Title: KROENLEIN v. EDDINGTON

State: wyoming

Issuer: Wyoming Supreme Court

Document:

KROENLEIN v. EDDINGTON2001 WY 11535 P.3d 1207Case Number: 00-134Decided: 12/05/2001

OCTOBER TERM, A.D. 2001

 

                                                                                                            

 

ROBERT 
L. KROENLEIN and BETTY                   

KROENLEIN,

 Appellants(Plaintiffs),

 

v.

 

JAMES 
A. EDDINGTON; RONALD D.

HILL; 
TONY L. MARLATT; 77 CAPITAL

CORP., 
a Wyoming corporation; and

THE 
TOWN COUNCIL OF THE TOWN OF

TORRINGTON, 
WYOMING

Appellees(Defendants).

 

 

Appeal 
from the District Court of Goshen County

The 
Honorable Nancy J. Guthrie, Judge 

 

Representing 
Appellants:

            
Eric M. Alden, Wheatland, Wyoming.

Representing 
Appellees James A. Eddington, Ronald D. Hill, Tony L. Marlatt, and 77 Capital 
Corp.:

            
Donald J. Keenan of Keenan Law Office, Riverton, 
Wyoming.

Representing 
Appellees The Town Council of the Town of Torrington, Wyoming, and James A. 
Eddington, in his official capacity:

Stuart 
R. Day and Susan Chapin Stubson of Williams, Porter, Day & Neville, P.C., 
Casper, Wyoming.   Argument by 
Ms. Stubson.

Before 
LEHMAN, C.J.; GOLDEN and KITE, JJ., and SPANGLER, D.J., 
Retired.

  

GOLDEN, Justice.

 [¶1]           
This appeal requires that we consider various issues 
arising from passage of an annexation ordinance and the issuance of a liquor 
license.  
Appellee the Town Council of the Town of Torrington (Town Council) passed 
an annexation ordinance for property belonging to Appellees Eddington, Hill, 
Marlatt (property owners), 77 Capital Corp.  Before the annexation was effective, the 
property owners applied for a retail liquor license.  Appellants Robert 
L. Kroenlein and Betty Kroenlein (Kroenleins) sought a declaratory judgment that 
the annexation ordinance and liquor license were void because statutory 
requirements were not properly followed, and Appellee Eddington, Torrington's 
town attorney, had participated in the decision-making process despite a 
conflict of interest.   The district court ruled that because 
the initial liquor license had expired by passage of time, any questions 
regarding issuance were moot.  It further determined that the annexation 
ordinance was properly enacted pursuant to Wyo. Stat. Ann. § 15-1-407.  Summary judgment 
was entered in favor of all appellees.

 

[¶2]           
Kroenleins' appeal requires that we determine whether the 
mootness doctrine precludes review of procedural defects in issuing a liquor 
license; whether a town attorney is prohibited from holding a liquor license 
either by statute or conflict of interest; and whether the annexation ordinance 
is valid.   
We affirm.

 

 

ISSUES

 

[¶3]           
Kroenleins present this statement of the issues:

 

1.  Are defects in the original issuance of a 
liquor license rendered moot by its renewal during the course of litigation?

a.  Procedural defects which do not recur on 
renewal

b.  Jurisdictional defects which remain at 
renewal

 

2.  Is the annexation procedure provided in W.S. 
§ 15-1-407 subject to the requirements of § 15-1-403(c) and (d) and the findings 
required by § 15-1-402(a) and other annexation statutes?

 

3.  Is a prosecuting attorney a person prohibited 
from holding a liquor license under W.S. § 12-4-103(a)(ii)?

 

4.  May a person prohibited by W.S. § 12-4-103 
from holding a liquor license avoid that prohibition by holding through a 
corporation?

 

Appellees James A. Eddington, Ronald D. Hill, Tony L. 
Marlatt, and 77 Capital Corp. restate the issues to be:

A.  Did renewal, without objection from 
Appellants, of the liquor license issued by Appellee Town of Torrington to 
Appellee 77 Capital Corp. render issues raised concerning the initial licensing 
proceedings moot?

 

B.  Did Appellee Town of Torrington effectively 
annex lands belonging to Appellees Eddington, Hill and Marlatt?

 

C.  May a town attorney own a significant 
interest in a corporation holding a liquor license issued by the town?

 

Appellees Town Council of the Town of Torrington and 
Eddington, in his official capacity as Town of Torrington attorney, present 
these issues:

 

A.  Did the District Court err in ruling that the 
Wyoming Statutes provide three separate and distinct avenues by which property 
may be annexed into a town or city and the Torrington Town Council fully and 
fairly met the requirements for annexation under Wyo. Stat. § 15-1-407 (Lexis 
1999) and therefore the annexation of a particular parcel was proper?

 

B.  Did the Appellants come before this Court 
with "clean hands" even though they admitted in the record that they knew about 
the annexation and liquor license proceedings and failed to timely respond to 
requests for public comment?

