Pirolo v. City of Clearwater

CLARK,

Circuit Judge, concurring in part and dissenting in part:

I concur in affirming the district court’s ruling that the city ordinances regulating air traffic were unconstitutional. I disagree with the holding that appellants have no claim under 42 U.S.C.A. sec. 1983 (1981).

The district court should not have granted summary judgment on appellants’ section 1983 claims. There remain issues of material fact as to whether the city used its police powers in violation of due process of law to impair its contractual obligations and to deprive its lessee of peaceful enjoyment of a property right. These are issues properly raised under section 1983.

Despite statements to the contrary by the majority, I find that the appellants’ allegations are more than sufficient for stating their section 1983 claims. More important, the record indicates that, at a trial now denied them, appellants could prove their claims. Appellants asserted that their injuries “resulted in whole or in part from the enactment ... of a curfew that was both arbitrary and unreasonable.” 1 Further, they asserted that the city commissioners,

willfully and deliberately acted in their official capacities to harm the plaintiffs [through wrongdoings extending] from the taking of improper legislative action to impair vested contractual rights to which the city was a party ... to the acting in concert to deprive the airport operators from enjoying the full use and benefit of the airport. 2

In their Amended Complaint, the appellants alleged, “The Defendants individually and/or collectively, engaged in acts indicative of ‘bad faith’ proximately resulting in damage to Plaintiffs in the past and continuing in the future,” and then went on to list episodes evidencing bad faith.

This list indicates a pattern of suspicious activity by the city. The city, under the airport lease, had only two legal means of redress to the nighttime takeoffs and landings. These two were rescission and arbitration. Appellants alleged that the city neglected and delayed these remedies and, in so doing, also unreasonably delayed the city’s purchase of the airport leasehold. Such a purchase would have been the proper course for the city, given its limited legal options. Beyond the drawing out of negotiations for purchase, the list goes on: passing Ordinances Nos. 1896 and 2064, which the city had reason to believe were unconstitutional because a state court had earlier *1015 declared a similar ordinance, No. 1516, to be so, and which were to result in complex court actions; arresting pilots pursuant to the suspect ordinances; and refusing to cut trees along a flight path as required by Florida aeronautics law. These actions, as well as others, effectively lessened the leasehold’s value, to the city’s eventual illicit advantage.

The majority dismisses the appellants’ allegation as to the city’s bad faith. Yet, following the majority’s affirmation of the district court’s summary judgment, the question of the possibility of the city’s bad faith lingers heavily. Appellants should have been afforded the opportunity to prove it.

The facts stated by the majority call for emphasis and elaboration. As those facts suggest, the city has tried for a long time to stop nighttime takeoffs and landings at the airport in question. On March 6, 1974, the city and Clearwater Golf Park amended their lease to prohibit night flying unless the city consented. (However, it is important to note that Clearwater Aircraft— Clearwater Golf Club’s sublessee which Pirolo was later to buy in 1977 — was not a party to the amendment, and so, the amendment did not reach appellants.) Next, on June 17, 1974, the city enacted Ordinance No. 1516, prohibiting nighttime takeoffs and landings. The preamble to this ordinance noted that the city had received many complaints about nighttime flying.

In holding the ordinance unconstitutional in 1975, the Circuit Court for Pinellas County noted “comments and activities of some City Commissioners [which] have not been in the category of good faith honoring all the City commitments to the lessee.” Clearwater Golf Park, Inc. v. The City of Clearwater, Circuit Civil No. 64-5779-16, (Pinellas Cty., Fla., Cir.Ct.1975) (Record). Thus, even before the Pirolos’ purchase of Clearwater Aircraft, the city’s enactment of the 1979 curfew ordinances, or the state court’s 1975 holding regarding the 1974 ordinance, there were city commissioners making statements and performing activities that were not “in the category of good faith.”

The .majority suggests that the second curfew ordinance, with its specific mention of the appellants’ lease and rights, was perhaps a simple misinterpretation of the scope of federal authority in airport regulation. Yet, the Pinellas County Criminal Division Court suggested otherwise when in 1980— before the filing of this federal action — it dismissed charges against Thomas Kersey, apparently a nighttime pilot, charged under that second ordinance. State of Florida v. Thomas G. Kersey, No. CTC8002494MOA-NO (Pinellas Cty., Fla., Ct.Crim.Div.1980) (Record). The county court said:

The City of Clearwater is trying by ordinance to supersede something they failed to do by contract. The City had delegated or limited a proprietary interest by contract, and thereafter by governmental power is attempting to make a petty crime the use of a facility in a way which is considered part of the operation of a public airpark. This is governmental interference into operation of a valid contract and it is also a “taking” of a property right without due process of law.

