Reedy v. Collingswood ( 2006 )

  •                                                                                                                            Opinions of the United
    2006 Decisions                                                                                                             States Court of Appeals
                                                                                                                                  for the Third Circuit
    Reedy v. Collingswood
    Precedential or Non-Precedential: Non-Precedential
    Docket No. 05-3490
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                                                      NOT PRECEDENTIAL
                     FOR THE THIRD CIRCUIT
                               No. 05-3490
                   BOROUGH OF COLLINGSWOOD.
              On Appeal From the United States District Court
                         for the District of New Jersey
                               (No. 04-cv-04079)
               District Judge: Honorable Jerome B. Simandle
                Submitted Under Third Circuit LAR 34.1(a)
                           September 26, 2006
         Before: RENDELL, CHAGARES and ROTH, Circuit Judges.
                        (Filed: November 7, 2006)
                        OPINION OF THE COURT
    CHAGARES, Circuit Judge.
           In this appeal we consider whether the District Court abused its discretion in
    denying preliminary injunctive relief to plaintiffs-appellants Gayle Reedy, Beth Burns,
    Katherine Sorg, Elena R. Flynn, Maurice Cornelis, Kathy Cornelis, Barbara N. Furman,
    Richard James, Sandra McCausland, Elola Sokoloff, and Marcia Shapiro (collectively
    “plaintiffs”) in favor of the defendant-appellee Borough of Collingswood, New Jersey
    (the “Borough”). We will affirm.
           Because we write solely for the benefit of the parties, we recite only those facts
    necessary to decide this appeal.1
           Plaintiffs are the owners of owner-occupied duplex properties2 located in the
    Borough. Plaintiffs claim to be doubly aggrieved by certain actions undertaken by the
    Borough vis à vis their duplexes. First, plaintiffs claim that the Borough’s Property
    Maintenance Code (“PMC”) § 227-2 violates their rights to procedural due process. In
    enacting the PMC, which requires plaintiffs to meet certain aesthetic and safety standards
             The District Court had jurisdiction over plaintiffs’ federal constitutional and
    pendant state law claims pursuant to 28 U.S.C. §§ 1331, 1343(3), 1367. We have
    jurisdiction under 28 U.S.C. § 1292(a)(1) (“the courts of appeals shall have jurisdiction of
    appeals from: (1) Interlocutory orders of the district courts of the United States . . .
    granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve
    or modify injunctions”).
            Each duplex property has two separate living quarters, one occupied by an owner
    (and plaintiff in this action) and the other occupied by a tenant.
    in maintaining their rental properties and to submit to regular inspections in furtherance
    thereof, the Borough adopted some provisions of a model code known as the BOCA
    National Property Maintenance Code, but specifically excluded the model code’s
    provisions for appeal and review of code enforcement actions. Therefore, if an inspection
    leads to a Notice of Violations and Order to Correct (“Notice”), the duplex owner faces a
    Hobson’s choice: either cure the cited code violation or do nothing and wait until the
    Borough takes further action. The latter course, however, could result in the receipt of a
    summons and complaint requiring an appearance before the Collingswood Municipal
    Court. If convicted of violating the PMC, a duplex owner risks incurring large fines and
    incarceration for up to ninety days in county jail.
           Although plaintiffs are all duplex owners, the record reflects that only plaintiff
    Elena R. Flynn (“Flynn”) received a Notice.3 The inspection of Flynn’s property
    revealed, inter alia, that portions of the duplex and the garage needed to be painted, the
             The record indicates that a Frances Morris also received a Notice, but Morris is
    not a Plaintiff in this action. During the inspection of her property, Morris informed the
    inspector that she had already contracted with a painter to perform exterior painting and
    was waiting for him to begin work. She was cited nonetheless.