 

C.  Do Appellants, as parties who only have a 
threat of economic competition and who were otherwise not involved in the 
annexation and liquor licensing process, having standing to contest the validity 
of the Torrington Town Council's actions?

 

D.  Did the District Court err in finding that 
the issue of whether or not a liquor license was properly issued was rendered 
moot in light of the Torrington Town Council's subsequent renewal of the liquor 
license?

 

 

FACTS

 

[¶4]           
Kroenleins' complaint arose following the annexation of 
property and the issuance of a liquor license for that property by the Town 
Council.  On 
July 17, 1997, 77 Capital Corp. purchased a tract of real property known as the 
truck stop parcel.1  Appellees Eddington, Hill, and Marlatt are 
shareholders of 77 Capital Corp.   On June 26, 1998, 77 Capital Corp. 
transferred the truck stop parcel to Eddington, Hill, and Marlatt.   On July 28 or 
29, 1998, 77 Capital Corp. applied to the Town Council for the issuance of a 
retail liquor license for the parcel.  At the time of the filing of the application 
for the liquor license, that location was not within the Town of Torrington's 
corporate limits.  

 

[¶5]           
On August 3, 1998, Eddington, Hill and Marlatt petitioned 
the Town Council to annex the truck stop parcel pursuant to Wyo. Stat. Ann. § 
15-1-407.  On 
September 1, 1998, the Town Council passed and approved on third and final 
reading Ordinance No. 946, which annexed the truck stop parcel in the corporate 
limits of Torrington pursuant to Wyo. Stat. Ann. § 15-1-407.  No publication of 
Ordinance No. 946 occurred before September 4, 1998, but on that date a public 
notice was published in the Torrington Telegram.  On September 2, 1998, a liquor license was 
issued to 77 Capital Corp. for the truck stop parcel.  On February 18, 
1999, the Town Council, after proper publication and notice, reissued a retail 
liquor license to 77 Capital Corp.

 

[¶6]           
Kroenleins are residents and property owners in Torrington 
and also hold a retail liquor license.  On September 10, 1998, Kroenleins filed a 
complaint against the owners, 77 Capital Corp., and the Town Council seeking a 
declaratory judgment that the annexation and issuance of the liquor license were 
invalid for violation of statutes.  The Kroenleins further alleged that 
Eddington, Torrington's town attorney, had a conflict of interest and had thus 
acted improperly by advising the Town Council regarding the liquor license and 
annexation applications.  Based on these alleged improprieties, their 
complaint requested class action status for competing retail liquor license 
holders to recover compensatory and punitive damages. 

 

[¶7]           
Kroenleins filed three separate motions for partial summary 
judgment.  The 
district court denied all three and entered judgment for the defendants on these 
three motions and later on all remaining motions.  This appeal followed.  The relief it seeks 
is limited to a declaration that the Town Council's annexation ordinance and 
liquor license issuance are void.

 

 

 

[¶8]           
"When this Court reviews a summary judgment denying a 
petition for a declaratory judgment, we invoke our usual standard for review of 
summary judgments."    Fontaine 
v. Board of County Comm'rs of Park County, 4 P.3d 890, 892 (Wyo. 2000). 
  In this 
instance, there is no contention that any genuine issue of material fact exists, 
and our concern is strictly with the application of the law.  Questions of 
application of the law, including statutory interpretation, are considered de novo.  Anderson Highway 
Signs and Supply, Inc. v. Close, 6 P.3d 123, 124 (Wyo. 2000).  If the summary 
judgment can be affirmed under any proper legal theory presented in the record, 
we will do so.  
Fontaine, 4 P.3d  at 892.

[¶9]           
We have often stated our rules of statutory 
interpretation.  
In interpreting statutes, we primarily determine the legislature's 
intent.  Parker Land & Cattle Co. v. 
Wyo. Game & Fish Comm'n, 845 P.2d 1040, 1044 (Wyo. 1993).  If the language is 
sufficiently clear, we do not resort to rules of construction.  We apply our 
general rule that we look to the ordinary and obvious meaning of a statute when 
the language is unambiguous.  If the statute's language is clear and 
unambiguous, we apply its plain meaning and need not consult the numerous rules 
of statutory construction.  Id. at 1043.

 

 

 

[¶10]       The Town Council contends that Kroenleins do not have 
standing to challenge the annexation and liquor license process.  In a declaratory 
judgment action, a party does not have standing to contest issuance of a liquor 
license by virtue of the party's status as a competitor.  State ex rel. Bayou Liquors, Inc. v. City of Casper, 
906 P.2d 1046, 1050 (Wyo. 1995).  A party does have standing as a resident even 
though he or she is a competitor.  Id.  A resident has 
standing to contest issuance of a liquor license for those purposes set forth in 
Wyo. Stat. Ann. § 12-4-104(b)(iv), namely, "that actions which seek to ensure 
that licenses are issued, renewed or transferred in compliance with the liquor 
code and local ordinances fit within the broad purpose enunciated by the 
statute."  Id.  Residents have a strong interest in seeing 
compliance with the law.  Id.  The record shows 
that Kroenleins are residents of the Town of Torrington and had standing to 
contest the issuance of the liquor license.

