242 F.3d 642 (5th Cir. 2001), 97-10907, Freeman v City of Dallas

Docket Nº:97-10907
Citation:242 F.3d 642
Party Name:CHARLES FREEMAN and ROSALYN BROWN, Plaintiffs-Appellees-Cross-Appellants, v. CITY OF DALLAS, Defendant-Appellant-Cross-Appellee.
Case Date:February 22, 2001
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
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Page 642

242 F.3d 642 (5th Cir. 2001)

CHARLES FREEMAN and ROSALYN BROWN, Plaintiffs-Appellees-Cross-Appellants,

v.

CITY OF DALLAS, Defendant-Appellant-Cross-Appellee.

No. 97-10907

United States Court of Appeals, Fifth Circuit

February 22, 2001

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[Copyrighted Material Omitted]

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Appeal from the United States District Court for the Northern District of Texas.

Before JOLLY, HIGGINBOTHAM, DAVIS, JONES, SMITH, WIENER, BARKSDALE, EMILIO M. GARZA, DeMOSS, BENAVIDES, STEWART, PARKER and DENNIS, Circuit Judges.[*]

EDITH H. JONES, Circuit Judge:

The City of Dallas served notices on the owners of two vacant, deteriorated apartment houses, warning them to repair or demolish the structures. The owners fought the order according to City procedures but lost. After the City tore down the condemned buildings, the owners filed suit in federal court alleging violations of the Fourth Amendment and the Due Process Clauses. A divided panel of this court held that although the City procedures complied with due process, the City must also obtain a pre-demolition warrant of some sort in order to satisfy the Fourth Amendment. This court, sitting en banc, disagrees with the panel majority's interpretation of the Fourth Amendment and denies relief to the property owners. A warrant is unnecessary when a municipality seizes property that has been declared a

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nuisance by means of established police power procedures.

I.

Between December 1992 and April 1993, Rosalyn Brown acquired two vacant, eight-unit apartment buildings in Dallas, Texas located at 2621 and 2611 Meyers Street. Brown paid $10.00 for the first building and $1.00 for the second, which had suffered fire damage prior to purchase. On August 11, 1994, Brown transferred a one percent undivided interest in both buildings to her brother, Charles Freeman. The buildings remained vacant during the entire period of plaintiffs' ownership.

Brown intended to rent the apartment units after making repairs. To this end, she asked Freeman to be the general contractor in charge of renovating the apartments. Freeman was neither a registered engineer or architect, nor did he possess a general contractor's license or trade license from the State of Texas. No construction company or crew worked for him.

In April and July of 1993, inspectors from the Dallas Department of Housing and Neighborhood Services (the "Department") cited the plaintiffs' two apartment buildings for non-compliance with the City's Minimum Urban Rehabilitation Standards Code (the "Code"). According to the Department's inspectors, the buildings together needed nearly $200,000 in repairs to comply with the Code. When the Code violations were not corrected, the Department referred the matter to the Urban Rehabilitation Standards Board ("URSB") and recommended demolition.

The URSB was established by the City of Dallas to determine whether property condition reports filed by city inspectors identify violations of the City's building codes. The URSB comprises thirty private citizen members (and eight alternates) who are appointed by the Dallas City Council. The URSB may determine, after a hearing, whether a given structure is an "urban nuisance" and take various remedial measures. The URSB is authorized by city ordinance to order repairs, receivership, the closing and vacating of buildings, demolition, and civil penalties of up to two thousand dollars a day against property owners who fail to repair or demolish a structure after the board has issued a valid determination and remedial order. Dallas, Tex., Code ch. 27, art. II, § 27-8.

The URSB functions through hearing panels composed of members of the URSB. The Dallas City Code establishes the procedure to be used by the panels. At a hearing, "an owner, lessor, occupant, or lienholder may present witnesses in his own behalf and is entitled to cross-examine any witnesses appearing against him." Dallas, Tex., Code ch. 27, art. II, § 27-9(c). The decision of the hearing panel is final except that rehearings may be granted in certain instances. The code also gives an affected property owner an absolute right to appeal the panel decision to state district court. Dallas, Tex., Code ch. 27, art. II,§ 27-9(e). Under state law, the court considers whether the landowner's substantial rights have been prejudiced because the URSB decision violates constitutional or statutory law; exceeds URSB's authority; is based on unlawful procedure or any other error of law; is unsupported by substantial evidence; or is arbitrary or capricious or an abuse of discretion. TEXAS GOV'T CODE § 2001.174(2).

