Ethical Considerations in Land Use Law Blowing in ...

Ethical Considerations in Land Use Law Blowing in the Wind Patricia E. Salkin1 I. Introduction The number of reported land use law cases involving allegations of unethical conduct by one or more players in the land use game remains at about fifteen to twenty each year,2 but in 2008 it seems as though the number of instances of media reports about alleged unethical conduct, the instances of ethical allegations lodged in court cases and attention by government regulators in this area is on the rise. 3 This is not surprising given the downturn in the economy combined with significant financial investments made in real estate resulting in increased scrutiny of the often pressurefilled land use decision making process. Both applicants and residents desire to protect their property values and investments, demanding full transparency to ensure that decisions made are not influenced by self-interest on the part of the decision makers and that they are not subject to improper political and other influences that could taint the objectivity of the decision maker. The vast majority of the reported cases deal with real and perceived conflicts of interest situations based in part on employment, personal financial interests, familial and personal relationships, and residency.4 Reported cases also address allegations of bias, prejudice, and bad faith on the part of decision makers.5

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Patricia E. Salkin is the Raymond & Ella Smith Distinguished Professor of Law at Albany Law School where she is also the Associate Dean and Director of the Government Law Center. Salkin is the author of the blog Law of the Land, available at http://lawoftheland.albanylaw.edu 2 An annual discussion of land use ethics cases by the author can be found at: “Crime Doesn’t Pay and Neither Do Conflicts of Interest in Land Use Decisionmaking,” 40 The Urb. Lawyer 561 (Summer 2008); “Ethical Considerations in Land Use Decisionmaking: 2006 Annual Review of Cases and Opinions,” 38 The Urban Lawyer 669 (Summer 2006); “Tips for Ethical Considerations in Land-Use Decision Making: No Gobbly Goop in the 2006 Annual Review of Cases and Opinions,” Zoning and Planning Law Report (May 2006); “Land Use Ethics Update 2005: Conflicts of Interest, Improper Conduct and Other Ethical Considerations,” 28 Zoning & Planning Law Report 1 (March 2005); “A Woody Allen Movie, Show Me the Money and Other Ethical Considerations in Land Use Planning,” 27 Zoning & Planning Law Report 3 (March 2004); “Ethics Allegations in Land Use Continue to Fill the Court Dockets,” 26 Zoning & Planning Law Report 4 (April 2003); “Litigating Ethics Issues in Land Use: 2000 Trends and Decisions,” 24 Zoning & Planning Law Report 4 (April 2001); “Municipal Ethics Remain a Hot Topic in Litigation: a 1999 Survey of Issues in Ethics for Municipal Lawyers,” 14 BYU J. of Pub L. 209 (2000); and “1998 Survey of Ethics in Land Use Planning,” 22 Zoning and Planning Law Report 4 (April 1999). 3 For current reports about alleged unethical conduct in reported cases, as well as reports about government action to regulate certain conduct, see the “ethics” button at http://lawoftheland.albanylaw.edu. 4 For a comprehensive overview of the reported cases and opinions over the last couple of decades in th planning and land use law, see, Salkin, American Law of zoning, 5 ed., Chapter 38 (Thomson West 2008). 5 Id.

Electronic copy available at: http://ssrn.com/abstract=1315543

In 2008, ethical issues in the land use process received further attention when the Center for Public Integrity launched its Land Use Accountability Project.6 According to a press release issued in August 2008 announcing the initiative, the Center explains that its efforts focus “on the role of money and politics in land use and development decisions affecting America’s open spaces.”7 The Center further explains that its “first series looks at three communities in the Mid-Atlantic region facing visible growing pains: Loudoun County, the Eastern Shore of Maryland, and the exurban area outside Philadelphia, including Bucks County,” and the “The Center’s goal is to expand the discussion of local land-use issues to make this a truly national story, where the experiences of these Mid-Atlantic communities are coupled with other communities throughout the country. To that end, the Center will be covering development stories nationwide involving small communities and developers and the challenges of protecting our national heritage while permitting appropriate growth.” In addition, the Chicago Tribune ran a series of articles about their investigation (“Neighborhoods For Sale”) into a decade of zoning changes to detail how real estate interests have funneled millions of dollars to the aldermen who dictate what can be built.8 Although there are a fair number of reported land use ethics cases each year, and the conduct complained of, if true, may not be ethical, from a legal standpoint the courts may have no choice but to reluctantly find the complained of conduct did not violate a statute or regulation.9 Courts are also clear, however, that when parties make allegations of unethical conduct, they will not consider “naked assertions” without knowledge of any facts.10 The overarching consideration then, is although community standards may dictate that the conduct is unacceptable and hence unethical, unless state or local laws prohibit the conduct, litigation may not be the most effective tactic in attempting to overturn the decision. The remainder of this article focuses on two aspects of ethics in land use where there was considerable activity in 2008. Part II examines regulation of ethical conduct by an attorney general and by a state legislature. Both actions are designed to provide the public with full transparency and disclosure of potential conflicts of interest arising 6

The Center for Public Integrity is dedicated to producing original, responsible investigative journalism on issues of public concern in the USA and around the world. See, http://www.publicintegrity.org/investigations/luap/pages/introduction (site visited November 2008). 7 See, http://lawoftheland.wordpress.com/2008/08/09/land-use-accountability-project-launched-by-centerfor-public-integrity (site visited November 2008). 8 http://www.chicagotribune.com/news/specials/chi-zoning-storygallery,0,6709336.storygallery (site visited November 2008). 9 For example, see Tuttle v. Planning Bd., 18 Mass. L. Rptr. 381 (Mass. 2004), where the Massachusetts Supreme Judicial Court reluctantly determined that the State’s Conflicts of Interest Law did not prevent a municipality from hiring a traffic consultant to advise it, even though the consultant was simultaneously involved in a business relationship with the applicant for a project in a different state, and the consultant was also a partner with the applicant on the development at issue. The conflicts of interest laws did not apply because the statute only encompassed municipal employees and not consultants. 10 See for example, Blinkoff v. Planning and Zoning Commission (Conn. Super. Ct. 1999), finding that there was no personal financial conflict of interest where a member of a planning and zoning commission served as an electrical contractor for several projects with the applicant and where each of these jobs was won through a competitive bidding process.

