Certification from the U.S. Dist. Court for the W. Dist. of Wash. in Chong Yim v. City of Seattle

• Citation: 451 P.3d 694
• Decision Date: 14 November 2019
• Docket Number: No. 96817-9,96817-9
• Court: Washington Supreme Court
• Parties: Certification from the United States District Court for the Western District of Washington in Chong and Marilyn YIM, Kelly Lyles, Eileen, LLC, and Rental Housing Association of Washington, Plaintiffs, v. CITY OF SEATTLE, Defendant.

451 P.3d 694

Certification from the United States District Court for the Western District of Washington in Chong and Marilyn YIM, Kelly Lyles, Eileen, LLC, and Rental Housing Association of Washington, Plaintiffs,

v.CITY OF SEATTLE, Defendant.

No. 96817-9

Supreme Court of Washington.

Argued June 11, 2019

Filed: NOVEMBER 14, 2019

Brian Trevor Hodges, Pacific Legal Foundation, 255 S. King Street, Suite 800, Seattle, WA 98134, Ethan Blevins, Attorney at Law, 839 W. 3600 S, Bountiful, UT 84010-8423, for Plaintiffs.

Roger D. Wynne, Sara O'Connor-Kriss, Seattle City Attorney's Office, 701 Fifth Avenue, Suite 2050, Seattle, WA 98104-7097, Jessica L. Goldman, Summit Law Group, 315 5th Avenue S, Suite 1000, Seattle, WA 98104-2682, for Defendant.

YU, J.

¶1 This case concerns the facial constitutionality of Seattle’s Fair Chance Housing Ordinance, which provides in relevant part that it is an unfair practice for landlords and tenant screening services to "[r]equire disclosure, inquire about, or take an adverse action against a prospective occupant, a tenant, or a member of their household, based on any arrest record, conviction record, or criminal history," subject to certain exceptions. SEATTLE MUNICIPAL CODE (SMC) 14.09.025(A)(2). The plaintiffs claim that on its face, this provision violates their state constitutional right to substantive due process and their federal constitutional rights to free speech and substantive due process. WASH. CONST . art. I, § 3 ; U.S. CONST. , amends. I, V, XIV.

¶2 The merits of the plaintiffs’ claims are not before us. Instead, we have been certified three questions by the federal district court regarding the standard that applies to the plaintiffs’ state substantive due process claim: (1) "What is the proper standard to analyze a substantive due process claim under the Washington Constitution?" (2) "Is the same standard applied to substantive due process claims involving land use regulations?" and (3) "What standard should be applied to Seattle Municipal Code [chapter] 14.09 (‘Fair Chance Housing Ordinance’)?" Order, No. C18-0736-JCC, at 2-3 (W.D. Wash. Feb. 5, 2019).

¶3 This court has not previously adopted heightened standards for substantive due process challenges to laws regulating the use of property as a matter of independent state law, and we are not asked to do so in this case. Therefore, we answer the district court’s questions as follows: Unless and until this court adopts heightened protections as a matter of independent state law, state substantive due process claims are subject to the same standards as federal substantive due process claims. The same is true of state substantive due process claims involving land use regulations and other laws regulating the use of property. Therefore, the standard applicable to the plaintiffs’ state substantive due process challenge to the Fair Chance Housing Ordinance is rational basis review.

FACTUAL AND PROCEDURAL BACKGROUND

¶4 In 2014, the mayor of Seattle and the Seattle City Council convened an advisory committee "to evaluate potential strategies to make Seattle more affordable, equitable, and inclusive." Doc. 33-12, at 59 (Stipulated R.). The committee recommended "a multi-pronged approach of bold and innovative solutions to address Seattle’s housing affordability crisis," particularly as related to "barriers to housing faced by people with criminal records." Id. at 59-60. Based on the committee’s report and its own findings, the Seattle City Council enacted the Fair Chance Housing Ordinance, chapter 14.09 SMC.

¶5 Several Seattle landlords and the Rental Housing Association of Washington (which provides tenant screening services) challenged the ordinance’s facial constitutionality in King County Superior Court. Their challenge focuses on SMC 14.09.025(A)(2), which makes it an unfair practice for landlords and tenant screening services to "[r]equire disclosure, inquire about, or take an adverse action against a prospective occupant, a tenant, or a member of their household, based on any arrest record, conviction record, or criminal history," subject to certain exceptions. The plaintiffs claim that this provision facially violates their federal free speech rights and their state and federal substantive due process rights.

¶6 Defendant city of Seattle (City) removed the case to federal district court, and the parties filed cross motions for summary judgment based on stipulated facts and a stipulated record. The district court has not yet ruled on the summary judgment motions because the parties dispute the standard of review that applies to the plaintiffs’ state substantive due process claim. The plaintiffs contend that the Fair Chance Housing Ordinance deprives property owners of "a fundamental property interest" and is therefore subject to heightened scrutiny. Doc. 23, at 21. The City contends that rational basis review applies.

