13 F.3d 920 (6th Cir. 1993), 92-1903, Smith & Lee Associates, Inc. v. City of Taylor, Mich.

Docket Nº:92-1903.
Citation:13 F.3d 920
Party Name:SMITH & LEE ASSOCIATES, INC., a/k/a Mortenview Manor, a Michigan Corporation; United States of America, Plaintiffs-Appellees, v. CITY OF TAYLOR, MICHIGAN, Defendant-Appellant.
Case Date:December 30, 1993
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit

Page 920

13 F.3d 920 (6th Cir. 1993)

SMITH & LEE ASSOCIATES, INC., a/k/a Mortenview Manor, a

Michigan Corporation; United States of America,



CITY OF TAYLOR, MICHIGAN, Defendant-Appellant.

No. 92-1903.

United States Court of Appeals, Sixth Circuit

December 30, 1993

Argued May 3, 1993.

Rehearing and Suggestion for Rehearing En Banc Denied March

11, 1994.[*]

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[Copyrighted Material Omitted]

Page 922

Gregory J. Bator (argued & briefed), Smith & Lee Associates, Birmingham, MI, for plaintiff-appellee.

Stephen J. Markman, U.S. Atty., Detroit, MI, David K. Flynn, John R. Dunne, Gregory B. Friel (argued & briefed), U.S. Dept. of Justice, Civil Rights Div., Appellate Section, Washington, DC, Paul F. Hancock, Barbara Burr, Sharon Bradford Franklin, U.S. Dept. of Justice, Civil Rights Div., Washington, DC, for U.S.

Patrick B. McCauley, Patrick J. Burkett (argued & briefed), Alan B. Koenig, Sommers, Schwartz, Silver & Schwartz, Southfield, MI, for defendant-appellant.

David M. Davis (briefed), Hardy, Lewis, Pollard & Page, Birmingham, MI, for Michigan Municipal League amicus curiae.

Before: KENNEDY and SILER, Circuit Judges; and CONTIE, Senior Circuit Judge.

KENNEDY, Circuit Judge.

The City of Taylor appeals from the District Court's decision granting judgment to plaintiffs on their claims against the City under the Fair Housing Amendments Act of 1988, 42 U.S.C. Sec. 3601 et seq. (the "FHAA"). The court found that the City had intentionally discriminated against handicapped persons and that it had failed to make reasonable accommodations to provide handicapped individuals with an equal opportunity to use the housing of their choice in violation of the handicap provisions of the FHAA. This case raises the issue of whether the FHAA's directive to make reasonable accommodations imposes affirmative obligations upon municipalities to amend neutral zoning laws that may have the effect of denying the handicapped equal access to housing. For the reasons that follow, we reverse and remand this case to the District Court.

I. Background


Smith & Lee Associates ("Smith & Lee") is a for-profit Michigan corporation that owns and operates Adult Foster Care ("AFC") homes, including Mortenview Manor in Taylor, Michigan, the one involved in the instant case. An AFC home provides twenty-four hour supervised care to dependent adults who require ongoing supervision, but not continuous nursing care. Mortenview Manor is a one-story dwelling, and includes a kitchen, living room, dining room, six bedrooms, two full baths, and a small office. Currently it houses six elderly and disabled residents who suffer from Alzheimer's disease, senile dementia, organic brain syndrome, as well as other ailments associated with growing old. Under a Michigan statute, its operation with six handicapped individuals is considered to be a residential use and is not in issue. Smith & Lee contends that it is economically infeasible to operate the home with only six residents and seeks to increase the number of residents to twelve.

Mortenview Manor is located in a single-family residential area, designated "R-1A" by Taylor's zoning ordinance. Under Mich.Comp. Laws Sec. 125.583b(2), an AFC home for six or fewer residents is considered a residential use permitted in all residential zones including single family, a statewide accommodation for the handicapped.

That section provides:

In order to implement the policy of this state that persons in need of community residential care shall not be excluded by zoning from the benefits of normal residential surroundings, a state licensed residential

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facility 1 providing supervision or care, or both, to 6 or less persons shall be considered a residential use of property for the purposes of zoning and a permitted use in all residential zones, including those zoned for single family dwellings, and shall not be subject to a special use or conditional use permit or procedure different from those required for other dwellings of similar density in the same zone.

MICH.COMP.LAWS Sec. 125.583b(2). A new AFC facility accommodating more than six residents, however, must receive municipal approval before the state will issue a temporary license. 2 The Michigan Adult Foster Care Facility Licensing Act ("AFCFLA"), MICH.COMP.LAWS Sec. 400.716(2).