Electronic copy available at: http://ssrn.com/abstract=1315543

from financial interests in applications before boards. One method of regulation puts the burden on applicants to identify and disclose the potential conflicts, and the other puts the onus on municipal officials. Part III examines recent cases where the conduct, past and present, of attorneys involved in various aspects of the land use decision making process is called into question by members of the public. Sometimes this conduct is regulated by the individual state version of the Rules of Professional Conduct, and other times the conduct is regulated by state and local government ethics laws. The two subjects selected for coverage in this article are by no means the only land use ethics to arise in 2008. Municipal officials, including elected legislators, members of planning and zoning boards are most often the subject of allegations of unethical conduct in the land use decision making arena. Recent cases have focused on a wide range of ethics issues including: allegations of bias,11 allegations of conflicts of interest based upon relationships,12 and unethical conduct based upon alleged gender13 or ethnic discrimination.14 II. Government Regulators Focus on Ethics in Land Use Decisions in 2008 A. New York Attorney General Proposes Voluntary Code of Ethics for Wind Farm Development Perhaps the biggest news of 2008 is the attention to ethical issues involved with renewable energy, such as wind farms. Following an investigation launched in July 2008 by the New York Attorney General into two companies developing and operating wind farms across New York amid allegations of improper dealings with public officials and anti-competitive practices, In October 2008 the New York Attorney General announced a new voluntary code of ethics for the wind industry (a copy of the code is appended to this article).15 The Code prohibits conflicts of interest between municipal officials and wind companies and establishes certain public disclosure requirements. Among other things, the Code bans wind companies from: hiring municipal employees or their relatives, giving gifts of more than $10 during a one-year period, or providing any other form of compensation that is contingent on any action before a municipal agency. In addition, the Code prevents wind companies from soliciting, using, or knowingly receiving confidential information acquired by a municipal officer in the course of his or her officials duties; requires wind companies to establish and maintain a public Web site to disclose the names of all municipal officers or their relatives who 11

See, for example, Lane Construction Corp. v. Town of Washington, 942 A.2d 1202 (Me. Sup. Ct., 3/11/2008)(Although the planning board chair may have been predisposed to support an application, The Maine Supreme Court said he was not biased in his participation in the matter). 12 See, for example, see, Hughes v. Monmouth University, 394 N.J. Super. 193, 925 A.2d 741 (6/27/2007)( NJ Appellate Court found no conflicts of interest where board members had remote connections to the University-applicant).. 13 Dutko v. Lofthouse, 2008 WL 1927036 (D. Conn., 5/1/2008) (The District Court concluded that the applicant’s gender had nothing to do with a denial to have her land rezoned). 14 Rante v. City of Wood Dale, 2008 WL 345603 (N.D. Ill. 2/5/2008) (The Northern District of Illinois found no evidence of discrimination based on ethnicity). 15 See, http://www.oag.state.ny.us/media_center/2008/oct/oct30a_08.html (site visited November

2008).

have a financial stake in wind farm development, requires wind companies to submit in writing to the municipal clerk for public inspection and to publish in the local newspaper the nature and scope of the municipal officer’s financial interest, mandates that all wind easements and leases be in writing and filed with the County Clerk, and requires that within thirty days of signing the Wind Industry Ethics Code, companies must conduct a seminar for employees about identifying and preventing conflicts of interest when working with municipal employees.16 Developed in response to numerous complaints regarding two wind companies from citizens, groups and public officials in eight counties that alleged improper relations between the companies and local officials and other improper practices, the Attorney General stated in the announcement that he would investigate the matter that, “The use of wind power, like all renewable energy sources, should be encouraged to help clean our air and end our reliance on fossil fuels, however, public integrity remains a top priority of my office and if dirty tricks are used to facilitate even clean-energy projects, my office will put a stop to it.”17 The voluntary Code, which has now been signed by the two companies that had been under investigation, remains the subject of ongoing debate in New York.18 One month after the Code was released a New York appellate court dismissed a petition calling for removal of a town legislator that alleged that the legislator concealed a conflict of interest when he voted to approve a wind energy facility because the project would include a turbine on his property, determining that the petitioner failed to prove the existence of an actual conflict of interest.19 The New York Public Officer’s Law sec. 36 provides, in part, that upon application by any citizen resident of a town or village or by the district attorney having jurisdiction in the municipality, a municipal officer may be removed from office by the court “for any misconduct , maladministration, malfeasance or malversation in office.” The Courts have said that removal “generally will not be granted absent allegations of self-dealing, corrupt activities, conflict of interest, moral turpitude, intentional wrongdoing or violation of public trust[,]…[and a] allegations of minor neglect of duties, administrative oversights, or violations of law…do not, in general, warrant removal.”20 Here, the Court said, that the alleged conflict consisted solely of the wind company’s proposal for a wind energy facility that identified the legislator as a proposed participating landowner on whose property a turbine would be located.21 Because the legislator and the wind company had not entered into any 16