 

[¶11]       Similarly, Wyo. Stat. Ann. § 15-1-409(a) provides standing 
to resident property owners if aggrieved by the acts of the governing body 
because of a failure to comply with the annexation statues.  See Town of Marbleton v.Town of Big Piney, 719 P.2d 1389, 1390 (Wyo. 1986).    The statute states:

 

(a) If any landowner in the territory proposed to be 
annexed or any owner of real property in the annexing city or town, or utility 
is aggrieved by the acts of the governing body, he may appeal to the district 
court for a review of the acts or findings thereof.

 

Wyo. Stat. Ann. § 15-1-409(a) (LexisNexis 2001).2  As resident property owners, Kroenleins have 
standing to challenge annexation under the statute.

 

 

Validity of 
Liquor License

 

[¶12]       Kroenleins 
complained that the liquor license issued to defendants was invalid because it 
was issued before the truck stop parcel had been annexed and statutory notice 
requirements were not followed.  The trial court found that these complaints, 
though meritorious, were now moot because the liquor license had since been 
properly renewed without Kroenleins' objection.  The trial court granted summary judgment to 
defendants.  

 

[¶13]       In Bard Ranch Co. v. Frederick, 950 P.2d 564, 566 (Wyo. 
1997), we said: 

 

Our general law on justiciability provides that courts 
should not consider issues which have become moot.  Gulf Oil Corp. v. Wyoming Oil and Gas Conservation 
Comm'n, 693 P.2d 227, 233 (Wyo. 1985).  We do not decide cases when a decision will 
have no effect or pertains only to matters that might arise in the future.  McLain v. Anderson, 933 P.2d 468, 472 (Wyo. 1997).  A case is moot when 
the determination of an issue is sought which, if provided, will have no 
practical effect on the existing controversy.  Id. Therefore, if 
events occur during the pendency of an appeal that cause a case to become moot 
or make determination of the issues unnecessary, we will dismiss it. Id; see also Rocky Mountain Helicopters, Inc. v. Air Freight, Inc., 
773 P.2d 911, 924-25 (Wyo. 1989).  

 

We have previously held that the mootness doctrine bars 
review of the validity of a liquor license that has since expired by the passage 
of time.  State ex. rel. Schwartz v. Jones, 61 Wyo. 350, 364, 157 P.2d 993, 997 (Wyo. 1945).  On appeal, Kroenleins do not contend that 
this ruling was in error.  However, they argue that the mootness 
doctrine does not apply to the questions of whether the defendants validly hold 
the license because annexation was void and because a town attorney is 
prohibited from holding a liquor license both by statute and conflict of 
interest.  
These assertions require statutory interpretation, and we will address 
these issues.

 

 

Annexation Statutes

 

[¶14]       Kroenleins seek to void the annexation ordinance passed by 
the Town Council. The governing body of a city or town may annex property by 
petition of a majority of landowners, by petition of the governing body, or by 
the petition of all owners of the land to be annexed.  Wyo. Stat. Ann. §§ 
15-1-403, 404 (LexisNexis 2001); Wyo. Stat. Ann. § 15-1-407 (Michie 1997).  Kroenleins contend 
that the trial court erred in granting summary judgment to appellees after 
determining that the Town Council properly granted annexation under § 15-1-407, 
which provides:

 

If the city is the sole owner of any territory whether or 
not contiguous that it desires to annex, or if all of 
the owners of such land sign a petition to annex, the governing body, by 
ordinance, may annex the territory to the city or town without notice or public 
hearing as provided in W.S. 15-1-405 and without preparing the annexation 
report or providing the estimates required by W.S. 15-1-402(c) and (e) and 
15-1-404(a)(ii)(C) and (D).  All ordinances annexing territory without 
notice and public hearing shall contain a statement that the territory is solely 
owned by the petitioning city or town or that all of the owners of the territory 
have signed a petition requesting annexation. 

 

Wyo. Stat. Ann. § 15-1-407 (Michie 1997)3 (emphasis 
added).

