In Re: PHILIP LEE SULLIVAN, ) CASE NO. 95-4141EC
Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, Susan B. Kirkland, held a formal hearing in this case on December 14, 1995, in Panama City, Florida.
Whether Respondent violated Section 112.313(7)(a), Florida Statutes, and if so, what penalty is appropriate.
On April 25, 1995, the Florida Commission on Ethics entered an Order Finding Probable Cause to believe that Respondent, Philip Lee Sullivan, as Chief of Police of Panama City Beach, violated Section 112.313(7), Florida Statutes, by contracting to provide security consulting services, either personally or through his corporation, with businesses located in Panama City Beach. The case was forwarded to the Division of Administrative Hearings for assignment to a hearing officer.
At the final hearing, the Advocate called the following witnesses: Charles Hilton, Stephen Joyner, Robert Henry, Shelton Wilkes, W. B. Sparkman, and Philip Lee Sullivan. Advocate's Exhibits 1-12, 14-17, and 19 were admitted in evidence. Advocate's Exhibit 18 was proffered. Respondent testified in his own behalf and called the following witnesses: William Paddon, Howard Parks, James Dever, Wesley Burnham, John Ghessling, Frank Lange, Douglas Sale, Richard Jackson, and Phillip Griffitts. Respondent's Exhibits 1-3 were admitted in evidence.
The parties stipulated to the facts stated in Section E of the Joint Prehearing Stipulation.
The parties agreed to file proposed recommended orders within ten days of the filing of the transcript. The transcript was filed on January 12, 1996.
The parties timely filed their proposed recommended orders. The parties' proposed findings of fact are addressed in the Appendix to this Recommended Order.
Respondent, Philip Lee Sullivan (Sullivan), has served as Chief of Police for the City of Panama City Beach, Florida since August 10, 1977.
Sullivan's salary as Police Chief was $62,326.12 in 1994, and will total $63,211.20 in 1995.
As Police Chief, Sullivan's duties include planning, organizing, and directing all activities of the Panama City Beach Police Department. He is also charged with supervision of all members of the police force, with particular attention to personnel at the administrative and supervisory level, and with the investigation and disposition of complaints against police officers. In his official capacity, Sullivan is also required to cooperate with state and federal officers in the apprehension and detention of wanted persons and with other agencies where activities of the police department are involved.
Sullivan has the authority to take disciplinary action against an employee of the police department up to and including suspension without pay for
30 days, and can recommend termination to the City Manager. He also completes written performance evaluations on members of his command staff, which is comprised of the Patrol Division Commander, the Investigative Division Commander, the Assistant to the Chief, and the Reserve Division Commander.
In 1987, Sullivan began a business as a loss prevention and security consultant, operating as a sole proprietorship.
Sullivan's first client was Hilton, Inc. Charles Hilton is the Chief Executive Officer of Hilton, Inc. It was Mr. Hilton who made the initial decision to hire Sullivan. He considered one other person for the work, but rejected that individual based on the fee sought.
Sullivan verbally sought approval from the City Manager to contract with Hilton, Inc. The City Manager verbally approved the arrangement.
Hilton, Inc. owns and operates five hotels in Panama City Beach: The Holiday Inn Sun Spree, Ramada Inn, Days Inn, Best Western Del Coronado, and Best Western Casa Loma. All except Sun Spree, which was added in 1990, were owned by Hilton, Inc., when Sullivan began contracting with the corporation.
Hilton, Inc. pays Sullivan $2,000 a month with an additional fee for background checks.
Sullivan's next client was the Bay Point Improvement Association (Bay Point). Bay Point is outside the city limits of Panama City Beach. By letter dated February 2, 1989, Sullivan formally requested approval from the City Manager to accept the position of Director of Security for Bay Point. Approval was granted by letter dated February 15, 1989. Sullivan was initially hired in February, 1989, as Director of Security, but his employment status was subsequently changed to that of an independent contractor, similar to his position with his other private employers.
Bay Point pays Sullivan $18,000 per year for his services.