            The record reflects that other unnamed persons were also cited for violations and
    that their respective failures to cure resulted in court proceedings. John Amet, the
    Collingswood Fire Chief, stated that “[o]n at least four separate occasions, the
    Collingswood Municipal Court judge has disagreed with and dismissed my notice of
    violation complaints which I filed as a result of property maintenance code inspections. I
    am aware that the municipal court has disagreed with other inspectors and found against
    them in municipal court proceedings.” Appendix 194 (Certification of John Amet ¶ 6).
    chimney needed repointing, weeds and grass in the backyard required maintenance, and
    garbage located in back of the garage had to be removed. Flynn chose to undergo the
    necessary repairs after unsuccessfully attempting to appeal the Notice.
           Second and apart from the PMC, plaintiffs assert that, in enacting certain zoning
    amendments, the Borough rendered duplexes non-conforming uses while it continued to
    permit other types of multi-family dwellings, such as garden apartments and mid- and
    high-rise apartments, as well as single family homes, bed-and-breakfast facilities, and
    funeral homes. Plaintiffs claim that this differing treatment violates their rights to
    substantive due process and equal protection. Plaintiffs acknowledge that their duplexes
    qualify as pre-existing uses.
           Plaintiffs filed an eight-count Complaint seeking monetary damages and injunctive
    relief. In Count One, plaintiffs allege that, by failing to provide for an appeals process
    within the PMC, and consequently a reasonable opportunity to be heard, the Borough
    violated their rights of procedural due process and equal protection under the Fifth and
    Fourteenth Amendments. In Count Two, plaintiffs claim the Borough’s differing
    treatment of duplexes as non-conforming uses is without legitimate rational basis and
    violates their substantive due process and equal protection rights. Count Three alleges
    that the Borough employed improperly trained Collingswood firemen to conduct the
    inspections and to enforce the ordinances. Count Four alleges that the Borough
    selectively enforced the PMC and formulated policies and practices intended to harass
    plaintiffs into abandoning their properties. In Count Five, plaintiffs allege that the
    inspection process violated their rights to be free from unreasonable searches. In Count
    Six, plaintiffs allege violations of their rights to free speech claiming that the Borough
    retaliated against them for speaking out on matters of public concern. Count Seven
    alleges that by subjecting the duplexes to regulation, registration and inspection as a
    rental unit, the Borough has impaired the plaintiffs’ rights to define their families.
    Finally, in Count Eight, plaintiffs allege that the ordinances pertaining to inspection and
    regulation of their properties were invalid exercises of municipal authority under the New
    Jersey Constitution.
           On September 14, 2004, the District Court entered an Order to Show Cause in
    response to plaintiffs’ application for a preliminary injunction. Plaintiffs sought to enjoin
    the Borough from utilizing the PMC without the addition of the model code’s appeal and
    review procedures and to require the Borough to provide said appeals process.
    Additionally, plaintiffs sought to enjoin the Borough from treating duplexes as
    nonconforming uses within its zoning ordinance. In response, the Borough cross-moved
    to dismiss the Complaint pursuant to Fed. R. Civ. P. 12(b)(6).
           By Order dated June 22, 2005, the District Court granted in part the Borough’s
    motion to dismiss and denied plaintiffs’ application for a preliminary injunction.
    Specifically, the District Court dismissed Counts Two, Three, Four, Five, Six, Seven and
    Eight. As for Count One, the District Court held that plaintiffs’ due process claim
    survived the Borough’s motion to dismiss. On July 18, 2005, plaintiffs timely filed a
    Notice of Appeal.
           The District Court’s dismissal in part of plaintiffs’ constitutional and state law
    claims embodied in Counts Two through Eight does not constitute a final judgment.
    Despite plaintiffs’ inclusion of these claims in the Notice of Appeal, the finality doctrine
    precludes appellate review of the District Court’s order dismissing these claims since
    proceedings related to Count One of the Complaint are ongoing. See 28 U.S.C. § 1291;
    Drinkwater v. Union Carbide Corp., 
    904 F.2d 853
    , 858 (3d Cir. 1990). Although we will
    not consider the merits of plaintiffs’ substantive claims on appeal, our review of the
    denial of injunctive relief at this juncture is appropriate. See 28 U.S.C. § 1292(a).
