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Don Gronberg, Sue Gronberg v. Teton County Housing Authority and Erving W. Mantey and Caryl S.

February 1, 2011

DON GRONBERG, SUE GRONBERG, JIM FARMER, WES FOX, RENELDA FOX, CHRISTY FOX, JENNY FOX, DENNIS CICHELLI, SUE CICHELLI, DEBORAH FOX, DON LANDIS, BEVERLY LANDIS, SCOTT AUSTIN, HOLLY AUSTIN, ROBIN MOYER, PETER MOYER, EMILY MOYER, DOUG HANSON, ANNA MARIE HANSON, BARBARA SELLAS, DEBORAH D. WARD, PAUL PERRY, PAM ROMSA, LOU BREITENBACH, KEN JERN AND SHERRIE JERN, S-10-0018 APPELLANTS (PLAINTIFFS),
v.
TETON COUNTY HOUSING AUTHORITY AND ERVING W. MANTEY AND CARYL S. MANTEY, APPELLEES
DEFENDANTS



Appeal from the District Court of Teton County The Honorable Nancy J. Guthrie, Judge

The opinion of the court was delivered by: Kautz, District Judge.

Before KITE, C.J., and HILL, VOIGT*, and BURKE, JJ., and KAUTZ, D.J.

*Chief Justice at time of oral argument.

NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of typographical or other formal errors so correction may be made before final publication in the permanent volume.

[¶1] Gronberg, et al., (Appellants) sued the Teton County Housing Authority (TCHA), claiming that TCHA violated Wyoming's Public Meetings Act, improperly purchased land for investment purposes and incurred debt in violation of the Wyoming Constitution and Wyoming Statutes. The district court dismissed some claims under W.R.C.P. 12(b)(6) and granted summary judgment in favor of TCHA on other claims. Appellants appeal those rulings. We affirm the district court on the Public Meetings Act and Wyoming Constitutional issues, but reverse on the Rule 12(b)(6) dismissals of claims for improperly purchasing the land and financing the purchase.

ISSUES

[¶2] Appellants present the following issues on appeal:

I. Could the Appellee Teton County Housing Authority (TCHA) ratify a real estate sale over 9 months after an illegal meeting occurred approving the transaction and over 4 months after the actual closing, where TCHA acknowledges that the only vote at the meeting was taken during a secret executive session resulting in a "null and void" approval?

II. After the real estate closing occurred, is TCHA, as a public Wyoming agency, entitled to keep secret an 8 page transcript and tape recording of the illegal meeting, where it improperly approved the expenditure of $2.1 Million in public funds for the real estate purchase?

III. Is TCHA entitled to pursue a "land banking" real estate investment program, not housing projects, where the applicable specific purpose excise tax (SPET) funding was approved by the voters for "affordable housing projects," and Wyoming Statutes limit the use of SPET funds to the purposes approved by the voters, and where Wyoming Statutes strictly limit investments by public agencies?

IV. Is TCHA, as a public Wyoming agency, entitled to mortgage its properties and to pledge future tax receipts?

V. Can the Appellants present these issues in a declaratory judgment action?

[¶3] TCHA chose not to submit its own list of issues.

FACTUAL BACKGROUND

[¶4] Appellants are landowners and/or residents of Teton County, Wyoming. TCHA is a housing authority established by the Teton County Commissioners pursuant to Wyo. Stat. Ann. §§ 15-10-101 through 117 (LexisNexis 2009), which gives counties and municipalities in Wyoming the authority to create "housing projects." Housing projects basically involve (1) planning, (2) cleaning up or removing substandard buildings, and

(3) providing or assisting in providing suitable houses to persons of low income. Wyo. Stat. Ann. § 15-10-101(a)(ii). A county or municipality may exercise its housing project powers directly, or it may establish a "housing authority" to act on behalf of the county or municipality. Wyo. Stat. Ann. § 15-10-115(a).

[¶5] Teton County chose to establish TCHA to act on its behalf in performing its housing project powers. In 2006, the voters in Teton County approved a sales tax, known as a Special Purpose Excise Tax, or SPET, to fund TCHA's "affordable housing project." Such a tax is authorized by Wyo. Stat. Ann. § 39-15-204(a)(iii) (LexisNexis 2009) which requires tax proceeds to be used "for specific purposes authorized by the qualified electors." The ballot for the tax stated that voters were deciding whether to fund

$5,000,000.00 for the Teton County Housing Authority's Affordable Housing Program (the "project"), which shall include the acquisition, planning, improvement and financing of properties as allowed by law and to be utilized for affordable housing, or the pledge and use to pay debt service and/or lease payment for such purpose . . .

