Cranford v. Montgomery County

RODOWSKY, Judge. This action is one to enforce the Public Information Act, Md.Code (1957, 1980 Repl.Vol., 1983 Cum.Supp.), Art. 76A, §§ 1-5A (the Md.Act). At issue are many documents which relate to a public construction project and which a public agency withheld when a newspaper requested production under the Md.Act. The circuit court and the intermediate appellate court approved nondisclosure in reliance on the exemption from production for agency memoranda set forth in § 3(b)(v) of the Md.Act.

In our view there are deficiencies in the agency’s proof. We shall remand pursuant to Maryland Rule 871 in order to have the substantial merits of the case determined in light of the principles hereinafter set forth. The construction project around which this litigation centers is the Montgomery County Government Center consisting of a nine-story courthouse and a seventeen-story executive office building both of which rise from a multiple level parking structure. Government Center was designed as two separate projects by two architectural firms, but a single prime construction contract covering the work for the entire complex was awarded to Blake Construction Company (Blake).

Work started in May of 1978. Within the executive branch of Montgomery County, Maryland (the County) is a Department of Facilities and. Services (DFS). One of the functions and responsibilities of ⁷⁶³ DFS is “[pjroject administration, design and supervision of construction of all new county buildings.” Montgomery County Code (1972, 1977 Repl.Vol., 1982 Cum.Supp.), § 2-64G(a).

The director of DFS is Thomas S. Abraham (Abraham). Within DFS is a section headed by Frederick P. Kranz (Kranz) and known as the Office of Architectural Services (OAS). While it is not completely clear in the record, we infer that OAS is or was sometimes called the Office of Design and Construction. Overall responsibility for project administration, design and supervision of construction of Government Center was in OAS.

James A. Dove (Dove) and John D. McNickle (McNickle) are staff architects in OAS assigned to the Government Center project. As early as January 9, 1979 Blake had claimed against the County for additional compensation. By the fall of 1979 construction was behind schedule. The County began discussions with a consultant, MDC Systems Corp. (MDC), which culminated in a contract dated March 31, 1980 between MDC and the County.

Services to be rendered by MDC included schedule analysis, monthly schedule review and “claims prevention services.” MDC agreed to “[sjerve as expert witness testifying in behalf of the County in court sessions, as required.” By an amendment of March 11, 1981 MDC agreed to evaluate all change order claims and requests for time extensions and for delay costs. These evaluations were to be done “by professional engineers capable of testifying in behalf of the County as expert witnesses ....” On May 8, 1981 a reporter and the editor of the Sentinel newspapers in writing asked Abraham to give them access to all documents relating to the Government Center construction project. Martin J. Hutt, Esq. (Hutt), an Assistant County Solicitor, was assigned to determine what material was exempt from disclosure under the Md.Act.

He went through files at OAS for “several hours” and concluded that documents filling two five drawer file cabinets should be produced. He called out a variety of documents, num ⁷⁶⁴ bering in excess of 130 and collectively measuring approximately three inches in thickness, each of which he deemed to be privileged in its entirety. When the County advised the newspaper that certain classes of documents were being withheld, its corporate publisher and its editor (the Petitioners) sued in the Circuit Court for Montgomery County. Pertinent to the instant controversy are the following provisions of § 3 of the Md.Act: (a) The custodian of any public records shall allow any person the right of inspection of such records or any portion thereof except on one or more of the following grounds or as provided in subsection (b) or (c) of this section: (i) Such inspection would be contrary to any State statute; (ii) Such inspection would be contrary to any federal statute or regulation issued thereunder having the force and effect of law; (iii) Such inspection is prohibited by rules promulgated by the Court of Appeals, or by the order of any court of record; or (iv) Such public records are privileged or confidential by law.

