The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us) STATE OF MICHIGAN FRANK J. KELLEY, ATTORNEY GENERAL Opinion No. 5413 December 28, 1978 DEPARTMENT OF SOCIAL SERVICES: Execution of contracts OFFICERS AND EMPLOYEES: Execution of contracts by Director of Social Services SOCIAL WELFARE ACT: Execution of contracts by Director of Social Services OFFICE OF CHILDREN AND YOUTH SERVICES: Execution of contracts by the Executive Director The authority to perform ministerial acts may be delegated by a department head, but decisions which require the exercise of judgment and discretion or which are quasi-judicial are the responsibility of the head of the department. A decision to bind the department by contract to a particular course of action or to authorize the expenditure of funds appropriated by the legislature generally involves the exercise of judgment and discretion on the part of the director. The Office of Children and Youth Services created by 1978 PA 87 performs its duties under the supervision and control of the Department of Social Services. Therefore, it is the Director of Social Services who exercises the ultimate authority to approve or disapprove any actions of the Executive Director of the Office of Children and Youth Services including the negotiation of agreements. John T. Dempsey Director Michigan Department of Social Services 300 South Capitol Avenue Lansing, Michigan You have requested my advice as to whether you, as Director of Social Services, may delegate your authority to sign contracts, established by the Social Welfare Act, 1939 PA 280, as amended, MCLA 400.1 et seq; MSA 16.401 et seq, and, if so, to whom such authority may be delegated. Subsequently, you also asked for my opinion regarding the power, if any, of the Executive Director of the Office of Children and Youth Services to enter into contracts on behalf of that office which was 'created as a single purpose entity within the department of social services.' Social Welfare Act, Sec. 114(1), supra. Both requests will be responded to by this opinion. The Social Welfare Act, Sec. 10, supra, confers the following authority upon the Director of Social Services with regard to executing certain types of contracts: 'The director may . . . enter into any agreement or agreements with federal, state, or local units of government or private agencies necessary to participate in any plan the director deems desirable for the welfare of the people of this state.' Furthermore, as successor to the Social Welfare Commission, abolished by Sec. 453 of the Executive Reorganization Act of 1965, 1965 PA 380, MCLA 16.453; MSA 3.29(353), the Department of Social Services is considered to be 'a body corporate, and . . . authorized to lease any lands under its jurisdiction and to do any other act or thing necessary in carrying out the provisions of this act [Social Welfare Act, supra].' See Social Welfare Act, Sec. 7, supra. Therefore, as head of a principal department with the legislatively delegated authority described in the Social Welfare Act, supra, Secs. 7 and 10, the Director of Social Services is clearly and specifically authorized to execute contracts on behalf of said department. The Social Welfare Act does not confer upon any official or employee of the Department of Social Services, with the exception of the Director, the authority to execute contracts for the Department. In Roxborough v Michigan Unemployment Compensation Commission, 309 Mich 505; 15 NW2d 724 (1944), the Michigan Supreme Court, quoting from 59 CJ pp 172, 173, Sec. 286, stated the following rule with regard to the contracting authority of state officials: 'Public officers have and can exercise only such powers as are conferred on them by law, and a State is not bound by contracts made in its behalf by its officers or agents without previous authority conferred by statute or the Constitution. Nor is a State bound by an implied contract made by a State officer where such officer had no authority to make an express one.' (Citations omitted.) 309 Mich 505, 510. The Director of Social Services is the sole official empowered to enter into agreements on behalf of that Department. The Director's ability to delegate such authority to subordinate officials within the Department must be determined by reference to common law principles, as neither the Social Welfare Act, supra, nor the Executive Reorganization Act of 1965, supra, provide express statutory authorization for such subdelegation. In OAG, 1965-1966, No 4479A, p 262 (May 2, 1966), the Attorney General, after an extensive analysis of the law relating to delegation of authority by an administrative official, drew the following conclusion: 'Clearly the authority to perform ministerial acts can be delegated by the department head . . . but decisions which require the exercise of judgment and discretion or which may be quasi-judicial are the responsibility of the head of the department.' OAG 1965-1966, No 4479A, supra, p 278. The decision to bind the Department by contract to a particular course of conduct or to authorize the expenditure of funds appropriated by the legislature generally involves the exercise of judgment and discretion on the part of the Director. While the execution of contracts involving routine administrative matters may be of a ministerial nature, the advice given by the Attorney General regarding the decision to delegate in OAG 1965-1966, No 4479A, supra, p 278 should be given careful consideration prior to the making of a delegation in this area. In said Opinion the Attorney General stated: 'Any decision to delegate and subdelegate responsibility within a principal department must be made with caution and after careful consideration of the nature of the act and with due regard to the public trust which has been placed in the head of each principal department. In doubtful cases the safe course to follow is to avoid delegation or redelegation.' Of course, the Executive Reorganization Act of 1965, Sec. 6, supra, does authorize deputy department heads to assume the responsibilities of the department head in his absence or during an illness. This is not a delegation of authority but is merely a substitution of individuals, both of whom are exercising the authority