A city or town council cannot deprive its successor councils of their legislative discretion.
As the South Carolina Supreme Court has explained in the 1948 case Newman v. McCullough, “the power conferred upon municipal councils to exercise legislative or governmental functions is conferred to be exercised as often as may be found needful or politic, and the council presently holding such powers is vested with no discretion to circumscribe or limit or diminish their efficiency, but must transmit them unimpaired to their successors.”
In some ways, the point is obvious: if a prior council has passed a law by ordinance, for example, latter councils could amend or even repeal the ordinance. After all, councilmembers are elected to represent their constituents, and this representation cannot be constrained by actions taken by prior councils.
But what about contracts entered into by prior councils, where the timeframe of the contract extends beyond the existence of that council? Here, the question gets interesting.
Governmental versus proprietary functions
The general rule for contracts is determined by the subject matter of the contract. If a contract involves the municipality’s proprietary or business powers, it may bind successors so long as it was fair, reasonable and advantageous when made. If it involves governmental or legislative powers, it may not.
In the 1995 case Piedmont Public Service Dist. v. Cowart, the South Carolina Court of Appeals explained that the “[t]he true test is whether the contract itself deprives a governing body, or its successor, of a discretion which public policy demands should be left unimpaired.”
The tricky part is to apply this rule: how is a council to determine whether a given function is proprietary or governmental? Some contracts may be readily classified as one or the other. Bond issues, ordinary commercial leases, equipment purchases and service contracts are almost invariably considered proprietary. On the other hand, requiring approval of a private party before a government may provide sewer service to any “commercial establishment, townhouses, apartments, or condominiums” clearly implicates a governmental function, as seen in the 1980 SC Supreme Court decision G. Curtis Martin Inv. Tr. v. Clay.
The South Carolina courts have considered a handful of other, more difficult questions. In 1997, in City of Beaufort v. Beaufort-Jasper County Water & Sewer Auth., the SC Supreme Court held that a contract requiring municipal approval before a special purpose district could provide retail water service impaired a governmental function. The courts have also consistently held that employment contracts for managers or administrators involve a governmental function and cannot bind future councils.
Unfortunately, there are many unanswered questions here. When in doubt, councils should consult their municipal attorney or the Municipal Association of SC.
Statutory exceptions
The South Carolina General Assembly can override the rule by clear statutory authorization. The classic example of this is the Local Government Development Agreement Act, which authorizes a council to enter into a binding agreement with a property owner that locks in the zoning and land use regulations applicable to a qualifying parcel for the term of the agreement. Outside of an express statutory grant, however, the default rule governs.
What counts as a “future council”?
The courts have not definitively stated what, exactly, is a “future council.” Because most South Carolina municipalities use staggered elections, the question arises of whether a future council is one in which every member has changed, a majority of members have changed, or a single member has changed.
It seems likely that the courts, if required to squarely address the question, would rule that a future council arises after each municipal general election, whether or not a majority of the council is on the ballot, and even if all of the incumbents win reelection. But, from an abundance of caution, councils should also consider the possibility that a future council might exist even if only a single seat could change hands — including, for example, a special election that fills a vacant seat.
Settlement agreements are not exempt
Recently, the South Carolina Court of Appeals answered a question that has long perplexed municipal lawyers: does the rule against binding future councils apply to court-approved settlement agreements? In the 2026 case Town of Sullivan’s Island v. Bluestein, a court-approved settlement agreement required the town to provide periodic clearing and maintenance of a town-owned parcel of accreted land.
The court conceded that “[t]here is a public interest in the finality of settlement agreements,” but nonetheless held that it “still must view this settlement agreement as a contract between the Town and Property Owners.”
Because the underlying activity — clearing vegetation on a publicly owned parcel — served to protect the public health and safety, the subject matter was governmental. As a result, the agreement was unenforceable against successor councils.
Questions to consider
Before signing a contract, there are several points to consider.
- Does the contract extend beyond the current council’s term?
- If so, does the contract’s subject matter impair a governmental or legislative function?
- If so, is there a clear statutory authorization that permits the binding obligation?
If the first two answers are “yes” and the third is “no,” the agreement is at risk, no matter how carefully it was drafted. Again, when in doubt, officials should call their municipal attorney.