 

[¶15]       Kroenleins 
contend that failure to comply with the petition requirements set forth in Wyo. 
Stat. Ann. § 15-1-403(d) caused the Town Council to annex land not owned by 
"landowners" as defined in Wyo. Stat. Ann. § 15-1-401.  They claim that § 
407 does not provide an independent means of initiating annexation by owners of 
property that are not landowners which § 401 defines as "the owner of real 
property in the territory proposed to be annexed who in the last calendar year 
was liable for property tax thereon."  Wyo. Stat. Ann. § 15-1-401(a)(ii) (LexisNexis 
2001) states:

 

"Landowner" means the owner of real property in the 
territory proposed to be annexed who in the last calendar year was liable for a 
property tax thereon or was exempt by law from the payment of taxes on the 
property.  
Anyone having a right to purchase land under a written contract is the 
owner of that land for annexation purposes.  For purposes of W.S. 15-1-402, 15-1-404 and 
15-1-405 "landowner" shall include persons owning property which, as a result of 
the proposed annexation would then be brought within one-half (1/2) mile of the 
corporate limits of a city which has exercised the authority granted under W.S. 
15-3-202(b)(ii)[.]

 

Wyo. Stat. Ann. § 15-1-403 (LexisNexis 2001) states:

 

(a) The proceedings for annexation of eligible territory 
may be initiated by a written petition filed with the clerk of the city or town 
to which annexation of the territory is proposed, after compliance with the 
following conditions and procedures:

            
(i) The petition is signed and dated by a majority of the landowners 
owning a majority of the area sought to be annexed, excluding public streets and 
alleys and tax exempt property;

            
(ii) The petition contains the following detailed information:

(A) A legal description of the area sought to be 
annexed;

(B) A request that the described territory be annexed;

(C) A statement that each signer is an owner of land and a 
description of his land within the area proposed to be annexed; and

(D) A map of the area.

            
(b) No signature on the petition is valid if it is dated more than one 
hundred eighty (180) days prior to the date of filing the petition with the 
clerk.  No 
person signing a petition for annexation may withdraw his signature from the 
petition after it has been filed with the clerk.

            
(c) The clerk shall refer the petition to the governing body which, 
without undue delay, shall take appropriate steps to determine if the petition 
substantially complies with this article.

            
(d) If the petition complies, the governing body shall adopt a resolution 
certifying compliance, and the procedure outlined in W.S. 15-1-402, 15-1-405 and 
15-1-406 shall then be followed.  If it does not comply the petitioner shall be 
notified that no further action will be taken on the petition until compliance 
is made.

 

[¶16]       We disagree 
with Kroenleins' position and agree with the district court that § 407 is an 
independent means by which property "owners" can petition for annexation.  Plainly, ¶ 407 
provides for an annexation method that does not require identifying "landowners" 
or applying the petition compliance procedures found in § 403.  It foregoes those 
procedures and chooses instead to solely rely upon the requirement that the 
ordinance provide a statement that all owners of the territory have signed a 
petition requesting annexation.  An annexation ordinance that failed to comply 
with this requirement would be subject to district court review and could be 
declared void under Wyo. Stat. Ann. § 15-1-409(b) (LexisNexis 2001), which 
states:

 

(b) If the court determines that the action taken was 
capricious or arbitrary, or if it appears from the evidence that the landowner's 
right in his property is being unwarrantedly invaded or that the governing body 
abused its discretion, the court shall declare the annexing ordinance void.  If the court 
determines the action of the governing body was proper and valid, it shall 
sustain the ordinance.

 

[¶17]       Kroenleins do contend that the statement of ownership in 
the ordinance failed to comply with § 407.  The ordinance stated:

 

That James A. Eddington, Ronald D. Hill and Tony L. Marlatt 
are the owners of real property set forth below and said real property is 
annexed into the corporate limits of the Town of Torrington pursuant to W.S. § 
15-1-407.

 

We agree that this statement does not say that "that all of 
the owners of the territory have signed a petition requesting annexation."  The statutory 
purpose behind requiring this statement is obviously to show the governing 
body's jurisdiction to annex the property.  Here, we will find that referencing the 
applicable statute substantially complies with the statutory requirement, and 
this variation does not require declaring the ordinance void.   See Miller v. Town of Mills, 590 P.2d 378, 380-81 (Wyo. 
1979) (failure to comply with annexation statutory requirements is not 
necessarily a fatal deficiency).  

 

[¶18]       Kroenleins' point, however, appears to be that the Town 
Council and the owners gave short shrift to the purpose behind the procedural 
requirements, namely, protection of the public interest.  The public interest 
concerns are enumerated in Wyo. Stat. Ann. § 15-1-402 with the requirement that 
these matters be addressed in a public hearing pursuant to Wyo. Stat. Ann. § 
15-1-405.  The 
public interest concerns were restated in the owners' petition for 
annexation.  
Section 407 waives compliance with a hearing under § 405 and parts of § 
402, leaving the question whether the legislature intended that the Town Council 
address these § 402 concerns not specified before issuing an ordinance 
annexing property pursuant to § 407. Providing a hearing to address the 
concerns enumerated in § 402 protects landowners who may object to 
annexation.  In 
contrast, owners requesting annexation under § 407 do not object and, 
accordingly, § 407's procedures have been deliberately abbreviated.  It is, therefore, 
entirely consistent with the purpose of § 407 that it not require further 
consideration of public interest concerns.  That is not to say, however, that residents 
like Kroenleins may not seek review of the annexation proceeding on the 
statutory grounds that the annexation decision is arbitrary, capricious, or 
unreasonable.  
Generally, in an annexation proceeding the courts are not concerned with 
the wisdom or expediency of altering the boundaries of a city or town by 
annexation.  We 
presume that the action taken by the governing body is reasonable, and the 
burden is on the resident property owner attacking the ordinance to show that 
such action was unreasonable.   Henderson v. 
City of Laramie, 457 P.2d 498, 501 (Wyo. 1969).   Kroenleins 
make no such showing.  