Sullivan's next client was the La Vela Beach Club ("La Vela") in March, 1993. He was hired by the club's owner, Alois Pfeffer. Sullivan no longer works for the La Vela Beach Club, but while he was working for the club he was paid $6,000 per year.
Sullivan's next client was Boardwalk Beach Resorts, which hired him in September, 1993. Boardwalk Beach Resort is the fictitious name for a limited partnership, Resort Hospitality Enterprises, Ltd. ("Resort Hospitality"). The majority of the stock of Resort Hospitality is owned by People's First Properties, Inc. ("People's First"). Resort Hospitality owns and operates four hotel properties, totaling approximately 625 rooms, on Panama City Beach.
Robert Henry, the chief financial officer for People's First, was the person who decided to contract with Sullivan after independently determining to the satisfaction of People's First that Sullivan did not have a conflict of interest.
People's First pays Sullivan $18,000 per year with additional fees for background checks. In 1994 Sullivan was paid $6,450 for background checks and as of September 11, 1995, he was paid $4,720 for the background checks performed in 1995.
Sullivan incorporated his business as Beach Security, Inc. on December 12, 1993.
Sullivan's next client was the Miracle Strip Park/Shipwreck Island (Miracle Strip). He was hired in May, 1994 by the Miracle Strip's General Manager, Shelton Wilkes. Miracle Strip is located on Panama City Beach. Sullivan receives $7,200 per year from Miracle Strip.
Sullivan's next client was Spinnakers, where he was hired in July, 1994, by W. B. Sparkman, III. Spinnakers paid Sullivan $6,000 per year. As of the date of the final hearing it was not known whether Spinnakers would continue its contract with Sullivan for the next season.
Except for Bay Point, there are no written contracts between Sullivan and any of the businesses with which he contracts. Sullivan has no job description, no set work hours, and no regular meetings with his employers.
As part of the services offered by Beach Security, Sullivan makes recommendations to his clients in developing their safety and security policies and procedures, particularly with respect to policies, procedures and training for the security staff. The ultimate decision whether to implement any of Sullivan's recommendations rests with Sullivan's clients. Sullivan is also expected to defend those policies and procedures in court as an expert witness in the event his employer adopts his recommendations and is sued.
Sullivan neither sets nor manages security for his clients. He makes recommendations. Sullivan does not hire, fire, or make other employment decisions for the security personnel of his clients. He does not supervise or evaluate the performance of his clients' security staff on a daily basis, and does not evaluate the individual performance of any of his clients' employees.
As part of Sullivan's services to Hilton, Inc., Boardwalk Beach Resort and La Vela, Sullivan did background checks for potential employees. Sullivan hired an employee of the police department to do the background checks for him. The background checks were performed at the Bay County Courthouse for local applicants. If the information needed was located in another county or state, Sullivan would contact the clerk of the court at the appropriate location for the information. Getting information from another county or state can be a slow process. The information which Sullivan uses in doing the background checks is information which is available to the general public.
The Police Department of Panama City Beach (Police Department) has an agreement with the Florida Department of Law Enforcement to allow the Police Department access to criminal history record information. Access to the information is limited to police department business. If a police department employee desires to access the information, the employee must log in on the computer, which creates a computer-generated log at FDLE. Sullivan personally does not know how to access the information. Sullivan could request a police department employee to access the information for him.
Panama City Beach is a popular resort area, which experiences a large influx of teenagers and young adults during spring break. Problems associated with alcohol consumption, including traffic violations and accidents, assaults, and disorderly conduct, are commonplace police concerns, particularly during spring break.
Spinnakers and La Vela are clubs located on Panama City Beach which cater to the spring break crowd and serve alcohol. The La Vela has a capacity for about 6,000 people and Spinnakers about 4,000.
The Hilton, Inc. hotels, the Boardwalk Beach Resort, and the Miracle Strip also do heavy spring break business. The Miracle Strip deals with more than 600,000 visitors over the course of its season.
The police department investigates crimes and responds to calls and complaints made by citizens. The department also investigates accidents and is routinely called any time an ambulance is called.
In the past two years the police department has received more than five thousand calls for service at businesses which are located in Panama City Beach and which contract with Sullivan.
