4.a 4 Quasi Judicial 2012 city attorneyQuasi -Judicial Hearings:
What Do You Tell Decision Makers?
Peter W. Ginder
Minneapolis City Attorney's Office
Room 210, City Hall
350 South Fifth Street
Minneapolis, MN 55415
(612) 673-2478
Peter.Ginder@minneapolismn.gov
2012 Minnesota City Attorneys
Educational Conference
February 10-11, 2012
Bloomington, Minnesota
I. CONTINENTAL PROPERTY GROUP, INC. v CITY OF
MINNEAPOLIS, 2011 WL 1642510 (MINN. APP. 2011).
The Court of Appeals reversed the District Court's fmding that there had
been a constitutional due process violation "because CPG did not have a protected
property interest in its CUP and variance applications."
However, the Court of Appeals held that the decision of the City
Council to deny the permits was arbitrary and capricious under Minn.
Stat. § 462.361, subd. 1.
The Court recognized that "arbitrary and capricious" has different
meanings under Minn. Stat. § 462.361, subd. 1 and substantive due
process under the federal constitution.
Generally a decision to deny a CUP application is arbitrary if the
applications meets the standard specified by the zoning ordinance ...
but a decision is also arbitrary and capricious if the decision maker
"relied on factors it is not permitted or intended to consider."
• The city council's decisions to deny the CUPS and variances had some
basis in the record including evidence that CPG's proposal was
inconsistent with the scale and character of the neighborhood and
might block the use of landmarks, open spaces or bodies of waters
which were sufficient bases to deny the CUPs, and CPG made no
showing whatsoever of the "undue hardship" necessary to support a
variance under Minn. Stat. § 462.357 and Krummenacher.
+ However, the city council decision was arbitrary and capricious under
Minn. Stat. § 462.361, subd. 1 when:
(1) Council Member took a position in opposition and exhibited a
closed mind with regard to the proposed project prior to the
hearing;
(2) Adopted an advocacy role in opposition to the proposed project
well before she discharged her quasi-judicial duties;
(3) Was clearly involved in an effort not only to assist, organize
and mobilize neighbored opposition but also to sway the
opinions of her fellow Council Members; and,
(4) The fact that the opinion of the Council Member in whose ward
the project is proposed gives the substantial weight by other
members of the council.
According to the Court, these findings all establish that the city
council relied on factors it was not intended or permitted to consider
in denying CPG's applications.
Noting that the city council's decision would not necessarily have
been arbitrary and capricious had the council followed the correct
standards and procedures — namely had it not allowed the biased
council member to participate in decision, the Court remanded the
matter to the Minneapolis City Council for a new hearing and
decision.
II. ELEMENTS OF QUASI-JUDICIAL HEARINGS.
• The three indicia which are used to distinguish between quasi-judicial
and quasi legislative proceedings are:
(1) Investigation into a disputed claim and weighing of evidentiary
facts;
(2) Application of those facts to a prescribed standard; and,
(3) A binding decision regarding the disputed claim.
Minnesota Center for Environmental Advocacy v. Metropolitan Council, 587
N.W.2d 838 (Minn. 1999); Meath v. Harmful Substance Compensation
Board, 550 N.W.2d 275 (Minn. 1996); Handicraft Block Ltd. Partnership v.
City of Minneapolis, 611 N.W.2d 16 (Minn. 2000).
o Under the first factor quasi-judicial proceedings involve
"determining facts for the purpose of reaching a legal
conclusion in resolution of adversarial claims."
Handicraft, 611 N.W.2d at 20. The first factor may
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require a formally identified party to the proceeding. Id.
at 21.
o Under the second indicia, the standards to be evaluated
must be both specific and prescribed, especially when
applied to a specific property. Id. at 22-23.
