Cooper v. Berger

State Court (South Eastern Reporter)1/26/2018
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ERVIN, Justice.

**395On 8 November 2016, plaintiff Roy A. Cooper, III, was elected Governor of the State of North Carolina for a four-year term office commencing on 1 January 2017. On 16 December, 2016, the General Assembly enacted Senate Bill 4 and House Bill 17, which abolished the existing State Board of Elections and the existing State Ethics Commission; created a new Bipartisan State Board of Elections and Ethics Enforcement; and appointed the existing members of the State Ethics Commission to serve as the members of the Bipartisan State Board. The legislation in question was signed into law by former Governor Patrick L. McCrory on 16 December 2016. On 17 March 2017, a three-judge panel of the Superior Court, Wake County, convened pursuant to N.C.G.S. § 1-267.1(b1), determined that the legislation in question violated the separation-of-powers provisions of the North Carolina Constitution by unconstitutionally impinging upon the Governor's ability to faithfully execute the laws. Cooper v. Berger , No. 16 CVS 15636, 2017 WL 1433245 (N.C. Super. Ct. Wake County, Mar. 17, 2017).

On 25 April 2017, Chapter 6 of the 2017 North Carolina Session Laws became law notwithstanding the Governor's veto. See Act of Apr. 11, 2017, ch. 6, 2017-2 N.C. Adv. Legis. Serv. 21 (LexisNexis).1 Session Law 2017-6 was captioned

AN ACT TO REPEAL G.S. 126-5(D)(2C), AS ENACTED BY S.L. 2016-126; TO REPEAL PART I OF S.L. 2016-125; AND TO CONSOLIDATE THE FUNCTIONS OF ELECTIONS, CAMPAIGN FINANCE, LOBBYING, AND ETHICS UNDER
**396ONE QUASI-JUDICIAL AND REGULATORY AGENCY BY CREATING THE NORTH CAROLINA BIPARTISAN STATE BOARD OF ELECTIONS AND ETHICS ENFORCEMENT.

The newly-enacted legislation provided, in pertinent part, that:

