion panel of this Court granted in part, and denied in part, the Governor's motion ("June 2022 Order"). That order prohibited the parties from enforcing the aspects of revised KRS Chapter 247 "that

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allow[] the President of the Senate and the Speaker of the House or their designees from serving as ex officio members of the [State Fair Board]." All other aspects of the KRS Chapter 247 modifications were allowed to remain in effect.^[3]

II.STANDARD OF REVIEW

Here, the circuit court granted in part, and denied in part, respective motions for summary judgment."The standard of review on appeal when a [circuit] court grants a motion for summary judgment is 'whether the [circuit] court correctly found that there were no genuine issues as to any material fact and that the moving party was entitled to judgment as a matter of law.'"Blackstone Mining Co. v. Travelers Ins. Co., 351 S.W.3d 193, 198 (Ky. 2010) (quoting Scifres v. Kraft, 916 S.W.2d 779, 781 (Ky. App. 1996)); see also CR 56.03."Because there are no factual issues in dispute and...