If a developer sues a New York village board, do the board members automatically have to recuse from later applications by the same developer or a related entity?

Plain-English summary

A developer in the Village of Great Neck Plaza got a conditional permit for a restaurant in 1998, then sued the Village and four village trustees in their individual and official capacities under 42 U.S.C. § 1983 for compensatory and punitive damages. After the lawsuit was pending, a related entity (with the same corporate principals) bought adjoining property used as the shopping center parking lot and applied to the Village Board for permits required to develop it. The Village Attorney asked whether the trustees had to recuse.

The AG's office said no automatic disqualification. There is no rule of law that a pending § 1983 suit against board members categorically bars them from hearing a later application by the same plaintiff or a related entity. The right answer requires a case-by-case look at: (1) personal liability exposure (does the village provide a defense and indemnify the trustees, including for punitive damages?), (2) appearance of impropriety, (3) the municipal attorney's assessment of the merits of the suit, and (4) the trustees' own judgments about whether they can rule impartially. Because granting a development permit is not a non-delegable legislative act (Levine v Whalen), the board has the option to delegate consideration of the later applications to another existing board or an ad hoc board if recusal is the right call.

Currency note

This opinion was issued in 2000. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Q: Why isn't an active lawsuit against board members automatically disqualifying? A: Courts treat decisionmakers as presumptively capable of judging each matter on its own merits. Hortonville Joint School District No. 1 v Hortonville Education Assn., 426 U.S. 482 (1976), held that a decisionmaker is not disqualified from a matter merely because the decisionmaker has previously taken a position on a related policy issue. The AG's office applied that presumption: each application is presumed to be made and considered on its own merits unless there is a specific reason to find otherwise.

Q: What raises the bar toward recusal?
A: Personal financial exposure is the biggest factor. When trustees are sued in their personal capacities for compensatory and punitive damages, they have a personal stake in not antagonizing the plaintiff. If the municipality has not authorized defense and indemnification under Public Officers Law § 18 (and a related local law extending indemnification to punitive damages, see Op Atty Gen (Inf) No. 93-22), the conflict is sharper. Appearance of impropriety to outside observers also pushes toward recusal even when actual impartiality is plausible.

Q: Can the board delegate to a substitute decisionmaker?
A: Yes. Citing Levine v Whalen, the opinion noted that determining a development application under existing zoning is not a non-delegable legislative act. The board may delegate to an existing board or form an ad hoc board to consider the later application, with reasonable safeguards and standards.

Q: What does municipal counsel's opinion of the lawsuit matter? A: Recusal is meant to protect public confidence in impartial administration, not to reward parties who file weak lawsuits hoping to disqualify the board. If the municipal attorney determines the lawsuit is frivolous or has little merit, recusing the board members would just hand the plaintiff a tactical win without serving the public interest.

Q: What about ethics codes under General Municipal Law § 806? A: Section 806 requires each municipality to adopt a code of ethics covering things like disclosure of interests, outside investments and employment in conflict with official duties, and future employment. The Village of Great Neck Plaza's code did not address the specific recusal question, so the AG's office walked through the common-law conflict-of-interest factors instead.

Background and statutory framework

The opinion stitched together state and federal authorities. General Municipal Law § 806 requires municipal codes of ethics. Public Officers Law § 18 authorizes municipalities to defend and indemnify officers and employees against civil actions arising out of acts within the scope of public duties; some local laws extend that to punitive damages (see Op Atty Gen (Inf) No. 93-22). When indemnification exists, board members worry less about personal financial exposure from a pending suit, and the bias concern is weaker.

The leading Supreme Court authority for the presumption of impartiality is Hortonville. The leading New York case on delegation of decisionmaking is Levine v Whalen, 39 N.Y.2d 510 (1976), which approved delegation with reasonable safeguards. The analogy to judicial recusal in interlocutory disputes (footnote 1 of the opinion) explains the rule. Judges do not recuse themselves whenever a party files an article 78 challenge to an interim ruling; municipal officers should be no different.