 

[¶19]       We find that 
the legislature deliberately stayed silent regarding addressing public interest 
concerns in a § 407 proceeding in order to provide the governing body with the 
discretion to consider these matters, but without an obligation to do so.  In answer to 
similar arguments, we have said the well-settled rule is that "a court of equity 
will not interfere at the suit of a taxpayer to restrain the officers of a 
municipal corporation in the exercise of their discretionary power with regard 
to the control or disposition of the property of the municipality, in the 
absence of illegality, fraud, or clear abuse of their authority." Quackenbush v. City of Cheyenne, 52 Wyo. 146, 156-57, 
70 P.2d 577, 579 (Wyo. 1937) (quoting Seafeldt v. 
Astoria, 16 P.2d 943 (Or. 1932); Haesloop v. City 
Council of Charleston, 115 S.E. 596 (S.C. 1923); 44 C.J. 1411).  Presumably, the 
legislature justified allowing a governing body this discretion by the political 
risk that awaited an elected body that failed to properly consider and serve the 
public interest.  
That being so, the judicial review role is limited to determining 
whether, in exercising discretion, the governing body has acted capriciously or 
arbitrarily, the landowner's right in his property is being unwarrantedly 
invaded, or that the governing body abused its discretion.    Wyo. 
Stat. Ann. § 15-1-409(b) (LexisNexis 2001).  A review of whether the governing body had 
acted arbitrarily or capriciously would necessarily include reviewing whether 
the governing body's action was illegal, fraudulent, or a clear abuse of 
authority.  Quackenbush, 52 Wyo. at 156-57, 70 P.2d  at 579.  

 

[¶20]       Here, Kroenleins do not argue other reasons that the 
ordinance violated this standard.  Under § 407's abbreviated procedure, we have 
no record that would show otherwise, and we affirm the district court's order 
that the ordinance is valid.

 

 

Statutory Restrictions upon License Holders

 

[¶21]       Kroenleins contend that a town attorney is prohibited from 
holding a liquor license by the language of Wyo. Stat. Ann. § 12-4-103(a)(ii) 
(LexisNexis 2001), which states:

 

(a)  A license or permit authorized by this title 
shall not be held by, issued or transferred to:

 

* * * *

 

(ii) Any person employed by the state or a city, town or 
county as a law enforcement officer or who holds office as a law enforcement 
officer through election[.]

 

 

Kroenleins contend that the term "law enforcement officer" 
intends to include a town attorney or any public official whose duties involve 
the enforcement of law.  In its entirety, § 12-4-103 restricts 
holding of liquor licenses under a lengthy list of circumstances obviously 
carefully considered by the legislature.  A town attorney is not specified although the 
legislature could obviously have done so.  Nevertheless, we will address Kroenleins' 
contention.  

 

[¶22]       This is not the first time that we have been asked to 
define the term "law enforcement officer."  We have previously observed that the 
legislature had not given the phrase "law enforcement officers" a statutory 
definition.  Hurst v. State, 698 P.2d 1130, 1133 (Wyo. 1985).  After determining that the plain meaning of 
"law enforcement officer" should be defined as a "peace officer," we found that 
phrase indicated a legislative intent to limit peace officers to those persons 
with the direct authority to make arrests or keep the peace.  Hurst decided that parole officers were not vested with 
that kind of authority, and our review of the case law from other jurisdictions 
supported this decision.  Id. at 1134.      

 

[¶23]       Our review of current statutes indicate that this 
definition remains applicable today.  A prosecuting attorney does not have the 
power to make arrests or keep the peace.  We also note that a statute governing 
retirement programs defines "law enforcement officer" as "any member who is a 
county sheriff, deputy county sheriff, municipal police officer, University of 
Wyoming campus police officer, jailer or dispatcher for law enforcement 
agencies."  
Wyo. Stat. Ann. § 9-3-402(a)(xviii) (LexisNexis 2001).  The Controlled 
Substance Act defines "law enforcement officer" to mean "any sheriff, 
undersheriff or sheriff's deputy of any county of this state, any duly 
authorized municipal policeman of any city or town of this state, any member of 
the Wyoming highway patrol, or any special agent employed by the commissioner 
under this act."  
Wyo. Stat. Ann. § 35-7-1002(a)(xxiv) (Michie 1997).4  Under these 
circumstances we find that our definition from Hurst 
remains applicable today, and we hold that a town attorney is not a law 
enforcement officer for purposes of § 12-4-103.  

