TIMOTHY MOORE, APPELLANT, V. NEBRASKA ACCOUNTABILITY AND DISCLOSURE COMMISSION, APPELLEE.
No. S-20-753
Nebraska Supreme Court
October 22, 2021
310 Neb. 302
Filed October 22, 2021. N.W.2d
Administrative Law: Judgments: Appeal and Error. A judgment or final order rendered by a district court in a judicial review pursuant to the Administrative Procedure Act may be reversed, vacated, or modified by an appellate court for errors appearing on the record. When reviewing an order of a district court under the Administrative Procedure Act for errors appearing on the record, the inquiry is whether the decision conforms to the law, is supported by competent evidence, and is neither arbitrary, capricious, nor unreasonable. - Judgments: Appeal and Error. Whether a decision conforms to law is by definition a question of law, in connеction with which an appellate court reaches a conclusion independent of that reached by the lower court.
- ____: ____. An appellate court, in reviewing a district court judgment for errors appearing on the record, will not substitute its factual findings for those of the district court where competent evidence supports those findings.
- Statutes: Appeal and Error. The interpretation of statutes presents questions of law, in connection with which an appellate court has an obligation to reach an independent conclusion irrespective of the decision made by the court below.
- Public Officers and Employees: Contracts.
Neb. Rev. Stat. § 49-14,103.01(5) (Reissue 2010) provides an exemption from the general prohibition against an officer having an interest in any contract with his or her governing body, when all of the following conditions are met: (1) The contract is an agenda item approved at a board meeting; (2) the interested officer makes a declaration on the record to the governing body regarding the nature and extent of his or her interestbefore official consideration of the contract; (3) the interested officer does not vote on matters relating to the contract, including making payments рursuant to the contract or accepting performance of work under the contract; and (4) the interested officer does not act for the governing body as to any inspection or performance under the contract. - ____: ____. When an officer complies with the disclosure and abstention requirements set out in
Neb. Rev. Stat. § 49-14,103.01(5) (Reissue 2010), he or she can avoid violating the general prohibition against having an interest in any contract to which his or her governing body is a party. - Statutes: Legislature: Intent. When construing a statute, a court must determine and give effect to the purpose and intent of the Legislature аs ascertained from the entire language of the statute considered in its plain, ordinary, and popular sense.
- Statutes: Appeal and Error. The rules of statutory interpretation require an appellate court to give effect to the entire language of a statute, and to reconcile different provisions of the statutes so they are consistent, harmonious, and sensible.
- Contracts: Parties. A binding mutual understanding or meeting of the minds sufficient to establish a contract requires no precise formality or express utterance from the parties about the details of the proposed agreement; it may be impliеd from the parties’ conduct and the surrounding circumstances.
- Contracts: Parties: Intent. An implied contract arises where the intention of the parties is not expressed in writing but where the circumstances are such as to show a mutual intent to contract.
- ____: ____: ____. The determination of the parties’ intent to make a contract is to be gathered from objective manifestations—the conduct of the parties, language used, or acts done by them, or other pertinent circumstances surrounding the transaction. If the parties’ conduct is sufficient to show an implied contract, it is just as enforceable as an express contract.
- ____: ____: ____. The determination of the parties’ intent to make a contract is normally a question of fact.
- Appeal and Error. An appellate court does not consider errors which are argued but not assigned.
Appeal from the District Court for Buffalo County: RYAN C. CARSON, Judge. Affirmed.
James R. Korth, of Reynolds, Korth & Samuelson, P.C., L.L.O., for appellant.
HEAVICAN, C.J., MILLER-LERMAN, CASSEL, STACY, FUNKE, PAPIK, and FREUDENBERG, JJ.
STACY, J.
