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Gessler v. Smith

Supreme Court of Colorado, En Banc

June 4, 2018

Scott Gessler, individually and in his official capacity as Colorado Secretary of State, Petitioner
v.
Matt Smith, April Jones, William Leone, Gary Reiff, and Jo Ann Sorensen, in their official capacities as members of the Independent Ethics Commission, and the Independent Ethics Commission. Respondents

          Certiorari to the Colorado Court of Appeals Court of Appeals Case No. 14CA670.

          Attorneys for Petitioner: MRD Law Michael Francisco, Special Assistant Attorney General Denver, Colorado.

          Attorneys for Respondents: Cynthia H. Coffman, Attorney General Russell B. Klein, Deputy Attorney General Natalie L. Powell, Assistant Attorney general Denver, Colorado.

          Attorney for Amicus Curiae Colorado counties, Inc. Hall and Evans, L.L.C. Thomas J. Lyons Kelley G. Shirk Denver, Colorado.

          Attorney for Amicus Colorado Municipal League: Geoffrey T. Wilson Denver, Colorado.

          Attorney for Amicus Curiae Colorado Ethics Watch: Luis Toro Denver, Colorado.

          OPINION

          MÁRQUEZ JUSTICE.

¶1 Under section 24-9-105(1), C.R.S. (2017), each of Colorado's five statewide elected officials, including the Secretary of State, has access to a modest annual discretionary fund to spend "in pursuance of official business." In August 2012, then-Secretary of State Scott Gessler ("the Secretary") used $1, 278.90 from this discretionary fund to travel to Florida to attend an election law seminar hosted by the Republican National Lawyers Association and thereafter attend the Republican National Convention. Before his trip to Florida, the Secretary also requested "any remaining funds" in his discretionary fund account as reimbursement, without submitting documentation of mileage or other expenses incurred. Colorado Ethics Watch filed a complaint about these activities with the state's Independent Ethics Commission ("the IEC"), which has authority to address complaints on "ethics issues arising under [article XXIX of the Colorado Constitution] and under any other standards of conduct and reporting requirements as provided by law." Colo. Const. art. XXIX, § 5(1).

         ¶2 Following an investigation and evidentiary hearing, the IEC determined that the Secretary breached the public trust by using his discretionary funds for partisan and personal purposes. It ordered the Secretary to personally pay a penalty of $1, 514.88.

         ¶3 The Secretary sought judicial review of the IEC's ruling, arguing that the IEC lacked jurisdiction over the case and violated his procedural due process rights. Both the district court and the court of appeals affirmed the IEC's ruling. We granted the Secretary's petition for certiorari review. [1]

         ¶4 The Secretary argues that the IEC's jurisdiction is limited to matters involving gifts, influence peddling, and standards of conduct and reporting requirements that expressly delegate enforcement to the IEC. We disagree.

         ¶5 The IEC was created in 2006 by Amendment 41, a voter initiative that added article XXIX ("Ethics in Government") to the Colorado Constitution. The overarching focus of article XXIX is the regulation of activities that allow covered individuals working in government, including elected officials, to gain improper personal financial benefit through their public employment. Given this focus, we hold that the reference in article XXIX, section 5 to the IEC's authority to hear complaints under "any other standards of conduct . . . as provided by law" means ethical standards of conduct relating to activities that could allow covered individuals to improperly benefit financially from their public employment. We further hold that section 24-18-103, C.R.S. (2017), which appears in part 1 ("Code of Ethics") of article 18 ("Standards of Conduct") establishes an ethical standard of conduct subject to the IEC's jurisdiction. This provision establishes that the holding of public office or employment is a public trust, and that a public official "shall carry out his duties for the benefit of the people of the state." § 24-18-103(1). Because the allegations against the Secretary clearly implicated this standard, we hold that the complaint here fell within the IEC's jurisdiction. Further, because we conclude that the IEC's jurisdiction over this case was proper and that the allegations against the Secretary were within the scope of the IEC's jurisdiction, we reject the Secretary's jurisdictional challenge, as well as his vagueness challenge. Finally, we reject the Secretary's procedural due process claim because he failed to demonstrate that he suffered any prejudice as a result of the allegedly deficient notice. Accordingly, we affirm the judgment of the court of appeals.

         I. Facts and Procedural History

         ¶6 In August 2012, the Secretary flew to Tampa, Florida to attend and speak at the "National Election Law Seminar, " a two-day continuing legal education conference sponsored by the Republican National Lawyers Association ("the RNLA"). From August 23 through August 25, the Secretary stayed at a hotel in Sarasota, where the RNLA conference was held. On August 26, the Secretary traveled to Tampa, Florida, to attend the Republican National Convention ("the RNC"). The total cost of the Secretary's airfare to Florida and his lodging from August 23 through August 25 in Sarasota was $1, 278.90. The Secretary paid this amount out of his discretionary fund established by section 24-9-105, C.R.S. (2017). The Secretary paid for his lodging and meal expenses associated with his attendance of the RNC from his campaign funds.

         ¶7 In July 2012, before traveling to Florida, the Secretary requested reimbursement of "any remaining discretionary funds" in his discretionary fund account but did not provide any receipts or documentation supporting this request at the time. The Secretary received $117.99 as a result of this request.

