Request By:
Mr. John A. Youngerman
Chairman
Board of Commissioners
Murray-Calloway County
Public Hospital Corporation
P.O. Box 266
Murray, Kentucky 42071
Opinion
Opinion By: Steven L. Beshear, Attorney General; BY: Carl Miller, Assistant Attorney General
You have requested an opinion of the Attorney General as to whether a law firm may be employed to represent the Murray-Calloway County Public Hospital Corporation in litigation while a member of the law firm is also a member of the Board of Commissioners of the Corporation. You give the following statement of fact.
"The Murray-Calloway County Public Hospital Corporation is a non-profit, non-stock corporation formed under Chapter 273 of the Kentucky Revised Statutes. The Corporation's power to act is vested in a Board of Commissioners. The members of the Board of Commissioners are appointed by the Fiscal Court of Calloway County and the Murray City Council from nominations made by specified civic organizations. The Mayor of Murray and the Calloway County Judge/Executive are also members of the Board of Commissioners. One of the organizations which nominates a member of the Board of Commissioners is the Calloway County Bar Association. This has resulted in two members of the Board of Commissioners being regularly practicing attorneys, Judge Robert O. Miller the Calloway County Judge/Executive and Harold T. Hurt the representative from the Calloway County Bar Association. Both of these attorneys over the years have supplied legal services to the Board of Commissioners free of charge. However, the hospital is now involved in major litigation and the Board of Commissioners will require the services of an attorney to represent it in the litigation. We respectfully request an opinion from you as to whether the Board of Commissioners may enter into an employment agreement with Hurt, Haverstock & Jones, a local law firm. Harold T. Hurt is a member of the firm and a member of the Board of Commissioners of the hospital."
It is the opinion of the Attorney General that there is no statutory conflict of interest created by the proposed employment of the law firm of which Mr. Hurt, a member of the Hospital Board of Commissioners, is a member. The Murray-Calloway County Public Hospital Corporation, being a corporation, is not a public agency subject to the provisions of the statutes pertaining to conflict of interest. In OAG 77-583, we discussed the subject of common law conflict of interest as related to the same factual situation you now present. We suggest that in order to avoid a common law conflict of interest, or even the appearance of one, that Mr. Hurt should abstain from voting and absent himself from any meeting of the Commission wherein the employment of his law firm is discussed or acted upon. If the Board of Commissioners sees fit to employ Mr. Hurt's law firm in his absence from the meeting where the decision is made, we see no common law problem. A computer check of Kentucky case law has turned up no case where such circumstances constituted a conflict of interest under the common law.
You present a second question as to whether the Murray-Calloway Public Hospital Corporation, as described herein, is a public agency subject to the Kentucky Open Meetings Law, KRS 61.805-61.850.
It has consistently been the opinion of this office that a non-profit corporation is not a public agency as defined in the Open Meetings Law. See OAG 81-266 and OAG 75-402, copies enclosed.