STATE OF MINNESOTA
IN SUPREME COURT
Court of Appeals Lancaster, J.
Prior Lake American, a newspaper of Red Wing
Publishing Company, Inc., petitioner,
vs. Filed: May 2, 2002
Office of Appellate Courts
Wes Mader in his capacity as mayor
of Prior Lake, et al.,
S Y L L A B U S
Heard, considered, and decided by the court en banc.
O P I N I O N
The Prior Lake American, a newspaper published in Prior Lake, Minnesota, sued the Mayor of Prior Lake and three members of the Prior Lake City Council (respondents), claiming that they violated the Minnesota Open Meeting Law when they invoked the attorney-client privilege exception to close a Council meeting. The district court granted respondents’ motion for summary judgment, holding that respondents’ need for confidential legal advice relating to a threat of litigation outweighed the public’s right to access. The Prior Lake American appealed and the court of appeals affirmed. To determine whether the attorney-client privilege exception to the Open Meeting Law applies, we balance the purposes served by the attorney-client privilege against those served by the Open Meeting Law. The exception applies when this balancing dictates the need for absolute confidentiality. In this case, the balancing does not dictate the need for absolute confidentiality and, therefore, we reverse and remand.
The parties agree that there are no material facts in dispute. Ryan Contracting Co. (Ryan) applied for a conditional use permit (CUP) to operate a gravel extraction site in the City of Prior Lake (City). Ryan’s application sparked concern from several sources, including the Shakopee Mdewakanton Sioux Community (SMSC), the Minnesota Department of Natural Resources, and the City. On January 18, 2000, Ryan sent a letter to the City that responded to several issues surrounding its application. The letter stated in part:
In 1997-98 Ryan Contracting had secured an approved grading permit allowing the removal of material from this property. The City of Prior Lake revoked Ryan Contracting’s approved grading permit while allowing an adjacent property owner and contractor to mine sand material from their property * * *. Ryan Contracting suffered severe financial harm as a result of the revocation of our approved grading permit. At this present time Ryan Contracting has voluntarily decided to comply with the City of Prior Lake’s request to apply for a Conditional Use Permit. In the event Ryan Contracting is denied its CUP as allowed by City ordinance or an EAW is required, Ryan Contracting will revise its application to include any or all of the above items [set forth in preceding paragraphs]. Furthermore Ryan Contracting may seek legal action to ensure proper handling and compliance of this matter as well as legal action to recover lost revenues and/or costs incurred as a result of actions by the City of Prior Lake.
The Council’s first opportunity to consider Ryan’s letter took place at its regularly scheduled February 7, 2000, meeting.
The February 7, 2000, meeting was open to the public. Council members Ericson, Gundlach, Petersen, and Schenck attended, as did Mayor Mader. Lee Ann Schutz, the editor of the Prior Lake American, also attended the meeting.
The Council’s agenda included the following item: “Consider Approval of Report Regarding the Petition for Preparation of an Environmental Assessment Worksheet for Ryan Contracting’s Application for a Conditional Use Permit for Gravel Excavation.” The City’s staff presented its findings and recommended that the petition for an environmental assessment worksheet (EAW) be denied and that Ryan’s CUP application be approved.
A discussion of the staff’s report followed. Although Mader acknowledged that the petitioner had not submitted facts to prove that Ryan’s gravel excavation operation “would necessarily represent a risk to the water supply,” he believed that the petitioner had submitted facts showing that Ryan’s operation might pose a threat to the water supply. Mader continued, asking questions about the acreage that Ryan intended to mine, traffic concerns, and effects Ryan’s operation would have on water resources. Mader concluded, “I’m not persuaded that * * * there isn’t a potential environmental problem, nor * * * am I persuaded that this can be carried out without impact on neighboring properties, significant impact on neighboring properties.”
Gundlach followed Mader. Gundlach asked about an observation well, traffic concerns, an aquifer, noise concerns, enforcement of conditions attached to Ryan’s CUP, and tree replacement. Petersen spoke next. He believed that the Council should grant the petition for an EAW:
[T]he Mayor brought up a bunch of concerns that in denying this environmental assessment worksheet which I though[t] we were going to do here, and I just hardly can’t go along with that at this point. There are too many concerns that got brought up on that and so I have to change my opinion on that a little bit. I think if we go anyplace on this we’ll have to have that worksheet brought up. There are just too many things.
After Petersen’s questions, Schenck asked about the timing and cost of an EAW, dewatering, cleaning, the length of time it would take Ryan to complete its gravel extraction, road maintenance, and property reclamation. Ericson then stated that “it would be prudent for us to conduct an EAW since there have been significant issues raised this evening.”