Citations and references

Statutes:

• N.Y. General Municipal Law § 806 (municipal codes of ethics)
• N.Y. Public Officers Law § 18 (defense and indemnification)
• 42 U.S.C. § 1983 (federal civil rights claims)

Cases:

• Hortonville Joint School District No. 1 v Hortonville Education Assn., 426 U.S. 482, 491-494 (1976) (decisionmaker not disqualified by prior public position absent showing of incapacity)
• Levine v Whalen, 39 N.Y.2d 510, 515 (1976) (delegation of decisionmaking is permitted with reasonable safeguards and standards)

Prior AG opinions:

• Op Atty Gen (Inf) No. 97-19 (officials must avoid appearance of impropriety)
• Op Atty Gen (Inf) No. 93-22 (local law may authorize indemnification for punitive damages)
• Op Atty Gen (Inf) No. 92-12 (decision to defend based on allegations or facts at commencement)

Source

• Landing page: https://ag.ny.gov/libraries-documents/opinions/opinions-year
• Original PDF: https://ag.ny.gov/sites/default/files/opinions/I_2000-22_pw.pdf

Original opinion text

OPINIONS OF THE ATTORNEY GENERAL

Page 1 of 3

Opn. No. 2000-22
GENERAL MUNICIPAL LAW § 806; PUBLIC OFFICERS LAW § 18; 42 USC § 1983. In applying standards governing conflicts of interest, pending litigation against a municipal board or board members does not as a matter of law require that board members recuse themselves in a separate application by the party that commenced the lawsuit. In particular cases, however, recusal will be appropriate. Local facts and circumstances must be reviewed to determine whether board members can act impartially as to the separate application. December 19, 2000 Richard Gabriele, Esq. Melzer, Lippe, Goldstein & Schlissel, P.C. Attorneys for the Village of Great Neck Plaza 190 Willis Avenue Mineola, New York 11501

Informal Opinion
No. 2000-22

Dear Mr. Gabriele:
You have inquired whether the members of the Village Board of the Village of Great Neck Plaza (the "Village") have conflicts of interest that require them to refrain from deciding two permit applications, and if so whether they may delay acting on the permits or delegate authority to an entity other than the Board to rule upon the permits. You advised us that in 1998 a corporation applied to the Village Board under the Village's land use regulations for a conditional permit authorizing the operation of a restaurant in a shopping center. The applicant received the conditional permit, but nonetheless commenced an action in federal court under 42 U.S.C. § 1983 seeking compensatory and punitive damages as a result of certain conditions contained in the permit. The owner (applicant) sued the Village and the five village trustees, four of whom remain on the Board, in their individual and official capacities. When the restaurant opened in violation of the terms of the conditional permit, the Village brought a separate action seeking permanent and injunctive relief. After the commencement of the federal action, the owner transferred other property adjoining the shopping plaza to another corporation, with which it shares corporate principals (the "related entity"). This property is used as a parking lot for the shopping center. The related entity has submitted proposed development plans for the adjoining property to the Village Board. Under local land use regulations, the related entity must apply to the Board for a permit to allow elimination of parking spaces from a lot. It also is required to obtain a permit of compliance from the Board certifying that the proposed development satisfies all applicable requirements of the village code. Granting of this permit of compliance is a condition of issuance of a building permit. Your question is whether the pending litigation prevents the Board members from deciding the permit applications by the related entity. We note that under section 806 of the General Municipal Law, each municipality is required to adopt a code of ethics setting forth for the guidance of its officers and employees the standards of conduct reasonably expected of them. The code must provide standards regarding disclosure of interests in legislation, holding of investments in conflict with official duties, private employment in conflict with

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OPINIONS OF THE ATTORNEY GENERAL