. http://www.oag.state.ny.us/media_center/2008/oct/WindCODE%20FINAL.pdf (site visited November 2008). 17 http://lawoftheland.wordpress.com/2008/07/17/ny-attorney-general-launches-investigation-of-potentialunethical-and-illegal-dealings-between-wind-power-companies-and-municipalities (site visited November 2008). 18 See, for example, http://www.democratandchronicle.com/article/20081031/OPINION04/810310318/1041/OPINION (site visited November 2008); and http://www.wind-watch.org/news/2008/11/01/wind-ethics-guidelines-bringneeded-transparency (site visited November 2008). 19 Hedman v. Town Board of Town of Howard, 2008 WL 4952613 (N.Y.A.D. 11/21/2008). 20 th See, Matter of Jones v. Filkins, 238 A.D. 2d 954 (4 Dept. 1997). 21 Hedman v. Town Board of Town of Howard, 2008 WL 4952613 (N.Y.A.D. 11/21/2008).

agreement with the company at the time of the vote, the Court could not say that his vote in favor of the project was affected by virtue of a conflict of interest.22 Further, the Court said that the alleged impropriety that he failed to make a public disclosure of the potential conflict does not warrant removal under Public Officer’s Law sec. 36.23 B. Virginia Legislature Enacts Public Disclosure Provisions for Loudon County Decision Makers With disclosure of potential conflicts resulting from self-interest reigning high on the agenda for regulators, in March 2008, the Virginia enacted a new law requiring each individual member of the Loudoun County board of supervisors, planning commission, and board of zoning appeals in any proceeding before each such body involving an application for a special exception or variance or involving an application for amendment of a zoning ordinance map, which does not constitute the adoption of a comprehensive zoning plan, an ordinance applicable throughout the locality, or an application filed by the board of supervisors that involves more than 10 parcels that are owned by different individuals, trusts, corporations, or other entities, to, prior to any hearing on the matter or at such hearing, make a full public disclosure of any business or financial relationship that such member has, or has had within the 12-month period prior to such hearing, (i) with the applicant in such case; (ii) with the title owner, contract purchaser, or lessee of the land that is the subject of the application, except, in the case of a condominium, with the title owner, contract purchaser, or lessee of 10 percent or more of the units in the condominium; (iii) if any of the foregoing is a trustee (other than a trustee under a corporate mortgage or deed of trust securing one or more issues of corporate mortgage bonds), with any trust beneficiary having an interest in such land; or (iv) with the agent, attorney, or real estate broker of any of the foregoing. 24 III. Ethical and Professionalism Considerations for Attorneys 25 Attorney ethics are of critical importance in the land use game, not just in terms of the Rules of Professional Conduct, but also with respect to avoiding appearances of impropriety and ensuring compliance with state and municipal ethical codes and regulations. Sometimes, the application of ethics codes can have chilling effects on attorneys in private practice. For example, prohibitions in professional codes of conduct that prohibit lawyers from representing clients who may have an interest adverse to a former client can serve to prevent law firms who formerly represented municipalities on land use matters from representing clients in the future in front of land use boards.26 22

Id. Id. 24 Chap. 532 of the Laws of 2008. The text of the new law can be accessed at: http://leg1.state.va.us/cgi-bin/legp504.exe?081+ful+SB532ER 25 th The Introductory paragraph to this Section is excerpted from Salkin, American Law of zoning, 5 ed., Chapter 38 (Thomson West 2008). 26 In Walden Federal Sav. And Loan Ass’n v. Village of Walden, 212 A.D.2d 718, 622 N.Y.S.2d 796 (N.Y.App.Div. 1995), for example, a New York appellate court held, based upon prohibitions in the Code of Professional Responsibility, that since the law firm had represented the Village on various land use issues over the course of thirty years, six years after the firm last represented the Village it was prohibited 23

Even a lawyer’s relationship with their law firm (e.g., status as partner, associate or of counsel) may be determinative of a conflict of interest.27 Sometimes the focus of conflicts of interest allegations centers around lawyers who also serve as local elected or appointed officials, and who, in their governmental capacities, occasionally cast votes against the interest of firm clients.28 Other times attorney conduct is challenged based on notions of undue influence, particularly where the lawyer is or was a municipal official in the jurisdiction where he or she is presently representing a client.29 Attorneys may also be criticized for community involvement where such activities create a real or perceived conflict of interest.30 Familial relationships between lawyers and board members have also been the subject of litigation.31 What follows is a discussion of recent land use ethics cases where an attorney’s conduct was called into question. A. Kansas Appeal Court Holds County Counsel Involvement Did Not Violate Due Process