Article 1.
Bipartisan State Board of Elections and Ethics Enforcement.
§ 163A-1. Bipartisan State Board of Elections and Ethics Enforcement established.
There is established the Bipartisan State Board of Elections and Ethics Enforcement, referred to as the State Board in this Chapter.
§ 163A-2. Membership.
(a) The State Board shall consist of eight individuals registered to vote in North *101Carolina, appointed by the Governor, four of whom shall be of the political party with the highest number of registered affiliates and four of whom shall be of the political party with the second highest number of registered affiliates, as reflected by the latest registration statistics published by the State Board. The Governor shall appoint four members each from a list of six nominees submitted by the State party chair of the two political parties with the highest number of registered affiliates, as reflected by the latest registration statistics published by the State Board.
....
(c) Members shall be removed by the Governor from the State Board only for misfeasance, malfeasance, or nonfeasance. Violation of G.S. § 163A-3(d) shall be considered nonfeasance.
....
(f) At the first meeting in May, the State Board shall organize by electing one of its members chair and one of its members vice-chair, each to serve a two-year term as such. In 2017 and every four years thereafter, the chair shall be a member of the political party with the highest number of registered affiliates, ... and the vice-chair a **397member of the political party with the second highest number of registered affiliates. In 2019 and every year four years thereafter, the chair shall be a member of the political party with the second highest number of registered affiliates, as reflected by the latest registration statistics published by the State Board, and the vice-chair a member of the political party with the highest number of registered affiliates.
....
§ 163A-3. Meetings; quorum; majority.
....
(c) Unless otherwise specified in this Chapter, an affirmative vote of at least five members of the State Board shall be required for all actions by the State Board.
....
§ 163A-5. Independent agency, staff, and offices.
(a) The State Board shall be and remain an independent regulatory and quasi-judicial agency and shall not be placed within any principal administrative department. The State Board shall exercise its statutory powers, duties, functions, and authority and shall have all powers and duties conferred upon the heads of principal departments under G.S. 143B-10.
....
§ 163A-6. Executive Director of the State Board.
(a) There is hereby created the position of Executive Director of the State Board, who shall perform all duties imposed by statute and such duties as may be assigned by the State Board.
(b) The State Board shall appoint an Executive Director for a term of two years with compensation to be determined by the Office of State Human Resources. The Executive Director shall serve beginning May 15 after the first meeting held after new appointments to the State Board are made, unless removed for cause, until a successor is appointed. In the event of a vacancy, the vacancy shall be filled for the remainder of the term.
**398(c) The Executive Director shall be responsible for staffing, administration, and execution of the State Board's decisions and orders and shall perform such other responsibilities as may be assigned by the State Board.
(d) The Executive Director shall be the chief State elections official.
....
§ 163-30. County boards of elections; appointments; terms of office; qualifications; vacancies; oath of office; instructional meetings.
In every county of the State there shall be a county board of elections, to consist of four persons of good moral character who are registered voters in the county in which they are to act. Two of the members of the county board of elections shall be of the political party with the highest number of registered affiliates, and two shall be of the political party with the second highest number of registered affiliates, as reflected by the latest registration statistics published *102by the State Board. In 2017, members of county boards of elections shall be appointed by the State Board.... In 2019, members of county boards of elections shall be appointed by the State Board on the last Tuesday in June, and every two years thereafter, and their terms of office shall continue for two years from the specified date of appointment and until their successors are appointed and qualified.
....
The State chair of each political party shall have the right to recommend to the State Board three registered voters in each county for appointment to the board of elections for that county. If such recommendations are received by the Board 15 or more days before the last Tuesday in June 2017 and each two years thereafter, it shall be the duty of the State Board to appoint the county boards from the names thus recommended....
....
At the first meeting in July annually, the county boards shall organize by electing one of its members chair and **399one of its members vice-chair, each to serve a one-year term as such. In the odd-numbered year, the chair shall be a member of the political party with the highest number of registered affiliates, as reflected by the latest registration statistics published by the State Board, and the vice-chair a member of the political party with the second highest number of registered affiliates. In the even-numbered year, the chair shall be a member of the political party with the second highest number of registered affiliates, as reflected by the latest registration statistics published by the State Board, and the vice-chair a member of the political party with the highest number of registered affiliates.
....
§ 163-31. Meetings of county boards of elections; quorum; majority; minutes.
... Three members shall constitute a quorum for the transaction of board business. Except where required by law to act unanimously, a majority vote for action of the board shall require three of the four members.
....
SECTION 9. Notwithstanding G.S. 163A-2, as enacted by Section 4 of this act, the chairs of the two political parties shall submit a list of names to the Governor ..., and the Governor shall make appointments from those lists.... The State chairs of the two political parties shall not nominate, and the Governor shall not appoint, any individual who has served two or more full consecutive terms on the State Board of Elections or State Ethics Commission, as of April 30, 2017.
SECTION 10. Notwithstanding G.S. 163A-2(f) and (g), as enacted by Section 4 of this act, the Governor shall appoint a member of the State Board to serve as chair, a member to serve as vice-chair, and a member to serve as secretary of the State Board until its first meeting in May 2019, at which time the State Board shall select its chair and vice-chair in accordance with G.S. 163A-2(f) and select a secretary in accordance with G.S. 163A-2(g).
....
**400Section 17. Notwithstanding G.S. 163A-6, the Bipartisan State Board of Elections and Ethics Enforcement shall not appoint an Executive Director until May 2019. Until such time as the Bipartisan State Board of Elections and Ethics Enforcement appoints an Executive Director in accordance with G.S. 163A-6, as enacted by this act, the Executive Director of the State Board of Elections under G.S. 163-26, as of December 31, 2016, shall be the Executive Director.

Id ., secs. 4, 7(h)-(i), 9, 10, 17, at 23-34.

On 26 April 2017, the Governor filed a complaint, a motion for a temporary restraining order, and a motion for a preliminary injunction challenging the constitutional validity of Sections 3 through 222 of Session Law 2017-6 and seeking to preclude its implementation. On 27 April 2017, the Chief Justice of the Supreme Court of North Carolina assigned a three-judge panel of the *103Superior Court, Wake County, to hear and decide this case as required by N.C.G.S. § 1-267.1(b1). On 28 April 2017, defendants Philip E. Berger, in his official capacity as President Pro Tempore of the North Carolina Senate, and Timothy K. Moore, in his official capacity as Speaker of the North Carolina House of Representatives, filed a response in opposition to the Governor's motion for temporary restraining order. On the same date, the panel, by a divided vote, entered an order temporarily enjoining the enforcement of Sections 3 through 22 of Session Law 2017-6 "pending expiration of this Order or further Order of this Court."

