Alongside City Managers, City Attorneys are among two of the most powerful unelected officials in most municipalities. The Aiken City Attorney has served at the pleasure of Aiken City Council since the Council-Manager form of government was adopted in the mid-1950s.
Since 2012, Aiken’s Municipal Code has dictated that the City Manager is responsible for preparing the City Attorney’s contract, which Council must then approve.
Attorney Gary Smith III has served as the City Attorney since 1995. No formal contract, as defined by city code, exists between him and the City Council.
According to City of Aiken records, the City Attorney’s office is composed not only of Mr. Smith, but the entire law firm of Smith Massey Brodie Guynn and Mayes (SMBGM); some of whose members perform city work under his direction on an as-needed basis. One prominent example from May 2021 involved a title search and document preparation directly related to Project Pascalis.
By Don Moniak
August 10, 2024
Local governments employ legal counsel that provide a variety of legal services, including preparation of ordinances, contracts, and leases; providing legal representation and advice; filing court actions against nuisance properties; acting as the Parliamentarian during public meetings and hearings; and recommending other attorneys for more time-consuming, specialized, and complex legal matters.
South Carolina towns, cities, and counties can hire full-time, in-house attorneys whose only client is the government body; or independent contractors that may be part-time and have private clients. Independent contractors are also not subject to the state’s ethics laws.
Aiken County employs the in-house approach, with Attorney Brad Farrar occupying the position. The Cities of Aiken and North Augusta both employ independent contractors—Gary Smith III and Kelly Zier, respectively. (In most situations, the prosecution of criminal cases is tasked to the Solicitor’s offices).
Aiken City Attorney’s Office: 1958-1994
In 1958 Aiken City Council approved its first City Code of Ordinances after the formal adoption in 1955 of a Council-Manager form of government. Section 4.01 stated that the City Attorney “shall be appointed by and subject to removal by the City Council.”
By the time the City Code was revised in 1980, both changes in wording and structure had occurred.
First, a Department of Legal Services had been established that included both a City Attorney and a City Solicitor; with the latter representing the city in all “criminal and related proceedings” and the former representing the City in other matters.
Second, the new code stated that “The city attorney and city solicitor shall be appointed by, and serve at the pleasure of, and be subject to removal by the city council. The city council at its discretion may appoint one person to serve as the city attorney/city solicitor, and in the event of such appointment, it shall be considered one position or office.”
From 1985 to 1993, the late Attorney Jim Holly was the last City Attorney to hold this in-house, dual role.
In October 1993, Mr. Holly requested that Council convert him to a part-time status as City Attorney, with a “full-time staff attorney that will also serve as the City Solicitor.” In February 1994, this arrangement was formally approved when Council appointed Paul Anderson as City Solicitor.
After converting to part-time status, Mr. Holly became a concurrent partner in the law firm of (Robin) Braithwaite, (Clark) McCants III, (James) Holly, and (Gary) Smith III. The firm’s specialty was representation of insurance firms. The only local clients were SRP Credit Union and the City of Aiken.
The Gary Smith III Era: 1995 to Present.
After City Attorney Holly resigned in early 1995, attorney Gary Smith III, who had also joined Braithwaite et al as a partner in 1992, submitted a proposal to City Council to become the next part-time City Attorney, again operating as an independent contractor. The proposal implied that the entire law firm was also under retainer:
“We would like to propose offering our firm’s services to the City of Aiken in the following manner. The City would pay a monthly retainer of $2,500 at the beginning of the month. The present retainer is $3,000. In return for this retainer, the City would receive up to 30 hours of billable time. Any hours over this 30-hour minimum would be billed to the City at the rate of $80 per hour—the present billing rate is $90 per hour.” (emphasis added in italics). (Pages 7-11)
On July 24, 1995, after receiving several other resumes during the search for Holly’s replacement, Aiken City Council held a Special-Called Meeting to discuss appointing Mr. Smith. At the end of the meeting, he was approved by a unanimous vote. The meeting minutes read:
“Councilman Radford moved, seconded by Councilman Perry and unanimously approved, that Gary H. Smith III, of Braithwaite, McCants Holly & Smith Attorneys, be appointed to serve as part-time City Attorney on a monthly retainer basis.”
