The City of Lake Oswego added the Carman House to its inventory of historic landmarks in 1990, pursuant to Statewide Planning Goal 5. The oldest extant residential structure within the City, the Carman House is considered a rare and valuable example of a territorial Oregon residence. The owners at the time, Mr. Wilmot and Mr. Gregg filed an objection to the designation. However, since the city could designate a property as historic without a property owner’s consent, the property was designated over the owners’ objections.
Spring Training has begun! The boys of summer have reported to camp and pre-season games are underway. While major league teams are preparing for the coming baseball season in sunny Arizona and Florida, the Chicago Cubs baseball club has started its season in federal court in Illinois. The Cubs are renovating historic Wrigley Field, which includes adding a large video board and signs in the outfield. The new video board and signs happen to block the view of the field for neighbors beyond right field who have rooftop businesses that provide patrons with food, drinks and views of Wrigley Field events. The rooftop businesses have sued the Cubs to stop construction. They have also sued the City of Chicago and the City’s Landmark Commission for approving the renovation to the ballpark in the first place.
In their suit against the Cubs, the rooftop businesses have alleged that the Cubs are violating the Sherman Antitrust Act by strategically constructing the video board and signs in locations that block the views of the rooftop businesses, while not blocking views from other rooftops that the Cubs own or control. The rooftop businesses have also alleged that the Cubs’ renovations violate a 2004 settlement agreement between the Cubs and the rooftop owners, which provided that the rooftop owners would pay the Cubs a royalty based on gross revenues in return for unobstructed views of the field.
Last month, the rooftop businesses sought a temporary restraining order against the Cubs to halt construction of the video board and signs. After considering arguments from both sides, the federal judge threw the rooftop businesses a curve and denied their request for a TRO. The judge ruled that the rooftop businesses failed to satisfy their burden of proving immediate and irreparable harm from the construction, because the businesses did not provide evidence of potential loss of income.
The ruling is not a home run for the Cubs, however. A further hearing is scheduled for March 23 to determine whether the rooftop businesses are entitled to a preliminary injunction to halt construction. With opening day in Wrigley Field scheduled for April 5, and with renovations reportedly behind schedule, the Cubs will be hoping to turn a double play and prevail again so the renovation can be completed.
As the Oregon Legislative session moves into full-swing giving spectators a front row seat to frantic lobbying and frenetic lawmaking, the Oregon Court of Appeals issued a decision that should remind those involved in this pastime affectionately known as “sausage-making,” to consider the importance of the deliberations. The decision relates to efforts to remove the oldest home in Lake Oswego, the historic Carman House, from the City of Lake Oswego’s inventory of historic resources and potentially allow for its demolition, as described in my previous blog post. In 1995, the Oregon Legislature passed the statute at issue, ORS 197.772, which precludes a local government from imposing a historic designation on a property over “a property owner’s” objection. Subsection (3) of that same statute further provides that “a property owner” may subsequently seek to remove a historic designation that was imposed. The issue before LUBA and the Court in the case, Lake Oswego Preservation Society v. City of Lake Oswego, was whether a request to remove a designation after it has been imposed must be made by the same property owner who originally objected or whether a subsequent owner may also seek removal.
The general rule when interpreting a statute is to focus on the text and context of the provision. However, courts will also look to the legislative history to determine intent. In the Lake Oswego case, the Court found, as had LUBA, that the text and context for determining who was included as “a property owner” under ORS 197.772 was not particularly helpful and it turned to the legislative history. This history came largely from two hearings before the House Committee on General Government and Regulatory Reform. LUBA keyed into a statement by one of the bill’s authors, when asked whether a subsequent purchaser could seek to remove historic designation, responded that “[w]e haven't thought about that situation.” LUBA also noted that a proposed amendment making clear that in cases where the property owner does not object, subsequent owners are bound to the designation, and was rejected and not included in the engrossed bill. Based on those comments, LUBA concluded that the drafters intended to afford relief only to those property owners on whose property the designation had been imposed.
The Court of Appeals analysis of the legislative history makes no mention of those portions of the legislative history that LUBA found important. Instead, the court highlighted that the legislation was to allow owners that were “coerced into the historic property designation” to seek removal of that designation. The court quoted from another representative summarizing the scope of subsection (3) to include those cases where “property owners were not allowed to consent and government imposed it on them that now they would have an opportunity to remove their property from that designation.” From this, the court concluded that the amendment allows “individuals who own property on which historic designations had been involuntarily imposed by the local government – before the enactment of ORS 197.772 – to have that designation removed.” The court explained that the focus during these committee meetings was on providing relief in cases where a designation was imposed over an owner’s objection and not on whether subsequent purchasers could also take advantage of the previous owner’s objection. Further, the court found that preservation advocates’ concerns that adoption of subsection (3) would have the effect of “dismantling historic districts” and a lack of response by the proponents indicated an intent to have broad effects. As a result, the court concluded that any property owner that has a local historic designation forced on their property may remove that designation.