from appearing before the Village Planning Board on behalf of a new client seeking a site plan review. But see Nicholas v. Wilton Zoning Board of Appeals, 30 Conn. L. Rptr. 386 (Conn. Super. Ct. 2001), where the court reached a different result after the Town sought to disqualify its former counsel who, twenty-six years after he represented the Town on the same matter, sought to represent the private individual before the Town. In this case, the court said that “the public’s interest in the scrupulous administration of justice” would not be compromised and that the “plaintiff’s interest in the free selection of the counsel of his choice outweighs the defendant’s interest in protecting confidential information.” See also Florida Country Clubs, Inc. v. Carlton Fields, Wards, Emmanuel, Smith & Cutler, P.A., 98 F.Supp. 2d 1356 (M.D. Fla. 2000) (involving a law firm that was the subject of alleged breach of fiduciary duty where the law firm possessed information from a former client who was presently involved with a real estate deal before a city for which the law firm was providing representation.). Most recently in State ex. Rel. Jefferson County Board of Zoning Appeals v. Wilkes, 655 S.E.2d 178 (W. Va. 2007), the Virginia Supreme Court, relying on the Rules of Professional Conduct, held that a lawyer and his firm were disqualified from representing an applicant before a zoning board since the lawyer had previously represented that board. 27 For example, in Haggerty v. Red Bank Borough Zoning Board of Adjustment, 385 N.J. Super. 501, 897 A.2d 1094 (2006), a case of first impression in New Jersey, the Superior Court held that since the father of the Vice Chair of the zoning board of adjustment had an “of counsel” relationship with the law firm that had represented an applicant a number of years ago, this created a disqualifying conflict-of-interest for the board member, necessitating a recusal. Since the Vice Chair had not recused herself, the court held that the entire process was tainted and set aside the Board’s decision. 28 For example, see Joe v. Two Thirty Nine Joint Venture, 145 S.W.3d 150 (Tex. 2004). 29 See, e.g., In re Covey, 166 N.J. 298, 765 A.2d 724 (2001). In Covey, the court reprimanded the lawyer, a former mayor who had also previously served as counsel to the board of adjustment, for attempting to use his political influence to pressure board members to grant a variance to his client. The court said: “Respondent, as an experienced attorney and ex-Counsel to the Edison board of Adjustment, should have known that influencing two members of the zoning board, a quasi-judicial tribunal, through third parties to vote to grant a variance for respondent’s client was highly improper.” 30 For example, recently a borough attorney in New Jersey tendered his resignation after serving as counsel to the zoning hearing board for almost twenty years based upon a “perceived conflict of interest” because he serves on the foundation board of an organization that provides scholarship funds for students attending a high school that had an application pending for a dormitory for foreign students. The attorney had not recused himself from the matter. See, Douglas B. Brill, “Council Sticks to Guns on Dormitory Appeal,” The Express-Times, March 4, 2008. Available at: http://www.pennlive.com/news/expresstimes/index.ssf?/base/news-15/1204607136129460.xml&coll=2 31 See, e.g., 78 Ops. Cal. Atty. Gen. 230 (No. 95-110) (July 27, 1995), (concluding that the city council could enter into a development agreement with the developer despite the fact that one of the city council members was married to a lawyer whose firm represented the developer on unrelated matters).

A Kansas Appeals Court held that the mere fact that the county counsel represented the county in a quasi-judicial proceeding to determine damages as a result of the County’s vacation of two unimproved roads that provided access to a ranch, and that the counsel had a long-standing relationship as the board’s legal advisor, was alone insufficient to find a due process violation.32 While the plaintiff argued that the fact that the attorney offered evidence at the Commission hearing, cross-examined witnesses at the hearing, and then drafted the decision for the Commission, constituted a violation of his due process rights, the Court found no evidence to suggest to that the attorney’s action in drafting the Board’s finding and order had actually affected the commission’s decision. 33 Although the plaintiff asserted that the attorney’s “dual role” had “created a probability of actual bias and impartiality on the part of the Board that is simply too high to be constitutionally tolerable,” the Court noted that the plaintiff conceded that the attorney did not conduct himself in a manner to cause such bias to occur. 34 The Court found no evidence in the record to suggest that the attorney’s actions created an appearance of impropriety.35 In fact, commissioners testified that the attorney did not influence their decision.36 Lastly, the Court noted that the Plaintiff never request that the attorney withdraw from any of the proceedings, nor did he request that the Commission retain separate counsel.37 The Court concluded, “Without evidence that an attorney’s action in representing a boar at a quasi-judicial hearing as well as advising the Commission has actually affected the Commission’s decision, we will not find a due process violation.” 38 B. Montana Supreme Court Finds County Attorney’s Volunteer Involvement Did Not Taint Proceedings After serving for ten years as the elected county attorney, DePuy resigned her position and began working in the newly created part-time position as a county attorney doing civil work, including advising the Park County Commissioners and the county planning staff on various legal issues, including land use and development issues.39 During this time she also served in a volunteer capacity as a board member of a group named Corporation for the Northern Rockies (CNR), a non-profit organization that promotes sustainable development and protection of Montana’s landscape. According to Park County Concerned Citizens (PCCC), CNR seeks to stop development of rural land. CNR has not engaged in any lobbying before the Park County Commissioners nor has it engaged in any litigation with or against Park County.40 PCCC sought an investigation of what they believed to be unethical conduct on the part of DePuy.41 After 32

Davenport Pastures, LP v. Morris County Board of County Commissioners, 2008 WL 4754925 (Kan. App. 10/31/2008). 33 Id. 34 Id. 35 Id. 36 Id. 37 Id. 38 Id. 39 Park County Concerned Citizens v. DePuy, 2008 WL 2738454 (MT. 7/15/2008 ). 40 Id. 41 Id.

the Attorney General’s office declined to pursue the matter, PCCC contacted the County Attorney’s Office which led to an investigation by the Yellowstone County Attorney’s office. The investigation concluded that neither DePuy nor the Park County Commissioners had engaged in any wrongdoing.42 They concluded that when she resigned as County Attorney and immediately was hired as Civil County Attorney, she remained employed by Park County and continued to represent the interests of the county.43 PCCC then filed a complaint alleging that DePuy improperly took advantage of her position as County Attorney to create a new Civil County Attorney position and then become employed in that position, in violation of § 2-2-105(3) of the Montana Statutes, and second, that it was unethical and in violation of § 2-2-121(5) of the State Statutes for DePuy to render legal opinions on land use issues while serving on the board of CNR.44 The District Court noted, “This lawsuit seems to have been illconceived,” and some of the evidence “suggests that this is, in fact, a personal attack on Ms. DePuy filed because of suspicion and speculation, but without evidence of wrongdoing.”45 In concluding that there was no unethical conduct, the Montana Supreme Court first examined Section 2-2-105(3) of the Montana Code Annotated which, provides: “A public officer or public employee may not, within 12 months following the voluntary termination of office or employment, obtain employment in which the officer or employee will take direct advantage, unavailable to others, of matters with which the officer or employee was directly involved during a term of office or during employment. These matters are rules, other than rules of general application, that the officer or employee actively helped to formulate and applications, claims, or contested cases in the consideration of which the officer or employee was an active participant.” 46 The Court noted that the Preamble to a 1995 amendment to the statute noted that the Montana Constitution intends to “prohibit[] conflict between public duty and private interest for . . . all state and local government officers and employees.”47 The Court reasoned that both “the Constitution and this statute are intended to prevent public employees from taking advantage of a government position to benefit themselves when they leave their prior employment.”48 Since PCCC did not offer any evidence to show that when DePuy was hired as Civil County Attorney she somehow gained an advantage, unavailable to others, over some matter handled by Park County or the Park County Attorney’s office, no violation occurred.49 Section § 2-2-121(5) of the Montana Code Annotated provides that “A public officer or public employee may not participate in a proceeding when an organization, other than an organization or association of local government officials, of which the public officer or public employee is an officer or director is: (a) involved in a proceeding before 42

