Could North Charleston lease City Hall office space to its city attorney for city and private legal work?

Plain-English summary

In 2009, North Charleston proposed leasing office space in its new City Hall to its city attorney, who also maintained a private law practice. The Attorney General concluded that a court likely would not find the proposed lease a breach of the city’s trust in its property. The opinion relied on three stated facts: the attorney spent most of his time on city matters, locating him in City Hall would benefit the city, and he would pay fair market rent. The proposed lease would end if he ceased to be city attorney.

The opinion did not say that any private law practice may occupy municipal space. Its conclusion addressed this proposed arrangement, with its public benefit and rent terms. As the letter put it, “we do not believe a court would find the City's lease of office space to the City Attorney amounts to a breach of trust by the City.”

Currency note

This opinion was issued in 2009. 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 the Attorney General say the lease violated South Carolina law? A: No. On the facts the mayor supplied, the office concluded that a court likely would not find a breach of trust. It expressly relied on the attorney’s majority-city workload, benefit to the city, and fair market rent.

Q: Could the city attorney still handle private clients from the leased office? A: The proposed arrangement included private legal work in the City Hall space. The opinion treated the use as not primarily private because most of the attorney’s time was spent on city matters; it did not announce a general rule for every mixed public and private practice.

Q: What city action did the opinion identify for leasing real property? A: It said Section 5-7-40 allows a municipality to lease real property so long as the action is effected by an ordinance.

Q: Why did fair market rent matter?
A: The opinion cited the rule against donating municipal property to a strictly private use without reasonably equivalent consideration, then noted that this attorney would pay a fair market rate.

Background and statutory framework

The mayor described a city attorney who headed the legal department while also representing private clients. The city wanted to move him from a private building into its new City Hall. The letter said that the move would make access more convenient and reduce travel time for city work; he would also use the leased space for parts of his private practice.

The Attorney General read Section 5-7-40 as authorizing a municipality to lease real property when it acts by ordinance. An earlier opinion, discussing Haesloop v. City Council of Charleston, described municipal property as held in trust for public use and identified a problem when property is donated to a strictly private use without reasonably equivalent consideration. The 2009 opinion found the proposed use was not primarily private and noted the fair market rent. It did not assess a completed ordinance or an executed lease.

Citations and references

Statute: Section 5-7-40 of the South Carolina Code (2004), municipal authority to lease real property by ordinance.

Case: Haesloop v. City Council of Charleston, 123 S.C. 272, 282, 115 S.E. 596, 600 (1923), discussed through an earlier Attorney General opinion on municipal property held for public use.

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/september-25-2009/
• Original PDF: https://www.scag.gov/wp-content/uploads/2011/03/summey-r-k-os-8848-9-25-09-city-of-north-charleston-lease-office-space-to-city-attorney.pdf

Original opinion text

HENRY M CMASTER
ATrORNEY G ENERAL

September 25, 2009

The Honorable R. Keith Summey
Mayor, City of North Charleston
Post Office Box 190016
North Charleston, South Carolina 29419-9016
Dear Mayor Summey:
We received your letter requesting an opinion of this Office as to the ability of the the City ofNorth Charleston (the " City'') to lease office space to its City Attorney. Along with your request, you provided the following information: The City of North Charleston retains a City Attorney who leases an office in a private office building that is not located in the current City Hall. The City Attorney is the department head of the City' s Legal Department and supervises City employees, including two Deputy City Attorneys, one prosecutor and one paralegal. The City has constructed a new City Hall and wishes to lease office space to the City Attorney at a fair market rate per square foot basis in the new facility. Having the City Attorney located in the new City Hall will make access issues much more convenient for the City and will save money in reduced travel time for City employees and the City Attorney for City-related legal matters. The proposed lease further states that the lease terminates if he should cease to be the City Attorney. Although the City Attorney's primary client is the City, he also has a private practice and would use the leased space in the new City Hall for aspects of the private practice of law in addition to working for the City under contract. The private practice generally handles complex litigation. Most clients are out of the local area and the practice has very little "walk in" traffic. His staff includes one paralegal who is privately employed for his private practice and another Deputy City Attorney who works for him on both City and private matters.

REMBERT

c. DENNIS BUU.OJNG • Posr OFFJCE Box 11549 • COLUMBIA , SC 29211-1549 • TELEPHONE 803-734-3970 • FACS!Mll.E 803-253-6283

The Honorable R. Keith Summey
Page2
September 25, 2009

Based on this information, you ask that we render "an opinion as to whether the abovedescribed lease agreement violates South Carolina law." Law/Analysis

Section 5-7-40 of the South Carolina Code (2004) provides municipalities with the authority to own and dispose of real and personal property and specifically states that municipalities may lease real property so long as such action is effected by an ordinance. In an opinion of this Office issued in 1984, we noted that although section 5-7-40 allows municipalities to dispose of their property,"[i]n Haesloop v. City of Charleston, supra, the court noted that as all powers of municipal corporations are held in trust for public use, so would all property held by such corporations be held in a fiduciary capacity." Op. S.C. Atty. Gen., July 6, 1984 (citing Haesloop v. City Council of Charleston, 123 S.C. 272, 282, 115 S.E. 596, 600 (1923)). Moreover, we added: "According to the court, it would be a breach of trust upon which this property is held to donate it to a strictly private use without receiving in return some consideration of reasonably equivalent value." Id. (citing Haesloop, 123 S.C. at 283, 115 S.E. at 600).

By your letter, you indicate that while the City Attorney represents clients other than the City and employees personnel other than City employees, a majority of his time is spent on City matters. Therefore, we do not believe his use of office space in City Hall is primarily private in nature and as you indicate will provide a great benefit to the City. In addition, you state that the City Attorney will agree to pay a fair market rate for space leased by the City. Thus, we do not believe a court would find the City's lease of office space to the City Attorney amounts to a breach of trust by the City. Very truly yours, Henry McMaster Attorney General

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By:

REVIEWED AND APPROVED BY:

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Robert D. Cook
Deputy Attorney General

Cydney M. Milling
Assistant Attorney General