Braithwaite, McCants, and Holley all moved on to different practices, and Braithwaite et al was gradually supplanted as the City’s law firm by Smith, Massey, Brodie, Guynn and Mayes (SMBGM); whose website lists a founding date of 1992–the same year Smith became a partner in Braithwaite et al.
Unlike Braithwaite et al, SMBGM specialized in different areas of the law. No longer was the city employing a firm whose clients were predominantly distant insurance companies; it was employing a firm that also eventually specialized in real estate law—much of which involved local cases.
In 2001, City Council adopted another updated Code of Ordinances, but not until 2012 did the Ordinance governing the Department of Legal Services change.
That change came in March of 2012, when City Council amended that part of the city code, Section 2-281, pertaining to the legal department. The amendment (Figure 2) involved three substantive changes that all increased the power of the City Manager over the legal department.
First, the City Manager was granted the power of consent to combine or dissolve a combined City Attorney/City Solicitor position.
Second, in the absence of a combined position, the City Manager was granted the power to appoint, and terminate, the City Solicitor, giving them full authority over the position.
Then-City Manager Richard Pearce explained that it was already the practice for the City Manager to supervise, and evaluate the performance of, the City Solicitor. He rationalized that the practice was at odds with City Code, and the code needed to be consistent with the practice.
However, the power to appoint the Solicitor had not been the practice prior to the amendment. As it was written, the City Council relinquished power in a manner that provided the City Manager veto power over any decision by Council to restore a combined City Attorney/City Solicitor position.
The amendment also mandated that a contract for both offices “be prepared by the city manager’s office;” with contract terms to include “compensation details, malpractice insurance coverage requirements, worker’s compensation insurance requirements, and other details which may be deemed important by the city manager and city council.”
No such contract has ever been produced for the City Attorney position. In neither of the meeting minutes for 3/12/12 and 3/26/12 were there discussions of a grandfather clause for Mr. Smith; nor were there any indications of when or if Council expected a contract to be produced and executed for the City Attorney position.
On December 28, 2016, Mr. Smith wrote to then City-manager John Klimm to ask for an increase in his firm’s retainer fee, indicating again that it was the firm being hired, not just himself, and that the firm’s other attorneys could work on city business “when their services may be needed.” This ultimately meant that the fees charged by the firm were in fact variable.
The letter read, in part:
“Currently, the City pays my firm a monthly retainer of $3,000.00. In return, the City receives 30 hours of legal services. Additional hours are charged at the rate of $110.00. This rate schedule has been in effect since 2002. I am aware that my firm receives a substantial amount of fees from the City each year. I do want you to be aware that this hourly rate is substantially lower than my usual hourly rate of $400.00 that I charge my private clients.
I would propose to modify my firm’s fee agreement as follows. The monthly retainer would be increased to $4,000.00 with the City still receiving 30 hours worth of service. The City would be billed for hours in excess of the 30 hours at the rate of $150.00 per hour. When services may be needed from other lawyers in my firm, those services will be billed to the City at their normal billing rate. I know this is a significant increase, however, it is the first time I have asked for a modification of the fee arrangement since 2002.” (emphasis in italics added).
Mr. Klimm did not prepare a contract for City Council review. Meeting agendas for both of Council’s January of 2017 meetings do not indicate that he informed Council of the pay increase. The 2016 fee arrangement, coupled with the 1995 proposal, continues to function as a contract—one which only identifies compensation but no other elements of the city code’s requirements.
(The current legal requirements for the Department of Legal Services remain defined by Section 2-281 of City Code.)
The Firm’s City Workload
Section 2-285(9) of the Aiken Municipal Code allows for the City Attorney to “assign any of his duties “to another attorney retained or employed by the city.”