What is so interesting about this case is that two review bodies looked at the same legislative history and reached diametrically opposing conclusions. Maybe the difficulty is that the Court of Appeals failed to mention, much less explain, why the comments that LUBA found instructive were not helpful. How could the court find that committee discussions focused solely on giving relief to those owners who were “coerced into a historic preservation designation” and from that extend that same protection to property owners who were not coerced but instead knowingly purchased a designated property? If this ruling rests on the conclusion that the legislature intended the effect of ORS 197.772 to “dismantle” historic preservation efforts, legislators, both proponents and opponents, need to be much more descriptive and particular in describing their intent.
Chabad Lubavitch of Litchfrield County, Inc. v. Litchfield Historic District Commission. United States Court of Appeals, Second Circuit, Case Nos. 12-1057-cv and 12-1495-cv, (September 19, 2014) involves the purchase of property in a historic district by plaintiff religious organization, led by plaintiff Rabbi Joseph Eisenbach in order alter the principal building and expand it for use in the religious mission of the organization. Defendant Historic District Commission (HDC) denied the application with leave to reapply. Plaintiffs, the religious organization and its Rabbi, contest the denial under the Religious Land Use and Institutionalized Persons Act (RLUIPA) and Connecticut statutory law, seeking an injunction and declaration, damages, attorney’s fees and the appointment of a federal monitor.
The trial court dismissed the claims of the Rabbi for lack of standing for want of a sufficient property interest and the failure to distinguish his claims from that of the religious organization. The trial court found that Connecticut’s historic district law was facially neutral and generally applicable and thus none of the plaintiffs as a matter of law could be subject to a “substantial burden” on their religious exercise. The trial court also denied plaintiffs’ discrimination claims for failure to identify a sufficient comparator against which to measure the discrimination alleged. Because Defendant asserted that RLUIPA was unconstitutional, the United States intervened to defend the constitutionality of the act; however, that defense was not raised on appeal.
The Second Circuit concluded that the trial court erred in dismissing the Rabbi’s claims on standing and remanded that case for a determination of the merits of certain of the claims while also affirming a dismissal of the remainder for his failure to brief them. As to the claims of all parties, the Second Circuit concluded that the proceeding before the Historic District Commission resulted in an “individual assessment” of plaintiffs’ land use which was subject to RLUIPA’s substantial burden provisions and that plaintiffs need not show an identical comparator under RLUIPA’s nondiscrimination provisions.
The facts showed that the religious organization spent great sums of money to rent space to fulfill weekly and other religious services to its members and had brought the Litchfrield property, which was located in a historic district and had significant historic components, and thus was subject to the Historic District Commission’s authority for any modification of structures. Plaintiffs’ proposed changes that were significant (a 17,000 sq. foot addition to the existing house, a 5,000 sq. foot residence for the Rabbi and his family, and a new clock tower with a Star of David on top). Defendant divided its review of the project into two pieces – one to deal with the modification of the historic structures and the other to determine whether any denial would place “substantial burden” on plaintiffs’ religious exercise. Plaintiffs continued to modify the proposed design and asserted its need for a larger structure but did not provide certain data, such as the size of its congregation or the number of students that would attend its religious classes. Defendant denied the application, but added that if certain changes were made, the application could be approved. Plaintiffs did not take any administrative appeal but rather filed this suit in Federal District Court.
As to the Rabbi’s standing, the court undertook a de novo review to determine whether the factual allegations of the complaint allows a court to draw a reasonable inference that defendants are liable for the alleged misconduct, drawing all inferences in favor of the non-moving party in reviewing the grant of summary judgment to Defendant.
Turning first to the substantial burden claim of the religious organization, the court looked to whether there were any individualized assessment in the evaluation of the proposed use of property under the town’s land use regulations. If a substantial burden be found, the public agency must show a compelling governmental interest applied in the least restrictive manner. The court noted that if there were no such assessment required, there would be no RLUIPA liability; however, it found such an individualized assessment required under the Connecticut statute and the Litchfield code. The Connecticut statute relating to historic districts necessarily involves application of subjective criteria by the local governments implementing the same. The District Court had found that there were individualized assessments, but also found that RLUIPA was inapplicable because the statutory scheme was of general applicability. In doing so, the trial court erred in applying RLUIPA, particularly its substantial burden provision.
