Kopp v. Schrader

187 A.3d 88, 459 Md. 494
Court of Appeals of Maryland·Decided June 21, 2018·No. 72/17·Published·Cited by 6 cases

Opinion

Wilner, J.

On its face, this case is a dispute between the State Treasurer and two former gubernatorial appointees over whether those appointees are entitled to be paid for the services they rendered in their appointed positions. It emanates, however, from a disagreement between the Governor and the General Assembly over whether the "design" of the Maryland Constitution places a limit on the Governor's appointing authority that the text of the Constitution does not place.

It is a disagreement that, if truly requiring a judicial resolution, could have found one simply, quickly, and cleanly through a declaratory judgment action testing the validity of what the Governor did in this case. 1 Instead, the response chosen by the Legislature has brought before the Judicial Branch not just the validity of the Governor's action but a host of collateral Constitutional issues involving the duties and authority of the State Comptroller, the duties and authority of the State Treasurer, the scope of the General Assembly's budgetary authority under Article III, § 52 of the Constitution, separation of powers issues under Article 8 of the Md. Declaration of Rights, the Governor's appointment and removal authority under Art. II, §§ 11 and 15 of the Constitution, Article III, § 33 of the Constitution prohibiting "special laws," and the sovereign immunity of the State.

BACKGROUND

On July 6, 2016, Governor Hogan appointed Wendi Peters as Secretary of the Department of Planning. The salary for that office was set in the State Budget at $137,749. On December 15, 2016, the Governor appointed Dennis Schrader as Secretary of the Department of Health. The salary for that office was set in the State Budget at $174,417. Both appointments were subject to the advice and consent of the Maryland Senate. They were what is known as "recess" appointments-appointments made while the Senate was not in Session-and, pursuant to Art. II, § 11 of the Constitution, the Governor sent the names of both individuals to the Senate on the first day of the 2017 legislative Session (January 11, 2017). In accordance with Senate Rule 22A, both appointments were referred for consideration by the Senate Executive Nominations Committee. 2

On March 13, 2017, that Committee voted against sending Ms. Peter's nomination to the full Senate. The Governor withdrew the nomination that same day. By March 31-the 79 th day of the 90-day Session-the Committee had taken no action on Mr. Schrader's nomination, and, on that day, the Governor withdrew his nomination as well. Thus, when the General Assembly adjourned its 2017 Session on April 10, 2017, the Senate had taken no action on either nomination and the Governor had not appointed anyone else to either position. A vacancy therefore existed in both offices. On April 11-the day following adjournment-the Governor filled those vacancies by reappointing Ms. Peters and Mr. Schrader. For the second time, they became recess appointees.

Obviously anticipating that prospect, the General Assembly sought to thwart it during its 2017 Session by adding language to the FY 2018 Budget Bill (House Bill 150, 2017 Md. Laws, Ch. 150) that purports to preclude Ms. Peters and Mr. Schrader from being paid any part of the salary that they otherwise would have been entitled to receive as Secretaries of the respective Departments. That was done by adding to the Budget Bill transmitted to the General Assembly by the Governor pursuant to Art. III, § 52 of the Constitution a new § 30 containing the following four paragraphs:

"That no funds in this budget may be expended to pay the salary of a Secretary or an Acting Secretary of any department whose nomination as Secretary has been rejected by the Senate or an Acting Secretary who was serving in that capacity prior to the 2017 session whose nomination for the Secretary position was not put forward and approved by the Senate during the 2017 session unless the Acting Secretary is appointed under Article II, Section 11 of the Maryland Constitution prior to July 1, 2017."
"Further provided that no funds in this budget may be expended to pay the salary of a Secretary or Acting Secretary of any department who was a recess appointment in 2016 and whose nomination as Secretary was put forward and was not acted upon by the Executive Nominations Committee, or whose nomination was rejected by the Executive Nominations Committee and whose nomination was withdrawn before the full Senate acted."
"Further provided that no funds in this budget may be expended to pay the salary of an Assistant Secretary or Deputy Secretary who was a recess appointment as Secretary in 2016 and whose nomination was rejected by the Executive Nominations Committee and was withdrawn before the full Senate acted or whose nomination was not acted on or whose nomination was not acted upon by the Executive Nominations Committee."
"Nothing in this language may be construed to prohibit employment in State Government not serving in a leadership capacity in the Agency or Department in which the Secretary or Acting Secretary's nomination as Secretary was put forward and was rejected by the Executive Nominations Committee or who was not acted upon by the Executive Nominations Committee."

There does not appear to be any dispute that the only persons to whom this language could apply or was intended to apply were Ms. Peters and Mr. Schrader. The language had no effect until July 1, 2017, when the 2018 fiscal year commenced. Ms. Peters and Mr. Schrader were paid the salaries set by law for their respective offices through June 30. There was, however, correspondence between the Governor's Office, the Attorney General's Office, the Comptroller's Office, and the Treasurer's Office regarding what would happen come July 1.

The Attorney General's Office, in a June 27, 2017 advice letter based on prior Opinions of the Attorney General, concluded that the Governor had the Constitutional authority to make the two recess appointments. The letter continued, however, that, notwithstanding that conclusion, the language in § 30 of the Budget Bill was a valid exercise of legislative authority. In a July 3, 2017 follow-up letter, the Attorney General personally expressed his view that, even if the two recess appointments "are assumed to be valid," § 30 effectively "stripped" the appropriation for the salaries and was a valid exercise of legislative authority under Article III, § 52(6) of the Constitution. In a response to the Attorney General, the Chief Legal Counsel to the Governor disagreed with the latter conclusion.

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Kopp v. Schrader, 187 A.3d 88, 459 Md. 494 (Md. 2018).

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