A District Court judge did not err in finding that Freeborn County commissioners arbitrarily set their sheriff’s salary $16,000 below what he requested, the state Supreme Court has ruled.
The decision overturns a published May 2020 Court of Appeals opinion. The lower court ruled that, in raising Freeborn County Sheriff Kurt Freitag’s salary 5% to $97,020 in 2019, the county board “exercised its judgment while simultaneously considering the required statutory factors.”
But that’s wrong, the Supreme Court decided Wednesday.
“Because the testimony at trial supports the District Court’s findings and conclusion, we hold that the District Court did not clearly err,” Chief Justice Lorie Gildea wrote for a unanimous court. “We therefore reverse the Court of Appeals and remand to that court for further proceedings.”
The lower court must now determine whether District Court Judge Carol M. Hanks abused her discretion when she unilaterally granted Freitag’s request for a $113,952 salary.
Ordinarily, setting government salaries is a legislative function handled by elected bodies like the Freeborn County board. However, case law holds it is no separation of powers violation for courts to intervene in salary matters if they involve judicial officials or “quasi-judicial officers,” like county sheriffs.
“And when reviewing a salary determination for quasi-judicial officers, such as county sheriffs, the District Court is necessarily vested with ‘wide discretion,’” Gildea writes, citing her own court’s 1947 ruling in Cahill v. Beltrami County.
‘In its lane’
During Dec. 1 oral arguments, attorney Karen K. Kurth, a business litigator with Coon Rapids law firm Barna, Guzy & Steffen, argued for the county board.
“This is an important case,” Kurth told justices. “This case tests the guardrails, put into place by the Minnesota Legislature and by this court, that keep the District Court driving in its lane during these salary appeals.”
Under Minnesota law, sheriffs are allowed to appeal a county board’s salary decision to the District Court. As Gildea’s ruling points out, judges can in two instances unilaterally reset the salary, when that decision is justified by the record.
First, it’s allowed when the judge finds a county board acted “in an arbitrary, capricious, oppressive or unreasonable manner.” Second, it’s permitted when the District Court finds the county board set the salary “without sufficiently taking into account the extent of the responsibilities and duties of the office of the sheriff, the sheriff’s experience, qualifications and performance.”
Kurth argued that Hanks strayed from her statutorily carved lane by failing to properly clear the first of those hurdles.
“The District Court clearly said that they disregarded the evidence of economic concerns, of budgetary concerns, constituent concerns and the salaries of the other elected officials, because those weren’t statutory factors that have been enumerated,” Kurth argued.
The judge was wrong to do that, Kurth argued, because those factors “are a basis for finding this decision to be not arbitrary.” Therefore, the judge lacked statutory discretion to overrule the county board and set the salary herself, Kurth argued.
Attorney Stephen J. Hovey of the Austin-based firm Hoversten, Johnson, Beckmann & Hovey, L.L.P., argued for Sheriff Freitag. Hovey told justices that Hanks had found the county board’s salary figure was “drawn out of thin air, effectively.”
According to Hovey, the board offered no rationale for setting the salary at $97,020. Instead, according to May 2019 District Court trial testimony, board member Glen Mathiason seems to have randomly come up with the figure on his own, then pitched it to the other county commissioners about 15 minutes before the meeting where it was voted on.
At trial, county commissioners testified to several reasons for denying Freitag’s request. They said they were worried about what other county employees and taxpayers might think of a 23% year-over-year raise for the sheriff. They also worried how the decision might affect the county’s cash-strapped budget.
The county maintained that, by taking such concerns into account, the board had not arbitrarily set the salary. But Hanks declined to consider that argument, ruling that the board’s economic and political considerations were not among the determinative factors set out in Minn. Stat. § 387.20, subd. 7.
She also found that the board “did not sufficiently take into account the extent of the responsibilities and duties.” Therefore, Hanks ruled, the decision was arbitrary. So she set Freitag’s salary at $113,952, just as he had asked.
The Court of Appeals reversed, finding Hanks’ decision clearly erroneous.
First, Judge Lucinda Jesson wrote for a unanimous panel, it was an error of law for Hanks not to credit the political and economic factors cited by the county board. Second, Jesson wrote, Hanks was wrong to find that board members’ inability to “articulate an exact mathematical process” for calculating the salary renders the decision arbitrary.
Finally, Jesson’s court found that Hanks erred by finding the county board did not sufficiently account for the sheriff’s responsibilities, duties, experience, qualifications and performance in setting the salary.
Supreme Court rules
The Supreme Court set aside that last question about the sheriff’s responsibilities and performance. It was unnecessary to go there, Gildea writes, because the county board had, indeed, acted arbitrarily.
During oral arguments, Hovey asserted that the Court of Appeals exceeded its authority by overruling Judge Hanks. Its sole role, he maintained, was to examine the record and decide whether there was sufficient basis for her findings.
“It was not a question of whether the Court of Appeals agreed with the decision,” the lawyer argued. “It’s not a question of whether the Court of Appeals, hearing the evidence, would have decided the case differently.”
The Supreme Court agreed. While agreeing the county board didn’t need precise reasons for setting the salary where it did, Gildea writes, “the county board certainly must articulate some reason for settling on a salary figure.” The record supports Hanks’ findings that no such reasons were offered, her court found.
“In concluding otherwise,” Gildea writes, “the Court of Appeals essentially substituted its own judgment for that of the District Court.”
The factors cited by the board all related to its rejection of Freitag’s salary request, but did nothing to explain how it set his salary, Gildea writes. The Court of Appeals’ assumption that the factors were used to set the salary was not supported in the record, she writes.
“And because of the deferential standard of review,” Gildea writes, “the Court of Appeals should not have substituted the District Court’s findings with its own interpretation of the record.”
In sum, the chief justice concludes, the record reasonably supports the District Court’s determination that the board’s salary determination was arbitrary, so the Court of Appeals’ ruling is overturned.
The only remaining issue is whether, by setting the salary herself, Hanks abused her discretion. The Supreme Court remanded that question back to the Court of Appeals.