Id. Id. 44 Id. 45 Id. 46 Id. 47 Id. 48 Id. 49 Id. 43

the employing agency that is within the scope of the public officer’s or public employee’s job duties; or (b) attempting to influence a local, state, or federal proceeding in which the public officer or public employee represents the state or local government. “50 The Court concluded that DePuy provided uncontradicted evidence that CNR was not, and had not been, “involved in a proceeding” in Park County, and that CNR was not, and had not been, “attempting to influence” a proceeding in Park County. Further, the Court noted that PCCC did not dispute DePuy’s evidence, rather they simply argued that there is an “inherent” conflict in DePuy serving both as a County Attorney handling civil matters and acting as a board member of CNR. This argument, said the Court, has no basis in the statute.51 C. New Jersey Appellate Court Finds That Although Lawyer Had a Conflict Which Voided the Planning Board Decision, Plaintiffs Are Not Entitled to Attorneys Fees A recent unpublished opinion, which although really focused on whether the plaintiffs were entitled to attorneys fees under the theories that they acted as private attorney general, it would be unjust enrichment not to award the fees, and that although the Court had found the attorney had an “apparent” conflict, and that it was a “actual” conflict central to the awarding of attorney fees, is interesting because the Court reviewed the facts in the prior ethics litigation.52 Although the Court disagreed with these arguments and did not award attorneys fees, a word about the underlying conflict of interest serves as an instructive reminder to attorneys to pay attention to the paper trail and necessary filings that could prevent future ethics allegations. The opinion explains that attorney Lawrence Vastola represented a Church before the planning board which was seeking approvals to convert an existing dwelling into administrative offices, as well as a bulk variance for an existing condition related to a detached garage, and a merger of two lots. Although the planning board granted the approvals, the trial court vacated these decisions because Vastola had an “apparent conflict of interest” as he also represented the planning board in an unrelated case during the same timeframe.53 The facts disclose that Vastola came to represent the planning board in 1977 in one matter because the Board’s regular attorney had a conflict in the matter that prevented his involvement in the action.54 The case was finally tried in 1998, but no decision was rendered because the Judge, who was waiting for a decision in a related matter from the Supreme Court before deciding the case, died in 2001 without having issued a decision. 55 Although the “regular” planning board attorney resolved his conflict around 2001 and he apparently resumed representation of the board in that matter, neither he nor Vastola filed a substitution of counsel until May 2002.56 Vastola began representing the Church in February 2002, and the matter was 50

Id. Id. 52 Hewson v. Alliance Bible Church, 2007 WL 120241 (N.J.Super. A.D. 1/19/2007). 53 Id. 54 Id. 55 Id. 56 Id. 51

before the planning board from April 2002 through a final resolution approving the project in August 2002.57 The Court did not award attorneys fees because they determined that the planning board did not act in bad faith, and also because the plaintiffs had procedural defects in their fee applications.58 Attorney Vastola represented to the court that his involvement with the earlier matter virtually ceased in August 2001 when the regular board counsel took over the case, and it did not appear that Vastola was copied on any correspondence related to that matter during the time he was representing the Church.59 D. West Virginia Supreme Court Holds that Lawyer and his Firm May Not Represent Applicant on CUP Permit He Previously Worked on as Counsel to the Zoning Board Under Rule 1.11 As a former assistant prosecuting attorney, between 2001 and 2003 J. Michael Cassell represented, advised, counseled and litigated on behalf of the zoning board of appeals with respect to a conditional use permit (CUP) sought by Thorn Hill, LLC.60 In 2005, Cassell left the prosecuting attorney’s office and joined a private law firm that represented Thorn Hill, LLC before the zoning board. While at the firm, he assumed representation for Thorn Hill in one of the CUP matters before the zoning board that Cassell had worked on when he represented the board.61 The zoning board brought a motion to disqualify both Cassell and the law firm from representing Thorn Hill before the Board in this matter. 62 Relying on the W. VA Rules of Professional Conduct, the Court said, “the controlling principle of law…is the requirement set forth in Rule 1.11(a) that except as law may otherwise expressly permit, a lawyer shall not represent a private client in connection with a matter in which the lawyer participated personally and substantially as a public officer or employee, unless the appropriate government agency consents after consultation. No lawyer in a firm with which that lawyer is associated may knowingly undertake or continue representation in such a matter unless: (1) the disqualified lawyer is screened from any participation in the matter and is apportioned no part of the fee therefrom; and (2) written notice is promptly given to the appropriate government agency to enable it to ascertain compliance with the provisions of this rule.” 63 The Court concluded that Cassell participated personally and substantially in connection with the two Thorn Hill permit applications in question as attorney for the zoning board.64 As a result, the disqualifying language of Rule 1.11(a) facially and 57

Id. Id. 59 Id. 60 State ex. Rel. Jefferson County Board of Zoning Appeals v. Wilkes, 2007 WL 4157128 (W. Va. 11/20/2007). 58