On 23 May 2017, the Governor and the legislative leadership filed summary judgment motions.3 In addition, the legislative leadership filed a motion seeking to have the Governor's complaint dismissed pursuant to N.C.G.S. § 1A-1, Rule 12(b)(1), on the grounds that the claims asserted by the Governor "constitute non-justiciable political questions" and that the Governor "lacks standing" and an answer in which they denied the material allegations of the Governor's complaint and asserted a number of affirmative defenses, including the political question doctrine, and the State of North Carolina filed an answer requesting the panel to "grant **401such relief as may be just and proper." On 1 June 2017, the panel entered an order dismissing the Governor's complaint pursuant to N.C.G.S. § 1A-1, Rule 12(b)(1). On 6 June 2017, the Governor noted an appeal to the Court of Appeals from the panel's order. On 15 June 2017, the legislative leadership noted an appeal to the Court of Appeals from the temporary restraining order. On 19 July, 20 July, and 24 July 2017, respectively, this Court entered orders granting the Governor's petition for discretionary review prior to a decision by the Court of Appeals, allowing the legislative leadership to file an appellants' brief, prohibiting the parties "from taking further action regarding the unimplemented portions" of the challenged legislation, establishing an expedited briefing schedule, and setting this case for oral argument on 28 August 2017.

In his initial brief, the Governor argued that, while the General Assembly has the authority to enact laws, citing Article II, Sections 1 and 20 of the North Carolina Constitution (vesting "[t]he legislative power" in the General Assembly), its authority is subject to the constraints set out in Article I, Section 6 (providing that "[t]he legislative, executive, and supreme judicial powers of the State government shall be forever separate and distinct from each other"). According to the Governor, the panel's decision to dismiss his complaint for lack of subject matter jurisdiction "ignor[es] separation of powers as a cornerstone of State government." In addition, the Governor asserted that he had standing to "protect the constitutional rights granted to his office," citing N.C. Const. art. I, § 6 ; id . art. II, §§ 1, 5 ; State ex rel. McCrory v. Berger , 368 N.C. 633, 645, 781 S.E.2d 248, 256 (2016) (noting that, since the adoption of the 1868 Constitution, the Governor has had the duty, pursuant to Article III, Section 5(4) of the North Carolina Constitution, to faithfully execute the laws); Mangum v. Raleigh Board of Adjustment , 362 N.C. 640, 642, 669 S.E.2d 279, 281-82 (2008) (explaining that "the North Carolina Constitution confers standing on those who suffer harm"); Bacon v. Lee , 353 N.C. 696, 718, 549 S.E.2d 840, 855 (observing that " Article III, Section 5 of the State Constitution enumerates the express duties of the Governor"), cert. denied , 533 U.S. 975, 122 S.Ct. 22, 150 L.Ed. 2d 804 (2001). The Governor denied that this case involves a nonjusticiable political question in light of the judicial branch's duty "to identify where the line should be drawn ... between the Executive Branch and the Legislature," quoting News & Observer Publishing Co. v. Easley , 182 N.C. App. 14, 15-16, 641 S.E.2d 698, 700, disc. rev. denied , 361 N.C. 429, 648 S.E.2d 508 (2007). The Governor contended that, contrary to the arguments advanced by the legislative leadership, the presumption of constitutionality does not insulate Session Law 2017-6 from judicial scrutiny, citing **402Moore v. Knightdale Board of Elections , 331 N.C. 1, 4, 413 S.E.2d 541, 543 (1992) (stating that "[t]he presumption of constitutionality is not, however, *104and should not be, conclusive"). Finally, the Governor contended that the challenged portions of Session Law 2017-6 should be invalidated because they deprive him of the ability to exercise "enough 'control over the views and priorities of the officers' that implement 'executive policy' to allow the Governor to fulfill his constitutional duty of faithful execution," quoting McCrory , 368 N.C. at 647, 781 S.E.2d at 257.

