STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL

Opinion No. 6717

April 7, 1992

INCOMPATIBILITY:

INCOMPATIBILITY:

A person may not simultaneously serve as a member of the governing body of one unit of local government and as the attorney for a second unit of local government if the two units of government have entered into or are negotiating one or more contracts with one another.

City attorney and school board member

School board attorney and member of city council

Honorable Susan Grimes Munsell

State Representative

The Capitol

Lansing, Michigan

You have requested my opinion on a question that may be stated as follows:

According to the materials submitted with your letter, your request was prompted by a situation which has arisen in the Brighton area. Two individuals are involved, both of whom are practicing attorneys.

One individual is an elected member of the Brighton City Council. He is also a principal in a law firm which has been retained by the Brighton Area School District to serve as general counsel. As is evidenced by a review of the minutes of certain of the Board of Education's meetings during 1990 and 1991, he frequently attends meetings of the Board of Education, acting in the capacity of attorney to the Board.

The second individual presents what is essentially the mirror opposite of these circumstances, i.e., he serves as an elected member of the Board of Education of the Brighton Area School District and is simultaneously a partner in a law firm which has been retained by the City of Brighton to fulfill the functions of the office of city attorney. Based upon a review of the materials forwarded with your letter, including copies of the minutes of certain meetings of the City Council, it is not clear whether this individual personally attended City Council meetings acting as City Attorney; this specific function appears to have been fulfilled by other members of his firm. However, this individual was one of the two partners who actually signed the agreement with the City and, as one of the two named principals of the firm, receives direct compensation including health and dental insurance policies provided by the City.

The materials submitted with your request further indicate that, during the period in question here, the School District and the City have entered into at least one contract. That contract concerned the collection of property taxes by the City on behalf of the School District. In addition, the School District and the City have engaged in discussions or negotiations regarding several other potential contracts, including a proposed joint vehicle maintenance facility, the purchase by the School District of certain city real property, and the provision of water and sewer services to a school-owned property located just outside the City limits. Because of their dual roles as members of one of these bodies and attorneys for the other, both of the individuals described above have found it necessary to abstain from voting on such issues which involve competing interests of the City and of the School District.

MCL 15.182; MSA 15.1120(122), provides, with certain exceptions not applicable here, that "a public officer or public employee shall not hold 2 or more incompatible offices at the same time." The term " 'incompatible offices,' " as used in this provision, is defined by MCL 15.181(b); MSA 15.1120(121)(b), as follows:

It is clear that, in their respective capacities as an elected member of the School Board and of the City Council, each of the above described individuals qualifies as a "public officer" subject to the provisions of MCL 15.182; MSA 15.1120(122). See, e.g., OAG, 1983-1984, No 6248, p 389 (September 25, 1984) (school board member), and OAG, 1981-1982, No 6029, p 532 (January 20, 1982) (elected member of the governing body of a city).

The more difficult question is whether their respective positions in law firms under contract with public bodies likewise constitute "offices" subject to MCL 15.182; MSA 15.1120(122).

Chapter 4, section 4.6, of the Brighton City Charter explicitly describes the position of City Attorney as constituting one of the "administrative officers" of the City, and further provides that the incumbent of this office "shall be appointed by the Council." This provision rather strongly suggests that the City Attorney is a "public officer" within the meaning of MCL 15.182; MSA 15.1120(122). There is, moreover, precedent for treating the office of city attorney as a public office subject to the incompatibility provisions of MCL 15.182; MSA 15.1120(122). See, OAG, 1987-1988, No 6418, p 15 (January 13, 1987).

However, as is noted above, the City of Brighton did not appoint a specific individual to serve as City Attorney but instead entered into a contract or retainer with a law firm. The same appears to be true of the School District's contract for legal services. There is some authority for the proposition that a private attorney or law firm retained by a public body does not constitute a public officer. See, e.g., State ex rel Pickett v Truman, 333 Mo 1018; 64 SW2d 105 (1933). However, while a number of courts have concluded that a contract or retainer between a municipality and a private attorney or law firm does not create a "public office," those same cases have generally held that such a contract does create an employment relationship, at least for purposes of addressing questions regarding the compatibility of public offices. See, e.g., Petermann v Tepe, 87 Ohio App 487, 93 NE2d 328, 331 (1949). See also, Jackson v Cosby, 179 Md 671, 22 A2d 453, 455 (1941), and Loard v Como, 137 SW2d 880, 882 (Tex Civ App, 1940). This result, it may be noted, is consistent with the language of section 1253 of the School Code of 1976, MCL 380.1253; MSA 15.41253, which authorizes a school board to "employ an attorney to represent the school district or board in actions brought for or against the district and to render other legal service for the welfare of the school district." [ Emphasis added.]

