Shepherd Props. Co. v. Int'l Union of Painters & Allied Trades, Dist. Council 91

• Decision Date: 31 July 2012
• Docket Number: No. 49S04–1112–PL–697.,49S04–1112–PL–697.
• Citation: 972 N.E.2d 845
• Parties: SHEPHERD PROPERTIES CO., d/b/a ShepCo Commercial Finishes, Appellant (Intervening Defendant below), v. INTERNATIONAL UNION OF PAINTERS AND ALLIED TRADES, DISTRICT COUNCIL 91, Appellee (Plaintiff below).
• Court: Indiana Supreme Court

972 N.E.2d 845

SHEPHERD PROPERTIES CO., d/b/a ShepCo Commercial Finishes, Appellant (Intervening Defendant below),

v.INTERNATIONAL UNION OF PAINTERS AND ALLIED TRADES, DISTRICT COUNCIL 91, Appellee (Plaintiff below).

No. 49S04–1112–PL–697.

Supreme Court of Indiana.

July 31, 2012.

Michael L. Einterz, Michael L. Einterz, Jr., Zionsville, IN, Attorneys for Appellant.

William R. Groth, Indianapolis, IN, Attorney for Appellee.

On Petition to Transfer from the Indiana Court of Appeals, No. 49A04–1010–PL–676

DAVID, Justice.

In this case, a plaintiff prevailed on its Access to Public Records Act claim against a public agency and an intervening private party. As required by statute, the trial court awarded the plaintiff attorney's fees.

The fees were awarded against both the public agency and intervening private party, jointly and severally. The private party argued that the Access to Public Records Act does not contemplate the award of attorney's fees against an intervening private party and that only the public agency should be liable for the fees.

We hold that the Access to Public Records Act, in light of the legislature's liberal-construction mandate and the statute's underlying policy, permits the award of attorney's fees against an intervening private party. We further hold that, in this case, the trial court did not abuse its discretion in its apportionment of liability.

Facts and Procedural History

The International Union of Painters and Allied Trades (Union) requested to inspect and copy payroll records in the possession of the Metropolitan School District of Warren Township (Township). The payroll records were submitted by ShepCo Commercial Finishes, a subcontractor on a public-works project.

Union claimed that the payroll records were “public records” subject to disclosure under the Access to Public Records Act (APRA).¹ ShepCo and Township, on the other hand, contended that the payroll records were trade secrets and confidential financial information that fell under exceptions within the APRA.

Pursuant to the APRA, ShepCo made an informal inquiry of the Public Access Counselor (PAC) regarding disclosure of the records. Later, Union requested a formal advisory opinion from the PAC. Both times, the PAC concluded that the records did not need to be disclosed. Specifically, the PAC's formal advisory opinion concluded that the records were “trade secrets” and “confidential financial information” that were exempt from disclosure under the APRA.

In October 2008, Union filed a complaint with the trial court, seeking to compel disclosure under the APRA and naming Township as the sole defendant. Township moved to add ShepCo as a necessary party. The trial court denied that motion, but it granted ShepCo's subsequent motion to intervene.

Union, Township, and ShepCo all moved for summary judgment. In its motion, Union requested attorney's fees pursuant to a provision in the APRA. After a hearing, the trial court entered summary judgment for Union and ordered Township to disclose the records. The trial court later held a separate hearing on Union's request for attorney's fees and awarded $20,234 in attorney's fees against Township and ShepCo, jointly and severally.

Union then filed a motion to amend the final judgment, seeking additional attorney'sfees expended by its counsel in litigating the original request for attorney's fees. ShepCo filed a motion to correct error, raising, for the first time, an argument on the appropriate weight to be given to the PAC's advisory opinion and an argument challenging the constitutionality of the attorney's fees award. The trial court denied the motion to correct error and entered an amended judgment awarding Union an additional $2,425 in attorney's fees.

ShepCo appealed. The Court of Appeals held that a private entity like ShepCo is not liable for attorney's fees under the APRA and that Township, the public agency, was solely liable. Shepherd Props. Co. v. Int'l Union of Painters, 950 N.E.2d 321, 325 (Ind.Ct.App.2011). On rehearing, the Court of Appeals acknowledged two prior Court of Appeals cases that stated that a private party may be liable for the attorney's fees of a party prevailing in an action to compel disclosure under the APRA. Shepherd Props. Co. v. Int'l Union of Painters & Allied Trades, Dist. Council 91, 955 N.E.2d 208, 209 (Ind.Ct.App.2011). But the Court of Appeals noted that the “APRA does not include language providing for payment of attorney's fees by an intervenor, and will not write into the statute such a provision.” Id. (emphasis omitted). We granted transfer.