The Second Circuit made an analogy of the substantial burden provision in RLUIPA to the disparate impact analysis used in employment discrimination cases. The court had used such an analysis in Westchester Day School v. Village of Maronek, 504 F3rd 308 (2007). On remand, the trial court was instructed to apply these factors which the court summarized as follows:
whether the conditions attendant to the HDC's denial of the Chabad's application themselves imposed a substantial burden on the Chabad' s religious exercise, whether feasible alternatives existed for the Chabad to exercise its faith, and whether the Chabad reasonably believed it would be permitted to undertake its proposed modifications when it purchased the property at 85 West Street. The district court should also consider, of course, whether the proposed modifications shared a "close nexus" with and would be consistent with accommodating the Chabad's religious exercise.
As to the equal term’s claims under RLUIPA, plaintiffs bear the initial burden to make a prima facie case of unequal treatment, after which the government bears the burden of persuasion. The court noted a division among Federal Appeals Courts as whether evidence of a secular comparator must be shown to evaluate similarly situated structures of a religious or non-religious nature to religious use and on what grounds the comparison is made. However, the court found it unnecessary to deal with this issue as there was no evidence to establish a prima facie case under any equal terms standard. However, the court said that different treatment by different zoning regimes is not necessarily equivalent to unequal treatment. An HDC decision regarding the Wolcott Library, another secular historical structure in the historic district, under which a permit was granted to make a substantial addition to its historic structure, was done under a different land use scheme and a different land use authority and thus was an insufficient comparator in any event.
As to the non-discrimination claims under RLUIPA, plaintiff again bears the initial burden of proof to establish a prima facie case, after which the government bears the burden of persuasion. The Second Circuit, as a matter of first impression, required intent to target to the religious use and found the United States Supreme Court’s decision in Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 520 (1993) pertinent. In that case, the Supreme Court used an equal protection analysis applicable to a religious discrimination claim now used under RLUIPA, looking at both direct and circumstantial evidence of discrimination. Three types of equal protection violations were possible in such case: (1) a facial discrimination; (2) a facially neutral law adopted and applied in a discriminatory manner; and (3) a facially neutral law applied in a discriminatory manner. The trial court erroneously required an identical comparator in lieu of the required “sensitive inquiry” into the direct and circumstantial evidence of intent to discriminate. The trial court thus overlooked that evidence, instead focusing upon an identical comparator. However, RLUIPA’s non-discrimination provisions prohibit facial or as applied discrimination on the basis of religion or religious denomination. The Second Circuit thus remanded this claim to determine whether there was discrimination on the basis of religion in the Historic District proceedings.
The court also determined that the remainder of the religious organization’s claims was waived by failure to brief them adequately. The federal claims were called out and the trial court’s ruling identified, but no more. Two other claims before the trial court were not even raised on appeal.
As to the Rabbi’s claims for standing, the Second Circuit found that a property interest was not required for these claims to be made. The issue is whether a particular statute confers standing, which thus required statutory interpretation. The court concluded that the Rabbi met Article III standing requirements – he and his family proposed to live at the facility, so that denial and the proposed conditions deprived him of the ability to do so – an injury that may be redressed by the court. The case was remanded to allow the trial court to determine whether the Rabbi had standing under RLUIPA and the claims that were made. However, the court affirmed dismissal of most of the Rabbi’s federal and state claims as those claims merely involved assertions made in a conclusorily manner and without record citations, to support the Rabbi’s conclusion that there were “independent constitutional claims” clearly expressed in the complaint. Without more, the claims were waived.
The court also remanded defenses of immunity to the trial court for resolution in the first instance. The trial court decision was thus affirmed in part and remanded in part.
This case demonstrates the necessity of careful pleading of both RLUIPA claims and defenses and the preservation of error. There is no doubt that RLUIPA will be interpreted in a fairly broad manner, but much will depend upon the facts alleged and pleading of adequate facts.
Chabad Lubavitch of Litchfrield County, Inc. v. Litchfield Historic District Commission. United States Court of Appeals, Second Circuit, Case Nos. 12-1057-cv and 12-1495-cv, (September 19, 2014).
