Baxter Homeowners Ass'n, Inc. v. Angel

• Citation: 298 P.3d 1145,369 Mont. 398
• Decision Date: 02 April 2013
• Docket Number: No. DA 12–0301.,DA 12–0301.
• Parties: BAXTER HOMEOWNERS ASSOCIATION, INC., Petitioners, Appellees and Cross–Appellants, v. Geoffrey ANGEL, Respondent and Appellant.
• Court: Montana Supreme Court

369 Mont. 398

298 P.3d 1145

BAXTER HOMEOWNERS ASSOCIATION, INC., Petitioners, Appellees and Cross–Appellants,

v.Geoffrey ANGEL, Respondent and Appellant.

No. DA 12–0301.

Supreme Court of Montana.

Submitted Feb. 27, 2013.

Decided April 2, 2013.

For Appellant: Geoffrey C. Angel, Angel Law Firm; Bozeman, Montana.

For Appellees: Brian K. Gallik; Goetz, Gallik & Baldwin, P.C.; Bozeman, Montana, Arthur V. Wittich, Margot Barg Ogburn; Wittich Law Firm, P.C.; Bozeman, Montana, Timothy Little, Department of Labor and Industry; Helena, Montana.

Justice BETH BAKER delivered the Opinion of the Court.

[369 Mont. 399]¶ 1 This matter comes before the Court on cross-appeals of the Eighteenth Judicial District Court's orders reversing the Human Rights Commission's finding of discrimination and award of $6,000 damages to Geoffrey Angel and denying both parties' requests for attorneys' fees. We affirm the District Court's orders. The dispositive issue on appeal is whether Angel possessed proper standing to file a complaint of discrimination on behalf of his unidentified and potential clients. We hold that he did not.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 2 Geoffrey Angel, a Bozeman, Montana, attorney, rented second-floor office space in the Baxter Hotel in downtown Bozeman. The first floor, the mezzanine level, and the second floor of the former hotel are rented for commercial purposes to businesses open to the public. The top four floors house residential condominium units. The building contains a single elevator and a stairway that permit access to all floors. Angel also owned one of the upper-floor residential units and, as such, was a member of the Baxter Homeowners Association (BHA). The BHA's Declarations, as amended in 1997, require that the elevator be locked at all times “in order to secure the safety of the occupants and their possessions.”

¶ 3 In 2007, the BHA board of directors began receiving complaints about the hotel's elevator not being locked as required by the Declarations. In response to the complaints, the board voted in January 2008 to restrict access to the elevator by only permitting unit owners and their tenants to access the elevator via swipe key cards. Members of the public could access the elevator only when accompanied by someone in possession of a swipe key card. The stairwell remained unlocked during business hours.

¶ 4 Angel complained to the Baxter's property manager that locking the elevator was inappropriate because it denied persons with disabilities access to his second-floor law office. Angel's complaint was brought to the board's attention and the board directed its attorney to look into whether locking the elevator was discriminatory. Angel filed a complaint with the Montana Human Rights Bureau on March 24, 2008. At its April 2008 meeting, the board discussed options for resolving the elevator dispute and began to explore alternatives. The issue was discussed during each of the board's monthly meetings for the next several months until, in the fall of 2008, the board voted to install a time clock system that would keep the elevator unlocked during business hours and locked at night. The installation was completed in January 2009; since then, the elevator has remained unlocked during normal business hours. Angel moved his law office out of the building in July 2008, relocating to a home he owned in Bozeman where he would not have to pay rent. That home did not have a handicapped-accessible entrance.

¶ 5 In the meantime, Angel's public accommodations discrimination complaint was investigated by the Montana Human Rights Bureau, which found reasonable cause to proceed with the complaint. BHA filed a motion for summary judgment in the administrative proceedings on the ground that Angel lacked standing to bring the complaint. As summarized by the Hearing Officer, BHA claimed that Angel:

cannot show that he is associated with disabled persons, is not an affected person within the meaning of the Montana Human Rights Statute, cannot prove that he has any damages, cannot prove that he moved out of the Baxter Hotel because the elevator was locked and allegedly denying disabled clients access to his office, and cannot seek any affirmative relief because that relief has already been completed.

¶ 6 The Hearing Officer issued an order on April 6, 2009, denying BHA's motion for summary judgment, but foreclosing Angel's ability to recover damages for lost profits, should he prevail on his claim, because he had failed or refused to identify any client or prospective client who had been denied access to his office because of the locked elevator. The Hearing Officer concluded summarily that because Angel is a licensed attorney who intends to practice discrimination law, “and because he was a tenant at the Baxter Hotel and could engage in discrimination law practice, he can fairly state within the confines of his complaint that he had a specific legal interest to be protected by the Human Rights Act.”