Standard of Review

The issue today is whether an intervening private entity can be held liable for attorney's fees under the APRA.² Because this is a matter of statutory interpretation, it is a pure question of law that we review de novo. State v. Int'l Bus. Machs. Corp., 964 N.E.2d 206, 209 (Ind.2012).

Access to Public Records Act

The public policy underlying the APRA is “that all persons are entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and employees.” Ind.Code § 5–14–3–1. Accordingly, the APRA requires a “public agency” to disclose its “public records” upon the request of any person. Id. § 5–14–3–3(a), (b).

Certain types of public records are excepted from the APRA's disclosure requirement, and a public agency may not disclose those records unless specifically required by statute or court order. Id. § 5–14–3–4. A public agency or a member of the public may file an informal inquiry request or a request for a formal advisory opinion with the PAC regarding whether a document is subject to disclosure under the APRA. Id. § 5–14–4–10(5), (6) (2010).

A person denied access to a public record may file an action in court “to compel the public agency to permit the person to inspect and copy the public record.” Id.§ 5–14–3–9(e). When such an action is filed, the public agency must notify each person who supplied any part of the public record at issue (1) that a request for release of the record was denied and (2) whether the denial was in compliance with an informal inquiry response or formal advisory opinion of the PAC. Id. Any person who supplied part of the disputed record is entitled to “intervene” in litigation resulting from the denial. Id.

If the plaintiff seeking disclosure prevails in the court action, the court “shall” award reasonable attorney's fees, court costs, and expenses if the plaintiff first sought and received an informal inquiry response or formal advisory opinion from the PAC. Id.§ 5–14–3–9(i).

In this case, the parties agree that Township is a “public agency” as defined in the APRA and that ShepCo is not a “public agency.” See id. § 5–14–3–2(m). The parties also agree that ShepCo appeared as an intervenor as permitted by the APRA and that Township is liable for Union's attorney's fees under the APRA. The parties' disagreement rests on whether ShepCo is also liable to Union for its attorney's fees under the APRA.³

A. Prior Decisions

Third-party liability for attorney's fees under the APRA is an issue of first impression for this Court. However, before its decision in this case, the Court of Appeals had addressed the subject on two prior occasions. See Indianapolis Newspapers v. Indiana State Lottery Comm'n, 739 N.E.2d 144 (Ind.Ct.App.2000), trans. denied; Knightstown Banner, LLC v. Town of Knightstown, 882 N.E.2d 270 (Ind.Ct.App.2008), clarified on reh'g,889 N.E.2d 317 (Ind.Ct.App.2008). In both opinions, described below, the Court of Appeals stated that third parties may be liable for the attorney's fees of a party prevailing in an action to compel disclosure under the APRA.

In Indianapolis Newspapers, a newspaper requested that the Lottery Commission, a public agency, disclose documents containing information generated by lottery retailers. 739 N.E.2d at 146–47. Upon request by the newspaper, the PAC rendered an advisory opinion, stating that the documents requested must be disclosed under the APRA. Id. at 147.

The retailers sued the Lottery Commission to enjoin disclosure, and the newspaper intervened. Id. at 148. The Lottery Commission then tendered the disputed documents to the court under seal. Id. at 148–49. The trial court found that the Lottery Commission's surrender of the documents obviated the need for it as a party and discharged it from liability, including liability for the newspaper's attorney's fees. Id. at 149–50. The newspaper appealed.

The Court of Appeals found the trial court erred in discharging the Lottery Commission because the Lottery Commission was still potentially liable to the newspaper for attorney's fees under the APRA, depending on the outcome of the litigation. Id. at 155–56. But the Court of Appeals also discussed the retailers' potential liability for attorney's fees. First, the Court of Appeals generally stated that the APRA “does not require that the attorney fees be awarded to or from the public agency when it is clear that the statute contemplates the involvement of third parties.” Id. at 156. The Court of Appeals then explained how it would apportion liability for attorney's fees if the newspaper prevailed in the litigation:

[W]e interpret the attorney fee provision to mean that, if the [newspaper] substantially prevails in this action, the Lottery is liable for the [newspaper's] attorney fees from the time the PAC rendered her advisory opinion until the Lottery has made complete tender of the disputed documents to the trial court. After complete tender has been made, the Retailers become liable for the fees, unless there is later litigation concerning whether or not complete tender was in fact made, in which case the Lottery may again become liable for the [newspaper's] fees in litigating that issue.

Id.

The Court of Appeals also found that because the Lottery Commission took the position that it was not liable for the newspaper's...