After an evidentiary hearing, the Nebraska Accountability and Disclosure Commission (NADC) determined that Timothy Moore, while serving as the chair of the board of trustees for the village of Madrid, Nebraska (Village Board), violated the Nebraska Politiсal Accountability and Disclosure Act (NPADA)1 by having an interest in a contract with the Village Board and failing to comply with the disclosure and abstention requirements of
BACKGROUND
The pertinent facts in this matter are undisputed. The village of Madrid is governed by a five-person Village Board. From 1998 through 2016, Moore served as the chair of the Village Board. Pursuant to Nebraska statute at the time, “the annual salary of the chair[person] and other members of the [village] board of trustees shall be fixed by ordinance”2 and “[n]o officer shall receive any pay or perquisites from the [village] other than his or her salary.”3
During 2014, 2015, and 2016, Moore performed certain work for the village beyond the normal duties of the chair of the Village Board and he regularly submitted requests to be pаid for such work at an hourly rate. This additional work, and the manner in which Moore requested and received payment for that work, is at the heart of this appeal.
Moore‘s payment requests for the additional work were reviewed during the monthly Village Board meetings, but were not listed as agenda items. Moore typically did not declare his interest on the record in such requests before they were considered, nor did he abstain from voting on or approving his own payment requests. The Village Board regularly approved and paid Moore‘s requests for additional compеnsation. The record contains Internal Revenue Service tax forms showing the village paid Moore “[n]onemployee compensation” of $9,528.68 in 2014, $8,898 in 2015, and $14,490.50 in 2016.
NADC COMPLAINT
In April 2017, a village resident filed a complaint against Moore with the NADC. Ultimately, Moore was notified that he was being investigated for 11 alleged violations of the NPADA. Two of the alleged violations pertained to
A public official or public employee shall not use or authorize the use of his or her public office . . . to
obtain financial gain, other than compensation provided by law, for himself or herself, a member оf his or her immediate family, or a business with which the individual is associated.
The NADC‘s notice alleged that in 2015 and 2016, while holding public office, Moore requested and received compensation other than that allowed by law, in violation of
Nine of the alleged violations pertained to
(2) . . . [N]o officer may have an interest in any contract to which his or her governing body, or anyone for its benefit, is a party. The existence of such an interest in any contract shall render the contract voidable by decree of a court of competent jurisdiction as to any person who entered into the contract or took assignmеnt of such contract with actual knowledge of the prohibited conflict. . . .
(4) The prohibition in this section shall apply only when the officer . . . (b) will receive a direct pecuniary fee or commission as a result of the contract.
(5) The prohibition in this section does not apply if the contract is an agenda item approved at a board meeting and the interested officer:
(a) Makes a declaration on the record to the governing body responsible for approving the contract regarding the nature and extent of his or her interest prior to officiаl consideration of the contract;
(b) Does not vote on the matters of granting the contract, making payments pursuant to the contract, or accepting performance of work under the contract, or similar matters relating to the contract, except that if the number of members of the governing body declaring an interest in the contract would prevent the body with all members present from securing a quorum on the issue, then all members may vote on the matters; and
(c) Does not act for the governing body which is party to the contract as to inspection or рerformance under the contract in which he or she has an interest.
The NADC‘s notice alleged that in 2014, 2015, and 2016, Moore had an interest in one or more contracts with the village, and that when submitting claims for payment under those contracts at monthly Village Board meetings, he failed to include the claims as agenda items, failed to declare an interest in the claims, and failed to abstain from voting on the claims, in violation of
After conducting its investigation, the NADC found “probable cause” that one or more of the violations alleged in the notice had occurred.4 It notified Moоre that a hearing would take place to determine whether he violated the NPADA and, if so, whether civil penalties should be assessed.5 There is no suggestion in the record that the NADC referred the matter for consideration of a possible criminal violation of the NPADA.6
NADC HEARING
A hearing officer was appointed, and an evidentiary hearing was conducted in Kearney, Nebraska. The evidence adduced during that hearing was generally consistent with the facts described above.