 

 

 

[¶24]       In their complaint, Kroenleins alleged that Eddington 
"participated in the consideration of the annexation ordinance and attempted to 
influence the members of the Town Council," "acted for the Town Council in the 
review of the annexation petition," and in the "preparation and review of the 
annexation ordinance." They further alleged that "throughout the consideration 
of the liquor license application . . . Eddington remained present in his 
capacity as town attorney and advised the Town Council in that capacity."   On appeal, 
Kroenleins insist that town attorney Eddington's role in this matter violated 
Wyo. Stat. Ann. §§ 15-1-127, 15-1-128, 6-5-106, and 16-6-118.  

 

[¶25]       In answer, the Town Council and Eddington in his official 
and individual capacity denied these allegations.  In his deposition, Eddington stated that 
after full disclosure to the Town Council that he owned the property, he 
attended the three town council meetings discussing the annexation as town 
attorney and as an individual. Eddington read the annexation ordinances at the 
meetings, but could not remember if he had prepared the ordinance.  He testified that 
he did not further participate in any manner.  Kroenleins' record on appeal has provided the 
deposition of a town council member who testified that Eddington attended the 
meetings where the proposed ordinance was read and stated that because he was 
involved he would not comment because it would be a conflict of interest.   The council 
member also testified that both the annexation petition and liquor license 
application would have been reviewed by town employees other than the town 
attorney, and specifically mentioned processing by building department employees 
and the city clerk.  
The town council member stated that after Eddington's disclosure, the 
mayor and council members discussed and agreed that the town council could seek 
legal representation by another attorney if necessary. The council member 
testified that Eddington refused to comment during consideration of the liquor 
license because of his conflict of interest, and that the council member did not 
believe that Eddington represented the town as town attorney in those matters in 
which he had a conflict of interest.  

 

[¶26]       The record indicates that in response to the district 
court's query why summary judgment should not be granted on all remaining 
issues, Kroenleins submitted a memorandum to the district court claiming that 
genuine issues of material fact existed as to whether Eddington violated 
statutes that they termed as laws on conflicts of interest.    
Kroenleins' memorandum conceded that it is unclear whether these statutes 
apply to a town attorney, apply to annexations or liquor licenses, or apply to 
Eddington's level of participation in this case.  Kroenleins did not provide any statutory 
interpretation to the lower court or here on appeal but continue to baldly 
assert that Eddington's conduct violates Wyo. Stat. Ann. §§ 15-1-127, 15-1-128, 
and 6-5-106,5 and these violations void the Town Council's 
actions in enacting the annexation ordinance and the issuance of the liquor 
license.     

 

[¶27]       Generally, these Wyoming statutes prohibit conflicts of 
interest by a public officer or employee on public works, contracts, or office 
appointments.  
A public officer or employee violating these statutes is subject to 
removal from office and criminal prosecution.  Further, a violation of Wyo. Stat. Ann. § 
15-1-127(a) will cause the contract to be declared null and void.    For 
conflict of interest issues other than those arising from public works or 
contract and governed by statute, public policy generally prohibits identified 
conflicts of interest on any matter that may undermine public confidence in the 
integrity of public officials.  Terry v. Bender, 
300 P.2d 119, 125 (Cal. 1956).  We have noted that the reason for the rule 
is: 

 

It is a well-established and salutary doctrine that he who 
is intrusted [sic] with the business of others cannot be allowed to make such 
business an object of pecuniary profit to himself.  This rule does not 
depend on reasoning technical in its character, and is not local in its 
application.  
It is based upon principles of reason, of morality, and of public 
policy.  It has 
its foundations in the very constitution of our nature, for it has 
authoritatively been declared that a man cannot serve two masters, and is 
recognized and enforced wherever a well-regulated system of jurisprudence 
prevails.  The 
law will in no case permit persons who have undertaken a fiduciary character or 
a charge to change or invert that character by leaving it and acting for 
themselves in a business in which their character binds them to act for 
others.  The 
application of the rule may in some instances appear to bear hard upon 
individuals who have committed no moral wrong; but it is essential to the 
keeping of all parties filling a fiduciary character to their duty, to preserve 
the rule in its integrity, and to apply it to every case which justly falls 
within its principle.

 

Board of Comm'rs of Natrona County v. Casper Nat'l 
Bank, 56 Wyo. 132, 149-50, 105 P.2d 578, 584 (Wyo. 1940) (emphasis omitted).  

