McGee v. Campaign Spending Commission

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
20-AUG-2024
08:15 AM
Dkt. 52 SO

CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS
OF THE STATE OF HAWAI#I

NANCY E. MCGEE, Plaintiff/Appellant-Appellant, v.
CAMPAIGN SPENDING COMMISSION, STATE OF HAWAI#I,
CALVIN K.Y. SAY, AND FRIENDS OF CALVIN SAY,
an unincorporated candidate committee,
Defendants/Appellees-Appellees

APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
(CIVIL NO. 1CC151000491)

SUMMARY DISPOSITION ORDER
(By: Leonard, Acting Chief Judge, Hiraoka and McCullen, JJ.)

Plaintiff-Appellant Nancy E. McGee (McGee) appeals from

the August 17, 2020 Judgment (Judgment) entered against her and

in favor of Defendants-Appellees Calvin K.Y. Say and Friends of

Calvin Say (collectively, Say) and Defendant-Appellee Campaign

Spending Commission, State of Hawai#i (Commission) in the Circuit

Court of the First Circuit (Circuit Court).1 McGee also

challenges the Circuit Court's (1) July 17, 2019 Order Granting

in Part and Denying in Part [Say's] Motion to Dismiss or, in the

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The Honorable James H. Ashford presided.
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

Alternative, for Summary Judgment, Filed May 20, 2019, and

[Commission's] Substantive Joinder in [Say's] Motion to Dismiss

or, in the Alternative, for Summary Judgment, Filed May 24, 2019

(Order Dismissing Count IV); and (2) August 17, 2020 Order

Denying [McGee's] Renewed Motion for Summary Judgment and

Granting [Commission's] Second Motion for Summary Judgment as to

Count V (Order Dismissing Count V).

McGee raises three points of error on appeal,

contending that the Circuit Court erred in: (1) granting summary
judgment on Count V of McGee's Complaint on the grounds that the

Commission's procedure does not constitute a rule as defined by

Hawaii Revised Statutes (HRS) § 91-1 (2012) because it is an

internal management procedure; (2) granting summary judgment on

Count V on the grounds that the Commission's procedures for

delegating authority do not affect private rights of or

procedures available to the public; and (3) granting summary

judgment on Count IV of McGee's Complaint on the basis that the

Commission's statement, which was the subject of Count IV, was

adjudicatory in nature and not a rule subject to challenge under

HRS § 91-7 (2012).
Upon careful review of the record and the briefs

submitted by the parties, and having given due consideration to

the arguments advanced and the issues raised by the parties, we

resolve McGee's points of error as follows:

(1 & 2) The key allegation in Count V is that "[t]he

Commission has a custom or practice of allowing its staff to make

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determinations which make statements of general or particular

applicability and future effect that implement, interpret, or

prescribe law or policy." The Circuit Court concluded that the

Commission's practice and procedure (Procedure) was an internal

delegation of authority from the Commission to its staff members

to make legal determinations, but that the Procedure did not

impact the private rights of or procedures available to the

public because it was not the policy or procedure of the

Commission for staff to dispose of complaints without Commission
action. Accordingly, the Circuit Court concluded that the

Procedure was not a rule under HRS § 91-1.

Under HRS § 91-1(4):
(4) "Rule" means each agency statement of general or
particular applicability and future effect that
implements, interprets, or prescribes law or policy,
or describes the organization, procedure, or practice
requirements of any agency. The term does not include
regulations concerning only the internal management of
an agency and not affecting private rights of or
procedures available to the public, nor does the term
include declaratory rulings issued pursuant to section
91-8, nor intra-agency memoranda.

(Emphasis added).

McGee argues that the Commission's unwritten rule
delegates authority to Commission staff to implement, interpret,

or prescribe policy by allowing staff to respond to inquiries

from the public without actual action by the Commission; and

thus, the internal management exception does not apply.