(b) The custodian may deny the right of inspection of the following records or appropriate portions thereof, unless otherwise provided by law, if disclosure to the applicant would be contrary to the public interest: . (iii) The specific details of bona fide research projects being conducted by an institution of the State or ,a political subdivision, except that the name, title, expenditures, and the time when the final project summary shall be available; (v) Interagency or intraagency memorandums or letters which would not be available by law to a private party in litigation with the agency. ⁷⁶⁵ (c) The custodian shall deny the right of inspection of the following records or any portion thereof, unless otherwise provided by law: (v) Trade secrets, information privileged by law, and confidential commercial, financial, geological, or geophysical data furnished by or obtained from any person[.] Responding by a letter of June 3, 1981 to Petitioners’ request, the county attorney claimed that the withheld documents were exempt under subsections (a)(iii) and (iv), (b)(iii) and (v) and (c)(v). This letter divided the allegedly exempt records into five categories, namely: (1) Intraagency memorandums from the staff of the Office of Design and Construction to Frederick Kranz and/or Thomas Abraham (Director of the Department of Facilities and Services). (2) Interagency memorandums from the staff of Office of Design and Construction or Thomas Abraham to the Chief Administrative Officer and/or County Executive.

(3) Inspection reports of James Dove. (4) Personal notes of John [McNickle]. (5) Consultant report prepared by MDC. A show cause order was issued when Petitioners docketed their suit, to which the County responded by filing a memorandum of law.

It relied almost entirely on the agency memoranda privilege of § 3(b)(v), but it did mention other provisions of the Md.Act. To the extent that category one of the June 3 letter embraced correspondence with the county attorney’s office, the County asserted an attorney-client privilege, which was said to rest on § 3(a)(iv). A privilege for confidential commercial information customarily regarded as confidential in the construction industry was claimed in reliance on § 3(c)(v), but the agency did not specify any documents or category of documents as protected by that claimed privilege. The County also raised executive privilege, citing Hamilton, Superintendent v. Verdow, 287 Md. 544 , 414 A.2d 914 (1980).

Although Montgomery ⁷⁶⁶ County’s memo said executive privilege “affords a broad immunity from disclosure of governmental documents, particularly those prepared for an executive officer,” it did not particularly identify any documents to which application of that privilege was peculiarly suited. Finally, category five, described in the June 3 letter as the MDC report, was said to constitute bona fide research and to be exempt under § 3(b)(iii). The case came on for trial on July 10, 1981 before Honorable John J. Mitchell. 1 In Public Information enforcement actions § 5(b)(1) provides that the court may examine the contents of the records in camera to determine whether the records or any part thereof may be withheld under any of the exemptions set forth in § 3, and the burden is on the defendant to sustain its action. In carrying this burden the defendant may submit to the court for review a memorandum justifying the withholding of the records.

The County’s case before Judge Mitchell consisted of the MDC contract and testimony of Abraham, by stipulation, and of Hutt. By then Blake had presented a claim of $8.5 million against the County. The transcript of the stipulation reads that Abraham, who relied on Hutt to prepare the response, would have testified that as a matter of course the subordinate staff correspondence with only on the project and subordinate staff design and construction correspondence with their supervisor Fred [Kranz] the Director of Architectural [Services] [sic ]. He would testify that he corresponds with the ⁷⁶⁷ chief administrative officers and county executives who are superiors.

Last he would testify that it would be detrimental for the correspondence to be public information since it would have a chilling effect on open and frank discussions between subordinates and in the [formulation] of policy and would have a detrimental effect on the claim pending before Blake Construction Company. Hutt testified in person and described the five categories as they are set forth in the June 3 letter. Those descriptions will be quoted later in this opinion. On matters of general application to documents in all categories, Hutt’s evidence was as follows: Q In these materials that you felt should not be disclosed, were any of these purely factual materials? [Emphasis added.] A No. In fact because from the County Attorney’s Office staffing I have been assigned to this project for the past two years.

And so I have been privy to know that what is perceived by the County is not necessarily the same facts perceived by the consultant, architect, engineers or general contractor. These are merely questions or queries that have been raised to alert their supervisors as to why this is something that we should keep our eyes on in the future which will develop into something and to stay on top of it from the beginning. Q Are there any policies or decisions contained in this material? A No, I personally know from my position in the County Attorney’s Office that neither Mr. [Kranz] or [McNickle] or Dove have decision making power, final power in the Department of Facility and Services or the County Government.