The legislative leadership argued, on the other hand, that this case involves a nonjusticiable political question and that the Governor lacks standing to challenge the constitutionality of Session Law 2017-6. According to the legislative leadership, "the commitment of the power to alter the functions and duties of state agencies is reserved for the Legislature," with the manner in which the General Assembly has chosen to exercise that authority constituting a "political question that this Court has no authority to review." In addition, the legislative leadership contended that the Governor lacks standing to challenge the constitutionality of Session Law 2017-6 because the alleged constitutional injury upon which the Governor relies did not result from the enactment of the challenged legislation "given the similar or identical provisions in prior law," citing N.C.G.S. § 163-19 and section 4(c) of Session Law 2017-6. In view of the fact that the panel did not reach the merits of the Governor's claim, the legislative leadership urged this Court to refrain from addressing the constitutionality of the challenged legislation even if it concluded that this case was justiciable and that the Governor had standing to challenge the constitutionality of Session Law 2017-6. In the event that the Court elected to reach the merits of the Governor's constitutional claim, the legislative leadership asserts that the challenged legislation represents nothing more than the proper exercise of the General Assembly's constitutionally-derived legislative authority.

On 1 September 2017, "without determining that we lack the authority to reach the merits of plaintiff's claims," the Court entered an order concluding that "the proper administration of justice would be best served in the event that we allowed the panel, in the first instance, to address the merits of [the Governor's] claims before undertaking to address them ourselves." As a result, the Court certified this case "to the panel with instructions ... to enter a new order ... that (a) explains the basis for its earlier determination that it lacked jurisdiction to reach the merits of the claims advanced in [the Governor's] complaint and (b) addresses the issues that [the Governor] has raised on the merits."

**403On 31 October 2017, the panel entered an order determining that it lacked jurisdiction to reach the merits of the Governor's claims on the grounds that "[t]he functions, powers, and duties of an agency encompass how a particular agency might work, its structure, and what role it may play in enforcement of the laws"; "the power to alter the functions and duties of state agencies is reserved to the Legislature through its law-making ability and the Governor through executive order subject to review by the Legislature"; and that "[t]he merger of the Board of Elections and Ethics Commission into the Bipartisan Board ... is a political question and therefore a nonjusticiable issue." In compliance with our order requesting it to address the merits of the Governor's claims, the panel found that:

1. The General Assembly has the authority and power to create and modify the duties of state agencies. See, e.g., Adams v. N. Carolina Dep't of Nat. & Econ. Res. , 295 N.C. 683, 696-97, 249 S.E.2d 402, 410 (1978).
....
5. Plaintiff has produced no authority that a commission or board with an even number of members is unconstitutional as a matter of law. Plaintiff has also produced no authority that "deadlock" on a particular issue constitutes a separation of powers violation.
6. The requirement that the Governor must make his appointments from lists provided by the state party chairs does not constrain his execution of the laws or otherwise violate separation of powers, as the Governor (and not the General Assembly) has a choice among the names on the lists and is making the decision about who will ultimately serve.... Session Law 2017-[6]-*105N.C. Gen. Stat. § 163-19 -also requires that the Governor appoint members to the Board of Elections from lists provided by the party chairs. This requirement was first added by Session Law 1985-62 after the election of Governor James Martin. Other statutory changes to the Board of Elections (including the extension of the term of the Executive Director, see S.L. 1973-1409, § 2; S.L. 1985-62), may have coincided with a change in the political party of the Governor but have not resulted in constitutional challenges.
....
**4048. The Executive Director of the Bipartisan Board is to be, beginning in May 2019, chosen by the Bipartisan Board. Until that time, the current Executive Director of the Board of Elections, whose term is extended by Session Law 2017-6, will serve as the Executive Director of the Bipartisan Board. Such a statutory extension of a term of office has been found to be constitutional....
9. The chair of the Bipartisan Board will initially be chosen by the Governor and will, thereafter, be chosen by the Bipartisan Board....
10. The Governor also has the ability to remove any or all members from the Bipartisan Board for misfeasance, malfeasance, or nonfeasance. The General Assembly has no ability to remove members.
11. The Governor has adequate supervision over the Bipartisan Board, given the Bipartisan Board's role in and impact on state government as the oversight authority for ethics, elections, and lobbying. Additionally, Session Law 2017-6 expressly states that the Bipartisan Board must comply with the duties under N.C. Gen. Stat. § 143B-10, which includes reporting duties to the Governor. The General Assembly does not retain the ability to supervise the Bipartisan Board.
12. Session Law 2017-6 reserves no ongoing control to the General Assembly, and therefore, the General Assembly neither exercises power that the constitution vests exclusively in the executive branch nor prevents the Governor from performing his constitutional duties. Were the Governor given the degree of control he seeks over with the Board of Elections or Bipartisan Board in this case, neither Board could continue to function as "an independent regulatory and quasi-judicial agency" as the Board of Elections under prior law, N.C. Gen. Stat. § 163-28, and the Bipartisan Board would under Session Law 2017-6 (enacting N.C. Gen. Stat. § 163A-5(a) ).
13. On a facial challenge, this Court cannot consider hypothetical situations that could sink the statute; to the contrary, Plaintiff must "establish that no set of circumstances exists under which the [a]ct would be valid."
**405State v. Bryant , 359 N.C 554, 564, 614 S.E.2d 479 (2005) (quotations omitted)....
14. There is evidence that supports the Bipartisan Board being able to function in politically divided situations....
15. There are also numerous other boards and commissions tasked with some administrative functions that are made up of an even number of members such that tie votes and, therefore, deadlock, are hypothetical possibilities....

