Zorc v. City of Vero Beach

• Decision Date: 02 December 1998
• Docket Number: No. 97-0465.,97-0465.
• Citation: 722 So.2d 891
• Parties: Frank L. ZORC, Appellant, v. CITY OF VERO BEACH, Florida, Appellee.
• Court: Florida District Court of Appeals

722 So.2d 891

Frank L. ZORC, Appellant, v. CITY OF VERO BEACH, Florida, Appellee.

No. 97-0465.

District Court of Appeal of Florida, Fourth District.

December 2, 1998.

Rehearing Denied January 12, 1999.

Jonathan D. Kaney Jr. and Jonathan D. Kaney III of Cobb Cole & Bell, Daytona Beach and Kathaleen Inman and Michael D. Battaglini, Vero Beach, for Appellant.

Robert N. Sechen, City Attorney, Vero Beach and Angela C. Flowers and Elizabeth M. Rodriguez of Kubicki Draper, Miami, for Appellee.

Edward M. Mullins and Lornette A. Reynolds of Steel Hector & Davis LLP, Miami, for Amicus Curiae-First Amendment Foundation, Florida Society Newspaper Editors, and Vero Beach Press-Journal.

J. Bruce Bowman of Dennis & Bowman, P.A., Tallahassee, for Amicus Curiae-Florida League of Cities, Inc.

SHAHOOD, J.

Appellant, Frank Zorc, appeals from Amended Summary Final Judgment entered in favor of appellee, City of Vero Beach ("City"), finding inter alia that the City did not violate the Sunshine Law in any of three closed-door meetings held March 6, 1995, April 4, 1995 and May 9, 1995, wherein the City discussed its participation as a creditor in pending litigation in the bankruptcy proceedings brought by Piper Aircraft Corporation ("Piper"). The trial court held that the City was authorized to conduct such closed-door meetings under section 286.011(8), Florida Statutes (1995), and that any violations which may have occurred were cured through the City's open-door meeting held on June 21,1995. We disagree and reverse and remand.

Background

In April 1985, the City and Zorc entered into a thirty-year lease for parcel 44, a piece of property owned by the City at the Vero Beach Municipal Airport, adjacent to the Piper facility. In August 1986, the City and Zorc entered into another thirty-year lease for parcel 43, also adjacent to the Piper facility.

Since 1959, Piper operated an aircraft installation facility in Vero Beach. Piper maintained certain underground storage tanks at this site containing chemicals used in its business, including trichloroethylene ("TCE"). In October 1978, an analysis of the City's water supply revealed that a water well located close to Piper's storage tanks, was contaminated by TCE. This contamination affected the City's property, including the portion leased to Zorc. In 1990, the Piper site was added to the National Priorities List, a prioritized list of properties affected by uncontrolled releases of hazardous substances requiring remedial evaluation and response pursuant to the Comprehensive Environmental Response, Compensation and Liability Act.

In 1991, Piper filed for bankruptcy. The City was a creditor in the Piper bankruptcy after filing a claim "in the approximate amounts of $136,000 for utility claims and $49,000 for claims for rent and gross receipts tax due to the airport." During that time, Piper and the Environmental Protection Agency negotiated a Consent Decree in order to assure that sufficient remedial action was taken to cleanup the area. Prior to Piper presenting the Consent Decree for final approval before the Federal District Court, the Consent Decree had to first be approved by the Bankruptcy Court.

Since the proposed Consent Decree filed with the Bankruptcy Court did not contain any provisions including the City's adjacent property in Piper's cleanup efforts, the City held a series of closed-door meetings with its attorneys, discussed below, to discuss strategy regarding its inclusion in the Piper Consent Decree.

As a result of the TCE contamination of his leased property, Zorc incurred problems obtaining refinancing for his property. In October 1994, Zorc voiced his concerns to the City regarding the renewal of his mortgage which was to mature on September 1, 1995. His lender was concerned that TCE might have migrated onto his property. In January 1995, Zorc thanked the City for what he believed to be its cooperation toward solutions regarding the possible contamination problem on the property he leased from the City and in clearing up any "stigma" regarding contamination of the property. Zorc kept the City informed of his discussions with the EPA in an attempt to determine if his property near the Piper site required cleanup.