           A denial of a preliminary injunction is reviewed to determine whether there has
    been an abuse of discretion, an error of law, or a clear mistake on the facts. Shire US Inc.
    v. Barr Labs., Inc., 
    329 F.3d 348
    , 352 (3d Cir. 2003). Legal conclusions are reviewed de
    novo. Id. Factual determinations made as a prerequisite to the issuance of an injunction
    are reviewed under the clearly erroneous standard, and are upheld unless a finding of fact
    “‘is completely devoid of a credible evidentiary basis or bears no rational relationship to
    the supporting data.’” Id. (quoting American Home Prods. Corp. v. Barr Labs., Inc., 
    834 F.2d 368
    , 371 (3d Cir. 1987)). “An abuse of discretion is a clear error of judgment and
    not simply a different result which can arguably be obtained when applying the law to the
    facts of the case.” Hohe v. Casey, 
    868 F.2d 69
    , 70 (3d Cir. 1989) (quotation omitted).
           Preliminary injunctive relief is “an extraordinary remedy, which should be granted
    only in limited circumstances.” Frank’s GMC Truck Center, Inc. v. General Motors
    847 F.2d 100
    , 102 (3d Cir. 1988). A preliminary injunction is warranted when the
    movant demonstrates each of the following four elements: (1) a likelihood of success on
    the merits; (2) irreparable injury if relief is not granted; (3) no greater harm to the
    nonmoving party from the relief sought; and (4) that the public interest favors such relief.
    Morton v. Beyer, 
    822 F.2d 364
    , 367 (3d Cir. 1987).
           Plaintiffs seek to restrain the Borough from engaging in maintenance inspections
    under the PMC unless and until it adopts the model code’s procedures for appeal and
    review of code violations. The District Court concluded, however, that plaintiffs failed to
    show the irreparable harm necessary to warrant such injunctive relief, reasoning that none
    of the plaintiffs have received municipal court summonses or complaints or have incurred
    fines or faced incarceration as a result of the inspection process.
           The irreparable harm element requires a “clear showing of immediate irreparable
    injury.” Hohe, 868 F.2d at 72 (emphasis added) (quoting ECRI v. McGraw-Hill, Inc.,
    809 F.2d 223
    , 226 (3d Cir. 1987)). We agree with the District Court that plaintiffs have
    failed to demonstrate the requisite immediacy as none of the plaintiffs are presently
    confronted with the imposition of penalties pursuant to the inspection process. In the
    event that any plaintiff is faced with fines or incarceration in the future, he or she may
    renew a request for preliminary injunction at that time.
           Plaintiffs also argue on appeal that they have sustained irreparable financial
    damage because, facing the threat of criminal prosecution, they made repairs to their
    properties which may not have been necessary given a review by a board of appeals.
    They argue that this out-of-pocket loss is a special circumstance which supports the grant
    of a preliminary injunction. We disagree.
           We have noted that “[t]he irreparable harm requirement is met if a plaintiff
    demonstrates a significant risk that he or she will experience harm that cannot adequately
    be compensated after the fact by monetary damages. This is not an easy burden.” Adams
    v. Freedom Forge Corp., 
    204 F.3d 475
    , 484-85 (3d Cir. 2000) (citations omitted). Here,
    plaintiffs can pursue their challenge to the constitutionality of the ordinance and seek
    damages for their allegedly unnecessary repairs through Count One of their Complaint,
    which the District Court left intact. Plaintiffs’ financial losses can therefore be rectified
    by an award of monetary damages if they prevail at trial. See Morton v. Beyer, 822 F.2d
    at 372 (“The claimed injury testified to . . . is purely economic in nature and thus
    compensable in money. [While] [t]his Court has recognized that the fact that the payment
    of monies is involved does not automatically preclude a finding of irreparable injury[,] we
    have emphasized that the injury must be of a peculiar nature, so that compensation in
    money cannot atone for it.”); In re Arthur Treacher’s Franchisee Litigation, 
    689 F.2d 8
    1137, 1145 (3d Cir. 1982) (noting that “we have never upheld an injunction where the
    claimed injury constituted a loss of money, a loss capable of recoupment in a proper
    action at law”).