[¶6] TCHA purchased real estate including the Mantey property. TCHA members recognized that the Mantey property might not be appropriate for an "affordable housing" project. Even so, the TCHA board thought the Mantey purchase would constitute good "land banking" and would be used either directly or indirectly for affordable housing.

TCHA borrowed $2 million of the purchase price for the Mantey property, planning to use future SPET receipts to pay that debt.

[¶7] Before purchasing the Mantey property, the TCHA board discussed the purchase in an executive session on March 1, 2007. It voted to purchase the property in that executive session, and the transaction closed on June 9, 2007. After learning that the vote to purchase the Mantey property should not have occurred in a closed executive session, TCHA voted to ratify the purchase on September 20, 2007. When questions developed about public notice for the September 20, 2007 meeting, TCHA voted to ratify the purchase again on November 15, 2007.

[¶8] Appellants sued TCHA and the Manteys, seeking declaratory relief. The district court dismissed some of Appellants' claims under W.R.C.P. 12(b)(6), finding that Appellants could not present any facts under those claims that would entitle them to relief. The district court granted summary judgment in favor of Appellees on the balance of the claims.

[¶9] Further facts are included below with the analysis for each issue.

STANDARD OF REVIEW

[¶10] The district court dismissed some claims under W.R.C.P. 12(b)(6). These dismissals relate to issues II and IV, listed above. When reviewing a W.R.C.P. 12(b)(6) dismissal, we focus on the allegations contained in the complaint and liberally construe those allegations in the light most favorable to the plaintiff. Cox v. City of Cheyenne, 2003 WY 146, ¶ 7, 79 P.3d 500, 505-506 (Wyo. 2003) (citation omitted). We will affirm an order of dismissal only when it is certain from the face of the complaint that the plaintiff cannot assert any facts which would entitle him to relief. Id. Dismissal under W.R.C.P. 12(b)(6) is warranted if, having assumed the allegations of the complaint are true and viewing the facts in the light most advantageous to the plaintiffs, the facts dictate judgment for the defendant as a matter of law. Cantrell v. Sweetwater County School District No. 2, 2006 WY 57, ¶ 4, 133 P.3d 983, 984 (Wyo. 2006). Dismissal is a drastic remedy and is sparingly granted; nevertheless, we will sustain a W.R.C.P. 12(b)(6) dismissal when it is certain from the facts of the complaint that the plaintiff cannot assert any set of facts that would entitled that plaintiff to relief. Robinson v. Pacificorp, 10 P.3d 1133, 1135-36 (Wyo. 2000).

[¶11] The district court entered summary judgment in favor of Appellees on claims that TCHA's land purchase was void because it violated Wyoming's Public Meetings Act, and that TCHA had no authority to purchase land as an investment. We review an order granting summary judgment de novo. Wyoming Med. Center, Inc. v. Wyoming Ins. Guar. Ass'n, 2010 WY 21, ¶ 11, 225 P.3d 1061, 1064 (Wyo. 2010).

[W]e have exactly the same duty as the district judge; and if there is a complete record before us, we have exactly the same material as did [the district judge]. We must follow the same standards. The propriety of granting a motion for summary judgment depends upon the correctness of a court's dual findings that there is no genuine issue as to any material fact and that the prevailing party is entitled to judgment as a matter of law. This court looks at the record from the viewpoint most favorable to the party opposing the motion, giving to him all favorable inferences to be drawn from the facts contained in affidavits, depositions and other proper material appearing in the record.

Id. (citation omitted). Summary judgment is appropriate in a declaratory judgment action so long as there are no genuine issues of material fact. Snake River Brewing Co., Inc. v. Town of Jackson, 2002 WY 11, ¶ 4, 39 P.3d 397, 402 (Wyo. 2002).

DISCUSSION

I. Can a public agency ratify or cure a violation of the Wyoming Public Meetings Act?

[¶12] We construe statutes according to the following standards:

The paramount consideration is to determine the legislature's intent, which must be ascertained initially and primarily from the words used in the statute. We look first to the plain and ordinary meaning of the words to determine if the statute is ambiguous. A statute is clear and unambiguous if its wording is such that reasonable persons are able to agree on its meaning with consistency and predictability. Conversely, a statute is ambiguous if it is found to be vague or uncertain and subject to ...


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