Among the congressional aims in passing the legislation now embodied in section 1983 was that of providing a federal remedy where the state remedy, although adequate in theory, was not available in practice. See Monroe v. Pape, 365 U.S. 167, 173-74 , 81 S.Ct. 473, 476-77 , 5 L.Ed.2d 492, 496-98 (1961). In light of this aim, it should be noted that the dismissal of charges against Kersey was reversed by the Circuit Court for Pinellas County, the court summarily stating, “The City of Clearwater is not preempted by federal law in this matter and appellee is without standing to contest the validity of the subject ordinance.” State of Florida v. Thomas G. Kersey, Case No. 80-7389 (Pinellas Cty., Fla., Cir.Ct.1981) (Record). Similarly, appellees, in asserting the ordinances’ constitutionality during the brief hearing before the district court, noted yet another local court decision, “Judge Catherine Harlan’s Order showing a denial of a barrage of attacks on the ordinance on *1016 the theories that they were violative of the preemption doctrine, that they exceeded the City police power, that they violated the commerce clause, and a host of other allegations, all of which were denied by that ruling [sic].” (Transcript, p. 8). Thus, concern about the adequacy of state remedies was significant in the formation of my belief that appellants’ issues fall within section 1983 jurisdiction.

Insofar as the appellants assert that the city violated the due process clause by depriving them of their property, the present case has much in common with Reed v. Village of Shorewood, 704 F.2d 943 (7th Cir.1983). Like the present case, the district court in Reed dismissed a suit for damages under section 1983 on the defendants’ motion for summary judgment. However, unlike the present case, the district court’s dismissal in Reed was reversed by a full panel of the circuit court.

The plaintiffs in Reed owned a bar and alleged that defendants — a police officer, the police chief, village officials and the village itself — “interfered with and eventually destroyed their business, in violation of the due process clause of the Fourteenth Amendment.” 704 F.2d at 947 . In 1976, the village issued the plaintiffs a Class A liquor license, allowing them to provide live entertainment along with liquor. Although the license expired after one year, the village renewed it for each of the succeeding three years. However, in 1979 the defendants began to arrest the plaintiffs’ customers and employees on allegedly baseless charges, to demand proof of age from customers who were apparently quite obviously beyond the minimum drinking age, and to bring proceedings to revoke the Class A license. Defendant Talaga, who served as both mayor and local liquor control commissioner, first suspended the plaintiffs’ license for 30 days for alleged infractions of the village’s liquor control ordinance. On appeal, the Illinois Liquor Control Commission reduced the suspension to five days. However, next the village board of trustees (also defendants) passed an ordinance reducing the number of Class A licenses in the village from four to three, and then informed plaintiffs that the village would not renew the license for 1980. On appeal, the Illinois Liquor Control Commission overruled the village. The commission granted the plaintiffs a stay enabling their continued operation, and held that they were entitled to a hearing, before the village decided to revoke the license. On remand, the village held no hearing, but instead revoked the license. The state commission reversed the revocation. In 1981, the defendants again refused to renew the plaintiffs’ license, again without a hearing and again reversed by the state commission. When the exasperated plaintiffs finally attempted to sell their business, the defendants interfered. Eventually, the plaintiffs shut down and surrendered their license. The plaintiffs attributed “defendants’ animosity to the fact that the live entertainment in the bar was provided by a rock and roll band.” 704 F.2d at 948 .

As Judge Posner noted in his opinion, the plaintiffs’ first amendment claim, regarding suppression of their rock and roll music, “is separate from the plaintiffs’ claim to have been deprived of property.” 704 F.2d at 949 .

Having determined that the liquor license was property, 3 the court went on to consider the issue of “whether the defendants could be found to have deprived the plaintiffs of their property rights.” 704 F.2d at 949 . Judge Posner wrote:

The defendants never succeeded in taking away the plaintiffs’ license either by revocation or nonrenewal; their efforts to do so were thwarted by the Illinois Liquor Control Commission; and though the brief suspensions [the five-day suspension that went into effect after the plaintiffs *1017 had been accorded due process by the state liquor commission and a three-hour closing as to which the plaintiffs had a right to a subsequent hearing] were deprivations, see North Georgia Finishing, Inc. v. Di-Chem, Inc., 419 U.S. 601, 606 , 95 S.Ct. 719, 722 , 42 L.Ed.2d 751 (1975), they were not denials of due process. But “deprive” in the due process clause does not mean “destroy.” If the state prevents you from entering your house it deprives you of your property right even if the fee simple remains securely yours. A property right is not bare title, but the right to exclusive use and enjoyment. So if it is true as alleged that through harassment of customers and employees and relentless, baseless prosecutions the defendants destroyed the value of the plaintiffs’ licensed business and forced them ultimately to give up their Class A license, the plaintiffs were deprived of their property right in the license even though the license was never actually revoked.