¶7 The district court noted that another pending case involving a different Seattle ordinance, Chong Yim v. City of Seattle, No. 95813-1, ––– Wash.2d ––––, 451 P.3d 675, 2019 WL 5997001 (Wash. Nov. 14, 2019) ( Yim I), raises a similar dispute regarding the standard that applies to state substantive due process claims in Washington. Therefore, "wary about applying a potentially inaccurate standard under state law," the district stayed this case and certified to us three questions regarding the applicable standard of review. Order at 2.

ISSUES

A. "What is the proper standard to analyze a substantive due process claim under the Washington Constitution?" Id.

B. "Is the same standard applied to substantive due process claims involving land use regulations?" Id.

C. "What standard should be applied to Seattle Municipal Code [chapter] 14.09 (‘Fair Chance Housing Ordinance’)?" Id. at 3.

ANALYSIS

¶8 Article I, section 3 of the Washington State Constitution provides, "No person shall be deprived of life, liberty, or property, without due process of law." Our state due process protection against "the arbitrary exercise of the powers of government" has both procedural and substantive components. State v. Cater’s Motor Freight Sys., Inc., 27 Wash.2d 661, 667, 179 P.2d 496 (1947). The procedural component provides that "[w]hen a state seeks to deprive a person of a protected interest," the person must "receive notice of the deprivation and an opportunity to be heard to guard against erroneous deprivation." Amunrud v. Bd. of Appeals, 158 Wash.2d 208, 216, 143 P.3d 571 (2006). Meanwhile, the substantive component of due process "protects against arbitrary and capricious government action even when the decision to take action is pursuant to constitutionally adequate procedures." Id. at 218-19, 143 P.3d 571. This case concerns only the substantive component.

¶9 In a substantive due process claim, courts scrutinize the challenged law according to "a means-ends test" to determine if "a regulation of private property is effective in achieving some legitimate public purpose." Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 542, 125 S. Ct. 2074, 161 L. Ed. 2d 876 (2005) (emphasis omitted). The level of scrutiny to be applied depends on "the nature of the right involved." Amunrud, 158 Wash.2d at 219, 143 P.3d 571. "State interference with a fundamental right is subject to strict scrutiny," which "requires that the infringement is narrowly tailored to serve a compelling state interest." Id. at 220, 143 P.3d 571. Meanwhile, "[w]hen state action does not affect a fundamental right, the proper standard of review is rational basis," which requires only that "the challenged law must be rationally related to a legitimate state interest." Id. at 222, 143 P.3d 571.

¶10 The plaintiffs characterize the right involved here as a "fundamental property interest[ ]," specifically, "the right of each residential landlord to rent her property to a person of her own choice." Pls.’ Resp. Br. at 15-16. They do not contend that this right requires the application of strict scrutiny, but they do not concede that rational basis review applies either. Instead, the plaintiffs argue that there is a third type of review, which applies in substantive due process challenges to laws restricting "fundamental property rights" or "traditional ‘old property’ rights." Id. at 15 n.6. This third type of review, the plaintiffs contend, is "some form of intermediate scrutiny," which exceeds rational basis review by requiring that laws regulating the use of property must either substantially advance a government interest (the "substantially advances test") or not be unduly oppressive on the property owner (the "unduly oppressive test"). Id. at 39.

¶11 The level of scrutiny that applies to the plaintiffs’ state substantive due process claim is a constitutional question that we decide as a matter of law. Amunrud, 158 Wash.2d at 215, 143 P.3d 571. We hold that rational basis review applies, and we clarify that the cases cited by the plaintiffs can no longer be interpreted as requiring heightened scrutiny because their "legal underpinnings" have "disappeared." W.G. Clark Constr. Co. v. Pac. Nw. Reg’l Council of Carpenters , 180 Wash.2d 54, 66, 322 P.3d 1207 (2014).

A. In answer to the first two certified questions, independent state law does not require heightened scrutiny in article I, section 3 substantive due process challenges to laws regulating the use of property

¶12 "[T]he protection of the fundamental rights of Washington citizens was intended to be and remains a separate and important function of our state constitution and courts that is closely associated with our sovereignty." State v. Coe, 101 Wash.2d 364, 374, 679 P.2d 353 (1984). Therefore, this court has a duty to recognize heightened constitutional protections as a matter of independent state law in appropriate cases. O’Day v. King County , 109 Wash.2d 796, 801-02, 749 P.2d 142 (1988). Nevertheless, "[t]his court traditionally has practiced great restraint in expanding state due process beyond federal perimeters." Rozner v. City...