451 F.3d 643 (10th Cir. 2006), 03-8060, Grace United Methodist Church v. City of Cheyenne

Docket Nº:03-8060.
Citation:451 F.3d 643
Party Name:GRACE UNITED METHODIST CHURCH, Plaintiff-Appellant, v. CITY OF CHEYENNE; City of Cheyenne Board of Adjustment; Dorothy Wilson, City of Cheyenne Development Director; Cheyenne City Council, Defendant-Appellees, Mountview Park Homeowners' Association, Defendant-Intervenor-Appellee, United States of America, Plaintiff-Intervenor-Intervenor, The Becket
Case Date:June 20, 2006
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit

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451 F.3d 643 (10th Cir. 2006)



CITY OF CHEYENNE; City of Cheyenne Board of Adjustment; Dorothy Wilson, City of Cheyenne Development Director; Cheyenne City Council, Defendant-Appellees,

Mountview Park Homeowners' Association, Defendant-Intervenor-Appellee,

United States of America, Plaintiff-Intervenor-Intervenor,

The Becket Fund for Religious Liberty, Amicus Curiae.

No. 03-8060.

United States Court of Appeals, Tenth Circuit.

June 20, 2006

Appeal from the United States District Court for the District of Wyoming, D.C. No. 02-CV-35-B

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Samuel Martin Ventola, of Rothgerber Johnson & Lyons LLP, Denver, Colorado, for the Plaintiff/Appellant.

Stephen H. Kline, of Kline Law Office, Cheyenne, Wyoming (Michael D. Basom, Attorney for City of Cheyenne, Cheyenne, Wyoming, on the brief), for the Defendants/Appellees.

Lowell V. Sturgill, Jr., Appellate Staff, Civil Division, Department of Justice, Washington, D.C. (Peter D. Keisler, Assistant Attorney General, Matthew H. Mead,

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United States Attorney, and Mark Stern, Appellate Staff, Civil Division, Department of Justice, Washington, D.C., with him on the brief), for the Plaintiff-Intervenor, United States of America.

Roman P. Storzer, Anthony Picarello Jr., and Derek L. Gaubatz, filed a brief for Amicus Curiae, The Becket Fund for Religious Liberty.

Before BRISCOE, HOLLOWAY, and SEYMOUR, Circuit Judges.


SEYMOUR, Circuit Judge.

Grace United Methodist Church (Grace United or Church), a non-profit religious corporation affiliated with the United Methodist Church, filed a civil action pursuant to the Religious Land Use and Institutionalized Persons Act (RLUIPA), 42 U.S.C. § 2000cc et seq., and 42 U.S.C. § 1983 against the City of Cheyenne, Wyoming and other affiliated defendants (hereinafter collectively the City). Grace United alleged that defendants' actions in denying it a license to operate a daycare in a residential zone violated (1) RLUIPA by imposing a substantial burden on the Church's exercise of religion; (2) the First Amendment by depriving the Church of its right to free exercise of religion and freedom of speech, assembly, and association; and (3) the Fourteenth Amendment's due process and equal protection clauses by denying the Church use of its property. Mountview Park Homeowners' Association, a non-profit corporation organized by and consisting of homeowners within the Mountain Park Addition of Cheyenne, Wyoming, intervened in the action as a matter of right. See Fed.R.Civ.P. 24(a)(2). Mountview sought a declaration that the proposed daycare center would violate neighborhood restrictive covenants.

The district court granted summary judgment to defendants on the Church's constitutional claims, Grace United Methodist Church v. City of Cheyenne, 235 F.Supp.2d 1186, 1201-02 (D.Wyo. 2002), and a jury found against the Church under RLUIPA and the restrictive covenants. As a result of the jury's determinations, the district court issued a post-trial judgment enjoining the Church from building and operating the daycare center.

We initially affirmed the district court's summary judgment rulings, as well as its associated trial rulings and the jury verdict on the RLUIPA claim. Grace United Methodist Church v. City of Cheyenne, 427 F.3d 775 (10th Cir. 2005). We held it unnecessary to address Grace United's additional contentions that Mountview had no standing to intervene, that the district court had no jurisdiction over the restrictive covenant claims, and that in any event the property on which the Church sits is not governed by the covenants. Id. at 804. Upon consideration of Grace United's petition for rehearing and petition for rehearing en banc, however, we make minor changes to the original opinion and grant panel rehearing to address the issues regarding Mountview's intervention and the restrictive covenants. Our previous opinion, see Grace United Methodist Church, 427 F.3d 775, is vacated, and this revised opinion is issued in its stead.