 

[¶28]       We have had few occasions to address conflict issues, and 
our rulings are limited to finding a conflict of interest exists when a public 
official acts on a public contract to which he or she is a party or has a 
financial interest, or where the public office held is incompatible with 
privately held employment because as the public official, he is acting as both 
employer and employee.  Coyne v. State ex 
rel. Thomas, 595 P.2d 970, 972-73 (Wyo. 1979); see 
also Casper National Bank, supra; Haskins v. State 
ex rel. Harrington, 516 P.2d 1171 (Wyo. 1973).   In an 
interpretation of earlier conflict of interest statutes, we recognized that the 
legislature intended to identify conflicts of interests and provide the 
procedures and remedies that should be followed by public officials:

 

If a matter in which one of the defendants has a 
conflicting interest comes before the board of trustees, that defendant must: 
(1) disclose the interest; (2) absent himself during consideration and vote on 
the matter; (3) not attempt to influence the parties to the matter with 
reference thereto; and (4) take no part in the future execution of the 
matter.  If he 
fails to do so, the action taken on the matter shall be null and void, and the 
defendant shall be subject to criminal prosecution for which the penalty is a 
fine of $100.00 to $5,000.00.  The legislature has recognized the existence 
of conflicts of interest and has directed the procedure and remedies applicable 
thereto.  
Accordingly, we cannot sustain the trial court in applying the remedy of 
quo warranto in this case on the basis of conflict of interest.

 

Coyne, 595 P.2d  at 973.  We have recognized, however, that the 
legislature did not intend that a person be disqualified from holding an office 
or position because it conflicts with other interests of that person.  Id.  As set out below, our examination of current 
statutes indicated that where applicable to a town attorney, no evidence shows 
that Eddington violated any prohibition.  We then follow that discussion with an 
analysis of whether Eddington violated any remaining public policies not 
addressed by statutes.  Again, we conclude that he did not.

 

[¶29]       Section 6-5-106 makes it a misdemeanor for a public servant 
to request or receive any pecuniary benefit, other than lawful compensation, on 
any contract, or for the letting of any contract, or making any appointment 
where the government employing or subject to the discretion or decisions of the 
public servant is concerned.  Wyo. Stat. Ann. § 6-5-106(a), (c)  (LexisNexis 
2001).  No 
offense is committed if the public servant "discloses the nature and extent of 
his pecuniary interest to all parties concerned therewith and does not 
participate during the considerations and vote thereon and does not attempt to 
influence any of the parties and does not act for the governing body with 
respect to the contracts or appointments."  Wyo. Stat. Ann. § 6-5-106(b) (LexisNexis 
2001).  
Kroenleins provide no argument that Eddington's actions constitute a 
pecuniary benefit on a contract or an appointment, nor do they argue that a 
violation of this statute would provide a basis for voiding the Town Council's 
vote.  We will 
not further consider this issue.

 

[¶30]       Wyo. Stat. Ann. § 15-1-128 (LexisNexis 2001) provides:

 

(a) No officer or employee of any city or town shall:

            
(i) Solicit or receive any pay, commission, money or thing of value, or 
derive any benefit, profit or advantage, directly or indirectly, from or by 
reason of any improvement, alteration or repair required by authority of the 
city or town, or any contract to which it is a party, except his lawful 
compensation as an officer or employee and except as otherwise provided in W.S. 
15-1-127(b) and (c);

            
(ii) Solicit, accept or receive, directly or indirectly, from any public 
service corporation, or the owner of any public utility or franchise of the 
city, any pass, frank, free ticket, free service or any other favor upon terms 
more favorable than those granted the public generally, except that councilmen 
who are regularly employed by any public service corporation or owner of a 
public utility or franchise may receive free service or favor as is given to all 
other similar employees.

(b) Any officer or employee who violates this section shall 
be subject to removal from his position or other disciplinary action after 
hearing.

 

Section 15-1-128 specifically prohibits a public officer or 
employee from any direct or indirect benefit by public works or contract, and a 
violation will result in removal or other disciplinary action.  Kroenleins did not 
provide the district court with argument or authority that this statutory 
language is intended to apply to any subject matter beyond public contracts or 
public works such as an annexation petition or application for liquor license, 
nor do they provide argument or authority to us, and we are unable to further 
consider the issue.

 

[¶31]       Section 15-1-127 prohibits conflicts of interest, and 
generally courts will find that violations of those kinds of statutes may void a 
governing body's legislative actions.  See Terry, 300 P.2d  at 125.  Wyo. Stat. Ann. § 15-1-127 (LexisNexis 2001) 
(emphasis added) states:

 

Prohibitions; interest in contracts; exception; extra pay; 
compensation to nonofficers; exception.

 

            
(a) No qualified member of the governing body 
of any city or town or any member of that qualified 
member's immediate family may receive any monetary or other economic benefit 
from any contract to which the city or town or anyone for its benefit is a 
party.  The 
obligation on the part of the city or town is void in any contract in which a 
monetary or other economic benefit will be received by a qualified member of the 
governing body or his family who does not comply with subsection (b) of this 
section.  Any 
money paid on the contract may be recovered by the city or town from any persons 
by an action brought in the name of the city or town.