In addition to variances and conditional use permits, other council
actions will be considered quasi-judicial, e.g., nuisance demolitions,
license revocations such as rental license or business licenses,
administrative citation hearings, and the historic preservation
designation of a building (landmark) or district. Handicraft, 611
N. W.2d at 24.
o Remains the responsibility of the local governmental unit to
recognize whether a matter is quasi-judicial in nature and to
conduct its proceedings in an appropriate quasi-judicial fashion.
o Unless otherwise provided by statute or appellate rule, a party
must petition for writ of certiorari to obtain review of a
municipal, quasi-judicial decision. Micius v. St. Paul City
Council, 524 N.w.2d 521, 522 (Minn. Ct. App. 1994). The
Municipal Planning Act in Minn. Stat. § 462.36 provides for
district court review of municipal zoning decisions including
quasi-judicial decisions.
III. DUE PROCESS REQUIREMENTS.
91 At its most basic, procedural due process "imposes constraints on
governmental decisions" and requires that a government provide
procedural safeguards in its actions to ensure. to the extent
practicable, that erroneous deprivations of liberty or property are
prevented. Matthews v. Eldridge, 424 U.S. 319 (1976).
The threshold requirement of any due process claim is that the
government has deprived a person of a constitutional protected liberty
or property interest. If this requirement is met, procedural due process
guarantees reasonable notice and a meaningful opportunity to be
heard. Procedural due process is flexible and calls for such procedural
protections as the particular situation demands. In the matter of the
4
IV
Rental Dwelling License Held by Mahmood Khan 804 N.W.2d 132,
137 (Minn. App. 2011) internal citations and quotation marks omitted;
Morissey v. Brewer, 408 U.S. 471 (1972).
The Supreme Court has repeatedly stated that "due process" unlike
some legal rules, is not a technical conception with fixed content
unrelated to time, place and circumstances." Matthews, 424 U.S. at
334.
To determine what procedural elements may be required to provide
adequate due process of protection, a balancing of three factors is
considered: (1) the private interest affected by the proceedings; (2)
the risk of an erroneous deprivation of the private interest through
available procedures and the probable added value providing further
safeguards; and, (3) the government's interests, including the
governmental function involved, and the fiscal and administrative
burdens reasonable expected from any added procedural requirements.
Matthews, 424 U.S. at 335. See also, Barton Contracting, Inc. v. City
of Afton, 268 N.W.2d 712, 715 (Minn. 1978) (requirements of due
process must be measured according to the nature of the government
interest involved and whether or not private interests are directly
affected by the governmental action).
FOUR ELEMENTS FOR EVERY QUASI-JUDICIAL HEARING.
Notice
The sufficiency of the notice is determined by the circumstances of
the particular hearing but it must reasonably convey the information
which reasonably informs persons of the substance of the hearing.
Mullane v. Central Hanover Bank and Trust Company, 339 U.S. 306,
314 (1950).
Opportunity to be heard
The opportunity does not have to be in a trial like proceeding or a full
evidentiary hearing but affected persons must be able to present their
case. Matthews, 424 U.S, at 348-349. Cross examination isnot an
essential of procedural due process in land -use hearings. Barton
Contracting Inc., 268 N.W.2d at 714.
A record
The outcome of the hearing must be based upon the evidence
presented at the hearing. No violation where allegation that writing
material was not received in sufficient time prior to the hearing where
applicant failed to show in a particularized way how it was prejudiced
and where the materials were largely just letters expressing the
opinions of private individuals opposed to the project. Id. at 716.
An impartial decision maker
"That officers acting in a judicial or quasi-judicial capacity are
disqualified by their interest in the controversy to be decided is of
course a general rule. Nice questions, however, often arise as to what
the degree or nature of the interest must be." Tumey v. Ohio, 273 U.S.
510, 522 (1927) cited in Kahn, 804 N.W.2d at 137. Parties to
administrative proceeding are entitled to a decision by an unbiased
decision maker. Buchwald v. University of Minnesota, 573 N.W.2d
723, 727 (Minn. App. 1998).