Grace United is the owner of real property in a low-density residential (LR-1) zone in Cheyenne, Wyoming. The property was deeded to Grace United in 1956 subject to neighborhood covenants, and has been operated as a Methodist church since that time. In March 2001, Grace United sought a license from the City of Cheyenne to operate a 100-child daycare center in the LR-1 zone. The proposed

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facility would provide care for children newly born to age thirteen, would be open to the public regardless of religious affiliation, and would operate eighteen hours a day – from 6:00 a.m. until midnight – seven days a week. Because the applicable Cheyenne zoning ordinance prohibited any entity from operating a daycare with more than twelve children in an LR-1 zone, the City's Development Director, Dorothy Wilson, denied the licence.

Grace United appealed that decision by filing an application for a variance from the LR-1 zoning restrictions. The matter was set for a public hearing in front of the City's Board of Adjustment, the body authorized to hear appeals from adverse zoning decisions. At the hearing, Grace United was represented by counsel and was permitted to present witnesses and evidence. The Church's witnesses testified that the proposed daycare would charge a fee for its services commensurate with fees charged by other daycare facilities in Cheyenne, and would hire caregivers and instructors who were not members of the Church and who may or may not have any religious training. Subsequent to the hearing, the Board of Adjustment unanimously denied the variance on the following bases: (1) the proposed daycare center was not a church, primary or secondary school, or any other similar use permitted within the LR-1 zone, as defined by the Cheyenne Laramie County Zoning Ordinance, and the Board therefore had no authority or discretion to grant the variance; (2) the Church failed to demonstrate that the proposed use was in conformance with all other applicable policies adopted by the City or Laramie County; and (3) the proposed use was incompatible with the neighborhood and would harm community goals.

Grace United filed this action against the City of Cheyenne, the Board of Adjustment, Dorothy Wilson, in her official capacity as Development Director for the City of Cheyenne, and the City Council, alleging that the Board's decision to deny the variance violated RLUIPA, and the First and Fourteenth Amendments. The City filed a motion to dismiss, which the district court converted into a motion for summary judgment. Grace United responded by filing a motion for partial summary judgment on its RLUIPA claim. The court granted the City's motion in part and dismissed all of the Church's constitutional claims, but it determined there was sufficient evidence to allow the RLUIPA claim to go to trial. Subsequent to the district court's ruling on the summary judgment motions, Mountview intervened to prevent a violation of the covenants of the neighborhood.

The RLUIPA and covenant issues proceeded to jury trial. The jury found that Grace United had failed to prove the proposed operation of the daycare center was a sincere exercise of religion under RLUIPA, and concluded that the daycare center would be in violation of the covenants of the neighborhood. As a result, the district court permanently enjoined Grace United from using its property as a daycare center in violation of Cheyenne's land use regulations and Wyoming's licensing requirements. In so doing, the court determined that the zoning ordinance was enacted pursuant to a compelling governmental interest and was accomplished by the least restrictive means. This appeal followed.


Dismissal of Grace United's Constitutional Claims

Grace United contends the district court erred by dismissing its constitutional claims. As previously noted, the Church brought claims for relief pursuant to

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§ 1983 alleging that the City, acting under the color of state law, deprived it of its constitutional rights to the free exercise of religion and freedom of speech, assembly, and association in violation of the First Amendment, and due process and equal protection in violation of the Fourteenth Amendment. The district court granted summary judgment to the City on each of these claims.

We review de novo the district court's grant of summary judgment. Keys Youth Servs., Inc. v. City of Olathe, 248 F.3d 1267, 1270 (10th Cir. 2001). Summary judgment should be granted if the evidence submitted shows "that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). "When applying this standard, we view the evidence and draw reasonable inferences therefrom in the light most favorable to the nonmoving party." Keys Youth Servs., 248 F.3d at 1270 (quotation omitted). A mere scintilla of evidence in support of the nonmoving party's position, however, is insufficient to create a genuine issue of material fact. Lawmaster v. Ward, 125 F.3d 1341, 1347 (10th Cir. 1997).

Free Exercise of Religion

Grace United maintains that the City's action in denying the Church a zoning variance prevents it from engaging in religious instruction on its property. Relying on Employment Div. v. Smith, 494 U.S. 872, 110 S.Ct. 1595, 108 L.Ed.2d 876 (1990), the district court held that the City's land use regulations are neutral rules of general applicability which do not substantially burden the Church's exercise of religion. On appeal, Grace United contends the City's zoning ordinances are not neutral laws of general applicability because they allow "case-by-case" exceptions. It also argues that even if the land use regulations at issue are neutral laws of general applicability, the...

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