             Accordingly, we conclude that the District Court did not abuse its discretion in
    denying preliminary injunctive relief.
             Plaintiffs additionally seek to enjoin the Borough from treating duplexes as
    nonconforming uses. In Count Two, plaintiffs allege that the Borough acted in an
    arbitrary and capricious manner in enacting the ordinance which treats duplexes as
    nonconforming uses, thereby depriving plaintiffs of substantive due process and equal
    protection of the law. Plaintiffs do not allege that as landlords they have a fundamental
    interest in conducting their businesses or that they fall within a constitutionally suspect
             To warrant injunctive relief based on Count Two, plaintiffs bear the burden to
    demonstrate a likelihood of success on the merits, which here entails a showing that the
    ordinance is arbitrary and unreasonable, and bears no rational relationship to a legitimate
    state interest. See Village of Belle Terre v. Boraas, 
    416 U.S. 1
    , 8 (1974); Doe v. City of
    Butler, Pennsylvania, 
    892 F.2d 315
    , 318 (3d Cir. 1989). It is well-established that
    “federal courts accord substantial deference to local government in setting land use
    policy, and that only where a local government’s distinction between similarly situated
    uses is not rationally related to a legitimate state goal, or where the goal itself is not
    legitimate, will a federal court upset a local government’s land use policy determination.”
    Congregation Kol Ami v. Abington Township, 
    309 F.3d 120
    , 125 (3d Cir. 2002).
           In dismissing Count Two, the District Court considered the Borough’s stated
    reasons for treating duplexes differently from other forms of residential uses. Those
    reasons are: (1) multi-family dwellings cause a more dense population; (2) single family
    homes promote more of a community feeling; (3) single family homes reduce traffic
    congestion; and (4) duplexes historically have fallen into a greater state of disrepair
    through the passage of time. The District Court concluded that the above-stated
    governmental interests were legitimate and rationally related to the zoning ordinance.
           Controlling population density, traffic congestion and blight associated with
    housing deterioration are legitimate governmental goals. See Village of Belle Terre, 416
    U.S. at 9 (“A quiet place where yards are wide, people are few, and motor vehicles are
    restricted are legitimate guidelines in a land-use project addressed to family needs. This
    goal is a permissible one . . . . The police power is not confined to elimination of filth,
    stench, and unhealthy places.”); Doe v. City of Butler, Pennsylvania, 
    892 F.2d 315
    , 320
    (3d Cir. 1989). Because we agree with the District Court that plaintiffs cannot
    demonstrate a likelihood of success on the merits of their equal protection and due
    process challenges to the zoning ordinance, we conclude that the District Court did not
    abuse its discretion in denying plaintiffs’ preliminary injunction.
           In addition, inasmuch as plaintiffs’ duplexes are valid, pre-existing non-
    conforming uses, they are protected by New Jersey’s Municipal Land Use Law
    (“MLUL”), N.J. Stat. Ann. § 40:55D-68 which states, “Any nonconforming use or
    structure existing at the time of the passage of an ordinance may be continued upon the
    lot or in the structure so occupied and any such structure may be restored or repaired in
    the event of partial destruction thereof.” The MLUL “permits a use to continue
    indefinitely after it has been rendered nonconforming by a zoning amendment.” Do-Wop
    Corp. v. City of Rahway, 
    168 N.J. 191
    , 198 (2001). Because the Borough has not taken
    any adverse action against plaintiffs with respect to the use of their properties as
    duplexes, we further conclude that plaintiffs have failed to establish the irreparable harm
    necessary to support a preliminary injunction.
           Accordingly, we will affirm the District Court’s Order of June 22, 2005 denying
    the preliminary injunction.