V. QUASI-JUDICIAL CONDUCT.
Bias
Quasi-judicial proceedings shall always be conducted in a fair and
impartial manner without favor toward any position or party. Obvious
push back regarding political concerns or preferences of the public.
The test for determining whether a decision maker is unbiased is
whether the decision maker's situation could tempt "the average man"
as a judge to forget the burden of proof required to rule against an
alleged violator. Kahn, 804 N.W.2d at 137 (Kahn failed to show that
a three year contract with the City to provide hearing officer services
would tempt an average judge to forget burden of proof and rule in
favor of city).
Pre -judgment
The quasi-judicial officer must refrain from prejudging the issues,
even though almost assuredly, some constituents will demand to know
an officials position on the issues before the hearing has been
concluded. Public official acting in a quasi-judicial capacity must be
cautious about making any statements that would give the appearance
of pre -judging the issue.
Vue v. City of St. Paul, 2010 WL 1439291 (Minn. App. April
13, 2010). Challenge to city's quasi-judicial, nuisance
abatement decision to demolish vacant building owned by
plaintiff. The Court of Appeals examined a video recording of
the hearing and determined that the city's decision was arbitrary
and capricious based on observed conduct. Specifically, the
Court determined:
A video recording of the city -council meeting
shows that relator distributed to the council
members a packet of information documenting his
progress on the building. It appears from the video
recording that the city council could not have
considered the contents of the packet before
passing its resolution because at every point during
the approximately 13 minutes between the packet's
distribution and the city council's vote, either a
relator or a council member was speaking.
Undue influence
Undue influences can be exerted by media, special interest groups or
family and friends.
Conflicts of interest
Minnesota law disqualifies public officials from participating in
decisions when they have a direct interest in the outcome. Lenz v.
Coon Creek Watershed District, 153 N.W.2d 209, 219 (Minn. 1967).
Among the relevant factors that should be considered in making this
determination are: (1) The nature of the decision being made; (2) the
nature of the pecuniary interest; (3) the number of officials making the
decision who are interested; (4) the need, if any, to have interested
persons make the decision; and (5) the other means available, if any,
such as the opportunity for review, that serve to insure that the
officials will not act arbitrarily to further their selfish interests. If a
disqualified official participates, the party can challenge the decision
directly. See State by Friends of the Riverfront v. City of
Minneapolis, 751 N.W.2d 586, 591 (Minn. App. 2008) (City council
itself was not impermissibly biased because hearing procedures
provided adequate protection against conflicts of interest even though
council president sat on affected private school board of trustees).
In Nevada Commission on Ethics v. Carrigan, 131 S.Ct. 23, 43
(2011), the Supreme Court upheld Nevada's Ethics in
Government Law which requires public officials to recuse
themselves from voting on, or advocating the passage or failure
of, "a matter with respect to which the independence of
judgment of a reasonable person in his situation would be
materially affected by" inter alia, "[h]is commitment in a
private capacity to the interests of others." Carrigan, was
found by the Nevada commission to have a disqualifying
conflict of interest and he was censured for voting to approve
an application for hotel/casino project. The Supreme Court
reversed the Nevada Supreme Court which had found that a
legislator's vote was protected speech because voting was
deemed to be a "core legislative function." The Supreme Court
held that the challenged law, which not only prohibited the
legislator with the conflict from voting on the proposal in
question, but also forbade him to advocate the passage or
failure of the proposition did not violate the First Amendment.
In part, the court recognized that a "universal and long-
established tradition or prohibiting certain conduct creates a
strong presumption that the prohibition is constitutional." The
Court recognized that there was a two hundred year history of
the federal government applying conflict-of-interest recusal
rules. The Court further recognized that virtually every state
today has some type of recusal law requiring public officials to
abstain on voting on all matters presenting a conflict of interest.
In response to the question that restrictions upon
legislators' voting are not restriction upon legislators'
protected speech, the Court stated:
The answer is that a legislator's vote is the
commitment of his apportioned share of the
legislature's power to the passage or defeat
of a particular proposal. The legislative
power thus committed is not personal to the
legislator but belongs to the people; the
legislator has no personal right to it.