The principle is familiar from the related area of takings of property that are subject to the just compensation clause of the Fifth Amendment. If government makes your house uninhabitable, that is a taking of your property even if you retain a clear title.... The principle applies equally to deprivations as distinct from takings (permissible if compensated) of property ... — and must, or state officials could with impunity destroy property rights in detail.

704 F.2d at 949 (emphasis added; citations omitted). In considering the liability of the village itself, Judge Posner wrote:

The plaintiffs contend that interference with their business was a policy orchestrated at the highest level of government in the Village of Shorewood: If so — a matter to be explored by the district court on remand — the Village would be liable.

704 F.2d at 953 . In the present case, the Pirolos contended that interference with their airport was a policy orchestrated by Clearwater’s highest officials. This interference, as in Reed , is a matter to be further explored by the district court. If it is true as alleged that through harassment of pilots who were the Pirolos’ customers, through the repetitious passage of unconstitutional ordinances and through the failure to afford the airport duties designated by statute, the city of Clearwater destroyed the value of the airport leasehold, the city of Clearwater deprived the Pirolos of their property right. Although the leasehold in the present case retained some value, the enactment of the ordinance cut it drastically, according to appellants’ allegations. Traffic decreased from 86,000 operations in 1979 to 30,000 in 1980; sales and business activities were reduced 50% and continue to decline. This strongly suggests a taking for which an action for damages under sec. 1983 would lie. Therefore, the district court should not have granted summary judgment.

In addition to Reed, the present case has much in common with land use cases that have been before this court. Hernandez v. City of Lafayette, 643 F.2d 1188 (5th Cir. Unit A 1981); Wheeler v. City of Pleasant Grove, 664 F.2d 99 (5th Cir. Unit B 1981). These two cases focused on suspicious ordinances that severely restricted certain property owners in the use of their property. In discussing Hernandez and Wheeler , the majority seeks to make an important distinction between the due process issue which was properly raised by appellant and a just compensation issue which, the majority says, was not. The two issues cannot be so neatly set apart. Indeed, Judge Posner, in stating the . above-quoted fourteenth amendment principle regarding deprivation of a property right without due process, noted, “The principle is familiar from the related area of takings of property that are subject to the just compensation clause of the Fifth Amendment.” 704 F.2d at 949 . Furthermore, Hernandez and Wheeler , which the majority says “are primarily just compensation cases,” manuscript at 15, demonstrate the interrelationship, not the distinctness of the “two” issues. In Hernandez — the facts of which, so similar to *1018 those of the present case, I shall discuss below — this court stated:

Since the just compensation clause applies to the states through the due process clause of the fourteenth amendment, ... an action for damages will lie under sec. 1983 in favor of any person whose property is taken for public use without just compensation by a municipality through a zoning regulation that denies the owner any economically viable use thereof.

643 F.2d at 1200 (emphasis added; citations omitted); see Chicago B. & Q. R. Co. v. City of Chicago, 166 U.S. 226, 234-39 , 17 S.Ct. 581, 583-85 , 41 L.Ed. 979, 983-85 (1897), cited in Hernandez, 643 F.2d at 1200 .

In Hernandez v. City of Lafayette, Hernandez owned 16.7 acres zoned for single family residential housing; in August 1975, he requested that the land be rezoned for a medical office complex. Shortly after his request, the city began planning a street realignment that would result in the bisection of Hernandez’s acreage. In December 1975, the Lafayette City Council, by unanimous vote, introduced an ordinance embodying Hernandez’s request, which the planning commission’s staff had recommended. The city council postponed final approval of the ordinance several times during the early part of 1976, and eventually tabled it because of an impending council election. In January 1977, the council requested that the planning commission reconsider Hernandez’s request. Following public hearings, the commission recommended that the council deny the request, which the council then did, one councilman having stated, “ ‘If we change zoning to another classification we are going to have to pay more money when we create the right-of-way [for the proposed street realignment].’ ” 643 F.2d at 1190 .

In August 1977, Hernandez filed a new request with the city to zone his property for multifamily housing. This request was also delayed as the planning commission and the council waited to determine whether the street realignment would become a reality. Hernandez, in February 1978, filed suit in state court for a mandatory injunction to compel the city to change his property’s zoning. Compromise seemed to be in the offing, but the mayor vetoed an ordinance to rezone the property for limited office use.

