Could South Carolina natural resources employees buy their agency’s seized or surplus property at auction?

Plain-English summary

A member of South Carolina's Natural Resources Board asked whether department officers, employees, or their agents could buy items seized by the agency or other surplus equipment at a public auction. The request also raised employees' inside knowledge and whether staff could serve as auctioneers.

The 1996 opinion found no express statute in the provisions it examined that categorically barred agency employees from bidding. It nevertheless drew on earlier opinions stating that public officers or employees should not have a private interest in contracts with their own agency. The author said the proposed transactions appeared to pose a conflict, or at least its appearance, under common-law public policy. He referred the application of the State Ethics Act to the Ethics Commission and did not give a separate categorical answer about an employee serving as auctioneer.

Currency note

This opinion was issued in 1996. 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: Did a public auction alone eliminate the conflict concern? A: No. The opinion said an open, competitive sale did not by itself settle the public-policy problem when an employee bought from the employee's own agency.

Q: Was there an express law in the reviewed provisions forbidding DNR employees to bid? A: The AG found no absolute statutory bar in those provisions. He considered the common-law conflict rule separately.

Q: Did the AG decide whether the State Ethics Act allowed the purchase? A: No. The letter referred that question to the State Ethics Commission.

Background and statutory framework

The opinion distinguished the absence of an express auction prohibition from the common-law rule against public officers dealing with their own agencies. It also noted Section 8-13-775's restriction concerning a public employee's economic interest in a government contract when that employee has an official function relating to it.

Citations and references

Statute discussed: Section 8-13-775.

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/june-18-1996/
• Original PDF: https://www.scag.gov/wp-content/uploads/2013/12/96jun18burnside.pdf

Original opinion text

The State of South Carolina

OFFICE OF THE ATTORNEY GENERAL
CHARLES MOLONY CONDON
ATIORNEY GENERAL

June 18, 1996

Marion Burnside, Member of the Board
South Carolina Natural Resources Board
7071 Bluff Road
Hopkins, South Carolina 29061
Re: Informal Opinion
Dear Mr. Burnside:
You have asked for an "informal opinion regarding DNR officers and employees or their agents purchasing items seized or confiscated by our Law Enforcement D·ivision, as well as other Department surplus equipment (used vehicles, etc.)" You further state:
[a]II surplus items are sold at public auction, with prior public notice and all auction activities under the direct supervision of an outside auctioneer. Furthennore, the Department strictly adheres to all Budget and Control Board regulations as it relates to this subject matter. However, is the 11 spirit" of the law or any other statutes violated when DNR officers and employees or their agents purchase any of these items. There are certain issues that must be considered. For example, Departmental employees are far more knowledgeable about a particular vehicle's maintenance record, who drove the vehicle, what was its primacy use, etc. Does such "insider" knowledge cause any possible ethical concerns? Secondly, can Department personnel serve as the auctioneer when seized or confiscated equipment is sold?

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PosTOfftCE Box 11549

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Mr. Burnside
Page 2
June 18, 1996

Law/Analysis
In O'Shields v . Caldwell, 207 S.C. 194, 35 S.E.2d 184 (1945), our Supreme Court
observed that "every public officer is bound to perform the duties of his office honestly,
faithfully and to the best of his ability, in a man.n er so as to be above suspicion of
irregularity, and to act primarily for the benefit of the public." Thus, such is the starting
point for any analysis regarding the ethical requirements attendant to the acts and actions
of a public official.
In an opinion dated October 5, 1992, this Office addressed the question as to
whether "persons employed by the Spartanburg County Sheriffs Office could participate
in a sale of abandoned and/or unclaimed items to be conducted by public auction. We
stated that
[a] review of S.C. Code Ann. Sec. 27-21-10 et seq., which
statutes pertain to disposition of confiscated, recovered stolen
property or abandoned property does not reveal any statute
which expressly prohibits personnel of the Sheriffs
Department from participating in such a sale. By contrast, we
note that Sec. 23-17-100 prohibits the purchasing of judgments
or decrees which the Sheriff is to enforce or have executed, by
the sheriff or his deputies. Specific inclus-ion :n Sec. 23-17l 00 of language prohibiting certain actions by the Sheriff or
deputies would suggest that a statute devoid of such
prohibition be interpreted differently. Cf., Pennsylvania Nat.
Mut. Cas. Ins. Co. v. Parker, 282 S.C. 546, 320 S.E.2d 458
(S.C. Ct. App. 1984). Thus, we are aware of no statute in
Sec. 27-21-10 et seq. which would prohibit a deputy or other
personnel from participating in the public sale.
However, we also stated that "[s]everal cautionary notes are in order." First we suggested
tbat
... the State Ethics Commission should be consulted to advise
you·of the potential applicability of the ethics laws; this Office
defers to that agency for advice and opinions on the ethics
laws. Too, we suggest that the auction be conducted "above
board" in all respects if your personnel participate therein, so
that certain items are not "held back" and/or your personnel
are not given any advantage as to the sale not available to the

Mr. Burnside
Page 3
June 18, 1996
public generally. Finally, this Office comments only as to the
legal aspects of your personnel participating in such a sale and
offers no comment as to the wisd'bm thereof or other policy
considerations.
My review of Title 50 of the Code concerning fish, game and watercraft, likewise
reveals no statute absolutely prohibiting participation in the sales which you have outlined.
None of the provisions relating to confiscation and sale or auction of property appear to
expressly bar participation by Department officers or employees in such sale. However,
I would herein particularly reiterate the advice provided in the 1992 opinion which
referred the individual there to the State Ethics Commission for interpretation of the
various provisions of the State Ethics Act. I would especially note that Section 8-13-775
of the Act states that [a] public official, public member, or public employee may not
have an economic interest in a contract with the State or its political subdivisions if the
public official,. public member, or public employee is authorized to perform an official
function relating to the contract. n
11