Id. at 2350.
In Justice Kennedy's concurring opinion, he expressed
some concern over the holding and also noted that there
may be differences between judicial conflicts of interest
and legislative conflicts of interest:
The Court has held that due process may
require recusal in the context of certain
judicial determinations ... [however] it is
not at all clear that a statute of this breadth
can be enacted to extend principles of
judicial impartiality to a quite different
context. The differences between the role of
political bodies in formulating and enforcing
public policy, on the one hand, and the role
of courts in adjudicating individual disputes
according to law, on the other ... may call
for a different understanding of the
responsibilities attendant upon holders of
those respective offices and of the legitimate
restrictions that may be imposed upon them.
Id. at 2353.
Ex parte communications
Communication between a quasi-judicial hearing officer and a person
with interest in the proceedings, conducted outside the formal hearing
process, are considered "ex parte" and may be improper if they relate
to the substance or merits of the issues involved in the hearing. This
is extremely common in local government and ex parte contacts are
becoming easier than ever due to the use of technology like text
messaging and emails. To the extent possible a local government
official acting in a quasi-judicial capacity should avoid ex parte
communications. If they do occur, those communications should be
disclosed for the record with the assurance expressed by the decision -
maker that their decision is based only the "evidence", presented
through the formal hearing process.
Hard Times Cafe Inc. v. City of Minneapolis, 625 N.W.2d 165
(Minn. App. 2001). The City of Minneapolis held a hearing to
deny the Hard Times Cafe's application to renew its food
license. Pursuant to the City's new License Adverse Action
Procedures Manual ("Manual"), the City determined that the
hearing was going to be held pursuant to the Minnesota
Administrative Procedure Act. After the hearing, the ALJ
issued findings of fact, conclusions of law and memorandum
but elected not to make a recommendation regarding any
specific disciplinary action against the Caf6 by the City
Council.
At the Public Safety and Regulatory Services Committee, the
Assistant City Attorney sent a letter to the Chair containing
excerpts from the Manual which, in part, instructed the
Committee to avoid ex parte contacts, based its decisions solely
on the record and not make its final decision until after the
hearing.
Subsequently, the matter went to the full City Council which
delayed it for a council cycle. During the delay a caucus of the
council got together, discussed the matter, received additional
information from staff, and other information outside the
record. At the second meeting of the full city council, one of
the council members asked the City Attorney what information
the council could appropriately consider in making its licensing
decision and was advised that they could consider only the
report of the ALI, any written exceptions that were filed, the
testimony in front of the Committee and the arguments before
the committee and any exhibits and documents that were
submitted during the hearing process. The city council denied
the license.
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o On appeal, the Court found that the city council violated both
the procedures set forward in the Manual as well as explicit
instructions of the City Attorney. Further evidence included
that there had been email correspondence between the council
members that suggested that some council members had made
up their minds before the license revocation process was
completed and that that information was not presented to the
ALL The Court of Appeals held that it was impossible to
untangle the improper influences from the City's final decision
and to determine whether the evidence in the record supported
the council decision. Therefore, the matter was transferred to
District Court to investigate the alleged irregularities in the
procedures.
Considerations outside the record
Local government officials frequently have access to information
outside the record whether its site visits, public documents or
information received from well-intentioned citizens. The official
should either refrain from considering such information or
alternatively take action to ensure that the information is included
properly in the record in a timely manner so that the parties and public
can fairly be apprised of it and have an opportunity to respond or
address it.
o Matter of Minnesota Public Utilities Commission's Initiation of
Summary Investigation, 417 N.W.2d 274 (Minn. App. 1987).
The Court vacated a rate order based upon a theory of a fraud
on the commission based upon certain commission members'
ex parte contacts with the phone companies (numerous
meetings and phone company bought meals for
commissioners). The Minnesota court cited Patco v. Federal
Labor Relations Authority, 685 F.2d 547, 564 (D.C. Cir. 1982)
for the proposition that improper ex parte communications do
not automatically render agency proceedings void, but voidable.