Hutt also said that, in making his decision, he considered the effect on the public interest that disclosure of a given document would have on the claim by Blake. Petitioners ⁷⁶⁸ presented no evidence and developed no additional facts on cross-examination. On October 2, 1981 Judge Mitchell ordered that the documents be delivered to him for in camera inspection. The County produced the documents on October 21 and filed with the court clerk a ten-page memorandum listing the documents.

However, because of a Sentinel editorial concerning an unrelated case, Judge Mitchell, by an order also filed on October 21, 1981, vacated his order for in camera inspection and recused himself. The October 21, 1981 list divides the withheld documents into five categories, but those categories differ from the five categories used in the June 3 letter. Significantly, memoranda to the Chief Administrative Officer or County Executive do not comprise a specific category in the October 21 filing. The categories in that list are: 1.

A class which is uncaptioned by the County but which is generally described as the file of correspondence with, and of preliminary reports from, MDC; 2. A class which is uncaptioned by the County but which is generally described as the file of handwritten notes made by the County’s project architect during regular progress meetings; 3. “INTRA OFFICE MEMOS”; 4. “DOVE REPORT”; and 5. “MEETINGS WITH ARCHITECTS.” Under categories two through five, but not as to category one, the County identifies each document in some way, usually by date or author or both. In a number of instances, general descriptions of the contents of the document are also set forth. In the case of some documents, the County states why that particular document was withheld.

Two of the sections of the memorandum close with reasons why all documents in that category have not been produced. After Judge Mitchell withdrew, Judge Samuel W. Barrick presided over this case. Both parties orally presented- legal arguments, but neither introduced any additional evidence. ⁷⁶⁹ In a written opinion of April 2, 1982, Judge Barrick described the withheld documents as “attorneys’ work product and consultants’ reports, progress meeting notes, inter-office memorandums, inspection reports of James [Dove] and personal notes of John McNickle.” He concluded that he need make no in camera inspection because the County’s testimony supported application of the agency memoranda privilege. Under the trial court’s analysis, this put the burden “upon the Plaintiff[s] to make a preliminary showing that the communications or documents may not be exempted in order to warrant an in camera inspection.” No such showing had been made.

Consequently the circuit court ruled that all documents withheld were exempt from disclosure. The Court of Special Appeals affirmed. It agreed that § 3(b)(v) applied to all of the material in each of the withheld documents. Cranford v. Montgomery County, 55 Md.App. 276 , 462 A.2d 528 (1983).

Set forth below is the essence of that court’s rationale (id. at 285-86, 462 A.2d at 534 ): We hold that the appellees \i.e., the County] adequately met their burden of proving that the documents should not be released. The appellees met this burden 1) by presenting sufficient evidence showing that the withheld documents fell within one of the enumerated exemptions of the [Md.] Act and 2) by providing the court with sufficient evidence from which it could reasonably conclude that disclosure of the documents would be contrary to the public interest.... In this case, the public was shown to have an interest in the efficient internal operation of the agency, and the agency showed that this public interest could be harmed by the disclosure of information pertinent to pending litigation. [I]n this matter, an absolute standard can be applied once the agency has set forth unrebutted evidence that the memoranda requested consist wholly of confidential opinions, deliberations and recommendations of officials and employees leading to the proper exercise of governmental ⁷⁷⁰ authority. The contents of such memoranda need not be disclosed if such disclosure would be contrary to the public interest.

The intermediate appellate court held that the question of in camera inspection rests in the broad discretion of the trial court. An inspection is or is not to be made depending upon whether the trial judge is “ 'concerned that he is not prepared to make a responsible ... determination in the absence of in camera inspection ____Id. at 288, 462 A.2d at 535 (quoting Ray v. Turner, 587 F.2d 1187, 1195 (D.C.Cir.1978)). We granted Petitioners’ application for certiorari. 2 Both parties predominately address the agency memoranda exemption in this Court. Petitioners assert that the Court of Special Appeals erroneously made a public interest standard control.

As Petitioners see it, § 3(b)(v) looks to whether a document falls within all of the statute’s terms. If a document does not, a public interest contrary to disclosure is irrelevant under that subsection. Petitioners attack the County’s justification for applying § 3(b)(v) as being, variously, unsworn, general or conclusory. They also argue that an in camera inspection should have been conducted.