It is well established that the term "incompatible offices" as used in MCL 15.182; MSA 15.1120(122), and as defined by MCL 15.181(b); MSA 15.1120(121)(b), applies not only to positions held by public officers but also those held by public employees. Wayne County Prosecutor v Kinney, 184 Mich App 681; 458 NW2d 674, lv den 436 Mich 887 (1990); OAG, 1979-1980, No 5626, p 537, 541 (January 16, 1980). Thus, irrespective of whether an attorney to a public body may be considered an "officer" or merely an "employee" of the public body, the incompatibility provisions remain applicable to that position.

We must now turn to the question of whether, under the facts described in your request, such incompatibility exists. As described in your letter, neither of the two combinations of public offices involve the subordination or supervision of one public office by another as defined in MCL 15.181(b)(i) and (ii); MSA 15.1120(121)(b)(i) and (ii). The issue, therefore, is whether the performance of the duties of the offices in question "results in ... [a] breach of duty of public office." MCL 15.181(b)(iii); MSA 15.1120(121)(b)(iii).

OAG, 1987-1988, No 6418, supra, addressed a substantially similar question. The issue in that opinion was whether a single individual could simultaneously serve as a city attorney and as an elected member of the county board of commissioners in the same county. In that case, unlike the circumstances presented by your request, there was no contract in existence nor under negotiation between the county and city, nor were there any pending legal matters between the two. The opinion concluded that:

Id, at 19.

However, the opinion also rather clearly indicated that the offices in question would become incompatible if contract negotiations or a legal dispute were to arise between the city and the county. That incompatibility, moreover, could not be "cured" or avoided by a decision on the part of the individual to abstain from participation in or voting upon the contract or dispute. Such an abstention would itself constitute a breach of duty:

Id.

Accord, Contesti v Attorney General, 164 MichApp 271, 281; 416 NW2d 410 (1987), lv den 430 Mich 893 (1988); Wayne County Prosecutor v Kinney, supra, 184 MichApp at 684. Nor is it significant that the officer in question is removed from direct participation in or supervision of the conflicting activity. As the Court of Appeals observed in Wayne County Prosecutor v Kinney, 184 MichApp at 685:

Based upon the information provided with your letter, it appears that, during the tenure of the two individuals here in question, the City of Brighton and the Brighton Area School District have entered into at least one contract and have engaged in discussions or negotiations regarding other possible contracts or agreements. As a member of one of these bodies and attorney for the other, each of these individuals was plainly positioned on opposite sides of that contractual relationship. Wayne County Prosecutor v Kinney, supra. It further appears that, in a good faith effort to avoid any potential conflict or impropriety, both of these individuals have found it necessary or appropriate to abstain from voting on at least some matters which have involved the interests of both the City and the School District. Under these circumstances, the two sets of offices described in your letter are clearly incompatible.

In response to your question, therefore, it is my opinion that a person may not simultaneously serve as a member of the governing body of one unit of local government and as the attorney for a second unit of local government if the two units of government have entered into or are negotiating one or more contracts with one another.

Pursuant to its constitutional authority to regulate the practice of law within this state, the Michigan Supreme Court has adopted the Michigan Rules of Professional Conduct. Those rules prescribe the minimum ethical standards that must be observed by Michigan attorneys and include prohibitions against certain types of conflict of interest. See, e.g., MRPC 1.7 through 1.10. See also, MRPC 1.11. The question of whether and to what extent those canons may apply to the facts described in your request is a matter that falls within the sole prerogative of the Attorney Discipline Board of the Michigan State Bar, acting upon the authority and under the supervision of the Supreme Court. Accordingly, that question is not addressed by this opinion.

Frank J. Kelley

Attorney General