No evidence was presented that Sullivan has ever disregarded public duty in favor of private interests, or misused confidential police information for the benefit of his private employers.
In February 1993, Spinnakers was sued for the wrongful death of one of its patrons. The Complaint alleged that the deceased, Robert Gaither, was involved in an altercation with one or more of the club's other patrons. Spinnaker security became involved, and the other patrons were ejected. When Mr. Gaither left, security allegedly saw these individuals in Spinnakers' parking lot, but took no action. After leaving the club, Mr. Gaither was beaten to unconsciousness by these same people, and was either left or passed out in the street, where he was run over by a drunk driver. The Complaint alleges that Spinnakers' security staff was negligent in its handling of the incident.
Although the incident took place before Spinnakers hired Sullivan, Sullivan has given a deposition in the case as a potential expert witness.
The Panama City Beach Police Department investigated the death of Mr. Gaither.
Part of Sullivan's services to Le Vela has been to instruct its staff on how to handle fights. The owner of the club has complained to Sullivan about reaction from Panama City Beach police officers when fights have occurred at the club. It is the club owner's observation that the police, in protection of their own physical safety, often leave the burden of breaking up a fight to the security officers, or wait until the participants wear themselves out. Since the club's insurance will not pay for damages if the club's security officers get involved in the fight, the owner wants the police officers to intervene at an earlier stage in the fight and has so complained to the police department.
At the June 23, 1994 meeting of the Panama City Beach City Council, Sullivan's outside employment as a consultant was thoroughly discussed. Sullivan gave a detailed account of his operation. At that meeting the City
Council voted to continue the City's policy of encouraging outside employment of its police officers and allowing police officers to use the police vehicles during off-duty hours as long as the police officer is on call.
On October 12, 1995, the City Council of the City of Panama City Beach enacted Ordinance No. 455, which codified the rules governing secondary or off- duty employment by employees of the City of Panama City Beach. Section 2-46 of the ordinance deals specifically with law enforcement officers, including the Chief of Police. Section 2-46(d)(1) of Ordinance 455 provides:
The following types of off-duty employment do not, on their face, constitute a conflict of interest for law enforcement officers:
Security guard duty protecting premises or property.
Security consultant within or without the City.
Providing dignitary or official's protection.
Conducting pre-employment checks into the applicant's previous criminal history provided that only public records are accessed.
Performing accident investigations or providing technical services as otherwise per- mitted by the Department.
Ordinance 455 requires that police officers who desire to have outside employment must submit an "Off-Duty Employment Request" form. The forms were made available to the police officers sometime during the early part of December, 1995. Shortly after Sullivan received the forms, he submitted authorization requests for off-duty employment with Bay Point Resort, Miracle Strip Amusement Park, Boardwalk Beach Resort, and Hilton, Inc.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of this proceeding. Section 120.57(1), Florida Statutes. Section 112.322, Florida Statutes, and Rule 34-5.0015, Florida Administrative Code, authorize the Commission to conduct investigations
and to make public reports on complaints concerning violations of Part III, Chapter 112, Florida Statutes (the Code of Ethics for Public Officers and Employees).
The burden of proof, absent a statutory directive to the contrary, is on the party asserting the affirmative of the issue of the proceedings. Department of Transportation v. J.W.C. Co., Inc., 396 So.2d 778 (Fla. 1st DCA 1981) and Balino v. Department of Health and Rehabilitative Services, 348 So.2d
349 (Fla. 1st DCA 1977). In this proceeding, it is the Commission, through its Advocate, that is asserting the affirmative: that the Respondent violated Section 112.313(7)(a), Florida Statutes. Therefore, the burden of establishing by a preponderance of the evidence the elements of the Respondent's violation is on the Commission.
Section 112.313(7)(a), Florida Statutes, provides:
No public officer or employee of an agency shall have or hold any employment or contrac- tual relationship with any business entity
or any agency which is subject to the regula- tion of, or is doing business with, an agency of which he is an officer or employee, exclud- ing those organizations and their officers who, when acting in their official capacity, enter into or negotiate a collective bargaining con- tract with the state or any municipality, or county, or other political subdivision of the state; nor shall an officer or employee of an agency have or hold any employment or contrac- tual relationship that will create a continuing or frequently recurring conflict between his private interests and the performance of his public duties or that would impede the full
and faithful discharge of his public duties.