After conceding that "circumstances could arise where a deadlock or stalemate so stifles the work of the Bipartisan Board that [the Governor] would have standing to raise a challenge that this statute is unconstitutional, not on its face but as applied to that particular situation," the panel held that Session Law 2017-6 is not unconstitutional on its face.

In the supplemental briefs that the Court requested following the filing of the panel's order, the Governor argued that "the judicial branch has subject matter jurisdiction to resolve separation of powers disputes," citing McCrory , 368 N.C. at 638, 781 S.E.2d at 25, In re Alamance County Court Facilities , 329 N.C. 84, 99, 405 S.E.2d 125, 132 (1991), and State ex rel. Wallace v. Bone , 304 N.C. 591, 608, 286 S.E.2d 79, 88 (1982), and that he has standing to advance the claim asserted in this complaint because the "North Carolina Constitution confers standing on the Governor to challenge statutes that cause him constitutional harm," citing Article I, Section 18 of the North Carolina Constitution and Mangum , 362 N.C. at 642, 669 S.E.2d at 281-82. In addressing the merits of his challenge to *106Session Law 2017-6, the Governor contends that the General Assembly's action in appointing the Executive Director of the Bipartisan State Board represented an unconstitutional exercise of control over an executive branch agency, with decisions authorizing legislative extensions of existing terms of office being inapplicable to a proper constitutional analysis given that those cases involved pre-existing municipal offices in which an incumbent's term was extended in lieu of holding a new election, citing Penny v. Salmon , 217 N.C. 276, 277, 7 S.E.2d 559, 560 (1940), and Crump v. Snead , 134 N.C. App. 353, 354, 517 S.E.2d 384, 385, disc. rev. denied , 351 N.C. 101, 541 S.E.2d 143 (1999), while the office of Executive Director of the Bipartisan State Board did not exist prior to the enactment of the challenged legislation, citing section 4(c) of Session Law 2017-6 (creating "the position of Executive Director of the State Board"), and given that the challenged legislation abolished the office **406of Executive Director of the State Board of Elections, citing subsections 7(e) and (f) of Session Law 2017-6 (repealing N.C.G.S. §§ 163-26 ). Finally, the Governor contends that Session Law 2017-6 contravenes the separation-of-powers principles set out in McCrory , which require a reviewing court to focus upon the extent to which the Governor has a sufficient degree of control over executive branch agencies. According to the Governor, McCrory requires that "the Governor must have 'enough control' over executive branch entities and officials that possess 'final executive authority' in order to perform his constitutional duty to ensure that the laws are faithfully executed," quoting McCrory , 368 N.C. at 646, 781 S.E.2d at 256, with the requisite degree of control being exercised by means of appointment, supervision, and removal, citing McCrory , 368 N.C. at 646, 781 S.E.2d at 256. Although the General Assembly may require the appointment of statutory officers from lists and may require that appointees satisfy additional qualifications, the provisions of the challenged legislation "deprive[ ] the Governor of the ability to appoint a majority of members of the [Bipartisan] State Board who share his views and priorities."