In March 1979, Hernandez filed suit under section 1983, complaining that the city delayed making a final decision on rezoning in an effort to maintain a depressed market value for his acreage, minimizing the cost to the city for his right-of-way needed in the street realignment. The district court, noting that zoning is a legislative function and that a municipality is not absolutely immune when exercising its legislative function, Monell v. Department of Social Services of the City of New York, 436 U.S. 658 , 98 S.Ct. 2018 , 56 L.Ed.2d 611 (1978), held that, where the claimed deprivation is the result of the city’s failure to act promptly (rather than its affirmative enactment of an unconstitutional law or official policy), the city is immune from suit under section 1983. On this point, this court reversed, stating, as noted above, that, since the just compensation clause applies to the states through the fourteenth amendment’s due process clause, an action for damages lies under section 1983 in favor of any person whose property is taken for public use without just compensation by a municipality through a zoning regulation that denies the owner any economically viable use thereof. Although Hernandez involved the taking of nearly all the property’s value, this same reasoning applies in the present case, in view of Reed and the size of the proportional loss in appellants’ business.

In Wheeler v. City of Pleasant Grove , this court affirmed a district court finding that an ordinance forbidding new apartment construction was confiscatory and violative of the plaintiffs’ fourteenth amendment rights to due process. In Wheeler , the plaintiffs, in August 1978, were granted a permit to build an apartment complex on land the plaintiffs had recently purchased in Pleasant Grove, Alabama. In reliance on the permit, the plaintiffs initiated preparatory work. News of the construction creat *1019 ed a civic uproar. A referendum was held, showing overwhelming resistance to the apartment complex. The upshot of the referendum was the passage of a city ordinance prohibiting new apartment construction. This court affirmed the district court holding, finding the new ordinance a bald attempt to revoke an already authorized building permit.

The facts in the present case are quite similar to those of both Wheeler and Hernandez . The ordinances, their enforcement and the circumstances of their passage evidence the city council’s unreasonableness. The city council’s actions have severely decreased the value of appellants’ property, a leasehold interest.

Not only is the inference strong that the City of Clearwater employed its police powers to deprive appellants of peaceful enjoyment of a property right in violation of due process of law, but it gains further strength in light of the fact that the city had special obligations as to that property — contractual obligations. Thus, the due process question is compounded by the fact that the city used its police powers to impair its contractual obligations. 4

Finally, consideration is due Parratt v. Taylor, 451 U.S. 527 , 101 S.Ct. 1908 , 68 L.Ed.2d 420 (1981), noted by the district court. In Parratt , the Supreme Court found that a prison inmate had not stated a claim for relief under section 1983 when he asserted that prison officials had negligently caused the loss of certain goods he had ordered by mail. The Court held that “mere negligence” did not support a section 1983 claim; that a post-deprivation state tort remedy constituted sufficient due process for an assertion that a deprivation of property occurred through negligence. The Court noted significantly, “The loss of property, although attributable to the State as action under ‘color of law’ is in almost all cases beyond the control of the state.” 451 U.S. at 541 , 101 S.Ct. at 1916 , 68 L.Ed.2d at 432 . Parratt’s property loss “did not occur as the result of some established state procedure.” 451 U.S. at 543 , 101 S.Ct. at 1917 , 68 L.Ed.2d at 434 . In the present case, quite the contrary was true. The loss of property was wholly within the control of the city council. The deprivation occurred as a direct result of the council’s activity. The council employed its law-making power unlawfully to impair the value of the airport leasehold and to deprive Pirolo of his right to use his property.

In summary, I believe that this case is controlled by Hernandez and Wheeler . However, this case is even stronger than either of those because the city’s behavior was directed against a party to whom it bore contractual obligations — compounding the likelihood of the city’s bad faith and the due process deprivation.

. Supplemental Response to Defendants’ Motion to Dismiss, p. 2.

. Plaintiffs’ Points and Authorities, pp. 15-16.

. The leasehold interest in the present case is property. “At common law estates for years were classified as chattels real and regarded as personal property.” Devore v. Lee, 158 Fla. 608, 610-612 , 30 So.2d 924, 926 (1947). See 34 Fla.Jur.2d, Landlord and Tenant, sec. 5 (1983) (“The interest of a tenant in a term for years is deemed at common law to be personal property as distinguished from real estate.”).

. The majority writes, “Pirolo has never argued that the impairment of contract clause, U.S. Const, art. 1, sec. 10, ¶ 1, was violated.” Manuscript at 16. However, at the hearing on motions for summary judgment, appellants’ attorney stated:

In McGuire v. Sadler, 337 F.2d 902 , which is a Fifth Circuit Court of Appeals decision [discussing jurisdiction under U.S. Const, art. 1, sec. 10, ¶ 1], they hold that a claim founded upon impairment of contractual obligations itself is actionable under 28 U.S.C. 1331. That would cover the independent jurisdiction with respect to the impairment of contract allegation alone.

(Transcript, p. 38). Thus, in the district court, the Pirolos expressly argued that the contract clause was violated. However, in their brief to this court, they did not refer to their contract clause argument. Nonetheless, I believe the argument is relevant, because it is a constitutional element of the case related to appellants’ section 1983 claims. Furthermore, nothing like it existed in either Hernandez or Wheeler ; the present case thus gains strength in comparison.