61

Id. Id. 63 Id. 64 Id. 62

literally applies to him and he is prohibited from representing Thorn Hill before the zoning board in connection with an application in which he participated personally and substantially as a public officer or employee (and the Court noted that the zoning board has not consented to the Thorn Hill representation).65 Lastly, the Court did not find persuasive Cassell’s argument that each phase of the CUP process constitutes a “separate matter,” and that therefore he should not be disqualified from the current aspect of the process which he did not participate in as the Board’s attorney. The Court said, “neither common sense nor applicable legal authority support the contention that each stage in the consideration of a conditional use permit application is a separate and discrete “matter.” Nor do they support the contention that the BZA may not bar its former lawyer from aiding an applicant in connection with an application about which the lawyer once advised the BZA.”66 In explaining the unique situation that may confront former government lawyers, the Court cited to Allied Realty of St. Paul, Inc. v. Exchange National Bank, 283 F. Supp. 464 (D.C. Minn. 1968), which stated, “Many a lawyer who has served with the government has an advantage when he enters private practice because he has acquired a working knowledge of the department in which he was employed, has learned the procedures, the governing substantive and statutory law and is to a greater or lesser degree an expert in the field in which he was engaged.67 Certainly this is perfectly proper and ethical.68 Were it not so, it would be a distinct deterrant [sic] to lawyers ever to accept employment with the government. This is distinguishable, however, from a situation where, in addition, a former government lawyer is employed and is expected to bring with him and into the proceedings a personal knowledge of a particular matter-for which the government paid him while he was learning it and for which now the client who employs him theoretically will not have to pay.” (emphasis added).69 The Court agreed with the zoning board that “its former lawyer may not permissibly move from the closed chambers of the BZA to the law firm conference room-and then in that conference room advise his new client about the same application that he had worked on while representing the BZA.” 70 The Court concluded that “all proceedings before a board of zoning appeals and other legal proceedings regarding an application for a conditional use permit are proceedings about the same “matter” for purposes of West Virginia Rules of Professional Conduct,Rule 1.11(a),” and that therefore attorney Cassell and his law firm are prohibited from representing Thorn Hill before the zoning board on the CUP applications Cassell worked on when he represented the zoning board.71

65

Id. Id. 67 Id. 68 Id. 69 Id. 70 Id. 71 Id. 66

IV. Conclusion Attorneys involved in any aspect of the land development process must be mindful of the ethical landmines for clients, be they public or private sector actors, including lawyers, planners, municipal officials and applicants. Litigation is an expensive method of enforcing standards of appropriate, ethical conduct, yet too often players in the land use game experience ethical lapses and fail to recall training or education received on the subject and/or they fail to heed sage counsel about state and local laws and regulations governing conduct. Although it can be a challenge for land use attorneys to collect in one place all of the various applicable requirements – a thorough analysis of conduct must be measured against state and local laws and regulations that may not be easily accessible and many not be located in single sections of law at either level of government, as well as code of professional conduct that further govern the conduct of some players in the land use arena (e.g., lawyers, planners, engineers, architects, etc.) – there is no one better skilled than legal counsel to facilitate the discussion of difficult ethical dilemmas, sorting through conduct that is clearly legal and conduct that although not illegal may not be ethical.

Appendix A Voluntary Code of Conduct for Wind Farm Development Office of the New York State Attorney General October 2008 Wind Farm Development is a renewable energy source that should be fostered and encouraged. The Office of the Attorney General has received numerous complaints regarding Wind Farm Development from citizens, groups, and public officials alleging improper relationships between Wind Companies and local officials. To foster economic development and renewable energy, and promote public integrity in Wind Farm Development, the Office of the Attorney General has created the following Code of Conduct. The Code of Conduct will be monitored by an ongoing Advisory Task Force (the “Task Force”) assembled simultaneously herewith. Founding members of the Task Force will include a representative from each of the following agencies: the Franklin County District Attorney’s Office, the Monroe County District Attorney’s Office, the Wyoming County District Attorney’s Office, The New York State Association of Counties, and The Association of Towns of the State of New York. The Task Force shall also include a representative of the Office of the New York State Attorney General, and a designee of the Office of the New York State Attorney General who is not a member of that office. CODE OF CONDUCT FOR WIND FARM DEVELOPMENT The below-signed Wind Company voluntarily agrees to implement the following Code of Conduct to govern its future conduct in connection with Wind Farm Development in New York State. I. CONFLICTS OF INTEREST - PROHIBITED 1. General Standard: The Wind Company shall not directly or indirectly offer to, or confer on, a Municipal Officer, his or her Relative, or any third party on behalf of such Municipal Officer any benefit under circumstances in which it could reasonably be inferred the benefit would induce such Municipal Officer to commit an official act or to refrain from performing an official duty in connection with Wind Farm Development, unless such Municipal Officer recuses him or herself from any official duties in connection with Wind Farm Development. 2. No Gifts: The Wind Company shall not give any Municipal Officer, his or her Relative, or any third party on behalf of such Municipal Officer, any gift or gifts totaling more than ten dollars ($10.00) in the aggregate during any one-year period. 3. No Compensation for Services: The Wind Company shall not employ, hire, retain or compensate, or agree to employ, hire, retain or compensate, any Municipal Officer whose official duties involve Wind Farm Development in connection with the Wind Company, or his or her Relative, within two years of the time that such Municipal Officer had such duties, unless such Municipal Officer first recuses him or herself from any official conduct in connection with such Wind Farm Development. Accordingly, any compensation provided by the Wind Company to such Municipal Officer, his or her Relative, or third party on behalf of such Municipal Officer or Relative, shall be contingent on such prior recusal. The Wind Company shall disclose in writing to the Task Force and the Office of the Attorney General any agreement that is contingent on such recusal. 2