Last week in the case Lake Oswego Preservation Society v. City of Lake Oswego, LUBA gave a huge boost to the historic preservation community and the protection of local historic resources. ORS 197.772 is one of the few statutes regulating how local governments designate and protect historic resources. ORS 197.772(1) provides that where a property owner objects to any form of historic property designation, the local government must remove the designation. Subsection (3) of the same statute requires that the local government “allow a property owner” to remove a historic designation that was previously “imposed by the local government.” LUBA was asked to decide whether the term “property owner” is limited to the owner at the time that the designation was imposed or whether a person who becomes an owner after the designation was imposed, where the original owner objected to the designation, could also seek removal.
In 1990, the City of Lake Oswego designated the Carmen House, a historic farmhouse and barn, along with a number of other properties within the City’s historic landmark inventory. The property owners at the time, Wilmot and Gregg filed an objection to the designation. While the City’s decision was pending review before LUBA, a fire on the property destroyed the barn. The City’s decision was withdrawn for reconsideration and as a result, the Carmen House was designated without the additional acreage and without further objection. The Mary Caldwell Wilmot Trust, the current owner of the property, sought to remove the Carman House’s historic designation under ORS 197.772(3). The City Council granted the request to remove the historic designation concluding that the term “property owner” is not limited to the owner at the time the property was designated. The neighbors appealed that decision to LUBA.
LUBA began its analysis by focusing on the text and context of ORS 197.772(3). LUBA found the text of the provision not terribly helpful because adding a phrase to limit qualifying property owners to those who made the initial objection would insert language into the provision just as including post-designation subsequent purchasers would also insert language, contrary to a law governing statutory construction. Moving to the context, LUBA found the use of the same phrase, “a property owner” in both subsection (1) and (3) of the statute suggests that the two phrases have the same meaning and refer to the initial objecting property owner. However, LUBA also noted that these two provisions have “different, non-overlapping circumstances that occur at different times,” suggesting an intent to describe different owners because the two categories are “mutually exclusive.”
What tipped the scales for LUBA was legislative history indicating that the purpose of subsection (3) was to allow property owners who “have been coerced into the historic property designation” to petition for removal. When one of the legislators was asked whether a person who bought a piece of property that had a historic designation could seek to remove it, the response was “[w]e haven’t thought about that situation.” A proposed amendment was offered that in cases where a local government designation occurs with concurrence from the local government, the obligation “runs with the land.” LUBA found that “taken together,” subsection (3) and the proposed amendment would treat subsequent owners the same as the original owner. If the designation was imposed over an objection, then a subsequent owner could request removal and conversely, if the initial owner consented, the subsequent property owner could not request removal. This “run with the land” amendment was removed before final adoption. Without any discussion explaining why the amendment was deleted, LUBA concluded that elimination of the additional language that would have put “subsequent owners on the same footing as the property owner” provides the “strongest inference” that the legislature did not intend this result. From this analysis, LUBA concluded that, although it is “a close question,” the legislature did not intend for the term “property owner” to include person who become owners of property after it is designated and the City erred in removing the designation based on ORS 197.772(3).
LUBA’s decision went on to find that a property owner’s failure to continually raise the objection through later stages of a proceeding does not mean that the owner withdrew the objection or implicitly consented to the designation. LUBA found that although Wilmot did not object to the subsequent designation of just the Carman House, Wilmot did not withdraw his previous objections.
LUBA’s decision makes sense from a policy perspective. Once a historic inventory designation is in place, subsequent buyers, who are presumably aware of the designation, should be assumed to have bought the designation along with all of the obligations that come with it. Removal of the designation is still possible through Goal 5 and its implementing rules, but not through an end-run, relying on the limited objection of a previous owner who subsequently elected not to pursue such a course. After all, the value of a historic resource and its overall contribution to a community does not lessen when contemporary development pressures create incentives to develop that may have not existed when a resource is designated.
In a land use scheme that many argue is overly complicated and convoluted, it is interesting to note that historic preservation has very little, arguably a single relatively clear statutory standard, governing the protection has resulted in this case that will have a demonstrable impact on preservation efforts throughout the state. The first of these cases, Demlow v. City of Hillsboro, LUBA narrowed the removal exception to those cases where the historic designation was “imposed on the property”. Now, LUBA has narrowed the exception further to the current owners that object. This is a narrow exception indeed. Now we will wait to see if the Court of Appeals is asked to review or if the legislature decides to enlarge or alter the standard.
Note: This firm represents the City of Lake Oswego in some limited matters unrelated to this case.
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