Moore testified at the hearing. He explained that in 2014, 2015, and 2016, in addition to his ordinary board duties, he performed extra work for the village. According to Moore, this extra work included filling in for the village utilities superintendent when that employee was ill or absent, working on the village budget and audit, working with the attorney retained by the village to address ongoing legal issues related to a failure in the village‘s wastewater treatment facility, and performing miscellaneous “chores” for the village. Moore
Moore also admitted that from 2014 to 2016, he regularly submitted рayment requests to the Village Board for the extra work he performed. He charged an hourly rate for his services, and he testified that this hourly rate had been preapproved by the Village Board. The Village Board considered and approved Moore‘s payment requests during its regular monthly meetings, and Moore accepted the payments when they were made. These payments were in addition to Moore‘s annual compensation as the chair of the Village Board.
Moore further admitted that when submitting the payment requests, he did not list them as agenda items for the Village Board meetings, he typically did not declare his interest in the requests before they were considered, and he did not abstain from voting on the requests. Moore claimed he was not required to comply with the disclosure and abstention provisions of
NADC ORDER
In an order issued Seрtember 13, 2019, the NADC determined there was not sufficient evidence to establish violations of
Regarding the alleged violations of
The NADC rejected Moore‘s contention that he was not subject to the requirements of
ADMINISTRATIVE PROCEDURE ACT APPEAL
Moore filed a timely petition in the district court for Buffalo County, seeking judicial review of the NADC‘s decision under the Administrative Procedure Act (APA).8 As pertinent here, Moore assigned error to the NADC‘s determination that he entered into contracts with the Village Board to perform additional services for an hourly rate. Moore‘s primary argument was that he had not entered into any contracts with the Village Board to perform the additional work, so the provisions of
In an order entered September 18, 2020, the district court rejected both of Moore‘s arguments. The court agreed with the NADC that the evidence showed there was an implied contract between Moore and the village for the additional work, reasoning:
[T]he evidence shows that [Moore] agreed to perform certain tasks beyond the normal duties as Chairman of the Village Board, and did so at the board‘s request. While it is clear that [Moore‘s] motivation was to serve his community, the evidence shows he was offered consideration or payment for those services in the form of compensation at an hourly rate. This compensation was extra pay in addition to his salary and is generally prohibited by statute. See Neb. Rev. Stat. §17-611 (“No officer shall receive any pay or perquisites from a . . . village other than his or her salary“). The parties proceeded in this manner from 2014 to 2016, and [Moore‘s] invoices were regularly approved by the Village Board every month. Accordingly, the parties’ conduct and the surrounding circumstances are sufficient to indicate the existence of a contract, implied or otherwise.
The district court also rejected Moore‘s contention that the disclosure and abstention requirements of
The district court therefore affirmed the NADC‘s decision in all respects. Moore filed this timely appeal, which we moved to our docket on our own motion.
ASSIGNMENTS OF ERROR
Moore assigns that the district court erred in affirming the decision of the NADC based on a finding that he “entered into contracts with the Village of Madrid in 2014, 2015, and 2016.”10
STANDARD OF REVIEW
[1] A judgment or final order rendered by a district court in a judicial review pursuant to the APA may be reversed, vacated, or modified by an appellate court for errors appеaring on the record.11 When reviewing an order of a district court under the APA for errors appearing on the record, the inquiry is whether the decision conforms to the law, is supported by competent evidence, and is neither arbitrary, capricious, nor unreasonable.12
[2] Whether a decision conforms to law is by definition a question of law, in connection with which an appellate court reaches a conclusion independent of that reached by the lower court.13
[3] An appellate court, in reviewing a district court judgment for errors appearing on the record, will not substitute its
[4] The interpretation of statutes presents questions of law, in connection with which an appellate court has an obligation to reach an independent conclusion irrespective of the decision made by the court below.15
ANALYSIS
§ 49-14,103.01
Section 49-14,103.01(2) of the NPADA provides that “no officer may have an interest in any contract to which his or her governing body, or anyone for its benefit, is a party.” For purposes of this prohibition, the NPADA defines “officers” to include “а member of any board or commission of any . . . village which spends and administers its own funds, who is dealing with a contract made by such board or commission.”16 Moore does not dispute that as a trustee of the Village Board, he was an “officer” subject to the general prohibition against having an interest in any contract in which the Village Board is a party. His contention is that he had no contract with the Village Board to perform extra work for an hourly rate.
