Lake Cnty. Bd. of Comm'rs v. Martinez

199 N.E.3d 366

LAKE COUNTY BOARD OF COMMISSIONERS, et al., Appellants-Defendants,

v.Lake County Sheriff Oscar MARTINEZ, Jr., in his official capacity, Appellee-Plaintiff.

Court of Appeals Case No. 22A-PL-1559

Court of Appeals of Indiana.

Filed November 16, 2022

Attorneys for Appellants: Michael R. Limrick, Finis Tatum IV, Indianapolis, Indiana

Attorney for Amicus Curiae Indiana Association of County Commissions: Mark J. Crandley, Indianapolis, Indiana

Attorneys for Amicus Curiae Indiana Sheriffs’ Association Inc.: Tonya J. Bond, Josh S. Tatum, Indianapolis, Indiana

Attorneys for Appellee: Jenny R. Buchheit, Thomas A. John, Andrew J. Miroff, Timothy W. Walters, Indianapolis, Indiana

Altice, Judge.

Case Summary

[1] Lake County Sheriff Oscar Martinez, Jr. (the Sheriff), in his official capacity, executed a contract with Correctional Health Indiana, Inc. (CHI) for CHI to provide medical and healthcare services to inmates in the Lake County Jail (the Jail) during the 2022 calendar year. The Lake County Board of Commissioners (the Board), as executive of Lake County, Indiana government, refused to approve the 2022 contract and indicated that the Board would approve contracting with CHI but only at the 2021 rate and on a month-to-month basis.

[2] The Sheriff filed a complaint against the Board¹ seeking, in relevant part, a declaration that the Sheriff has the authority to enter into contracts related to the operation of the Jail and the care of its inmates. The Board filed a counterclaim in which it sought a contrary declaration that the Board has the sole authority to approve any contract with CHI for the provision of medical services at the Jail.

[3] The Board appeals the trial court's declaration, by way of partial summary judgment, that the Sheriff, without approval of the Board, has the authority to enter into contracts to take care of the Jail and its inmates, so long as the Sheriff is spending funds within his approved budget. The Board also appeals the trial court's order directing the Board and the Auditor to process, approve, and pay the invoices submitted by the Sheriff pursuant to the 2022 contract with CHI.

[4] We affirm and remand.

Facts & Procedural History

[5] Oscar Martinez, Jr., has served as the elected sheriff in Lake County since 2017. Among his various responsibilities, the Sheriff is tasked with operating the Jail and taking care of the prisoners housed therein.² Dating back to 2012, the Sheriff and his predecessor(s) have engaged the services of CHI, a qualified healthcare provider, to provide comprehensive medical services to the Jail's inmates, and contracts for these services have ranged from annual to multi-year. The earlier contracts were entered into between CHI and the Board "on behalf of" the Sheriff. Appellants’ Appendix Vol. 4 at 65. Later contracts, including the three-year contract for 2017 through 2019, were entered into between CHI and the Sheriff and were expressly "approved by" the Board "on behalf of" the Sheriff. Id. at 104.

[6] Consistent with past practices, in the summer of 2021, the Sheriff began discussions with CHI regarding contract renewal for calendar year 2022. They negotiated an agreement in which CHI would continue to provide healthcare services at the Jail throughout 2022 for a total cost of $6,094,854, payable in twenty-four bi-monthly installments of $253,952.

[7] The negotiated amount for CHI's services was included as a line item in the Sheriff's proposed departmental budget for 2022, which was submitted to the Lake County Council (the Council) for review and approval. The Council approved the Sheriff's 2022 budget on October 12, 2021. Thereafter, on October 28, 2021, the Sheriff and CHI executed a contract for medical services at the Jail (the First 2022 CHI Contract). At its November 2021 meeting, the Board ratified the Council's countywide budget for 2022.

[8] With approval of his 2022 budget, the Sheriff had available funds to cover the full amount of the First 2022 CHI Contract. Still, because the Board had historically requested that it review and approve such contracts, the Sheriff placed the First 2022 CHI Contract on the agenda for the Board's November meeting. When the matter came before the Board at the meeting, the individual commissioners expressed displeasure that the Sheriff had not allowed an independent quality insurance consultant, hired by the Board in 2020, to have access to the Jail. The commissioners also noted that this would be the third extension of the arrangement with CHI, with a significant price increase, and that the services had not been put out for bid since 2016. The Board voted to defer action on the First 2022 CHI Contract, ostensibly to give the Sheriff thirty days to grant the consultant access to the Jail. At the December 2021 meeting, the Board once again deferred action on the First 2022 CHI Contract.