The internal management exception applies where

internal agency regulations do not affect the private rights of

the public or any procedures available to the public; this

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exception occurs when, for example, the private rights of the

public or any procedures available to the public are indirectly

affected by internal agency regulations. See Kawashima v. State,

140 Hawai#i 139, 152-53, 398 P.3d 728, 741-42 (2017).

The internal management exception does not apply where

the private rights of the public or any procedures available to

the public are directly affected. See id. at 153, 398 P.3d. at

742; see also Green Party of Haw. v. Nago, 138 Hawai#i 228, 243,

378 P.3d 944, 959 (2016); Aguiar v. Haw. Hous. Auth., 55 Haw.
478, 488-89, 522 P.2d 1255, 1262-63 (1974).

McGee argues in part that the private rights and

procedures available to the public are directly affected by the

Commission's delegation of authority to the Commission staff

because "the manner in which staff make determinations directly

affects the public's right to know about campaign finances and in

a slightly more narrow way, candidate's committees' interests."

McGee's arguments are without merit. Only the Commission, not

Commission staff, may make binding Commission determinations upon

a complaint filed with the Commission. See HRS §§ 11-401 to 11-

411 (Supp. 2021). With respect to campaign finances, any member

of the public may view the source of a candidate's financial

support by viewing the candidate's contribution report on the

Commission's website. See HRS § 11-331 (Supp. 2023).

McGee points to 68 pieces of email correspondence sent

by Commission staff. However, a review of the emails does not

support McGee's arguments. In each instance, Commission staff

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responds to public inquiries, but does not make binding

determinations (for example, numerous emails state qualifiers

such as "Use of E-Mail Limited: E-mail messages to Commission

staff shall not be considered or construed to be a request for an

advisory opinion to the Commission under HRS § 11-315, nor shall

e-mail messages from Commission staff be considered or construed

to be an advisory opinion rendered by the Commission."). In none

of the emails provided did Commission staff dispose of a

complaint, make a binding determination, or otherwise affect the
rights and procedures available to the public. Commission staff,

in all instances, provided responses to public inquiries, with

appropriate qualifiers, putting the public on notice that no

official Commission action was being taken.

Finally, McGee argues that the Circuit Court improperly

relied on certain Commission declarations. This argument is

without merit. The challenged declarations simply averred, in

sum, that it is not Commission policy for staff to dispose of

complaints without Commission action.

(3) McGee argues that the Circuit Court erred in

entering summary judgment on the unlawful rule-making claim in

Count IV because the June 18, 2014 letter (June 2014 Letter) from

Commission staff to Say constituted unlawful rule-making. McGee

argues that the June 2014 Letter guided future conduct, as it did

guide the future conduct of Say, and thus the June 2014 Letter

was a rule within the meaning of HRS § 91-1.

First, the June 2014 Letter was not a binding

determination by the Commission; McGee's complaint was later

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heard by the Commission despite the June 2014 Letter. Moreover,

it was adjudicatory in nature, inasmuch as it addressed whether

particular expenditures were ordinary and necessary expenses in

connection with a particular candidate's duties as an office

holder. Accordingly, we conclude that the Circuit Court did not

err in concluding that the subject of Count IV was not a rule

subject to challenge under HRS § 91-7.

For these reasons, the Circuit Court's August 17, 2020

Judgment is affirmed.
DATED: Honolulu, Hawai#i, August 20, 2024.

On the briefs: /s/ Katherine G. Leonard
Acting Chief Judge
Lance D. Collins,
(Law Office of Lance D. Collins), /s/ Keith K. Hiraoka
and Associate Judge
Bianca Isaki,
(Law Office of Bianca Isaki), /s/ Sonja M.P. McCullen
for Plaintiff/Appellant- Associate Judge
Appellant.

Bert T. Kobayashi, Jr.,
Maria Y. Wang,
(Kobayashi Sugita & Goda),
for Defendants/Appellees-
Appellees CALVIN K.Y. SAY and
FRIENDS OF CALVIN SAY, an
unincorporated candidate committee.

Patricia Ohara,
Candace J. Park,
Deputy Attorneys General,
for Defendant/Appellee-Appellee
CAMPAIGN SPENDING COMMISSION,
STATE OF HAWAI#I.

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