Dewey mayor responds to Supreme Court appeal

Lawsuit continues over ethics violations
March 11, 2013

Delaware Public Integrity Commission maintains Dewey Beach Mayor Diane Hanson is guilty of violating the state Code of Conduct, and it has appealed a lower court decision in Hanson’s favor to Delaware Supreme Court in January.

Hanson’s attorney filed an answer to the appeal, Feb. 27, saying the commission lacks evidence to prove Hanson guilty.

Nearly two years ago, on May 13, 2011, the commission ruled Hanson should have recused herself from a 2010 Dewey Beach Town Council vote to limit the height of construction at Ruddertowne to 35 feet.

In the PIC’s decision, former Chairwoman and Rehoboth Beach Realtor Barbara Green said the Ruddertowne development would impact Hanson’s rental properties, which are located across Route 1 from the Ruddertowne site.  Green has since resigned from the commission.

Hanson filed an appeal of the PIC ruling, Aug. 2, 2011, in Sussex County Superior Court, saying the PIC’s ruling was arbitrary and capricious because no evidence was presented to support the assumption that Hanson would benefit from her vote to clarify the 35-foot height limit for Ruddertowne’s zoning district.

Superior Court Judge E. Scott Bradley sided with Hanson and reversed the PIC’s ruling Aug. 30, 2012.  Bradley agreed the PIC’s ruling was not supported by evidence. “Merely because Hanson and DBE would be renting rooms in the same town hardly means that they would be competing with each other,” he wrote.

Public Integrity Commission Counsel Janet Wright submitted an appeal of Bradley’s decision Jan. 4, to Delaware Supreme Court. “PIC did not err as a matter of law and had substantial evidence to support its conclusion that Ms. Hanson violated the Code of Conduct,” Wright wrote.

Officials are barred from voting on matters if they have a personal or private interest, Wright said.  At the time of the 2010 vote, Wright said, Hanson was being personally sued in a federal complaint by Ruddertowne developer Dewey Beach Enterprises regarding Ruddertowne’s height.  “PIC concluded from the facts the ordinance she allegedly sponsored and voted on could be a defense in the federal case,” Wright wrote.

In an answer to the PIC’s appeal, Hanson’s attorney, David Finger, asked the Supreme Court to affirm Bradley’s ruling.

Finger said there was no evidence in the record demonstrating that Hanson was vulnerable to personal liability or that her vote materially benefited her defense in the federal lawsuit.

“PIC did not have before it the complaint or the briefing in the federal action,” Finger wrote.  “Additionally, the Superior Court noted, Dewey Beach had a statutory obligation to indemnify Hanson.”

In the appeal, Wright also said officials must avoid the appearance of impropriety.  “In applying all the relevant facts, PIC found she acted contrary to the public trust as it could appear to the public she used her public office for personal benefit,” Wright wrote.

Finger argues officials must have an actual financial benefit or detriment to be found in violation of state ethics laws.  “For a conflict of interest to exist, the conflict must be concrete, direct and immediate.  A remote or speculative conflict is insufficient,” Finger wrote.

Wright also argued the Superior Court erred in saying the PIC’s ruling against Hanson was based on the fact she voted to help her rental properties compete with a hotel at Ruddertowne and to aid her defense in the federal lawsuit.

“Why she voted as she did was not the issue,” Wright wrote. The PIC found Hanson guilty because she voted at all, she said.

Finger said Bradley only noted the motives behind Hanson’s vote; his ruling was based on the fact that the PIC presented no evidence to support its decision.  “PIC is grasping at straws, and its argument is utterly without merit,” he wrote.

In an email, Hanson said she is confident the Supreme Court will affirm Bradley’s decision.  “I am also frustrated with the waste of state and town money that the PIC has caused by appealing the well-written decision of Superior Court Judge Bradley that found there was no evidence to support their accusations,” she said.

Hanson said the Supreme Court notified her its decision would be based solely on written briefs and would not hear oral arguments in the case.

Wright said in an email the PIC’s reply brief is due Thursday, March 14, but she would not comment further.

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