Mader summarized his thoughts with respect to the petition for an EAW:
The court of appeals affirmed:
In HRA, we grounded our analysis on the fact that the supreme court has the power to administer the practice of law. Id. at 318, 251 N.W.2d at 623. That power allowed us to determine the scope of the attorney-client privilege within the context of the Open Meeting Law. HRA, 310 Minn. at 320, 251 N.W.2d at 624. We described as “notable” a California case that faced a similar issue and quoted from it at length:
“The two enactments are capable of concurrent operation if the lawyer-client privilege is not overblown beyond its true dimensions. As a barrier to testimonial disclosure, the privilege tends to suppress relevant facts, hence is strictly construed. As a barrier against public access to public affairs, it has precisely the same suppressing effect, hence here too must be strictly construed. As noted earlier, the assurance of private legal consultation is restricted to communications ‘in confidence.’ Private clients, relatively free of regulation, may set relatively wide limits on confidentiality. Public board members, sworn to uphold the law, may not arbitrarily or unnecessarily inflate confidentiality for the purpose of deflating the spread of the public meeting law. Neither the attorney’s presence nor the happenstance of some kind of lawsuit may serve as the pretext for secret consultations whose revelation will not injure the public interest. To attempt a generalization embracing the occasions for genuine confidentiality would be rash.”
Id. at 320-21, 251 N.W.2d at 624 (quoting Sacramento Newspaper Guild v. Sacramento County Bd. of Supervisors, 69 Cal. Rptr. 480, 492 (Cal. Ct. App. 1968) (citation omitted)). We emphasized the limited scope of the exception: “Clearly the blind application of the attorney-client privilege in all such cases without guidelines or limitations would potentially jeopardize the public’s right to be informed as required by the Open Meeting Law. Public matters should be discussed openly and freely * * *.” HRA, 310 Minn. at 322, 251 N.W.2d at 625. We cautioned against unfettered application of the exception:
The attorney-client exception discussed herein would almost never extend to the mere request for general legal advice or opinion by a public body in its capacity as a public agency. We cannot emphasize too strongly that should this exception be applied as a barrier against public access to public affairs, it will not be tolerated, for this court has consistently emphasized that respect for and adherence to the First Amendment is absolutely essential to the continuation of our democratic form of government. It will be upheld, however, if the balancing of these conflicting public policies dictates the need for absolute confidentiality. The exception is therefore available to satisfy the concerns expressed herein but is to be employed or invoked cautiously and seldom in situations other than in relation to threatened or pending litigation.
HRA, 310 Minn. at 323-24, 251 N.W.2d at 626.
Almost fourteen years after we decided HRA, the legislature amended the Open Meeting Law to include an attorney-client privilege exception. Act of May 3, 1990, ch. 550, § 2, 1990 Minn. Laws 1517, 1519 (codified at Minn. Stat. § 13D.05, subd. 3(b)). Respondents and amici curiae note that the 1990 amendment adopted the attorney-client privilege exception without limitation. We therefore address what impact, if any, Minn. Stat. § 13D.05, subd. 3(b), has on the attorney-client privilege exception as set forth in HRA. We are mindful that “[w]e have occasionally permitted a statute to stand as a matter of comity, even where the legislature has encroached somewhat upon a judicial function, so long as the statute does not conflict with this court’s inherent authority to make the final decision.” State by Humphrey v. Jim Lupient Oldsmobile Co., 509 N.W.2d 361, 363 (Minn. 1993); see Sharood v. Hatfield, 296 Minn. 416, 424, 210 N.W.2d 275, 279 (1973) (noting that “this court has acquiesced in legislative acts prescribing administrative procedures for admission and discipline of attorneys as long as such acts did not usurp the right of the court to make the final decision”).
D I S S E N T
GILBERT, Justice (dissenting).
I respectfully dissent from the majority opinion. In light of the undisputed fact that there was a specific threat of litigation made by the developer of the property at issue, allowing a short time-out for the city officials to consult privately with the city attorney seems to be the most reasonable course of action. In a letter, Ryan Contracting Co. (Ryan) alleged severe financial harm as a result of the city’s revocation of its gravel removal and grading permit. Ryan’s letter went on to threaten legal action to recover lost revenues and/or costs if the city decided to either deny its request for a conditional use permit (CUP) or require an environmental assessment worksheet (EAW).