The first clause of Section 112.313(7)(a) is inapplicable here. In order to prove a violation of the second clause of Section 112.313(7)(a), the following elements must be proven:
The Respondent must have been a public officer or employee.
The Respondent must have held employment or a contractual relationship that will:
create a continuing or frequently recurring conflict between the Respondent's private interests and the performance of the Respondent's public duties; or
impede the full and faithful discharge of the Respondent's public duties.
The parties have stipulated that Sullivan, as Chief of Police for the City of Panama City Beach, was and is subject to the requirements of Part III, Chapter 112, Florida Statutes, the Code of Ethics for Public Officers and Employees.
As the owner of Beach Security, Inc., Sullivan has a relationship with Beach Security which is contractual in nature. See CEO 86-36. Prior to the
incorporation of Beach Security, Inc., Sullivan as a sole proprietor, had individual contractual relationships with his clients. Thus there is a contractual relationship at issue.
Section 112.312(8), Florida Statutes, defines "conflict" or "conflict of interest" as "a situation in which regard for a private interest tends to lead to disregard of a public duty or interest."
In Zerweck v. State Commission on Ethics, 409 So. 2d 57, 61 (Fla. 4th DCA 1982), the court discussed the standard of conduct set forth in Section 112.313(7)(a), Florida Statutes.
Section 112.313(7)(a), Florida Statutes (1979), establishes an objective standard which requires an examination of the nature and extent of the public officer's duties to- gether with a review of his private employment to determine whether the two are compatible, separate and distinct or whether they coincide
to create a situation which 'tempts to dishonor.'
In United States v Mississippi Valley Generating Co., 364 U.S. 520, 81 S.Ct. 294, 5 L.Ed 2d 268 (1961), the court upheld a federal conflict of interest statute and discussed the significance of conduct that tempts to dishonor.
The statute is thus directed not only at dishonor, but also at conduct that tempts to dishonor. This broad proscription embodies a recognition of the fact that an impairment of impartial judgment can occur in even the most well-meaning men when their personal economic interests are affected by the business they transact on behalf of the Government. To this extent, therefore, the statute is more con- cerned with what might have happened in a given situation than with what actually happened. It attempts to prevent honest government agents from succumbing to temptation by making it illegal for them to enter into relationships which are fraught with temptation.
Id. at 354 U.S. 549-550, 81 S.Ct. at 309.
Sullivan's service of performing background checks on applicants for employment constitutes a conflict of interest. The information that Sullivan needs for the employment background checks is located within the data base at the police department. Although, Sullivan contends that he only uses information that is available to the public through other means, there still exists the temptation to use the police department data base in order to expedite the background checks. In order to get information concerning applicants who are not local, Sullivan has to resort to the slow process of contacting the clerks of court in other counties or states. This process is cumbersome, time consuming, and costs money. In order for Sullivan to get information on local applicants, he hires a person to check the information at the County Courthouse. This too can take time. The use of the data base at the police department is limited to police business and should Sullivan use the data
base for his personal business he would be using his position for an improper purpose.
As Police Chief Sullivan is privy to confidential information. In doing background investigations on employment applicants, Sullivan could be tempted to use confidential information to make a determination on whether to recommend that his client consider the applicant for employment. For example, if the applicant were under investigation for drug trafficing and Sullivan was aware of the investigation, it would be a great temptation to use that information as part of the background check. In CEO 89-43 the Commission on Ethics opined that a conflict of interest existed for a deputy sheriff who wanted to be employed as private investigator and would include investigating matters concerning pre-employment applications for businesses.
Based on CEOs 91-66, 87-59, 82-36, and 79-23, Sullivan's employment by Bay Point for consulting services other than background checks would not be a conflict of interest because Bay Point is not located within the jurisdiction of the Panama City Beach Police Department. In contrast to the situations discussed in CEOs 91-34 and 83-46, making recommendations on policies and procedures regarding safety and security would not present a need for Sullivan to use confidential information which he could obtain through his contact with other law enforcement agencies or the Panama City Beach Police Department.
