Opinion ID: 2671306
Heading Depth: 1
Heading Rank: 2

Heading: First Summary Judgment Order

Text: ¶ 26. We consider the trial court’s rulings in the order they were made: first, the decision granting summary judgment with respect to counts 2 and 5 and second, the later decision concerning counts 1, 3 and 4.
¶ 27. We begin with plaintiff’s claim that the Town damaged her reputation without providing her with an opportunity to clear her name in violation of the Due Process Clause of the Fourteenth Amendment. “To maintain a procedural due process action against a governmental entity, a plaintiff must show that he was deprived of interests protected by the Fourteenth Amendment.” LaFlamme v. Essex Junction Sch. Dist. , 170 Vt. 475, 480, 750 A.2d 993, 997 (2000). Once a deprivation is established, it must be determined what process is due. Hegarty v. Addison Cnty. Humane Soc’y , 2004 VT 33, ¶ 18, 176 Vt. 405, 848 A.2d 1139. “Though the required procedures may vary according to the interests at stake in a particular context, the fundamental requirement of due process is the opportunity to be heard at a meaningful time and in a meaningful manner.” Langlois v. Dep’t of Emp’t & Training , 149 Vt. 498, 501, 546 A.2d 1365, 1367 (1988) (quotation and alterations omitted). ¶ 28. Plaintiff’s claim of reputational damage is frequently described as a stigma-plus claim. An individual may sue for reputational damages under 42 U.S.C. § 1983 if he or she can meet two criteria: damage to public standing through governmental action without a hearing or opportunity to contest the action plus an accompanying tangible loss such as discharge from government employment. Herrera v. Union No. 39 Sch. Dist. , 2009 VT 35, ¶¶ 11-13, 186 Vt. 1, 975 A.2d 619 (citing Paul v. Davis , 424 U.S. 693, 701-02 (1976)). Such claims are called stigma-plus claims. The injury to reputation alone—the stigma—is insufficient to amount to a deprivation of liberty without some additional tangible loss—the plus—such as termination of employment. See Owen v. City of Independence , 445 U.S. 622, 633 n.13 (1980) (discussing both requirements). The stigma-plus formulation is widely accepted today as a constitutional analog to common law defamation in cases involving statements and other actions by government officials. See generally E. Mitnick, Procedural Due Process and Reputational Harm: Liberty as Self-Invention , 43 U.C. Davis L. Rev. 79 (2009). ¶ 29. The trial court applied this test, setting forth the elements as follows: To prove a stigma-plus claim, the plaintiff must first demonstrate that the government made stigmatizing statements about her—statements that call into question the plaintiff’s good name, reputation, honor, or integrity. Second, the plaintiff must show that these statements were made public. Third, the plaintiff must show some tangible and material state-imposed burden in addition to the stigmatizing statement. (Quotations and citations omitted.) ¶ 30. In considering the sufficiency of the record to overcome the motion for summary judgment directed to the stigma-plus claim, the trial court appropriately considered the evidence in the light most favorable to plaintiff. Samplid Enters., Inc. v. First Vt. Bank , 165 Vt. 22, 25, 676 A.2d 774, 776 (1996) (“In determining whether a genuine issue of fact exists, the nonmoving party receives the benefit of all reasonable doubts and inferences.”). Based on this evidence, the trial court found there was a sufficient basis to conclude that plaintiff was falsely accused and removed from office. As the trial court wrote, Ms. Stone alleged that the Selectboard made false statements about her in a letter which was published to at least one insurer, VLCT, as well as in phone calls to bonding companies, which resulted in her inability to get a bond. This satisfies the “stigma” prong. In addition, the Selectboard’s decision to raise Ms. Stone’s bond, coupled with its alleged defamatory communications to the bonding companies, amounted to adverse action by the government that resulted in Ms. Stone’s de facto removal from office. ¶ 31. The trial court determined, however, that the “pre-deprivation hearings,” especially the hearing on July 12 following the issuance of the July 1 letter, provided plaintiff with “an adequate opportunity to be heard.” The trial court quoted at length from the transcript of the July 12 hearing and concluded that at that hearing plaintiff was indeed given an opportunity to express herself before the selectboard. ¶ 32. When the facts are construed in a light most favorable to plaintiff, we disagree that the hearing provided plaintiff a meaningful opportunity to be heard. Determining the type of process due requires examination of three factors: the private interest at stake; the risk of an erroneous deprivation of that interest through the procedure used relative to other available procedures; and the governmental interest, including any increased administrative burden. Langlois , 149 Vt. at 502, 546 A.2d at 1367 (citing Mathews v. Eldridge , 424 U.S. 319, 335 (1976)). In assessing these factors in the context of this case, the first factor favors a high level of process. Plaintiff has a strong private interest at stake since any damage to her reputation can affect her standing in the community and her future prospects for town office. See Patterson v. City of Utica , 370 F.3d 322, 336 (2nd Cir. 2004). Because plaintiff claims she was effectively terminated by the