The council’s first opportunity to consider Ryan’s letter took place at its regularly scheduled meeting on February 7, 2000. At that meeting, there were two resolutions before the council: one to deny the EAW and one to approve the CUP. The council had tabled the CUP application at its prior meeting after it learned that the Environmental Quality Board had received a petition for an EAW and that no further action could be taken on the CUP until the council determined whether to require an EAW.
Ryan’s threat of litigation related to the same project, the same development permit, andthe same responsible government unit and involved environmental and nonenvironmental issues. The letter threatened specific legal action and was a direct, relevant, and material legal matter intertwined with the revocation of Ryan’s 1997 and 1998 grading permits and its request for a CUP allowing gravel extraction on its property.
There is no allegation that Ryan’s threat of litigation was frivolous. It is undisputed that the district court found that there was a specific threat of litigation and thatthe council needed advice from its attorney relating to that specific situation. The district court held that this type of advice rose above the level of mere general legal advice, that the mayor and councilmembers demonstrateda need to discuss the matter with the city attorney in confidence, and that this needoutweighed the public’s right to access. Minnesota statutes and our precedent allow for the closure of publicmeetings when permitted by the attorney-client privilege. Minn. Stat. § 13D.05, subd. 3(b) (2000); Minneapolis Star & Tribune Co. v. Hous. & Redev. Auth., 310 Minn. 313, 323, 251 N.W.2d 620, 625 (1976). The majority opinion wrongfully singles out one reason for open meetings—“the fundamental proposition that a well-informed populace is essential to the vitality of our democratic form of government”—but then ignores boththe facts of this case and the equally compelling fundamental proposition that, in a democratic society,citizens should be encouragedto participate in governmental functions as elected officials. When there is a real threat of litigation relating to their decisions, they should be allowedto seek legal counsel. This fundamental proposition is particularly compelling when, as here,the threatened litigation includes claims for damages against the city itself and potential statutory liability for individual council members.
Our citizen taxpayers expect their city council members to be prudent in exercising their judgment. When faced with a specific threat of litigation, it is prudent for a city council to seek timely advice from its counsel. Without legal advice, the council may fail to take proper legal considerations into account in making its decision and unwittingly expose its taxpayer constituents to potentially millions of dollars of damages.
This case does not come close to representing the blind application of the attorney-client privilege to all cases. The record demonstrates that the privilege was invoked only in response to a specific, written threat of litigation that included a claim for damages. This minimal intrusion on the principle of open meetings is the responsible reaction to an increasingly litigious society in which city councils are brought into court on a regular basis to defend themselves and/or pay damages for wrongful conduct.
I submit that when there is a bona fide threat of specific litigation, there is also a corresponding need to recognize the importance of timely and confidential attorney-client communications between public servants and their counsel. The majority opinion fails to deal with the facts of this case, which are uncontested with respect to the written threat of specific litigation. Although the majority purports to discard a bright-line rule in favor of a case-by-case approach, it in fact adopts a bright-line rule that applies irrespective of the specific facts of the case. Under the majority’s analysis, the threat of litigation would never justify a public body’s decision to close a public meeting to obtain confidential legal advice from its attorney. This case presentsone of the rare situations in whichwe must balance the public policy of favoring open meetings against the need for absolute confidentiality. Furthermore, there is no basis for discounting or ignoring the threat of litigation in this analysis. In fact, we have declined to make a distinction between threatened and pending litigation in the past. See Minneapolis Star & Tribune Co., 310 Minn. at 324, 251 N.W.2d at 626. The record in the case at bar reflects that the only item that prompted the closed session with counsel was the threat of litigation.
In support of its decision, the majority attempts to isolate the EAW decision from other actions impacting Ryan’s project, i.e., the grading and extraction permit and the CUP. The majority states that “[t]he factors that determine whether to require an EAW are detailed and specific. The assessment of litigation risks is not among them.” However, in this case, the city had already issued a grading permit for the property at issue and then summarily revoked the permit. The EAW was considered only in the context of Ryan’s CUP application and the validity of the city’s revocation of Ryan’s grading permit. Indeed, these other decisions directly impact the EAW as to the type, extent, and reversibility of any environmental effects and the cumulative potential effects of related or anticipated future projects, such as the site that was being graded immediately adjacent to Ryan’s property. The majority then concludes that “[t]he Council did not need information regarding possible litigation with Ryan to determine whether Ryan’s project may have the potential for significant environmental effects.” The majority’s great concern with the open meeting principle throws out of balance the ramifications of disallowing an attorney-client privilege exception to the Open Meeting Law. Such an exception would allow the council to close its meeting to discuss how to assess a collaterally related threat of litigation arising from the grading permit revocation and the CUP. Moreover, our citizens expect more of their elected officials and the attorneys who advise them when they are faced with a specific threat of litigation. Importantly, all of these matters—including the grading permit, the CUP, and the EAW—were within the city’s jurisdiction. We should not splice out segments of these governmental actions and review them in isolation, but rather look to the context of the whole picture. Furthermore, contrary to the majority’s assertion, the fact that the threatened litigation is contingent upon a public matter pending before the council should have no bearing on this analysis.