Before addressing the merits of this contention, we pause to note that under earlier codifications of this statute, when an оfficer had an interest in a contract to which his or her governing body was a party, the contract was deemed void as a matter of law.17 But under the current statutory scheme, the existence of a prohibited interest renders the contract voidable
[5,6] Section 49-14,103.01(5) provides an exemption from the general prohibition against an officer having an interest in any contract with his or her governing body, when all of the following conditions are met: (1) The contract is an agenda item approved at a board meeting; (2) the interested officer makes a declaration on the record to the governing body regarding the nature and extent of his or her interest before official consideration of the contract; (3) the interested officer does not vote on matters relating to the contract, including making payments pursuant to the contract or accepting performance of work under the contract; and (4) the interested officer does not act for the governing body as to any inspection or performance under the contract.20 When an officer compliеs with the disclosure and abstention requirements set out in
As stated, Moore concedes he did not comply with the disclosure and abstention requirements of
MOORE‘S INTEREST IN CONTRACT
The NPADA does not expressly define “an interest in any contract” as used in
Although the Legislature has not expressly defined “an interest in any contract” for purposes of
As relevant here,
The prohibition in this section shall apply only when the officer or his or her parent, spouse, or child (a) has a business association as defined in section 49-1408 with the business involved in the contract or (b) will receive a direct pecuniary fee or commissiоn as a result of the contract.
Moore does not dispute that he received a direct pecuniary fee or payment of money from the Village Board in exchange
[9-11] A binding mutual understanding or meeting of the minds sufficient to establish a contract requires no precise formality or express utterance from the parties about the details of the proposed agreement; it may be implied from the parties’ conduct and the surrounding circumstances.26 An implied contract arises where the intention of the parties is not expressed in writing but where the circumstances are such as to show a mutual intent to contract.27 The determination of the parties’ intent to make a contract is to be gathered from objective manifestations—the conduct of the parties, language used, or acts done by them, or other pertinent circumstances surrounding the transaction.28 If the parties’ conduct is sufficient to show an implied contract, it is just as enforceable as an express contract.29
[12] Normally, the determination of the parties’ intent to make a contract is a question of fact.30 Here, the district court made an express factual finding that “the parties’ conduct and the surrounding circumstances are sufficient to indicate the existence of a contract, implied or otherwise.” We find competent evidence in the record to support this finding.
We agree with the district court‘s conclusion that the parties’ conduct and the surrounding circumstances demonstrate a mutual intent sufficient to show there was аn implied contract to have Moore perform additional work for the village in exchange for compensation at a set hourly rate. Indeed, without such a contract, there is nothing in the record that explains why Moore performed the extra work, why the Village Board paid him for such work, and why Moore accepted this additional compensation. While we express no opinion on the propriety of such a contract, we soundly reject as meritless Moore‘s contention that the district court erred in finding he had a contract with the Village Board to perform extra work in exchange for an hourly rate.
[13] For the sake of completeness, we note that Moore devotes a significant portion of his appellate briefing to arguing that the disclosure and abstention provisions of
At all relevant times, Moore was a trustee of the Village Board and was therefore subject to the general prohibition against having an interest in any contract in which the Village Board was a party. He entered into contracts with the Village Board to perform additional work for the village in exchange for compensation at a set hourly rate. He then regularly requested payment under such contracts, and he violated
While the record shows that Moore‘s primary motivation for agreeing to perform the extra work was to serve his community, noble intentions do not exempt him from the disclosure and abstention requirements of
The district court‘s judgment affirming the decisiоn of the NADC conforms to the law, is supported by competent evidence, and is neither arbitrary, capricious, nor unreasonable. We therefore affirm the judgment.
AFFIRMED.