The City gives two reasons why Mortenview Manor may not operate with more than six residents. First, the residents do not constitute a family as family is defined in Taylor's zoning ordinance, nor do they fall within the statutory exception to local zoning laws created by section 125.583b(2) since they number more than six, therefore, they do not meet the requirements for a R-1A single-family district. Second, the City categorizes a for-profit AFC facility of seven or more residents as a multiple-family dwelling permitted in multiple-family residential districts designated as RM-1 and RM-2. Special land uses in both districts expressly include housing for the elderly.

From the start, Smith & Lee sought to house twelve residents in the home. In September, 1989, the City refused to issue a building permit for renovations for the home because it believed that a twelve-person AFC home could not operate in a R-1A zone. 3 Michael Manore, Director of the Office of Development Services, informed Smith & Lee that the home could not operate with twelve residents unless the City rezoned the property to a RM-1 area. The City then issued the building permit with the express limitation: "SINGLE FAMILY RESIDENTIAL USE ONLY." After inspection of the home, the Department of Social Services ("DSS") licensed it for six residents and the home opened in December, 1990.

In January, 1990, Smith & Lee petitioned the City to rezone Mortenview Manor to a RM-1 district. Taylor officials referred the petition to its planning consultant, Wade/Trim Impact, which recommended denial of the request for three reasons: 1) RM-1 zoning would be inconsistent with the established zoning pattern of the neighborhood; 2) RM-1 zoning would allow for land uses that are incompatible with the established single-family residential character of the neighborhood; and 3) the request was inconsistent with the recommendation of the City's Master Land Use Plan 2000.

A public hearing before the Taylor Planning Commission was held on February 21, 1990. There were no objections from surrounding residents at the hearing. The Commission, however, voted to recommend to the City Council that the petition be denied. At a March 5, 1990 study session, the City Council discussed Smith & Lee's rezoning request. Smith & Lee advised the members of the City Council, as it had the Planning Commission, that denial of the rezoning petition might be in violation of the FHAA. A representative of the Michigan Residential Care Association made a presentation on behalf of Smith & Lee and explained the impact of the FHAA on the action. Some of the Council members were informed that the DSS would issue the license for twelve residents if the City were to give its permission in a letter and that the City need not rezone the area. At its March 6, 1990 meeting, the Council denied the rezoning request, citing concerns over spot zoning and inconsistencies

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with the City's master development plan. Smith & Lee attempted to get a vote by the Council on the letter of permission proposal, but the Chairman never put that proposal to vote.


On May 10, 1991, Smith & Lee instituted this action against the City alleging violations of the FHAA, 42 U.S.C. Secs. 3604(f)(1)(B), 3604(f)(3)(B) and 3617. The United States instituted a similar action shortly thereafter and the District Court consolidated the two cases. After a bench trial, the court issued its opinion on July 15, 1992. The court found no violation of section 3617 4, but found discrimination by the City in violation of sections 3604(f)(1)(B) and 3604(f)(3)(B). The court enjoined the City to send a letter to the DSS stating that Smith & Lee has Taylor's permission to operate the AFC home for twelve residents, and permanently enjoined the City from refusing to permit and interfering with the operation of the home. The court also ordered the City to pay damages in the amount of one-hundred and fifty-two thousand dollars ($152,000) to Smith & Lee (its profits if it had been permitted to operate with twelve residents instead of six, plus some expenses incurred), and a civil penalty of fifty thousand dollars ($50,000) to the United States under 42 U.S.C. Sec. 3614(d)(1)(C)(i). The City timely appealed. On August 14, 1992, a panel of this Court issued a stay of the injunctive relief and of the execution of the monetary relief without bond pending appeal.

II. 5

The FHAA prohibits excluding disabled persons from housing because of their disability and requires that reasonable accommodations necessary to ensure the handicapped equal housing opportunities be made. 42 U.S.C. Secs. 3604(f)(1) and 3604(f)(3)(B). This Court has applied the FHAA to municipal zoning ordinances that affect housing opportunities for the disabled. Marbrunak, Inc. v. City of Stow, Ohio, 974 F.2d 43 (6th Cir.1992). We have also held that the Act applies to discriminatory actions taken by municipalities pursuant to zoning ordinances. See United States v. City of Parma, Ohio, 661 F.2d 562, 571-72 (6th Cir.1981) (pre-1988 version of the Fair Housing Act also covered municipal zoning actions), cert. denied, 456 U.S. 926 (1982). Other courts have found that the reasonable accommodation provision found in section 3604(f)(3)(B) applies to municipal zoning variance procedures. See Parish of Jefferson v. Allied Health Care, Inc., 1992 WL 142574 (E.D.La.1992); United States v. Village of Marshall, Wis., 787 F.Supp. 872, 878 (W.D.Wis.1991) (where local government has legislative authority to determine whether to grant a variance).


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