Request By:
Mr. Carl Brown
Jefferson County Commissioner
Courthouse
Louisville, Kentucky 40202
Opinion
Opinion By: Steven L. Beshear, Attorney General; By: Charles W. Runyan, Assistant Deputy Attorney General
You are a commissioner on the Jefferson Fiscal Court. You are also a member of a local law firm. It is anticipated that your law firm may be retained by a corporate client seeking assistance in the issuance of industrial revenue bonds of the county. In another situation, your firm would serve as bond counsel to a corporate client seeking county issued industrial revenue bonds.
Your question is whether there would be any conflict of interest on your part. You are presently a member of the law firm on a salary basis; and you share in any business you bring in. Your law firm, serving as bond counsel, would only get paid when the bonds are issued. We assume you refer to industrial revenue bonds issued by the county under KRS 103.200 et seq. See specifically KRS 103.210.
In
Commonwealth v. Withers, 266 Ky. 29, 98 S.W.2d 24 (1936), the court stated that he who is entrusted with the business of others cannot be allowed to make such business an object of profit to himself. This conclusion is based upon principles of reason, morality, and public policy. In general, the disqualifying interest must be pecuniary or proprietary by which the officer stands to gain or lose something. The court went on to point out that it is not sufficient to disqualify the officer if the opportunity for self-benefit is a mere possibility or is so remote or collateral that it cannot be reasonably calculated to affect his judgment or conduct in the making of the contract or in its performance.
In either scenario, as you have described it, whether or not the bonds are issued under either set of circumstances (bond counsel or just legal advice for the corporate client) , you stand to gain nothing of monetary value. You get a set salary from the firm, regardless of what business is being performed by the firm members.
However, in order to pay you this set salary, the firm must make money, and your position on the fiscal court may well influence present and future clients to retain your firm to represent their interests in these types of matters. The income from such representation would, we assume, in part help to pay your set salary.
Therefore, it is our opinion that you should neither attend nor participate in a fiscal court meeting dealing with the bond issue matter affecting your law firm. You should likewise refrain from any discussion or contact with the county judge/executive or any other member of the fiscal court concerning this type of matter.