            
(b) Subsection (a) of this section does not apply to any qualified member 
of a governing body or any member of that qualified member's immediate family 
who may receive any monetary or other economic benefit from any contract made by 
the governing body if the qualified member complies with the following:

(i) The qualified member:

            
(A) Shall not participate in the consideration or discussion relating to 
the contract;

            
(B) Shall not attempt to influence the other members of the governing 
body in any way relating to the contract;

            
(C) Shall reveal the nature and extent of any monetary or other economic 
benefit he or any member of his immediate family may receive to the other 
members of the governing body prior to consideration of the contract;

            
(D) Shall not vote on the matter of granting the contract;

            
(E) Shall absent himself during the consideration, discussion and vote on 
the contract;  
and

            
(F) Shall not act, directly or indirectly, for the governing body in 
inspection, operation, administration or securing performance under the contract 
in which he or any member of his immediate family may receive any monetary or 
other economic benefit.

            
(c) The governing body, by ordinance, shall prescribe requirements 
governing conflicts of interest by any employee and 
any member of his immediate family and procedures by which any employee and any 
member of his immediate family may be exempt from those requirements.

            
(d) No qualified member of the governing body, 
officer or employee may receive any pay or perquisites from the city other 
than his salary for any work coming within the scope of his duties as provided 
by ordinance and the law.  The governing body shall not pay or 
appropriate any money or other valuable thing to any person not a qualified 
member of the governing body, officer or employee for the performance of any 
act, service or duty which is within the proper scope of the duties of any 
qualified member of the governing body, officer or employee of the city or town, 
unless specially appropriated and ordered by a vote of three-fourths (3/4) of 
all members elected to the governing body.

 

Arguably subsections (c) and (d) would apply to a town 
attorney.  The 
record on appeal does not provide the ordinances required in subsection 
(c).  A party 
contending that a government action is void under this statute has the burden of 
proof to show the precise violation, and here, Kroenleins have failed to show 
any violation of subsection (c) that warrants our decision to void the 
annexation ordinance or issuance of the liquor license.  Under subsection 
(d), Kroenleins provide no argument or authority that Eddington's receipt of a 
liquor license is included in the term "pay or perquisites other than his 
salary."   
Even assuming that it is included in the term, no argument or authority 
is provided showing that the liquor license was an "appropriation" that did not 
receive a proper vote.  Under these circumstances, a review of the 
plain language of these statutes indicates that Eddington's petition for 
annexation or application of a liquor license is not a conflict of interest that 
requires voiding the Town Council's actions.  

  

[¶32]       Having concluded that Kroenleins have failed to show that 
Eddington's actions violated any statutes, we consider whether Eddington 
violated public policy prohibitions against conflicts of interest.  We must first 
identify a conflict of interest, and plainly, Eddington was a public employee or 
officer who appeared before his employers seeking public action on his private 
financial interest at stake in obtaining annexation and a liquor license, which 
by law, only the Town Council could approve.  As town attorney, Eddington's role required 
advising the Town Council on just these sorts of issues.  Therefore, the 
conflict of interest would arise if he attempted to advise the Town Council on 
any matter for which he had a direct financial interest.  Having identified a 
conflict of interest, we must decide if Eddington properly protected the Town 
Council.  The 
evidence here indicates that Eddington fully disclosed his conflict of interest 
to the Town Council and did not attempt to advise them about his own 
petition.  The 
remaining question, therefore, is whether Eddington, having a conflict of 
interest, acted improperly by his presence at those Town Council meetings where 
any action was taken concerning his petitions.

 

[¶33]       Generally, participation on matters where a conflict of 
interest exists is improper.  Coyne, 595 P.2d  
at 973; see also Hamilton v. 
Town of Los Gatos, 261 Cal. Rptr. 888, 892-93 (Cal. App. 6 Dist. 1989).  However, mere presence is usually not 
considered improper participation, although a public official banned from voting 
may act improperly by remaining during private discussions by other voting 
members.  Id. at 893.  Eddington is not a 
voting official, and we do not see that by remaining during those times when the 
Town Council called for public comment, Eddington's presence was improper.  We will not 
determine that, simply because of his association with the Town Council, 
Eddington acted improperly.

 

[¶34]       The district court properly determined that the annexation 
ordinance and issuance of a liquor license were not void as a matter of 
law.  We 
affirm.

 

FOOTNOTES

1Approximately 
10.39 acres located in Section 14 of Township 24 North, Range 61 West, Goshen 
County, Wyoming. 

2The statutes cited in 
this opinion have not changed since annexation of said parcel was approved in 
1998 unless otherwise indicated.

3In 2001, this statute was 
amended and the language "or if all of the owners of such land sign a petition 
to annex," and "or that all of the owners of the territory have signed a 
petition requesting annexation" was deleted.

4Amendments in 2001 added 
"any police officer of the University of Wyoming or any Wyoming community 
college who is a peace officer."

5Kroenleins' brief does 
not address all statutes they had listed in their complaint.