The Patco Court set forth the following standards to
determining whether an agencies decision should be vacated:
A court must consider whether, as a result of
improper ex parte communications, the agency's
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decision making process was irrevocably tainted so
as to the make the ultimate judgment of the agency
unfair, either to an innocent party or to the public
interest that the agency was obliged to protect. In
making this determination a number of
considerations may be relevant: the gravity of the
ex parte communications; whether the contact may
have influenced the agency's ultimate decision;
whether the party making the improper contact
benefited from the agency's ultimate decision;
whether the contents of the communications were
unknown to opposing parties, who therefore had
no opportunity to respond and whether vacation of
the agency's decision and remand for new
proceedings would serve a useful purpose.
Patco, 685 F.2d at 564-65
Ex parte contacts between a party and a decision maker
can be grounds for reversal. See Meinzer v. Buhl, 66 C &
B Warehouse District, Inc., 584 N.W.2d 5, 6 (Minn. App.
1989). In Meinzer a re-employment judge and the
employer laughed while discussing pieces of evidence
after the relator had left the room. Relator later heard the
exchange in a tape of the proceedings which caused the
court to reverse the agency's determination, finding that
the procedure violation constituted reversible error.
o However, ex parte communications that were confined to
procedural aspects of the case rather than to the substance
of the evidence or the law were not improper and did not
provide a basis to reverse a board's decision. In the
Matter of the Chiropractic License of Judy C. Thompson,
D. C., 2004 WL 2093728 (Minn. App. 2004).
Non -record information is violative only if it is truly different
from the information in the record and is prejudicial to the
applicants. Courts will reject complaints of procedural
irregularities or suppose ex parte contacts were cumulative of or
similar to on -the -record information or the applicant fails to
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show how it was prejudiced. See Barton Contracting, 268
N.W.2d at 716 (even if council members relied on non -record
information there was no violation because similar information
was introduced on the record and plaintiff showed no particular
prejudice); Houston County v. Solum, 2008 WL 422493, *4
(Minn. App. 2008) (no violation where plaintiff failed to show
how he was prejudiced by consideration of information outside
the record); Amina, Inc. v. City of Minneapolis, 2008 WL
223250 at *4-5 (Minn. App. 2008) (limitations on duplicative
information do not violate due process and procedural
deficiency did not warrant remand where intent of the council
was otherwise clear).
V. QUASI-JUDICIAL IMMUNITY
Under Minnesota law, a city council member sued in his or her
individual capacity is absolutely immune from liability for quasi-
judicial acts. DePalma v. Rosen, 199 N.W.2d 517, 519-520
(Minn. 1972). See also Haefele v. City of Eden Prairie, 2000 WL
1869574 at *3 (Minn. Ct. App. Dec. 26, 2000) (finding quasi-
judicial immunity applied to city council members in land -use
matter because 'city council members are immune from civil
liability for acts properly characterized as quasi-judicial and
discretionary").
The Eighth Circuit is consistent, and has identified six factors
supporting absolute quasi-judicial immunity: (a) the need to assure
that the individual can perform his or her functions without
harassment or intimidation; (b) the presence of safeguards that
reduce the need for private damages actions as a means of
controlling unconstitutional conduct; (c) insulation from political
influence; (d) the importance of precedent; and (e) the adversary
nature of the process; and (f) the correctability of the error on appeal.
Brown v. Griesenauer, 970 F.2d 431, 437-39 (8th Cir. 1992)
(quoting Cleavinger v. Saxner, 474 U.S. 193, 202 (1985)). See also
Dotzel v. Ashbridge, 438 F.3d 320, 325 (3d Cir. 2006) (applying
same six factors and finding town board of supervisors individually
immune under doctrine of quasi-judicial immunity).