4. No Contingent Compensation: The Wind Company shall not provide or agree to provide compensation to any Municipal Officer or his or her Relative that is contingent upon such Municipal Officer’s action before or as a member of any Municipal agency. 5. No Honorarium: The Wind Company shall not confer on any Municipal Officer or his or her Relative any honorarium during the Municipal Officer’s public service, or for a period of two years after termination of such Municipal Officer’s service. 6. Restrictions on Easements/Leases with Municipal Officers: The Wind Company shall not enter into any agreement with any Municipal Officer that requires the Municipal Officer to support or cooperate with Wind Farm Development in any manner that relates to the Municipal Officer’s official duties. 7. Confidential Information: The Wind Company shall not solicit, use, or knowingly receive confidential information acquired by a Municipal Officer in the course of his or her official duties. 8. Restrictions on Legal Representation: The Wind Company shall not agree to pay legal fees for any Municipal Officer or Municipality in connection with any investigation by any law enforcement agency. II. PUBLIC DISCLOSURE For events transpiring after the date that this Code of Conduct is signed, the Wind Company shall make the disclosures as set forth in this section. For any financial interest held by a Municipal Officer or his or her Relative in any property Identified for Wind Farm Development prior to the date of this Code of Conduct, the Wind Company shall make the disclosure of the Municipal Officer and the nature and scope of the financial interest by a chart submitted to the Office of the Attorney General and displayed on a website hosted by the Wind Company. The format of the chart shall be subject to the approval of the Office of the Attorney General. 1. The Wind Company shall publicly disclose the full names of any Municipal Officer or his or her Relative who has a financial interest in any property Identified for Wind Farm Development, and the nature and scope of the financial interest in the following manner: a. Submit the information in writing for public inspection to the Clerk of such Municipality. b. Publish the information in a newspaper having a general circulation in such Municipality. c. Display the information on a website hosted by the Wind Company. d. Submit the information in writing to the Task Force and the Office of the Attorney 3 General. 2. All Wind easements and leases shall be in writing. The Wind Company shall promptly file, duly record, and index an abstract or memorandum of such agreements in the Office of the County Clerk for the county in which the subject property is located; if property owner is a Municipal Officer or his or her Relative, then the Wind Company also shall post an abstract or memorandum of any such agreement on a website hosted by the Wind Company. 3. The abstract or memorandum of such agreements shall, at a minimum, include: a. the full names and addresses of the parties; b. a full description of the property subject to the agreement; c. the essential terms of the agreement, including the rights conveyed by the property owner and, if the property owner is a Municipal Officer or his or her Relative, which of the following ranges encompasses the actual monetary consideration offered by the Wind Company or, if the actual

monetary consideration is not fixed, the Wind Company’s estimate of the monetary consideration: i. Under $5,000 ii. $5,000 to under $20,000 iii. $20,000 to under $60,000 iv. $60,000 to under $100,000 v. $100,000 to under $250,000 vi. $250,000 to under $500,000 vii. $500,000 to under $1,000,000 viii. $1,000,000 or higher. III. EDUCATION AND TRAINING 1. The Wind Company shall promptly provide a copy of this Code of Conduct and a written statement of its intention to comply with this Code of Conduct to the government of any Municipality in which it engages in Wind Farm Development. 2. Within one week of the announcement of this Code of Conduct, the Wind Company shall publish this Code of Conduct on a website hosted by the Company and 4 on any internal computer network (intranet) site that can be accessed only by its officers or employees, distribute copies of this Code of Conduct among its officers and employees, and post copies in its main office and at any local Wind Farm Development office. 3. Within thirty days of the announcement of this Code of Conduct, the Wind Company shall conduct a seminar for all officers and employees, except those who perform solely administrative/clerical, accounting, or building maintenance functions, about identifying and preventing conflicts of interest when working with Municipal Officers. 4. Within thirty days of the seminar, the Wind Company shall obtain acknowledgement forms from each of its employees, certifying that they have: (i) attended the seminar required by paragraph 3 of this section, unless they fall into the exception therein, and (ii) have read and agree to comply with this Code of Conduct. If, due to exceptional circumstances, an officer or employee is unable to attend the seminar required in paragraph 3 of this section, alternative arrangements should be made as soon as is practical for such officer or employee to receive the training described in paragraph 3 and sign the acknowledgement form. The Wind Company shall discontinue employment of anyone who fails to attend the seminar, or its equivalent, or sign the acknowledgment form. 5. The Wind Company shall distribute to all its employees and post prominently in all its work locations as well as on its website or intranet system the NYS Attorney General’s Public Integrity Hotline with instructions that any misconduct, violation of the law, or corruption of any sort in connection with Wind Farm Development; or any violation of this Code of Conduct shall be promptly reported to the New York State Attorney General. 6. Upon discovery by the Wind Company that a Municipal Officer or his or her Relative has entered into a lease or easement with the Wind Company, the Wind Company shall (i) notify the attorney for the Municipality and (ii) recommend to such Municipal Officer that he or she consult with the Municipality’s attorney concerning his or her legal obligations, including any obligation to recuse him or herself. IV. ENFORCEMENT AND COMPLIANCE