On the other hand, the County says its testimony placed the withheld documents under the § 3(b)(v) exemption and, because that testimony was unrebutted, the case on appeal presents a question of fact which has been conclusively resolved by the trial court. The County also says that, by not proceeding on affidavit but by its having presented a live witness who could have been cross-examined, its proof need not be as particular as proof presented exclusively by affidavit. Both parties quote liberally from cases dealing with the privilege for agency memoranda recognized in the federal Freedom of Information Act (FOIA), 5 U.S.C. ⁷⁷¹ § 552(b)(5) (1982). None of the cited cases involves a building construction contract controversy.

Each party then applies the general principles in FOIA cases to all of the documents at issue here, treating them as a whole. This case cannot be dispatched so simply. Our first task, addressed in Part I of this opinion, is to fathom what the agency memoranda privilege of § 3(b)(v) in general means. 3 In Part II we face the problem of how a court procedurally approaches determining whether a statutory exemption has been properly invoked by an agency. Based on that review we frame in Part III the issue to be decided and state some general conclusions about this case.

In Part IV and its subdivisions we apply or illustrate application of the operative rules within the categories into which the County’s memorandum divided the unproduced records. Part V deals with residual arguments. I Without doubt the bias of the Md.Act is toward disclosure. “All public records shall be open for inspection by any person at reasonable times, except as provided in this article or as otherwise provided by law.” § 2(a). The custodian who withholds public documents carries the burden of justifying nondisclosure. § 5(b)(1).

This policy is imbued in the § 3(b)(v) exemption. It contains three elements. “The custodian may deny the right of inspection” to 1. “Interagency or intraagency memorandums or letters” ⁷⁷² 2. “which would not be available by law to a private party in litigation with the agency” 3. “if disclosure to the applicant would be contrary to the public interest.” The first two elements, are present in the comparable provision of FOIA. Title 5, U.S.C. § 552 (b)(5), sometimes called Exemption 5, applies to inter-agency or intra-agency memorandums or letters which would not be available by law to a party other than an agency in litigation with the agency[.] The second element restricts the exemption. A document may be an agency memorandum but, if it is available by law to a private party in litigation with the agency, it is to be produced.

The third element is a further restriction. Although a document meets the first two requirements, withholding it might serve no public interest so that it is to be produced. For example, the document may relate to agency action taken so long ago that disclosing it no longer makes any difference. A. Moving from the relationship between the elements, we turn to the meaning of the elements themselves and to the question of what agency “memorandums” are.

Cases decided under FOIA § (b)(5) indicate that the agency memoranda exemption embraces various privileges. The broadest of these, and the one with which we are primarily concerned here, travels under a number of names, including “deliberative process,” “executive,” “pre-decisional” and “staff” privilege. FOIA’s Exemption 5 was involved in EPA v. Mink, 410 U.S. 73 , 93 S.Ct. 827 , 35 L.Ed.2d 119 (1973) where the request was for release of nine documents submitting to the President of the United States the views and recommendations of agencies and individuals concerning a scheduled underground nuclear test. An affidavit by the Under Secretary of State established the foregoing facts.

In describ ⁷⁷³ ing this exemption the Court quoted from S.Rep. No. 813, 89th Cong., 1st Sess. 9 (1965) {id. at 87, 93 S.Ct. at 836 , 35 L.Ed.2d at 132 ): “It was pointed out in the comments of many of the agencies that it would be impossible to have any frank discussion of legal or policy matters in writing if all such writings were to be subjected to public scrutiny. It was argued, and with merit, that efficiency of Government would be greatly hampered if, with respect to legal and policy matters, all Government agencies were prematurely forced to ‘operate in a fish bowl.’ The committee is convinced of the merits of this general proposition, but it has attempted to delimit the exception as narrowly as consistent with efficient Government operation.” In NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 150 , 95 S.Ct. 1504, 1516 , 44 L.Ed.2d 29, 47 (1975) the Court pointed out that “[t]he cases uniformly rest the [FOIA § (b)(5)] privilege on the policy of protecting the ‘decision making processes of government agencies’ ... and focus on documents ‘reflecting advisory opinions, recommendations and deliberations comprising part of a process by which governmental decisions and policies are formulated.’ ” (Citations omitted). Essentially the same policy underlies the executive privilege of Maryland evidence law which Judge Eldridge articulated for this Court in Hamilton, supra, 287 Md. 544 , 414 A.2d 914 .