¶ 7 The matter proceeded to a contested case hearing in April 2009, following which the Hearing Officer concluded that Angel had not been discriminated against because installation of the automated time clock was a reasonable accommodation for disabled persons and the delay in implementation of the accommodation was not so long as to constitute a failure to accommodate.

¶ 8 Angel appealed the Hearing Officer's determination. BHA did not cross-appeal the denial of its motion for summary judgment. The Human Rights Commission rejected the Hearing Officer's proposed decision, concluding that the Hearing Officer applied an incorrect legal standard. The Commission ruled that, once Angel met his burden of showing that he had requested a modification and that the modification was reasonable, BHA had the burden to prove that the requested modification would fundamentally alter the nature of the public accommodation.

¶ 9 On remand, the Hearing Officer concluded that BHA violated § 49–2–304(1)(a), MCA, when it failed to provide a reasonable alteration to the elevator to permit disabled persons to have unfettered access to the second floor business offices in the Baxter Hotel during business hours, and that such a modification would not have fundamentally altered the nature of the public accommodation that BHA provided. The Hearing Officer further concluded that BHA's discrimination did not cause Angel to vacate his office space and, therefore, he was not entitled to damages for relocating his office. The Hearing Officer did award Angel $6,000 in damages for the assessments he paid as a member of BHA to cover attorneys' fees and expenses in defending Angel's discrimination claim, together with interest in the amount of $815.08. Both Angel and BHA appealed the Hearing Officer's decision to the Commission; BHA did not raise the standing issue argued in its earlier summary judgment motion.In an order dated January 31, 2011, the Commission affirmed the Hearing Officer's decision.

¶ 10 Both parties petitioned for judicial review. The Department of Labor and Industry reserved its right to intervene if issues pertaining to the Department arose, but did not intervene before the District Court. BHA argued before the District Court that Angel lacked standing to pursue his claim. The District Court held a hearing on both petitions on August 18, 2011. It ruled on both petitions on November 3, 2011, reversing the Hearing Officer's and Commission's finding of discrimination and award of damages to Angel and denying Angel's petition for judicial review and request for attorneys' fees. In a separate order entered April 6, 2012, the court denied BHA's motion for reasonable attorneys' fees on the ground that Angel's complaint of discrimination was not “frivolous, unreasonable, or groundless” and that Angel did not “continue to litigate after it clearly became so.” See McCann v. Trustees, Dodson Sch. Dist., 249 Mont. 362, 364, 816 P.2d 435, 437 (1991). Both parties appeal.

STANDARD OF REVIEW

¶ 11 On appeal of a district court's ruling on judicial review of a contested case proceeding under the Montana Administrative Procedure Act, we review findings of fact for clear error and conclusions of law for correctness. Briese v. Mont. Pub. Employees' Ret. Bd., 2012 MT 192, ¶ 11, 366 Mont. 148, 285 P.3d 550. Issues of justiciability, such as standing, are questions of law, for which our review is de novo. Reichert v. State, 2012 MT 111, ¶ 20, 365 Mont. 92, 278 P.3d 455. The District Court's decision to grant or deny an award of attorneys' fees is reviewed for abuse of discretion. Wohl v. City of Missoula, 2013 MT 46, ¶ 29, 369 Mont. 108, 300 P.3d 1119.

DISCUSSION

¶ 12 Angel contends that the District Court erred in reversing the Commission's determination of discrimination and in reversing the award of damages. Angel also claims that he obtained affirmative relief in this action and is the prevailing party entitled to an award of attorneys' fees, even though he represented himself throughout the proceedings. BHA contends that Angel lacks standing to claim discrimination because he was not an aggrieved party under the statute and there was no evidence of discrimination against any individual. In the alternative, BHA argues that the Hearing Officer applied the correct legal standard in the first hearing and the Commission erred by requiring the Human Rights Bureau to apply the “fundamentally alter” test instead of the “reasonable accommodations” test.

¶ 13 The Department of Labor has filed an Appellee's Brief, arguing that BHA failed to exhaust its administrative remedies on the issue of standing because, though briefing its arguments to the Commission on two separate appearances, it never raised Angel's lack of standing through a cross-appeal or otherwise. The Department additionally argues, along with Angel, that the District Court erred in reversing the Commission's finding of discrimination because it incorrectly interpreted public...