conferred on the position by statute. Therefore, it is my opinion that unless the execution of a particular type of agreement is determined to be a ministerial act which does not involve the exercise of judgment and discretion, the contracting authority of the Director may not be delegated to his subordinates within the Department and must be exercised personally. Addressing your second question, the Office of Children and Youth Services was created by 1978 PA 87, Sec. 1, which, effective March 29, 1978, amended several sections of the Social Welfare Act, supra. The Social Welfare Act, Sec. 114(1), as amended by 1978 PA 87, supra, states: 'The office of children and youth services is created as a single purpose entity within the department of social services. The office shall be responsible for the planning, development, implementation and evaluation of children and youth services conducted, administered, or purchased by the department under the authority of sections 114 to 123 [of the Social Welfare Act].' (Emphasis added) The legislature clearly intended the Office of Children and Youth Services to be under the supervision and control of the Department of Social Services and indeed its functional responsibilities all relate to services 'conducted, administered or purchased by the department.' In language which seems contradictory to the legislative intent expressed in the Social Welfare Act, Sec. 114(1), supra, the legislature has, in Secs. 115a(1)(f), 117b(b) and 117b(c) of the Social Welfare Act, supra, authorized the Office of Children and Youth Services to enter into certain types of contracts. In pertinent part thereof the Social Welfare Act, Sec. 115a(1), supra, states: 'The office [of children and youth services] shall: (f) Enter into contracts necessary for the performance of its powers and duties and the execution of its policies. The contracts may be with a state agency, a local public agency, or a private agency, organization, association, or person to enhance, provide, or improve the availability and quality of children and youth services and programs.' (Emphasis added) The Social Welfare Act, Sec. 117b provides, in pertinent part, as follows: 'The office [of children and youth services] may: (b) Enter into agreements with the federal government, state, county, or municipal departments, or private foundations or trusts for the receipt of funds for purposes consistent with the powers and duties of the office, including subcontracts with the office of criminal justice programs to develop the state plan required by Public Law 93-415. (c) Contract with state, county, or other public agencies or private corporations to provide training programs for service personnel or to provide services to children and youth.' (Emphasis added) The contracting authority statutorily granted to the Office appears to involve subject matter areas that the Social Welfare Act, Sec. 114(1), supra, indicates are the functional responsibility of the Department including the conducting, administering and the purchase of services for children and youths, all of which may involve the exercise of contractual authority. It is clear that the authority to enter into agreements conferred by the Social Welfare Act, Secs. 115a(1)(f), 117b(b) and (c), supra, comprises additional express statutory power in the Department which is to be exercised in the name of the Office of Children and Youth Services. This interpretation is reinforced by a review of the statutory authority conferred on the Executive Director of the Office of Children and Youth Services in the Social Welfare Act, Sec. 114(2), supra, which provides as follows: 'The director of social services, after consultation with the governor, shall appoint an executive director of the office. The executive director shall be accountable directly to the director of social services. The executive director shall not be within the classified civil service and shall receive compensation as established by the legislature. The executive director shall: (a) Represent the department in all matters and hearings pertaining to children and youth services and programs. (b) Serve as a special advisor to the governor on children and youth services budgets and programs. (c) Advise the director of social services with respect to children and youth services and programs conducted, administered, or purchased by the department under the authority of sections 114 to 123 and make recommendations to the director for the improvement of those services and programs. (d) Recommend to the governor and the legislature methods of improving the effectiveness of public and private children and youth services and programs. '(e) Recommend to the governor and the legislature appropriate allocations of public funds for children and youth services and programs.' (Emphasis added) Clearly, it is the Director of Social Services who exercises the ultimate authority to approve or disapprove any actions of the Executive Director of the Office of Children and Youth Services, including the negotiation of agreements. The Executive Director merely advises the Director of Social Services and makes recommendations regarding the Department's securing or providing of children and youth services, while the actual decision-making authority remains with the Director of Social Services. The aforesaid statute, however, authorizes the Director of Social Services to empower the Executive Director to execute contracts approved by the Director of Social Services. In conclusion, it is my opinion that only the Director of Social Services may execute contracts binding upon the Department (1) except when the Director is absent or ill and replaced by a Deputy Director who is exercising the functions of the Director in his absence. Further, the Executive Director of the Office of Children and Youth Services, when exercising his statutory functions, is subject to the supervisory authority of the Director of Social Services. The Executive Director of the Office of Children and Youth Services may, however, execute the agreements provided by the Social Welfare Act, Secs. 115(a)(1)(f), 117b(b) and (c), supra, when authorized by the Director of Social Services. Frank J. Kelley Attorney General (1)