1. The Office of the New York State Attorney General shall establish the above-referenced Task Torce to provide oversight of Wind Farm Development and monitor compliance with this Code. The Task Force shall include, among others, local elected officials, including District Attorneys, and others designated by the Office of the Attorney General. The Task Force shall report only to the Office of the New York State Attorney General. The Office of the New York State Attorney General shall establish responsibilities and guidelines for the Task Force. 5 2. For three years following the Wind Company’s agreement to this Code of Conduct or until the Wind Company ceases operations in New York State, whichever is earlier, the Wind Company shall contribute a proportional share of the reasonable administrative costs of the Task Force, in an amount to be determined by the Task Force. So long as the Wind Company operates in New York State, it shall fully cooperate with the Task Force. 3. Should the Wind Company discover any conduct in violation of the provisions of this Code, the Wind Company shall promptly disclose such information to the Office of the New York State Attorney General. The Wind Company shall fully cooperate with the Office of the New York State Attorney General in any investigation arising out of such violation. 4. The Task Force shall give notice of any complaints relating to the Wind Company to the Office of the New York State Attorney General. The Task Force may decide not to refer such a complaint, if it determines that it involves a matter relating to this Code of Conduct that can be resolved by the Task Force. The Task Force may refer such complaints to the Office of the New York State Attorney General. With respect to any complaint referred to the Office of the New York State Attorney General by the Task Force, the Office of the New York State Attorney General shall advise the Wind Company of the complaint and give the Wind Company a reasonable opportunity to obtain and submit to the Office of the New York State Attorney General information relevant to the complaint. After providing such opportunity, the Office of the New York State Attorney General shall determine, in its reasonable discretion, and based on a reasonably comprehensive factual investigation including any information provided by the Wind Company, whether a preponderance of the evidence establishes that the Wind Company has violated this Code of Conduct in any material respect. In the event that a violation of any provision set forth in this Code is found, the Wind Company shall pay a civil penalty of up to $50,000 for the first violation, and up to $100,000 for any subsequent violation. In setting any penalty amount, the Office of the New York State Attorney General shall consider the relative severity of, and the relative harm to public integrity occasioned by, the violation. Any payment shall be made by certified check made payable to the “State of New York.” The Wind Company shall have the right to challenge the Office’s finding of a violation and determination of penalty amount before a court of competent jurisdiction, but shall pay any assessed penalty to the State of New York pending the resolution of any such court challenge. 5. The Wind Company and the Office of the New York State Attorney General shall meet to review the terms of this Code both four months and one year from the date on which this Code is signed. 6 V. DEFINITIONS Unless otherwise stated or unless the context otherwise requires, when used in this Code: 1. “Gift” means any thing having more than a nominal value whether in the form of money, service, loan, investment, travel, entertainment, hospitality, or in any other form and includes an

offer to a charitable organization at the designation of the Municipal Officer or at the designation of his or her Relative. 2. “Honorarium” means any payment made in consideration for any speech given at a public or private conference, convention, meeting, social event, meal or like gathering. 3. “Identified” means that the Wind Company has begun to pursue the purchase or lease of, or an easement on, real property in which the Wind Company knows, or through the exercise of reasonable diligence should have known, that a Municipal Official or his or her Relative has a financial interest in the property. 4. “Municipality” means a county, city, town, village, public authority, school district, or any other special or improvement district, but shall have no application to a city having a population of one million or more or to a county, school district, or other public agency or facility therein. 5. “Municipal Officer” means any officer or employee of a municipality, whether paid or unpaid, and includes, without limitation, all members of any office, board, body, advisory board, council, commission, agency, department, district, administration, division, bureau, or committee of the municipality. It also includes any entity that is directly or indirectly controlled by, or is under common control with, such officer or employee. a. "Municipal Officer" shall not include: i. A judge, justice, officer, or employee of the unified court system; ii. A volunteer firefighter or civil defense volunteer, except a fire chief or assistant fire chief; or iii. A member of an advisory board of the municipality if, but only if, the advisory board has no authority to implement its recommendations or to act on behalf of the municipality or to restrict the authority of the municipality to act. 6. “Relative” means a spouse, domestic partner, child, step-child, sibling, or parent of the Municipal Officer, or a person claimed as a dependent on the Municipal Officer's latest individual state income tax return. 7 7. “Wind Farm Development” means any stage of past, present or future development or siting of wind farms, wind turbines, wind power and related facilities or wind power projects; whether considered planned, attempted or completed, including but not limited to permitting, licensing, construction and energy production. VI. FORMS The following forms shall be used to comply with the disclosure requirements in Sections II and III above. 1. Disclosure under paragraph II.1.a. above shall be made with the following form: PROPERTY INTEREST OF MUNICIPAL OFFICER FOR FILING WITH CLERK OF MUNICIPAL ENTITY Please take notice that a Municipal Officer has a financial interest in a property identified for Wind Farm Development by the Wind Company as set forth below: Name of Municipal Official: Name of Municipality and Position that Municipal Official Holds: Name of Wind Company: Address of Wind Company: Description of Property: Street Address: Town/City: Section/Block/Lot #: 2. Disclosure under paragraph II.1.b. and c. above shall be made with the following form:

PUBLISHING ABSTRACT NOTICE OF CONVEYANCE OF PROPERTY INTEREST BY MUNICIPAL OFFICER TO WIND COMPANY Please be advised that [Name of Municipal Official] who holds that position of _________ with the ____________ of ____________, New York, has conveyed a _________________ to [Name of Wind Company] for property with the following street address and section/block/lot number in the ________ of _________, New York. An abstract with more information concerning the transfer is available with the ______ Clerk of the _______ of _________. 8 3. Disclosure under paragraph III.6. above shall be made with the following form: NOTICE TO MUNICIPAL OFFICER Dear Municipal Official: It has come to our attention that either you and/or one or more of your relatives may be a Municipal Officer or Employee that has transferred or otherwise conveyed an interest in real property to a wind company. We strongly recommend that you contact your municipality’s attorney to discuss possible obligations, including, but not limited to the obligation under certain laws to recuse yourself from certain matters involving that wind company. DATED: New York, New York October 30, 2008 _____________________________ ________________________ Andrew M. Cuomo Attorney General of the State of New York