         ¶8 Colorado Ethics Watch filed a complaint against the Secretary with the IEC, alleging that he had misappropriated state funds for personal or political uses and made false statements on travel expense reimbursement requests. Colorado Ethics Watch's complaint, which effectively consisted of a letter it had sent to the chief of police and the district attorney, [2] claimed that the Secretary's conduct may have violated certain provisions of the Colorado Criminal Code, including section 18-8-404, C.R.S. (2017) (first degree official misconduct); section 18-8-407, C.R.S. (2017) (embezzlement of public property); and section 18-8-114, C.R.S. (2017) (abuse of public records). The complaint argued that the fact that some payments for the Secretary's Florida trip apparently came from his statutory discretionary fund "d[id] not alter the analysis, " because those funds may be spent only in pursuance of official business, and the Florida trip was "manifestly personal and political." The IEC determined that the complaint was nonfrivolous and appointed an independent investigator.

         ¶9 Following the investigation, the IEC set a hearing on the complaint and issued a prehearing order that listed the "standards of conduct and/or reporting requirements" that "may apply to this case." The order made no reference to the criminal code provisions originally cited by Colorado Ethics Watch in its complaint. Instead, as relevant here, the order listed section 24-18-103, C.R.S. (2017), which states that the holding of public office is a "public trust, " and that "[a] public officer . . . shall carry out his [or her] duties for the benefit of the people of the state." In addition, the order listed section 24-9-105, which establishes discretionary funds for Colorado's five statewide elected officials[3] to use for "expenditure[s] in pursuance of official business as each elected official sees fit, " and also listed the state fiscal rules concerning travel.[4] The order noted that "the IEC reserves the right to consider additional standards of conduct and/or reporting requirements, depending on the evidence presented, and the arguments made, at the hearing in this matter."

         ¶10 At an evidentiary hearing, the IEC heard over eleven hours of testimony from eight witnesses and received over sixty exhibits. Documents submitted into evidence reflected that the RNLA's mission "includes support for Republican Party ideals, platforms and candidates"; that the seminar registration form required participants to state that they support the RNLA's mission; and that more than one of the topics at the conference "were concerned primarily with partisan values and/or politics." With respect to his attendance at the RNLA seminar, the Secretary claimed he incurred expenses "while meeting with constituents, county clerks, lobbyists, staff and legislators to discuss state business, " but could not recall specific meetings with county clerks, staff, or legislators. The Secretary also testified that he sought the "remaining discretionary funds" in the account essentially as a mileage reimbursement, but did not submit documentation because "to go through every single penny and mile and whatnot it just ended up being a waste of time." So, he accepted the remaining $117.99 in the fund, intending to treat it as additional taxable compensation.

         ¶11 In a written order, the IEC found that the Secretary's use of $1, 278.90 in funds from his discretionary account "to fly to Florida to attend the RNLA conference and thereafter attend the RNC" was primarily for partisan, and therefore personal, purposes. The Commission further found that the Secretary's acceptance of reimbursement of the $117.99 balance of his discretionary account, without documentation or detail of expenses incurred, was personal and not in pursuance of official business. The IEC concluded that the Secretary's actions "violated the ethical standard of conduct contained in C.R.S. section 24-9-105" by using funds from his discretionary account for other than official business. In so doing, the Secretary "breached the public trust for private gain in violation of C.R.S. section 24-18-103(1)" by using public funds for personal and political purposes. The IEC imposed a penalty of $1, 514.88.[5]

         ¶12 The Secretary sought judicial review of the IEC's order, asserting that the IEC exceeded its jurisdiction; that its findings of fact were arbitrary and capricious; and that it violated the Secretary's rights to due process, free speech, and assembly. The district court rejected these arguments, and affirmed the IEC's decision in a detailed written order.

         ¶13 The Secretary appealed the district court's decision to the court of appeals. Relevant here, the Secretary argued that the IEC lacked jurisdiction over this case because article XXIX, section 5 of the Colorado Constitution should be construed to limit the IEC's jurisdiction to matters involving gifts, influence peddling, and standards of conduct and reporting requirements that expressly delegate enforcement to the IEC. The Secretary further argued that these limitations must be read into section 5 to avoid unconstitutional vagueness and overbreadth. Finally, the Secretary argued that the IEC violated his procedural due process rights by failing to provide adequate notice of the claims against him.

         ¶14 In a unanimous, published opinion, the court of appeals affirmed the judgment of the district court. Gessler v. Grossman, 2015 COA 62. The court concluded that the plain language of article XXIX, section 5 "contains no requirement that the referenced standards of conduct and reporting requirements expressly delegate enforcement to the IEC." Id. at ¶ 16. The court further reasoned that, even assuming that section 5 requires specific standards of conduct, both section 24-18-103 (the public trust statute) and section 24-9-105 (the discretionary fund statute) prescribe such standards, and thus fall within the ambit of the IEC's jurisdiction. Id. at ¶¶ 18-31. Based on its interpretation of the scope of the IEC's jurisdiction, the court rejected the Secretary's vagueness and overbreadth challenges. Id. at ΒΆΒΆ 32-36. The court also concluded that the IEC did not violate the Secretary's procedural ...


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