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official duties, future employment and other standards relating to conduct of its officers and employees. Codes of ethics may regulate and prohibit conduct and may prohibit disclosure of information. You have informed us that your code of ethics does not provide standards applicable to the question you have raised. We conclude, in applying standards governing conflicts of interest, that the pending litigation against a municipal board and its members does not as a matter of law require that the board members recuse themselves in a separate application by the party that commenced the lawsuit. A case-by-case analysis is required to determine whether board members can act impartially in such circumstances. The determination must also consider whether their participation in the second application would cause an appearance of impropriety. Government officials must maintain public confidence in the integrity of government. See Op Atty Gen (Inf) No. 97-19. They must avoid even the appearance of impropriety. Id. In municipalities experiencing extensive development, it is possible for developers to have actions pending that challenge a board's land use decisions while continuing to make separate applications to that board for other developments. A board's performance of its official duties in applying municipal regulations is not per se a source of a conflict of interest in its consideration of subsequent applications by the same party or a related party.1 See Hortonville Joint School District No. 1 v. Hortonville Education Assn., 426 U.S. 482, 491-494 (1976) (a decision maker is not disqualified from deciding a matter simply because he has taken a position, even in public, on a related policy issue "in the absence of a showing that he is not 'capable of judging a particular controversy fairly on the basis of its own circumstances'"). Absent specific allegations to the contrary, each application is presumed to be made and considered on its own merits. We recognize, however, that in particular situations recusal may be appropriate. The relevant factors can be enumerated, but it is impossible to say in advance which will be decisive or how much weight each should be assigned. Among factors that may be considered here, in applying conflict of interest standards, are exposure of board members to personal liability; whether there is an appearance of impropriety that would erode public confidence in the integrity of government; and the judgments of board members as to whether they can act impartially. Under facts such as those presented here, where the board members have been sued in their personal capacities for compensatory and punitive damages, exposure to personal liability is a particular concern in determining whether recusal is appropriate. There is a greater potential for conflict where the personal financial interests of a board member are antithetical to those of an applicant appearing before the board member. Therefore, a consideration is whether the municipality has authorized defense of board members and indemnification, including defense and indemnification in civil actions for punitive damages, related to acts or omissions occurring within the scope of a member's duties. See Op. Atty. Gen (Inf) No. 93-22 (a local law may authorize defense and indemnification in an action for punitive damages). The decision to defend generally is based on allegations in the complaint or factual determinations at the time the action is commenced. See Op. Atty. Gen. (Inf) No. 92-12. A decision to provide a defense may have been made by the municipality, thus providing some comfort to board members that the facts determined at trial will permit indemnification based on a finding that they acted within the scope of their duties. Also relevant is the advice of the municipal attorney as to whether the litigation has merit. It may be apparent that an applicant's action against board members in their personal capacities is frivolous or of little merit. Such a lawsuit should not necessitate that board members recuse themselves from hearing a subsequent application by the applicant who brought the pending lawsuit. Under these circumstances, recusal would not serve the public interest.

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OPINIONS OF THE ATTORNEY GENERAL

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We recommend that the Village Board consider these and other relevant factors in determining whether recusal is appropriate. Determination of a development application under existing zoning laws is not a non-delegable legislative act. See Levine v. Whalen, 39 N.Y.2d 510, 515 (1976) ("there is no constitutional prohibition against the delegation of power, with reasonable safeguards and standards, to an agency or commission to administer the law as enacted by the Legislature"). Therefore, the Village Board may in its discretion delegate consideration of the later applications to an existing board or may form an ad hoc board to consider such applications. We conclude, in applying standards governing conflicts of interest, that pending litigation against a municipal board or board members does not as a matter of law require that board members recuse themselves in separate applications by the party that commenced the lawsuit. In particular cases, however, recusal may be appropriate. Local facts and circumstances must be reviewed to determine whether board members can act impartially in considering the later applications, or whether they should consider delegating the applications to an existing board or an ad hoc board. The Attorney General renders formal opinions only to officers and departments of the state government. This perforce is an informal and unofficial expression of the views of this office. Very truly yours, JAMES D. COLE Assistant Solicitor General In Charge of Opinions

1 In an analogous and common situation, judges do not recuse themselves in pending matters when one of the parties commences an article 78 proceeding against a judge arising out of an interlocutory ruling he or she has made.

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