Gilbert v. City of Cambridge

Decision Date09 August 1990
Docket NumberCiv. A. No. 88-1255-WD.
Citation745 F. Supp. 42
PartiesHoward H. GILBERT, Jr., et al., Plaintiffs, v. CITY OF CAMBRIDGE, et al., Defendants.
CourtU.S. District Court — District of Massachusetts

James D. St. Clair, Hale & Dorr, Kenneth R. Berman, Sherin & Lodgen, Boston, Mass., for plaintiffs.

Stephen B. Deutsch, Foley, Hoag & Eliot, Boston, Mass., for defendants.

MEMORANDUM AND ORDER

WOODLOCK, District Judge.

Certain Cambridge property owners perceive themselves burdened by the City's decade old restrictions on the removal of rental units from the rental market. In this declaratory judgment action they principally seek a federal court determination that the restriction scheme constitutes a "taking" of their property within the meaning of the United States Constitution. They do not seek damages — at least at this time in this court.

I find the plaintiff property owners stumble at the threshold of their action. Treated as a facial challenge to the restrictions, their claim is barred by the statute of limitations. Treated as "as-applied" challenges, their claims are either barred by the statute or are not yet ripe. Consequently, I will dismiss this law suit as untimely.

My dismissal rests on broader alternative grounds as well. I decline to entertain this "state-takings" law suit in a federal declaratory judgment context when the plaintiffs have failed to crystallize their claims through adequate and available state mechanisms for determining whether a taking without just compensation has occurred.

I

At issue is the constitutionality of those provisions of a Cambridge ordinance and the regulations promulgated thereunder which govern the ability of Cambridge landlords to remove their property from the rental housing market. Specifically, the plaintiffs challenge the requirement that any owner of a Cambridge apartment subject to rent control must obtain a permit from the Cambridge Rent Control Board prior to taking any action that would effect a removal.1

-A-

The Regulatory Scheme

A system of rent control has been in effect in Cambridge since 1970. See generally Clark, Rent Control in Massachusetts, 73 Mass.L.Rev. 160 (1988). In 1976, the city enacted a version of the current rent control regulatory scheme pursuant to Chapter 36 of the Massachusetts Acts of 1976.

In 1979, Cambridge adopted a municipal ordinance, the "Removal Permit Ordinance," that established a program of restricting removal of housing units from the rental market.2 The "Declaration of Emergency" in the first section of the Removal Permit Ordinance sets forth the following justification for adoption of the measure:

A serious public emergency continues to exist in the City of Cambridge with respect to the housing of a substantial number of its citizens, as declared by Chapter 36 of the Acts of 1976, for the reasons stated in the Act. The emergency has worsened since 1976 because of the removal of a substantial number of rental housing units from the market, by condominium conversion, demolition, and other causes. As a result, more than 2,000 or over 10 percent of the controlled rental units in the city have been removed from the housing market since 1970, and the vacancy rate has fallen below one percent. In order to carry out the purposes of the Act, and to continue to provide a sufficient supply of decent, affordable rental housing accommodations especially for families of low and moderate income and for elderly people on fixed incomes, it is necessary for the Cambridge City Council, in the exercise of its powers under section 6 of the Home Rule Amendment and under section 5(c) of the Act, to regulate the removal of controlled rental housing units from the market.

The Removal Permit Ordinance applies to housing units offered for rent prior to August 13, 1979. The Ordinance prohibits the owner of such a unit from ceasing to rent it without a removal permit, but entitles the owner to a "fair net operating income" on the use of the property as rental property. Judicial review of a decision to grant or deny a removal permit is provided in the state courts.

Sanctions for violation of the Ordinance can be severe. The Ordinance authorizes the city to take by eminent domain any apartment repeatedly or flagrantly occupied by its owner without a permit or left vacant for more than 120 days. Criminal penalties may be imposed for removing housing units from the rental market without a removal permit.3

In 1981, the constitutionality of the rent control laws was directly challenged in Massachusetts state courts. Relying in part upon federal takings case law, the Supreme Judicial Court upheld the ordinances in their entirety. Flynn v. City of Cambridge, 383 Mass. 152, 418 N.E.2d 335 (1981).