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Where the proceedings could be "controversial or political" it is in the
public interest that decision -makers feel free to exercise their
judgment "without fear of burdensome litigation and potentially
ruinous personal liability for damages." Brown, 970 F.2d at 438.
Indeed "zoning disputes can be among the most fractious issues
faced by municipalities, and the risk of threats and harassment is
great." Dotzel, 438 F.3d at 325 (citing Bass v. Attardi, 868 F.2d 45
(3d Cir. 1989), for proposition that public interest requires officials
deciding development applications be able to act with independence
and without fear, because developers will "frequently have significant
financial resources and the ability to litigate").
Where safeguards include allowing for such things as notice and a
hearing, recorded proceedings, written findings and conclusions, and
availability of judicial review, the procedural safeguards should be.
deemed sufficient. Brown, 970 F.2d at 438. See also Dotzel, 438
F.3d at 326 (listing similar procedural safeguards).
"The insulation -from -political -influence factor does not refer to the
independence of the government official from the political or
electoral process, but instead to the independence of the government
official as a decision -maker." Id. If the official is not subject to
removal, except for cause and upon due process, he or she is
deemed adequately insulated from political pressure. Dotzel, 438
F.3d at 326 (citing restrictions on removal of elected officials).
Precedent is deemed important -where decisions are subject to certain
legal standards on judicial review. Brown, 970 F.2d at 438
(describing "for cause" standard on judicial review of impeachment
proceedings). See also Dotzel, '438 F.3d at 326-27 (finding that
municipality's land -use determinations are "constrained by outside
law" and must follow standards in state statute and its own
ordinances). A municipality's decisions are constrained by the land
use statutes set forth at Minn. Stat. §§462.351 et seq. Similarly,
land -use decisions must be supported by a reasonable basis. See,
e.g., Mendota Golf, LLP v. City of Mendota Heights, 708 N.W.2d
162, 178-180 (Minn. 2006).
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Requiring notice of hearings to interested parties and the taking of
evidence are hallmarks of adversarial proceedings. Dotzel, 438
F.3d at 327.
An applicant's ability to seek review in state court is a "court -like
feature." Dotzel, 438 F.3d at 327 (noting that issuance of written
decisions and preparation of transcripts "exist largely to facilitate
appellate review"). Similar features exist here since municipal land -
use decisions are correctable through the judicial review
mechanism set forth in Minn. Stat. §462.361. A transcript of the
proceedings, staff reports and written record of the decision (as
existed here (See Myers Af. . Exs. 2, 3, 4, 5)), are crucial in facilitating
judicial review of municipal land -use decisions. Swanson v. City of
Bloomington, 421 N.W.2d 307, 313 (Minn. 1988) (holding courts
should review municipal land -use decisions on the record, which is
adequately clear and complete where it consists of a) verbal
transcripts of the public hearings, including statements by experts on
each side b) written reports by the city staff, and c) written
findings by the city council on which it based its decision)).
Accordingly, courts find that local elected officials sued in their
personal capacities (or their equivalents) enjoy absolute quasi-
judicial immunity for decisions they make regarding particular land -
use applications, See Dotzel, 438 F.3d at 325-27 (applying same six
factors to ton board members sued in personal capacity); Diva's Inc.
v. City of Bangor, 411 F.3d 30,41 (1st Cir. 2005) (finding individual
council members protected by quasi-judicial immunity in decision on
amusement permit because 1) hearing involved testimony, questions,
discussion and written decision; 2) act of denying a permit can be
controversial and prompt litigation that might deter people from
serving as council members; and 3) procedural safeguards included
written explanation and statutory recourse in state court); Akins v.
Deptford Twp., 813 F. Supp. 1098, 1102-03 (N.N.W. 1993) (finding
individual members of county construction board of appeals entitled
to absolute quasi-judicial immunity); B Street Commons v. Board of
Cnry Commis, 835 F. Supp. 1266, 1270-71 (D. Colo. 1993) (finding
individual commissioners absolutely immune from quasi judicial acts
in reviewing use permit applications).
is