Documents to which that privilege applies are agency “memorandums” within the meaning of § 3(b)(v) of the Md.Act. By analogy to FOIA, § 3(b)(v) also includes the attorney work product privilege. See FTC v. Grolier Inc., 462 U.S. 19 , 103 S.Ct. 2209 , 76 L.Ed.2d 387 (1983) (privilege continues for FOIA purposes after litigation ends); Federal Open Market Committee v. Merrill, 443 U.S. 340, 355 , 99 S.Ct. 2800, 2809 , 61 L.Ed.2d 587, 600 (1979); NLRB v. Sears, Roebuck & Co., supra (memoranda of NLRB General Counsel to Regional Directors directing filing of unfair labor practice complaints excepted by Exemption 5). Merrill held that FOIA Exemption 5, depending on a factual record to be ⁷⁷⁴ made on remand, could also include a statutorily created committee’s monetary policy directives which might be eligible for a limited form of protection from disclosure for confidential commercial information.

Because the executive privilege aspect of the agency memoranda exemption is designed to protect recommendations in the decision-making process, factual matters are not within that exemption. See EPA v. Mink, supra, 410 U.S. at 89-91 , 93 S.Ct. at 837-38 , 35 L.Ed.2d at 133-34 ; Hamilton, supra, 287 Md. at 564 , 414 A.2d at 925 . Rarely, however, will a given document reflect purely deliberative or policy-making processes without factual matters. In such instances FOIA applies a severability approach.

The Court in EPA v. Mink, supra, 410 U.S. at 91 , 93 S.Ct. at 838 , 35 L.Ed.2d at 135 , explained: Exemption 5 contemplates that the public’s access to internal memoranda will be governed by the same flexible, common-sense approach that has long governed private parties’ discovery of such documents involved in litigation with Government agencies. And, as noted, that approach extended and continues to extend to the discovery of purely factual material appearing in those documents in a form that is severable without compromising the private remainder of the documents. The Md.Act similarly requires agencies to utilize the principle of severability in responding to requests for public records. Section 3(d)(4) provides that “any reasonably severable portion of a record shall be provided to any person requesting such record after deletion of those portions which may be withheld from disclosure.” B. The second element of the agency memoranda exemption under § 3(b)(v) of the Md.Act, i.e., whether a memorandum “would not be available by law to a private party in litigation with the agency,” presents still further questions.

Among these are what type of litigation with the agency is ⁷⁷⁵ the court to assume and who is plaintiff or defendant in that hypothetical litigation. In the instant case the analogy is clearly to a suit by Blake against Montgomery County claiming the value of extra work and delay damages. This is implicit in the County’s position that it met the public interest element of the exemption in large part by its need to avoid making available to Blake County deliberations and work product. Another aspect of the statutory directive to consider discovery in hypothetical litigation involves what facts, if any, a court should assume to be the circumstances out of which the discovery request arises.

Federal courts in Exemption 5 cases have determined that materials which would be routinely or normally discoverable fall outside of the FOIA exclusion. Need on the part of the requesting party is not to be assumed or considered in determining the outcome of the discovery analogy element of the agency memoranda exemption. See FTC v. Grolier Inc., supra, 462 U.S. at-, 103 S.Ct. at 2214 , 76 L.Ed.2d at 393-94 ; Federal Open Market Committee v. Merrill, supra, 443 U.S. at 362-63 , 99 S.Ct. at 2813 , 61 L.Ed.2d at 604 ; NLRB v. Sears, Roebuck & Co., supra, 421 U.S. at 149 n. 16, 95 S.Ct. at 1515 -16 n. 16, 44 L.Ed.2d at 46 n. 16; EPA v. Mink, supra, 410 U.S. at 92 , 93 S.Ct. at 838 , 35 L.Ed.2d at 135 ; Hoover v. United States Dep’t of the Interior, 611 F.2d 1132, 1138-39 (5th Cir.1980); Deering Milliken, Inc. v. Irving, 548 F.2d 1131, 1137 (4th Cir.1977). These principles are equally applicable under the Md.Act.