Those attorneys, as inferred in Mr. Smith’s 1995 letter and described more directly in his 2016 letter, can include his law firm partners and associates. The 1995 and 2016 letters apparently provide that engagement commitment.
It is difficult to gauge what percentage of the City Attorney’s office workload is completed by other members of the SMBGM law firm. The firm’s invoices to the City for the period between January 2021 to May 2023 show at least 53 billing entries involving Gary Smith’s partners or associates (Table 1).
| SMBGM Law Partner | Number of Interactions |
| Brad Brodie | 4 |
| Mary Guynn | 46 |
| Ray Massey | 2 |
| Scott Patterson | 1 |
Only three separate invoices from an SMBGM partner were included in the billing invoices obtained via FOIA requests. All three were from Attorney Mary Guynn. One involved a Smith-Hazel Park matter, but two other matters were redacted.
The Project Pascalis Job
Up until Project Pascalis, complaints of real or perceived conflicts of interest involving the City Attorney’s office were absent from the public record (2); and any ethics concerns would probably have remained under the radar, if they even existed, if not for SMBGM partner Ray Massey’s involvement in the Pascalis project.
As explained in The Pascalis Attorneys and The AECOM Plan, the first rendition of Project Pascalis began to quickly unravel on April 30, 2021. That day Smith had separate meetings, of which the subject is redacted, with partners Mary Guynn and Ray Massey. (The subject of the Guynn meeting appears to end with “property.”)
After May 6, 2021, the AMDC, City of Aiken, and the Aiken Chamber of Commerce scrambled to salvage the Project Pascalis property acquisition contracts held by WTC Investments LLC (Agent: Ray Massey). The process involved a title search and preparation of an “assignment” contract to transfer $9.5 million worth of Purchase and Sales Agreements (PSAs) from WTC to the Chamber of Commerce in what functioned to be a property holding contract for the City.
As a result of the transfer of control of the Pascalis properties, WTC Investments did not lose $135,000 in earnest monies.
The legal agent for WTC Investments LLC was, and remains, SMGBM partner Ray Massey; who in part represented WTC during the purchase negotiations for the Pascalis properties, and assisted with the contract preparations. And, as explained in the Project Pascalis Includes the Alley series, Massey was the leader of the investment group Aiken Alley Holdings, which owned a key property in the first version of the Pascalis project (3).
An SMBGM invoice for June 30, 2021, submitted under Ms. Guynn’s company email account, involves work completed by Guynn towards transferring control of the Pascalis properties to the Aiken Municipal Development Commission (AMDC) and City of Aiken via the Chamber of Commerce.
The invoice was broken down into two billings for May 17, 2021—document preparation and a title search (Figure 4).
SMGBM partner Ray Massey is the registered agent for WTC, represented the firm in negotiations for the Pascalis properties, and led an investment group whose property was within the original Project Pascalis footprint. Unless the City of Aiken provides an unredacted version of this invoice and discloses its contents, there is no way of knowing whether or not it states “Assignment of Shah and Anderson properties to Aiken Chamber of Commerce.” But, based on all available information, the wording in red is considered accurate.
According to SMBGM’s May of 2021 invoices, Smith communicated with Guynn via email twice and in a meeting once on May 17th. Two of the billings involved document reviews, while another involved a meeting. Another billing entry on May 14th names both Guynn and AMDC Executive Director and Pascalis project organizer Tim O’Briant. That was the day that WTC and the Chamber almost consummated the sale of property that WTC did not own. (4)
One week later the Pascalis properties were assigned to the Aiken Chamber of Commerce; meaning that at least some of real estate legal work—that was technically conducted on behalf of the Chamber, and which saved Ray Massey’s client and investment partner WTC Investments, LLC, $135,000 in earnest monies—was billed to the City of Aiken.
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Coming Next: The City of Aiken’s Alley Project is Another Long Mismanaged Situation.