Town’s actions, her interest in the matter is elevated. Id . at 337 (noting that strength of private interest increases where employee is terminated and where stigmatizing statements will affect plaintiff from obtaining future employment in her profession). At the same time, the selectboard has an interest in making and explaining its decision. Segal v. City of New York , 459 F.3d 207, 215 (2d Cir. 2006). As to the remaining factor, the risk of an erroneous deprivation depends in large part “on the effectiveness of the procedures available and the promptness by which they are afforded.” Id . ¶ 33. The facts considered in the light most favorable to the nonmoving party are as follows. Immediately following plaintiff’s election, she was treated unfairly by a selectboard that was influenced by the town clerk—her rival in the election. In an effort to remove her from office, the selectboard doubled her bond requirement following a secret meeting on July 1. The town’s attorney and the selectboard members contacted all likely sources for the additional insurance coverage and made false statements about her to ensure that no company would accept the increased risk. The board sent plaintiff a letter on July 1, detailing several accusations, including mismanagement, lying and fabrication of evidence. The letter was also sent to potential insurers. Plaintiff appeared at the July 12 selectboard meeting and asked to be put on the agenda. She requested that the board reconsider the bond increase and attempted to defend her performance. She was told by one member: [I]t’s driving me crazy. Every friggen meeting we come down it’s the same rehash. And I’m not taking sides, I’m not—I’m—I’m [on the] side of Irasburg. I’m [on the] side of Irasburg. . . . I’m sick of it. . . . Half the people in town are sick of it. I’m hearing this every time. Will you guys get this shit behind you and get it done. . . . None of us have done it. This is the law. This is the way the state has set things up to run. ¶ 34. When plaintiff complained that town representatives were calling the bonding companies to make certain they would not issue the new bond, another selectboard member responded: We’re not—we’re not—we’re not dropping the increase in the bond, I can tell you that right now. . . . To total of $1 million that you would have, $1 million in coverage. Now 500,000 for right now and you need an additional 500,000 to add up to a million. . . . You need to work on it and let us know. ¶ 35. Plaintiff presented sufficient evidence to demonstrate a question of fact as to whether the July 12 hearing adequately protected her due process rights. To remedy a stigma-plus violation through a post-deprivation name-clearing hearing, due process requires more than a chance to speak. It requires an opportunity to clear one’s name before a body which is sufficiently neutral that a person has some realistic chance of success. See Patterson , 370 F.3d at 335-36 (explaining that post-deprivation hearing must give plaintiff “opportunity to hear and answer first-hand any stigmatizing charges, clearing his name of any false statements made about him, and curing the injury to his reputation”). ¶ 36. According to plaintiff, she initiated the interaction on July 12 by appearing at the hearing and requesting that the selectboard reconsider raising the bond. While the selectboard granted her request and offered her an opportunity to speak, the members made no statement of the allegations against plaintiff at that time. Because the selectboard did not provide notice in advance, plaintiff had little opportunity to address each allegation in turn. Further, the transcript of the hearing creates a question of fact as to whether plaintiff had sufficient opportunity to defend herself at the meeting. The selectboard members’ comments were rude and dismissive. There was no occasion for plaintiff to question the key individuals involved in the allegations or to present her own evidence on the substance of the allegations. Cf. Campbell v. Pierce Cnty. , 741 F.2d 1342, 1346 (11th Cir. 1984) (concluding that process afforded was adequate where claimant was afforded notice of charges and provided with “opportunity to hear and cross-examine all adverse witnesses and to attempt to rebut their claims”). [3] A factfinder reviewing the above-quoted heated exchange—which is typical of the statements made at the July 12 meeting—could reasonably conclude that the selectboard failed to grant plaintiff a sufficient opportunity to clear her name. [4] It was error to make a contrary factual determination in favor of the Town in the context of summary judgment. ¶ 37. On a final note, on appeal, plaintiff claims that she was entitled to a predeprivation hearing prior to receiving the July 1, 2010 letter. We conclude plaintiff was not entitled to such a hearing in this case. While deprivations of a property interest require a predeprivation hearing, when there is a deprivation of a liberty interest, the process required is a post-deprivation name-clearing hearing. See Herrera , 2009 VT 35, ¶ 13 (“When both the ‘stigma’ and the ‘plus’ are present, the remedy for the due process violation is a post-deprivation opportunity for the plaintiff to clear his name.” (quotation and alteration omitted)). This makes practical sense in this case because the reputational damage that forms part of the stigma-plus claim did not occur until after receipt and publication of the July 1, 2010 letter. See