Moreover, other previous opinions of this Office should be referenced to you. In
an opinion dated February 28, 1974, we stated that "[t]here ·is a long line of opinions
issued by this office as well as a number of South Carolina Supreme Court decisions
which regard such actions as contrary to public policy for a public officer to transact
business with a body of which he is a member." There, we further concluded that
[i]t is against public policy to permit dealings between a
public officer and himself as a private citizen, and public
officers are barred from contracting with the public agency
which they represent, or from having a private interest in the
contracts of such agency. When, therefore, the private
interests of one who is seeking contract for public works
conflicts with his public duties as officer of the public body
with whom he is contracting, or when a public officer has a
pecuniary interest, direct or indirect in a contract for public
work the contract is generally regarded as void or voidable.
The fact that the public officer would suffer no financial loss
from performance is not material to the question of validity.
(Quoting 43 Am. Jur. Pub. Works and Contracts Par. 14].

a

Even more significantly, an opinion of November 26, 1963, addressed the question
whether "a member of the Wildlife Resources Commission [is] barred from transacting
business with the Department even though the business he transacts is done on a

Mr. Burnside
Page 4
June 18, 1996

competitive bid basis in connection with a commodity on which other bids are taken?"
Attorney General McLeod, although noting that no specific statute expressly prohibited
the member from transacting business with the Department, advised that such should not
be undertaken. He wrote in that regard:
[i]rrespective of good faith and anns-length dealings by the
members, the general view appears to be that public officials
are not permitted to place themselves in a position in which
personal interests may come into cc.nflict with the duty which
they owe to the public. Transactions such as are considered
here have universally been criticized and subjected to the
highest degree of scrutiny as being inimical to the public
interest. In similar circumstances the Supreme Court of this
state has expressed the following v~ews:
"No man in the public service should be
permitted to occupy the dual position of master
and servant; for as master he would be under the
temptation of exacting too fa tle of himself as
servant; and as servant he would be inclined to
demand too much of himself as master. There
would be constant conflict between se1 f-i nterest
and integrity."

I am of opinion that it is comrary to public policy for
a public officer to transact business wi th the body of which he
is a member, irrespective of whether a statute specifically
prohibits such an officer from so acting.
In considering the validity of a contract between a city
and a corporation which had among its stockholders members
of the City Council, the Supreme Court of South Carolina
concluded:

"That the high chan,:ter of the three
gentlemen in question would show that their
presence in this contract on t) oth sides so to
speak, was due to their great anx iety to promote
the best interests of the public ... and not for
profit to themselves; still, it is our .duty to say

Mr. Burnside
Page 5
June 18, 1996
that their conduct is illegal;
Charleston, 60 S.C. 532.

"

Duncan v.

I recognize that contracts for business transactions
between public officers and the public bodies they represent
are generally bona fide, arms-length transactions, honestly and
fairly entered into. Numerous instances have occurred to my
certain knowledge whereby school districts were precluded
from borrowing money at lesser rates of interest, fron:i
acquiring desirable land, and from obtaining printed matter at
cost, because school trustees would have been parties to such
transactions. In other cases, large sums of money could have
been saved had a public official not been prohibited from
dealing with the agency of which he was a member. I refer
to these instances merely to emphasize that the views which
I express are not a reflection upon any business dealings
which a public officer has engaged in with an agency of this
state, and to point out that in all instances which have come
to my knowledge the. state has benefited by the action of the
officer.
At the same time the rule of law exists in this state
which bars a public officer from contracting with the public
agency which he represents or from having a private interest
in its contracts. The fact that the business is conducted upon
a business of competitive bids shows good faith and open
above-board dealing and, in fact, financial benefit to the
Wildlife Commission may be assumed. Nevertheless, the
public policy of this state does not sanction the practice and
I advise that, in my opinion, it should not be permitted.
Attorneys General in other jurisdictions have applied the same reasoning as
Attorney General McLeod to the practice of an agency's employees purchasing surplus
property when the sale is conducted by the State's General Services Department. For
example, the Virginia Attorney General concluded in an opinion of June 27, 1984 that
although the owning agency is not an actual party to the contract of sale of surplus
property, the "employees of both the selling agency and the owning agency would have
a prohibited personal interest in a contract with the governmental agency of_ which they
are a part if they purchase surplus property from DPS." Moreover, in an opinion of
August 21, 1981, the Attorney General of Mississippi found it to be a conflict for

Mr. Burnside
Page 6
June 18, 1996

"municipal surplus property to be sold to a municipal employee." While in part these
interpretations involved particular statutes, such laws simply restated the general law
which Attorney General McLeod relied upon.
Thus, the fact that there may not be an expli~it statute governing the situation you
describe, would not be determinative. As to any provisions of the Ethics Act which may
govern this situation, I would refer you to the Ethics Commission for such a
determination. However, I would also advise that this Office has determined on a number
of occasions in the past that an officer or employee of a government agency should not
do business with nor have an interest in a contract of that agency. Such transaction
presents the appearance of a conflict of interest and is prohibited as a matter of public
policy and the common law, notwithstanding the ~bsence of an express statute forbidding
such transaction. Based upon my research and the reading of these opinions, I would
advise that, as you suggest, the transactions which you describe would likewise have the
appearance of, even if not in fact, a conflict of interest.
This letter is an informal opinion only. It has been written by a designated
Assistant Deputy Attorney General and represents 1he position of the undersigned attorney
as to the specific questions asked. It has not, howev er, been personally scrutinized by the
Attorney General nor officially published in the manner of a formal opinion.
With kind regards, I am
Very truly yours,

Robert D. Cook
Assistant Deputy Attorney General
RDC/an