The services that Sullivan provides to the businesses located within the jurisdiction of the Panama City Beach Police Department create a continuing or frequently recurring conflict with his public duties. The businesses that Sullivan deals with do a huge volume of business focused on mostly a younger crowd. The combination of young adults and teenagers, alcohol, and a resort setting creates an atmosphere where there is a great likelihood of interaction between Sullivan's private employers and his public agency, the Panama City Beach Police Department. This is borne out in the high numbers of calls for police services from the businesses Sullivan serves in his private capacity. Inevitably, there will be occasions when, due to a crime or accident, the practices of the private entities come under the scrutiny of the police department.
This was precisely the case with the Gaither incident. While this incident occurred prior to Sullivan's employment with Spinnakers, it is a good illustration of the potential for Sullivan to have interests on both sides of an investigation. When there is a theft, a homicide, a drowning, or a balcony fall, the police will be called to investigate and Sullivan, as police chief, must have as his only concern the conduct of an objective and thorough investigation. But as an employee of the private business, and perhaps author of his clients' safety and security practices, Sullivan has a stake in protecting and defending those practices and procedures and protecting his clients, and even himself, from claims of negligence or wrongdoing.
Another way in which Sullivan's private and public duties conflict is illustrated by the complaint from the owner of La Vela. The club wants the police to break up fights and the police officers want the club's staff to do it. As police chief, Sullivan is responsible for the training of the police officers and as a consultant he is responsible for making recommendations to the club on ways to handle fights. He is placed in a conflict.
Sullivan contends that Panama City Beach Ordinance 455 exempts him from the provisions of Section 112.313(7)(a), Florida Statutes because the ordinance provides that outside employment of a police officer in providing
security consultant services, in conducting pre-employment checks into an applicant's previous criminal history through public records, and in performing accident investigations or providing technical services do not constitute, on their face, a conflict of interest.
Section 112.313(7)(b), Florida Statutes, states:
This subsection shall not prohibit a public officer or employee from practicing in a particular profession or occupation when such practice by persons holding such office or employment is required or permitted by law or ordinance.
This exemption serves the useful purpose of allowing political subdivisions to achieve subject matter expertise they could not obtain if practitioners were absolutely excluded. For example, without the exception, contractors could not serve on local contractor licensing boards. It is not a blanket exemption for political subdivisions to render Section 112.313(7)(a) a nullity by merely enacting an ordinance. This seems reasonable in light of Section 112.313(12), Florida Statutes, which provides specific details and procedures for exemptions by which local governments can permit conduct which otherwise would be a violation of either Sections 112.313(3) and (7), Florida Statutes. Thus, Ordinance 455 does not exempt Sullivan from the provisions of Section 112.313(7)(a).
Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order and Public Report be entered finding that
Philip Lee Sullivan's employment with businesses within the jurisdiction of the Panama City Beach Police Department and his employment in doing pre-employment application background checks is in violation of Section 112.313(7)(a), Florida Statutes, and recommending that Philip Lee Sullivan be dismissed from his employment as Police Chief of the Panama City Beach Police Department.
DONE AND ENTERED this 21st day of February, 1996, in Tallahassee, Leon County, Florida.
SUSAN B. KIRKLAND, Hearing Officer Division of Administrative Hearings The DeSoto Building
Filed with the Clerk of the Division of Administrative Hearings this 21st day of February, 1996.
APPENDIX TO RECOMMENDED ORDER, CASE NO. 95-4141EC
To comply with the requirements of Section 120.59(2), Florida Statutes, the following rulings are made on the parties' proposed findings of fact:
Advocate's Proposed Findings of Fact.
Respondent's Proposed Findings of Fact.
Advocate For the Florida Commission on Ethics Department of Legal Affairs PL-01, The Capitol
Florida Commission On Ethics Post Office Drawer 15709 Tallahassee, Florida 32317-5709
All parties have the right to submit written exceptions to this recommended order. All agencies allow each party at least ten days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this recommended order. Any exceptions to this recommended order should be filed with the agency that will issue the final order in this case.