Campbell , 741 F.2d at 1345 (explaining that identification of claim as a deprivation of liberty interest is dispositive of question of whether predeprivation hearing is required and noting that factual predicate for claim did not occur until after termination). ¶ 38. Plaintiff also contends that the Town deprived her of a property interest when the selectboard raised her bond and then made it impossible for her to obtain such a bond, effectively dismissing her from her position. In December 2010, in ruling on the Town’s motion to dismiss plaintiff’s § 1983 claims, the court concluded that plaintiff lacked a property interest in her elected position, and therefore had failed to state a claim for relief under § 1983 for deprivation of a liberty interest. On appeal, plaintiff renews her claim, and argues that she had a property interest in not being unlawfully ousted from office. ¶ 39. We agree with the trial court that plaintiff did not have a property interest in her elected position. The U.S. Supreme Court has so held for some time. In Taylor v. Beckham , 178 U.S. 548, 577 (1900), the Court stated: “The decisions are numerous to the effect that public offices are mere agencies or trusts, and not property as such. . . . In short, generally speaking, the nature of the relation of a public officer to the public is inconsistent with either a property or a contract right.” Thus, the Court held that removal of an elected officer did not amount to a deprivation of a property interest under the Fourteenth Amendment. Id . at 580; see Velez , 401 F.3d at 85 (holding that elected school board member’s claim that she was improperly removed from office did not establish deprivation of property interest protected by Fourteenth Amendment). The majority of courts agree that holding onto public office is not a property interest. Slawik v. State , 480 A.2d 636, 642-44, 644 n.9 (Del. 1984) (explaining that federal and state courts have consistently held that public officials do not have a property right to office and citing cases). This Court has rejected the notion that public officials have a property interest in serving out their entire elected term. See Brennan v. Town of Colchester , 169 Vt. 175, 179-80, 730 A.2d 601, 605 (1999) (holding that planning commission members did not have property interest in serving entire term where statute stated commissions could be removed “at any time”). As an elected official, plaintiff did not have a property interest in retaining her position in the absence of the liberty claim compensable in the stigma-plus context. Therefore, the court did not err in granting judgment to the Town on the claim of deprivation of a property interest.
¶ 40. Under 24 V.S.A. § 901(b), a municipality is required to “assume all reasonable legal fees incurred by an officer when the officer was acting in the performance of his duties and did not act with any malicious intent.” In her complaint, plaintiff claimed that her legal fees should be paid by the Town because she was acting in performance of her duties when she brought legal action to reclaim her office. The trial court concluded that plaintiff was not entitled to payment of legal fees because her lawsuit was filed not to further one of her duties, but instead was a personal matter in which she sought to defend her position as treasurer. ¶ 41. On appeal, plaintiff argues that her suit was not a personal matter, but the sole means for her to enforce her right to engage in the duties to which she was elected. As part of this claim, plaintiff argues that the Town did not lawfully remove her from office because the selectboard did not have the power to raise her bond without a public meeting and a vote. Plaintiff argues that because her removal was not effectuated lawfully, her suit was in furtherance of her duties, and therefore the Town was required to pay for her legal fees under § 901(b). ¶ 42. According to plaintiff, 24 V.S.A. § 832 requires the selectboard to provide notice, deliberate and take an official vote before requiring an increase in a bond. Plaintiff claims that the selectboard did not hold a public meeting or vote to increase plaintiff’s bond prior to sending the July 1, 2010 letter and therefore she still validly held office. There is both a factual and legal question encompassed in plaintiff’s argument—whether the selectboard was required by the statute to take an official vote and whether the facts demonstrate that the selectboard indeed voted. Under § 832: If the selectboard at any time considers a bond of any such officer or employee to be insufficient, it may require, by written order, the officer or employee to give an additional bond in such sum as it deems necessary. If an officer or employee, so required, neglects for ten days after such request to give such original or additional bond, his or her office shall be vacant. ¶ 43. We need not reach plaintiff’s argument that the selectboard did not take a formal vote prior to raising her bond and that she therefore still held office until the election vote. Regardless of whether the selectboard followed the correct procedures under § 832 when it raised plaintiff’s bond requirement, we conclude the intent of § 901 is not to provide attorney’s fees to municipal employees who have disputes with the Town regarding the termination of their employment. ¶ 44. In construing the statutory language, “[o]ur main purpose must be to find the intent of the Legislature based on a review of the entirety of the statutory scheme. Where the meaning of the words chosen is plain, we must give effect to the words chosen.” Smith v. Town of St. Johnsbury , 150 Vt. 351, 355, 554 A.2d 233, 237 (1988) (citation omitted). ¶ 45. Here, the statute states that the Town is required to “assume all reasonable legal fees incurred by an officer when the officer was acting in the performance of his duties and did not act with any malicious intent.” 