Court of Appeals Clarifies Party Litigation Limitation of the Open Records Act
In Wyrick v. Department of Revenue, the Court of Appeals reversed the Franklin Circuit’s application of the party litigation limitation of the Open Records Act found in KRS 61.878(1) and remanded the matter back to the Franklin Circuit to determine whether one of the fourteen enumerated exclusions from inspection applies to certain requested records and if so, whether the party litigation limitation limits release of these documents.
Mitzi Wyrick appealed an order and opinion enter by the Franklin Circuit Court which denied her request to inspect four types of records from the Department of Revenue (“Revenue”) that Revenue would not disclose under the Open Records Act. The request was made during the course of litigation at the Kentucky Board of Tax Appeals (“KBTA”) between Revenue and the Courier-Journal and Louisville Times Co (“Courier-Journal”). The Court of Appeals (“Court”) held that both Revenue and the trial court incorrectly applied the provisions of the Open Records Act.
Wyrick represents the Courier-Journal in a proceeding before the KBTA in regard to a refund claim. Via Interrogatories and Requests for Production during discovery in the KBTA proceeding, the Courier-Journal sought various categories of information. Some types of requested information included the interpretation and administration of tax laws, internal operations of Revenue, and resolution of matters of other taxpayers and Revenue.
Revenue successfully argued these requests were not relevant to the matter before the KBTA and, hence, the Courier-Journal had no right to discovery of the information. The day after the KBTA sustained Revenue’s objection to the discovery requests, Wyrick filed an Open Records request seeking nine categories of public records to inspect and copy.
Revenue sent a timely request for an additional thirty-two days to determine whether any of the information requested was exempt from disclosure. Later, Revenue responded to the open records request providing a copy of Revenue Policy 41P225, one of the documents requested, but denying the remainder of the requests in aggregate and denying each of the nine information categories individually pursuant to KRS 61.878.
Seeking enforcement of the request, Wyrick appealed Revenue’s denial of this open records request to the Attorney General. The Attorney General upheld the denial of five of the categories requested and held the denial of the four remaining categories was improper.
The requests the Attorney General authorized, which are related to unitary/combined filings, were: 1) training manuals or guides for personnel for process, audit, and the review or handling of audits and/or tax returns; 2) related policies or procedures for these tax matters; 3) Revenue Policy 41P225 and any preceding or subsequent policies; and 4) contracts, memorandums of agreement or understanding, and similar documents demonstration participation of the Commonwealth or the Revenue Cabinet in the Joint Audit Program of the Multistate Tax Commission.
The categories of requests for which the Attorney General did not authorize inspection were: 1) correspondence, questionnaires and similar material sent to taxpayers seeking information of unitary attributes and other matters related to such a determination of unitary classification; 2) memos and drafts regarding the unitary method and the treatment, review, audit, or processing of returns; 3) files regarding how unitary filings should be treated, reviewed, audited or processed; 4) legal memos regarding the effect of certain case holdings, e.g. GTE v. Revenue Cabinet, 889 S.W.2d 788 (Ky. 1994), on application, interpretation, or analysis of filings; and 5) audit files related to audits by the Multistate Tax Commission’s Joint Audit Program on behalf of the Revenue Cabinet.
Revenue petitioned the Franklin Circuit Court for review of the Attorney General’s decision. There, Revenue asserted that Wyrick’s request for enforcement was untimely, that inspection was prohibited as beyond pretrial discovery pursuant to KRS 61.878(1), and that each category the Attorney General decided was enforceable was prohibited by one of the fourteen exclusions listed in KRS 61.878.
The Franklin Circuit Court reviewed the Attorney General’s decision de novo. The court’s Opinion and Order entered December 11, 2006 only addressed the so-called party litigation exclusion provided in KRS 61.878(1). The court held that this limitation applied to bar inspection of the four categories at issue since Wyrick had applied for the records on behalf of the Courier-Journal as it was involved in litigation with the Commonwealth and a determination had been made that the documents were not discoverable.
The Court of Appeals reviewed the Franklin Circuit Court’s Order and Opinion de novo. The Court addressed each of the arguments raised in Revenue’s appeal to the Franklin Circuit Court. First, the Court held that Wyrick’s petition for enforcement to the Attorney General was timely as the Open Records Act does not contain a timeframe for challenging an agency’s denial of records to the Attorney General. The Court held that the legislature intended not to enact a time limit on petition as evidenced by time limits imposed upon other procedural matters contained in the Open Records Act, such as the time for the Attorney General to issue a decision and the time by which to appeal such decision.
Second, the Court held the party litigation limitation KRS 61.878(1) does not apply to the four categories of information requested. This statute states:
The following public records are excluded from the application of KRS 61.870 to 61.884 and shall be subject to inspection only upon order of a court of competent jurisdiction, except that no court shall authorize the inspection by any party of any materials pertaining to civil litigation beyond that which is provided by the Rule of Civil Procedure governing pretrial discovery[.]
KRS 61.878(1) (emphasis added).
The Court stated that the party litigation limitation prohibits the release of records which a party cannot obtain through a court order. Further, the purpose of the exclusion is to limit a court on an open records request on those that could be authorized through a court order on a request for discovery. The Court found each request should also be evaluated without regard to whether requested is a part or potential party to litigation.
The Court, recognizing “the confusion inherent in interpreting the party litigation limitation,” outlined steps a circuit court should take when reviewing an Open Records Act decision by the Attorney General. First, the court should determine whether the material requested falls under one of the fourteen exclusions of KRS 61.878, without regard to whether the requester is a party or potential party to litigation. If the request does not fall under an exclusion, then it is subject to inspection and the analysis ends.
If an exclusion applies, the circuit court then looks to the party litigation limitation. In this part of the analysis, if the material requested pertains to civil litigation and the requestor is a party or potential party to same, then the limitation applies and the circuit court cannot grant access to the requested records. If the material does not pertain to civil litigation, then the circuit court has discretion to grant access to the excluded record as in any other open records action.
The court held that the trial court reviewed the Attorney General’s decision in regard to the party litigation limitation without first analyzing whether the requested materials were excluding by one of the fourteen enumerated exemptions within KRS 61.878. Further, the Court held the circuit court incorrectly applied the party litigation limitation to the four requests. The action in which requests for discovery of the material at issue were denied was an administrative proceeding, not a civil one. The Court held that KRS 61.878(1) applies only to civil litigation by the plain language of the statute. Thus, the Court remanded this matter back to the Franklin Circuit for a determination as to whether one of the enumerated exclusions applies.