In a practical sense, the majority either forces a city council to proceed with their business and avoid discussing the threatened litigation or, alternatively, to conduct a public discussion of the threatened litigation with their city attorney in an open meeting. Such a discussion would force the city attorney to become a witness in any litigation that ensues. It may also require the city to seek outside counsel because of the conflict that is created when the city attorney becomes a material witness in the litigation. See Minn. R. Prof. Conduct 3.7 (stating the general rule that a “lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary witness”). Having closed sessions with an attorney to discuss settlement or ultimate strategy involving actual litigation is obviously not the sole purpose of having confidential communications with an attorney. The attorney’s advice can also be used in anticipation of litigation and in mitigation of potential damages. The availability of confidential advice from an attorney to a representative of a public body assists the making of informed decisions and prevents legal mistakes. Such advice should be deemed by this court to be appropriate preventive legal medicine that justifies the invocation of the attorney-client privilege.
The majority remands this case to the district court, commenting that “because the lower courts found no such violation [of the Open Meeting Law], they did not consider what remedy to impose, if any.” The potential consequences of intentionally violating the Open Meeting Law are serious. In this case, the city council obviously intended to close its meeting to the public to discuss with its attorney the ramifications of the threatened litigation in the context of this very complex land development situation. The record also reflects that the council was fully aware of the Open Meeting Law. One council member voted against the closure and, in addition, a member of the media challenged the closure. Upon remand now, the district court may have to consider whether to assess a civil penalty of up to $300 against the individual council members, “which may not be paid by the public body.” Minn. Stat. § 13D.06, subd. 1 (2000). An action to enforce this penalty may be brought by “any person.” Id., subd. 2. Moreover, if an individual intentionally violates the Open Meeting Law on three or more occasions, the individual must forfeit his or her office. Id., subd. 3. In addition to other remedies, the court may award reasonable costs, disbursements, and reasonable attorney fees up to $13,000 to any party. Id., subd. 4. Although the city “may pay any costs, disbursements, or attorney fees incurred by or awarded against any of its [city council] members,” id., subd. 4(c), it is not required to do so. It is true that these monetary penalties and attorney fees can be awarded against a council member only if the court finds that there was a specific intent to violate the Open Meeting Law. Id., subd. 4(c). Yet this rule does not remove the possibility that council members will have to individually defend themselves and incur personal liability if the city chooses not to indemnify them. The city may also incur further costs in defending such actions and then paying out an ultimate award. The taxpayers again may end up footing the bill on these additional costs and expenses. Could there be a closed meeting to discuss possible disposition of these further claims? Or would that discussion have to take place in a public meeting?
Anything short of affirming the decision of the lower courts will jeopardize our citizens’ trust and confidence in the decisions under consideration by public bodies and may even discourage our citizens from serving in an elected capacity. This service is essential in our democratic form of government. Finally, if a mistake is made and the city unknowingly or unwittingly makes a legal blunder because of its inability to consult with its attorney in private, the taxpayers are the ones who really lose. The balance needed in our system compels allowing our city officials to meet and discuss a specific threat of litigation in confidence with their attorney. We have thousands of public bodies meeting throughout the state on a regular basis. These entities are dealing with ever-more complex issues that often end up in court. We must be mindful of exposing our individual city council members and public bodies to damages and the enormous costs of defending such litigation. A short recess to consider preventative legal remedies provides the proper balance to these important, competing public interests when there is a bona fide threat of litigation.
 The complaint named Wes Mader in his capacity as Mayor of the City of Prior Lake and James Ericson, Michael Gundlach, and James Petersen, in their capacity as members of the Prior Lake City Council, as defendants. The complaint did not name council member Pete Schenck, who opposed the meeting’s closure and did not participate in the executive session, as a defendant.
 The record does not state who petitioned for an EAW. In a letter to the City dated October 7, 1999, the SMSC asked the City to require an EAW. In its January 18, 2000, letter, Ryan characterized the petition as “produced under the direction of the [SMSC].”