24 V.S.A. § 901(b). By its plain language, the provision is limited to payment of attorney’s fees when the officer was “acting in the performance of his duties.” Id . It permits reimbursement for the cost of defending a treasurer sued in the course of his or her work. It does not, however, require the Town to assume plaintiff’s legal fees in this type of personal action to recover damages against the Town for improper removal from office. ¶ 46. The intent of this subsection is illuminated by looking at the entirety of § 901. The section is entitled “Actions by or against town officers.” Subsection (a) indicates that when an action is brought by an appointed or elected municipal officer, “the action shall be brought in the name of the town in which the officer serves,” or if the action is brought against an officer, it should be brought against the town. This indicates that the Legislature intended § 901 to cover those actions in which the interest of the officer is coextensive with the interest of the town such that substitution of the town’s name with the officer’s name does not alter the nature of the action. Here, plaintiff is asserting a right that is personal to her and not simply in pursuit of the town’s interests. We conclude that the intent of § 901 was not to require a municipality to reimburse a town officer for legal fees incurred in a dispute with the municipality about the officer’s position. ¶ 47. Plaintiff cites two out-of-state cases in support of her position that § 901 was intended to allow a municipal officer to be reimbursed for legal fees when the officer was forced to bring an action against the municipality. Although we examine each case, we note that generally out-of-state cases on this topic are not particularly helpful because the statutory language involved is unique. ¶ 48. The first case involved a school superintendent, who was joined as a necessary party in a suit by the town council against the board of education seeking to enjoin an agreement between the superintendent and the board. King v. Bd. of Educ. of Watertown , 486 A.2d 1111 (Conn. 1985). The relevant statute provided that the board of education is responsible for legal fees incurred by an employee if the suit is “arising out of any claim, demand, suit or judgment by reason of alleged negligence or other act” provided that the employee “was acting in the discharge of his or her duties or within the scope of employment or under the direction of such board of education.” Conn. Gen. Stat. Ann. § 10-235(a). The trial court denied fees, concluding that the statute applied only to actions for damages. King , 486 A.2d at 1114. The appeals court emphasized that it was reviewing solely this single issue and not whether the superintendent’s actions fell within the scope of his employment. Id . at 1114 n.4. The court reversed, holding that the statute was not limited to damage claims, but extended to suits for injunctive relief. Id . 1115-16. There are obvious factual differences between plaintiff’s situation and the facts of King , including that plaintiff initiated this action while the superintendent in King was joined as a necessary defendant in the suit. Most importantly, however, King does not assist plaintiff because it did not reach the relevant factual and legal question of whether the superintendent was acting in the scope of his employment when he signed the stipulation. Id . at 1114 n.4. ¶ 49. The other case cited by plaintiff is closer factually, but did not rely upon a statute at all. In Ferrara v. Caves , 475 So. 2d 1295, 1299-1300 (Fla. Dist. Ct. App. 1985), the court held that the town was required pay the reasonable attorney’s fees of the city mayor and town commissioners who brought a declaratory judgment action alleging that a recall petition that was filed was legally insufficient. The court’s decision was not based on statute, but on common law in Florida, which allows a public official “to a defense at the public expense in defending suits or misconduct charges while performing his public duties and while serving a public purpose.” Id . at 1299 (citing Lomelo v. City of Sunrise , 423 So. 2d 974, 976 (Fla. Dist. Ct. App. 1982)). [5] Because of the unique common law rule in Florida, this case is not persuasive on how best to interpret Vermont’s statute. ¶ 50. In sum, neither case compels a ruling in plaintiff’s favor. While some states have granted attorney’s fees in like situations, there are equally states that have not. See, e.g., Castner v. City of Minneapolis , 99 N.W. 361 (Minn. 1904); Leo v. Barnett , 369 N.Y.S.2d 789, 792 (App. Div. 1975) (holding that municipality not liable to pay attorney’s fees of town officers wrongfully removed from office). The relevant inquiry is the intent of the Legislature in drafting the statute, and its language and subject matter indicate that it was not intended to cover cases such as this. If plaintiff prevails, she may be entitled to attorney’s fees under § 1983, but § 901 does not provide such a right.