[9] Given the impending expiration of the current contract with CHI, the Sheriff requested that the Board schedule a special meeting before January 1, 2022, in which to approve the First 2022 CHI Contract. The Board refused the Sheriff's request. The Sheriff then, on or about December 22, 2021, executed a new contract with CHI for medical services at the Jail for the 2022 calendar year (the Second CHI 2022 Contract), which was identical to the First CHI 2022 Contract except the signature block for approval from the Board was omitted.

[10] On January 18, 2022, the Sheriff submitted a purchase order to the Board and/or the Auditor for the full amount of the Second CHI 2022 Contract, along with CHI's first invoice for $253,952. The Auditor certified that there were appropriated funds available to pay for this purchase order.

[11] The next day, at its regular meeting, the Board voted to continue contracting with CHI for medical services at the Jail but only at the rate that CHI had been paid in 2021 (bi-monthly payments of $241,859) and only on a month-to-month basis. The Board's decision to approve payments at the prior 2021 rate resulted in a monthly shortfall to CHI of $24,186.

[12] The Board's decision required the Sheriff to amend the purchase order to reflect the 2021 contract rate in order for any payments to CHI to be made by the Auditor. Accordingly, the Sheriff submitted a purchase order change request form on January 24, 2022, changing the amount from $6,094,854 to $5,804,616. In the remarks section of the form, the Sheriff indicated that the amendment of the purchase order amount was "not intended as any compromise or waiver of the Sheriff's claims" in the instant lawsuit, which the Sheriff filed on January 21, 2022. Appellants’ Appendix Vol. 4 at 220.

[13] In Count I of his verified complaint for declaratory and injunctive relief against the Board, the Sheriff sought declarations that he, not the Board, has the authority to enter contracts relating to the operation of the Jail and/or the care of its inmates and that he alone has the authority to determine how to spend the funds in his annual approved budget. The Sheriff also asked the trial court to direct the Board and the Auditor to approve the original purchase order for the Second CHI 2022 Contract, "and any future purchase orders and/or invoices submitted by the Sheriff in connection with the Second CHI 2022 Contract." Appellants’ Appendix Vol. 2 at 31. Finally, in Count I, the Sheriff asked for a declaration that he need not submit future contracts to the Board for approval that relate to the operation of the Jail and/or the care of its inmates. Count II of the complaint, which is not at issue on appeal, alleged tortious interference with contract by the Board.

[14] The Board filed its answer and counterclaim on March 14, 2022. The counterclaim, in relevant part, asked the trial court to settle the parties’ controversy regarding whether the Sheriff or the Board has the legal authority to enter into contracts for the provision of medical services at the Jail and the authority to determine the amount that should be paid on invoices submitted for payment from the county treasury.

[15] The parties agreed to an expedited briefing schedule and then filed cross-motions for summary judgment on Count I of the complaint and Count I of the counterclaim, which presented analogous issues. After hearing argument on the motions on June 1, 2022, the trial court issued its decision on June 30, 2022, granting partial summary judgment in favor of the Sheriff and denying the Board's cross-motion for summary judgment. Specifically, the trial court declared and ordered, in relevant part, as follows: (1) The Sheriff, and not the Board, has the authority to enter into contracts to take care of the Jail and the prisoners there; (2) the Sheriff, and not the Board, has the authority to determine how to spend funds within the 2022 Sheriff's budget that have been allocated to take care of the Jail and its prisoners; and (3) the Board and the Auditor are directed to process/approve/pay/satisfy purchase orders and/or invoices submitted by the Sheriff attendant to the Second CHI 2022 Contract.³ The trial court expressly made its order final and appealable pursuant to Indiana Trial Rule 54(B).

[16] The Board timely appealed from the trial court's summary judgment order. It also filed a motion to stay order pending appeal, which the Sheriff opposed and the trial court denied. The appeal has proceeded in this court with expedited briefing, as requested by the Board.

Standard of Review & Statutory Interpretation

[17] On review of a summary judgment ruling, we stand in the shoes of the trial court. City of Lawrence Utilities Serv. Bd. v. Curry , 68 N.E.3d 581, 585 (Ind. 2017). Summary judgment is appropriate only when "the designated evidentiary matter shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Ind. Trial Rule 56(C). "Issues of statutory construction are questions of law, which are particularly appropriate for summary...