Ordinarily a court will apply the discovery element of § 3(b)(v) by looking to Title 2, Ch. 400 of the Maryland Rules of Procedure. Md.R. 2-402(c) in relevant part provides that a party may obtain discovery of documents ... prepared in anticipation of litigation or for trial by or for another party or by or for that other party’s representative (including an attorney, consultant, surety, indemnitor, insurer, or agent) only upon a showing that ... the party ⁷⁷⁶ seeking discovery has substantial need for the materials in the preparation of the case and is unable without undue hardship to obtain the substantial equivalent of the materials by other means. Subject to certain exceptions therein provided, MD.R. 2-402(c) requires a showing of substantial need for the discovery of work product materials. Thus, for purposes of applying § 3(b)(v) of the Md.Act, such materials are not “routinely” discoverable and are “not available by law to a party in litigation with the agency.” C. In cases in which the custodian invokes the agency memoranda exemption, and in which the trial court has determined that one of the privileges embraced within that exemption applies, the third element of § 3(b)(v) will typically be satisfied, namely, disclosure to the applicant would be contrary to the public interest.

There is a public interest which underlies each legally recognized privilege and, if the privilege applies, it would be at best difficult to say that an agency decision to withhold was contrary to the public interest. The foregoing analysis means that a public record does not enjoy § 3(b)(v) exempt status simply because it would be contrary to the public interest to disclose it. In the unusual case where a public policy factor should control but none of the specific exemptions applies, the Md.Act provides for a special procedure to safeguard the material from disclosure. Under § 3(e) a custodian may apply to a court for an order permitting him to deny disclosure in order to prevent substantial injury to the public interest. 4 Mont ⁷⁷⁷ gomery County did not attempt to use that procedure in this case.

II Cases like the one at hand also present a procedural problem similar to one encountered in applying court rules dealing with discovery in litigation. On one side a member of the public requests agency records as a matter of statutory right. On the other side a custodian denies production on the ground that the material is exempted from disclosure by the same statute. The person seeking disclosure is not always willing to accept that the custodian has correctly applied the claimed exemption.

If withheld documents are routinely dumped on the trial courts for in camera inspection in order to resolve the dispute, undesirable results follow. The Md.Act imposes the burden on the records custodian to make a careful and thoughtful examination of each document which fairly falls within the scope of the request in order for the custodian initially to determine whether the document or any severable portion of the document meets all of the elements of an exemption. The General Assembly did not intend for custodians broadly to claim exemptions and thereby routinely to pass to the courts the task of performing in camera inspections. To inhibit uncritical claims of exemption the General Assembly provided in § 5(b)(6) that ⁷⁷⁸ [t]he court may assess against any defendant governmental entity or entities reasonable attorney fees and other litigation costs reasonably incurred in any case under this section in which the court determines that the applicant has substantially prevailed.

One appropriate approach in these cases was outlined by the United States Court of Appeals for the District of Columbia Circuit in Vaughn v. Rosen, 484 F.2d 820 (D.C. Cir.1973), cert. denied, 415 U.S. 977 , 94 S.Ct. 1564 , 39 L.Ed.2d 873 (1974). There the Bureau of Personnel Management Evaluation of the Civil Service Commission was asked to produce evaluations of certain federal agencies’ personnel management programs. The custodian raised the agency memoranda exemption in an affidavit which set forth in conclusory terms the custodian’s opinion that the evaluations were not subject to disclosure under FOIA. After making an excellent review of the problems inherent in an adversary proceeding where the custodian has knowledge of the facts while the party requesting disclosure does not, the Vaughn court laid down certain procedures for testing claims to exemptions under FOIA.

Because “courts will simply no longer accept conclusory and generalized allegations of exemptions,” the first burden on an agency which seeks judicial approval of a claim of exemption is to provide “a relatively detailed analysis in