 Consideration of whether to approve Ryan’s CUP application was not on the agenda. The staff’s recommendation to approve it surprised Mader and Schenck. Schenck stated, “I wasn’t prepared to talk CUP tonight * * *.” Mader said, “I was looking primarily at the EAW issue as being the thing we were going to discuss, and I didn’t discover until late today * * * that the resolution [to approve Ryan’s CUP application] was also in [the staff’s report].”
 The complaint also sought a declaration that respondents violated Minn. Stat. § 15.17, subd. 1 (2000), when they removed Schutz’s objection to the meeting’s closure from the minutes of the February 7, 2000, meeting, and an order requiring respondents to restore the record of the objection. This claim is not before the court.
 “A popular Government, without popular information, or the means of acquiring it, is but a prologue to a farce or a tragedy; or, perhaps, both. Knowledge will forever govern ignorance; and a people who mean to be their own governors must arm themselves with the power which knowledge gives.” Letter from James Madison to W. T. Barry (Aug. 4, 1822), in 3 Letters and Other Writings of James Madison 276, 276 (Philadelphia, J. B. Lippincott & Co. 1865).
 The Open Meeting Law appeared at section 471.705 until a recent recodification.
 “An attorney cannot, without the consent of the attorney’s client, be examined as to any communication made by the client to the attorney or the attorney’s advice given thereon in the course of professional duty * * *, without the client’s consent.” Minn. Stat. § 595.02, subd. 1(b) (2000).
 A brief review of our opinions from the past several years reveals suits against cities arising out of a wide range of decisions. See, e.g., Conlin v. City of Saint Paul, 605 N.W.2d 396, 399 (Minn. 2000) (motorcyclist injured in tip-over alleges city was negligent in failing to inspect and maintain street, creating the hazardous condition, and failing to warn of the dangerous condition); Johnson v. City of Eagan, 584 N.W.2d 770, 771 (Minn. 1998) (landowners challenge city-imposed lateral benefit water fee); Country Joe, Inc. v. City of Eagan, 560 N.W.2d 681, 682 (Minn. 1997) (home building contractors challenge city’s decision to impose road unit connection charge as a condition of issuance of building permits); Zeman v. City of Minneapolis, 552 N.W.2d 548, 550 (Minn. 1996) (property owner challenges city’s revocation of rental dwelling license); Wheeler v. City of Wayzata, 533 N.W.2d 405, 405 (Minn. 1995) (landowners seek declaration of the invalidity of city’s zoning ordinances); Knudtson v. City of Coates, 519 N.W.2d 166, 167 (Minn. 1994) (bar owner challenges constitutionality of city ordinances prohibiting nudity in licensed liquor establishments); Carl Bolander & Sons, 502 N.W.2d at 206 (after city council ordered preparation of an EAW, applicant seeks order requiring city to grant license without preparation of an EAW); Krmpotich v. City of Duluth, 483 N.W.2d 55, 55-56 (Minn. 1992) (citizens group seeks declaratory judgment that retail project would violate Minnesota Environmental Rights Act if completed according to city council’s rezoning); Northpointe Plaza v. City of Rochester, 465 N.W.2d 686, 686-87 (Minn. 1991) (property owner alleges violation of due process rights arising from city’s refusal to grant conditional use permit).
 In Reserve Mining Co. v. Herbst, 256 N.W.2d 808, 824 (Minn. 1977), we stated:
We have consistently viewed with disfavor statutes which specify trials de novo and which attempt to confer original jurisdiction on trial courts over policy matters which are the responsibility of the legislative and executive branches. * * * We have repeatedly called attention to the danger of eroding the barriers which guarantee the separation of powers.
 In Village of Edina v. Joseph, 264 Minn. 84, 93, 119 N.W.2d 809, 815 (1962), we stated:
We have repeatedly said with respect to the decisions of municipal and other governmental bodies having the duty of making decisions involving judgment and discretion that it is not the province of the court to substitute its judgment for that of the body making such a decision, but merely to determine whether that body was within its jurisdiction, was not mistaken as to the applicable law, and did not act arbitrarily, oppressively, or unreasonably, and to determine whether the evidence could reasonably support or justify the determination.
 Reliance on factors that the legislature did not intend a public body to consider renders the body’s decision arbitrary and capricious. See Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). Reliance on secret advice thwarts review of whether the decision is arbitrary and capricious because the court cannot determine what the public body considered.
 There are 87 counties, 854 cities, and 1,792 townships in Minnesota.