On the other hand, the legislative leadership argues that the panel correctly decided that it lacked jurisdiction over the subject matter at issue in this case because the North Carolina Constitution provides the Governor with the authority to "make such changes in the allocation of offices and agencies and in the allocation of those functions, powers, and duties as he considers necessary for efficient administration," subject to later legislative review, quoting Article III, Section 5(10) of the North Carolina Constitution, thereby eliminating any need for the judicial branch to "interject itself into a balance struck in the text of the Constitution specifically dealing with the organization and structure of a state agency." For that reason, "[t]he question raised in this case by the Governor goes to the structure and function of the agency, which is textually committed to a balance struck in the text of the Constitution."

As far as the merits are concerned, the legislative leadership contends that McCrory does not necessitate the invalidation of Session Law 2017-6 because the Bipartisan State Board is structured as an independent agency. According to the legislative leadership, "the quasi-judicial nature of a commission can support its independence from being under the thumb of the executive," citing Morrison v. Olson , 487 U.S. 654, 687-88, 108 S.Ct. 2597, 2617, 101 L.Ed. 2d 569, 603 (1988). In addition, unlike the situation at issue here, the General Assembly appointed more members to the executive bodies at issue in McCrory than the Governor, citing McCrory , 368 N.C. at 637-38, 781 S.E.2d at 250-51.

**407Finally, the legislative leadership asserts that the Executive Director of the Bipartisan State Board is, on an ongoing basis, to be appointed by the members of the Bipartisan State Board and that the sole authority to remove the Executive Director is vested in the members of the Bipartisan State Board, citing section 4(c) of Session Law 2017-6. The legislative leadership further argues that the provisions of Session Law 2017-6 designating the Executive Director of the Bipartisan State Board represent nothing more than the extension of a pre-existing term of office and that the Governor has mischaracterized the role of the Executive Director, whose authority *107is limited to "staffing, administration, and execution of the State Board's decisions and orders," quoting section 4(c) of Session Law 2017-6.

"[O]ne of the fundamental principles on which state government is constructed," John V. Orth & Paul Martin Newby, The North Carolina State Constitution 50 (2d ed. 2013), is that "[t]he legislative, executive, and supreme judicial powers of the State government shall be forever separate and distinct from each other," N.C. Const. art. I, § 6. The legislative power is "vested in the General Assembly," N.C Const. art. II, § 1, which "enact[s] laws, within constitutional limits, to protect or promote the health, morals, order, safety, and general welfare of society," State v. Ballance , 229 N.C. 764, 769, 51 S.E.2d 731, 734 (1949) (citations omitted); see also N.C. Const. art. II, § 20. "The executive power of the State shall be vested in the Governor," N.C. Const. art. III, § 1, who "faithfully executes, or gives effect to, these laws," McCrory , 368 N.C. at 635, 781 S.E.2d at 250 ; see also N.C. Const. art. III, § 5 (4).4 Finally, "[t]he judicial power of the State, shall ... be vested in a Court for the Trial of Impeachments and in a General Court of Justice," N.C. Const. art. IV, § 1, which "interprets the laws and, through its power of judicial review, determines whether they comply with the constitution," McCrory , 368 N.C. at 635, 781 S.E.2d at 250 ; see also N.C. Const. art. IV, § 1. Bayard v. Singleton , 1 N.C. (Mart.) 5, 6-7 (1787).

"The political question doctrine controls, essentially, when a question becomes 'not justiciable ... because of the separation of powers provided by the Constitution.' " Bacon , 353 N.C. at 717, 549 S.E.2d at 854 (alteration in original) (quoting Powell v. McCormack , 395 U.S. 486, 517, 89 S.Ct. 1944, 1961, 23 L.Ed. 2d 491, 514 (1969) ). "The ... doctrine **408excludes from judicial review those controversies which revolve around policy choices and value determinations constitutionally committed for resolution to the" legislative or executive branches of government. Id . at 717,

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