After receiving the Department's reports on plaintiffs' properties, the URSB conducted a title search and mailed a notice of hearing on each of the properties to the owner of record.1 The notice announced

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that the URSB might order demolition to remedy the Code offenses. It further stated that the property owner would "be given an opportunity to present evidence and witnesses if so desired."

In preparation for the hearings, Department staffers briefed the panel of URSB members assigned to decide the fate of the Meyers Street properties. They provided the panel members with information on the properties, including repair cost estimates, and accompanied some of them on a tour of the premises.

Freeman appeared at the hearings, identifying himself as the "attorney-in-fact for Brown" and as an owner of 2611 and 2621 Meyers Street. The panel looked at pictures of the structures, questioned Freeman about his plans for repair, and asked whether he had the funds for repair. Freeman testified that he lacked funds at present and asked for more time to make repairs. Expressing doubt about Freeman's ownership and his ability to finance repairs, the panel unanimously voted to demolish each apartment building as an urban nuisance.2

Following the hearing, Freeman signed notices of demolition for both apartment buildings. He then asked for and received a rehearing from the URSB. Two panel members visited the properties before the rehearings. They examined the exterior of the apartment building at 2611 Meyers Street. At 2621 Meyers Street, they ran into Freeman. He showed them repairs he had made inside that property, and they told him to bring pictures of these repairs to the rehearings.

At the rehearing, the Department showed pictures of the apartment buildings' exteriors. In response, Freeman testified that he thought he could acquire most of the repair materials at little or no cost. He further stated that he hoped to finance repairs through a loan from the City; he had received a commitment from relatives in the construction business to help him make repairs if he received a City loan.

Freeman also submitted pictures of one unit in the 2621 Meyers Street building that he had repaired, and he presented a list of repair materials that he had already collected. He further testified that he could renovate each unit at 2621 Meyers Street for $2000. Though panel members reacted skeptically and reminded him of the Department's repair cost estimates, Freeman did not inquire about the basis for these estimates nor did he ask to question the Department officials responsible for them.

The panel again voted to demolish plaintiffs' buildings. The vote was unanimous on the 2611 Meyers Street property and was split five to two on the 2621 Meyers Street property. Freeman received a notice of demolition for each property at the end of the rehearing, and he signed them. The notice advised that the panel's decision could be appealed within twenty days to state district court for review. Freeman

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and Brown did not appeal the URSB decision to state district court.3

When Brown and Freeman failed to demolish the buildings within thirty days, the City hired a contractor to do the work. The two vacant structures were demolished in late December 1994, and the costs of the demolition were assessed against Freeman and Brown in the total amount of about $16,000.

A year and a half later, Freeman and Brown filed suit against the City of Dallas under 42 U.S.C. § 1983. They alleged that the demolition of their apartment buildings without first obtaining a judicial warrant constituted an unreasonable seizure in violation of the Fourth Amendment. They also alleged that the URSB's procedure for condemning and demolishing their apartment buildings and for imposing liens on the remaining realty denied them procedural due process in violation of the Fifth and Fourteenth Amendments.

Freeman and Brown moved for summary judgment on the Fourth Amendment claim while the City moved for summary judgment on all claims. The district court granted the plaintiffs' motion on the Fourth Amendment claim and granted the City's motion on the Due Process claims. Following a one-day trial on damages for the Fourth Amendment violation, the district court accepted the jury's verdict and entered final judgment against the City of Dallas in the amount of $20,000 plus interest.

A divided panel of this Court affirmed the district court's summary judgment for the property owners with respect to the Fourth Amendment claim, while also affirming the rejection of the plaintiffs' Due Process claims.4 See Freeman v. City of Dallas, 186 F.3d 601 (5th Cir. 1999), reh'g en banc granted, 200 F.3d 884 (5th Cir. 1999). We granted rehearing en banc to reconsider the Fourth Amendment ruling.

II. DISCUSSION

The panel majority reasoned toward a violation of the Fourth Amendment in three steps. First, the demolition of the Freemans' apartment houses is a "seizure" for Fourth Amendment purposes. Second, the seizure had to be preceded by a warrant. Third, a warrantless seizure, even if it occurred following...

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