Footnotes:
(1) Photo of the 1980 City of Aiken Code governing the qualifications and many of the duties of the City Attorney position. The current qualifications and job requirements are in Section 2-281 of the city code.
(2) Up until the late 2010s, it does not appear that any SMBGM partner was involved with city-related business that involved city property or the potential expenditure of city funds to subsidize a public-private partnership project.
Although SMBGM partner Ray Massey was involved with WTC Investments LLC in the failed effort to redevelop the Old Hospital property on Richland Avenue, no issue was raised regarding Gary Smith’s lack of a recusal.
Nor was the issue raised in 2021 when two parcels of city property were sold to an associate in SMBGM, Scott Patterson, for $150,000. Although the sale was approved in September 2021, a title dispute created by a “scrivener’s error” prevented the closing until June 2022. During that time, Mr. Patterson represented the City of Aiken in court proceedings to rectify the title situation. In June 2023, half of the property was sold for $280,000; yielding a $130,000 profit in one year; with two more acres still on the market.
Smith did on occasion properly recuse himself when his partners were involved, even peripherally, in any city-related business; a practice that increased after ethics issues were raised during Project Pascalis and in the Blake et al vs City of Aiken et al lawsuit where Smith was named as a defendant. He was also named as a defendant in two appeals of the Newberry Street privatization ordinance.
All those cases were dismissed due to jurisdictional issues—the SC Ethics Commission, and not State District Courts, are considered the arbiter for all ethics complaints involving public officials.
Smith is not considered a public officer or member by the Commission, and instead is considered an independent contractor. As such, he falls under the Commission’s precedent-setting ruling in 2014 that independent contractors are not subject to state ethics law.
(3) In the May 4, 2021, memorandum to the AMDC Executive Committee, AMDC Executive Director Tim O’Briant described an offer from Weldon Wyatt:
“(Wyatt) asked about our interest in the Alley fronting properties (likely $3 million) and the Harrison insurance parcel ($700,000 +). He would very much like those included in any deal. I told him we had no interest and could complete a slimmed project on solely the Shah and Anderson parcels.”
The “Alley fronting properties” had been purchased by Aiken Alley Holdings LLC on March 15, 2021. At the time of the memo, WTC Investments, LLC had a contract to purchase the adjacent Harrison insurance building on Newberry Street. Sometime after May 6th that contract was assigned to Aiken Alley Holdings, which bought the property on June 6, 2021.
(4) On May 14, 2021, WTC and the Chamber were prepared to sign a Purchase and Sale Agreement (Figure 6) for the “Shah Property”—but WTC only owned the right to buy the property, not the right to sell it.
Thus, an assignment of the property contract from WTC to the Chamber had to first occur. It is believed to have been prepared by the City Attorney’s law firm, and then passed on to the involved parties.
A document titled “HotelAiken.doc” was forwarded by Tim O’Briant to Ray Massey on May 18th; with O’Briant writing “Does this suit you all?”
Massey replied, “Let me get with Chip (Goforth);” a partner in WTC Investments (“the “C” in WTC).
The date of the final transactions was May 25, 2021. First, the assignment was signed (Figure 7). Then, a newly prepared PSA between the Shah family’s entities and the Chamber was signed (Figure 8). The latter PSA included the provision that the Chamber could make a future assigment to the City of Aiken or the AMDC. (Figure 9). The same process occurred with the Anderson Property (Newberry Hall) on June 3, 2021.
Six months later, the AMDC would acquire the properties for the original collective price of $9.6 million, thus formally initiating the second version of Project Pascalis; and eventually kicking off perhaps the most contentious debates ever over the future of downtown Aiken. A month after the AMDC acquired the properties, a Purchase and Sale Agreement was signed with RPM Development Partners. RPM, which stands for Raines, Purser, and Massey, had Ray Massey sign that contract to purchase the Pascalis properties for $5 million—a nearly fifty percent reduction in the price paid by the AMDC.