March 6, 1995 Closed-Door Meeting

In a notice dated March 5, 1995, the City called a Special City Council Meeting for March 6, 1995. Included on the agenda was a private meeting, not open to the public, to discuss the following "matters in litigation: U.S. Bankruptcy Court, In re: Piper Aircraft Corporation, Debtor, Case 91-31884-BKC-RAM, Chapter 11." The notice identified those persons who would be in attendance at the meeting, and provided that "[v]erbatim transcript of the City Attorney's litigation proceedings shall be made by an independent court reporter which will be filed with the City Clerk and open to the public for inspection after the conclusion of the litigation."

In part, this meeting was intended to be a "strategy session" concerning the Piper bankruptcy. At the meeting, the City Attorney informed the City Council as to the City's status as a creditor in the Piper bankruptcy. The City Council was also advised that the City was considering filing an additional claim in the Piper bankruptcy proceeding to protect its interests in the TCE contamination cleanup efforts being made at the Piper site. Special counsel for the City advised the City as to its options to protect its property in the face of the Consent Decree being negotiated between Piper and the EPA and which was to be presented before the Bankruptcy Court for approval. He explained that the Consent Decree did not contain any provisions allowing for the City to participate in the cleanup process in order to protect the City's property, which included Zorc's leased property.

Special Counsel presented three options: (1) do nothing and assume that the EPA will require Piper to clean up all properties affected by TCE, including the City's; (2) to file a motion in Bankruptcy Court objecting to the proposed Consent Decree prior to the court's approval and to request an amendment to the document to assure that the City's property will be included in the cleanup; and (3) to file a motion to intervene when the EPA seeks approval of the Consent Decree in Federal District Court.

After discussing the various options, Special Counsel recommended that the City pursue each of the three options. Included in this discussion was how the consent agreement was going to affect Zorc and the City's legal obligation to him over the contaminated property. A motion was passed by the City Council accepting counsel's recommendations and allowing counsel to "take whatever action is necessary to get this additional paragraph in the [consent] agreement ... including sending a letter to the DEP to start the clock running on a potential friendly suit with DEP, including in the bankruptcy filing an objection to the consent agreement as it's currently worded, and, lastly, to intervene in the suit to be filed by the United States versus Piper, if necessary." On April 3, 1995, the City filed its objection to the approval of the Consent Decree by the Bankruptcy Court, claiming that it was a creditor of Piper's and had a particular interest in the cleanup efforts set in the Consent Decree due to its ownership of property adjacent to the Piper site.

April 4, 1995 Closed-door Meeting

On March 30, 1995, notice of an April 4, 1995 Special City Council Meeting was published to discuss the Piper bankruptcy proceeding and another unrelated litigation matter. The notice included those persons scheduled to attend the meeting. The meeting consisted primarily of a status report by the City Attorney on the Piper bankruptcy. The City Attorney updated the City Council as to the action taken since the March 6th meeting, including the filing of the City's objection to the Consent Decree and an update on the various options available to the City. Further mention was made of Zorc's potential claims against the City and the related reasons as to why the City must continue to get involved in the cleanup efforts.

May 9, 1995 Closed-Door Meeting

Notice of the May 9, 1995 Special City Council Meeting was published on May 8, 1995. The sole purpose of the meeting was to discuss strategy and possible settlement in the Piper bankruptcy litigation. Those persons in attendance at the meeting were listed in the notice.

The City Attorney updated the City on the action authorized by the City in a previous meeting, including the filing of an objection to the Piper Consent Decree in Bankruptcy Court and negotiations with Piper and the EPA. Special Counsel requested authorization to enter into final negotiations with Piper and the EPA and to review the proposed protective language for inclusion into the Consent Decree.

Early in the meeting, Councilman Ginn asked whether the Piper Consent Decree was part of the agenda set out in the public notice and whether this was something that should be done in a public setting. The City Attorney explained that it was part of the agenda since the Piper Consent Decree must be signed by the Bankruptcy Court and since the City had filed its objection to the decree in the Bankruptcy Court. In response to the Councilman's concerns regarding the need for this meeting to be held in public, the City Attorney explained that the nature of the meeting was that of a strategy session, which was exempted from the requirements of the Sunshine Law. The City Attorney explained that the strategy session will settle the City's claims with respect to the Consent Decree, even though their financial claims would remain pending.

The Council members devoted much of the discussion to making sure that the tenants at the airport were covered under the consent agreement. Specific mention was made regarding Zorc's financing problem's as a result of his lender's concerns that TCE contamination may affect his leased parcel...