However, the Cambridge removal restrictions have not as yet generated such a definitive ruling by the Supreme Judicial Court. In 1983, the SJC affirmed, without opinion, the denial of a removal permit to an owner who wanted to demolish his residential building. Fresh Pond Shopping Center, Inc. v. Rent Control Board of Cambridge, 388 Mass. 1051, 446 N.E.2d 1060 (1983) (equally divided court). The United States Supreme Court, also without opinion, dismissed the appeal for want of a substantial federal question. Fresh Pond Shopping Center, Inc. v. Callahan, 464 U.S. 875, 104 S.Ct. 218, 78 L.Ed.2d 215 (1983). But Justice Rehnquist wrote a dissent from the dismissal in which he observed that he would have noted probable jurisdiction because the case "presented important and difficult questions concerning the application of the Takings Clause." Id. at 876, 104 S.Ct. at 218 (Rehnquist, J., dissenting). Relying on Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 102 S.Ct. 3164, 73 L.Ed.2d 868 (1982), he concluded that the Ordinance and removal regulations constituted a taking because they "effected a permanent physical invasion of appellant's property." Fresh Pond, 464 U.S. at 877, 104 S.Ct. at 219.

The SJC revisited the Cambridge Ordinance in 1986 in Polednak v. Rent Control Board of Cambridge, 397 Mass. 854, 494 N.E.2d 1025 (1986), when it held that an owner who purchased the apartment in which she was a tenant at the time of the conversion of the unit to a condominium did not need to apply for a removal permit and that a regulation which required her to do so unless she had been the tenant prior to August 10, 1979, could not be applied to her. However, the SJC declined to assess the effect of Teleprompter on its holding in Flynn. Id. at 855, 862 n. 9, 494 N.E.2d 1025.

-B-

The Plaintiffs

There are two plaintiff entities — the Southview plaintiffs and the Blevins plaintiffs — both of which own Cambridge apartment buildings covered by the Removal Permit Ordinance.

1. The Southview Plaintiffs consist of a housing cooperative, which owns a residential building containing approximately 100 units, and its individual shareholders. In 1979, before the adoption of the Removal Ordinance, the owners sought to convert their building into condominiums. After the master deed was recorded, but before any of the units were sold, the Removal Permit Ordinance was adopted and became effective on August 13, 1979, thereby preventing the sale of any of the units in the building without a removal permit. The Southview Plaintiffs sought permits in January, 1980, but the Rent Control Board denied the applications in April, 1980. The Southview Plaintiffs did not seek judicial review of this determination.

The original Removal Permit Ordinance did not expressly subject cooperative housing to the removal requirement, and in 1980 the Southview owners proceeded to convert the building into a cooperative. The shareholders in the new corporation became the "owners" of the units associated with their respective shares. After these transactions, the Rent Control Board adopted an "interpretive" regulation restricting the availability of any exemption for cooperatives to those units that were owner-occupied at the time of the adoption of the Removal Permit Ordinance in 1979.

Southview brought a state court action seeking a declaration that the interpretive application of the Removal Permit Ordinance to cooperatives was inconsistent with the Ordinance. The state courts found for the Rent Control Board. Southview Co-operative Housing Corp. v. Rent Control Board of Cambridge, 16 Mass.App. 1102 (1983). Southview also applied for removal permits, which were denied in 1980. No independent judicial review of that permit denial determination was pursued.

2. The Blevins Plaintiffs are two trusts of which Charles Blevins is trustee. The trusts own four residential buildings in Cambridge, with a total of 172 rental units. In 1981, after the adoption of the Removal Permit Ordinance, Blevins formed two condominium associations, intending to sell the units. At about the same time, one of the tenants in one of the buildings applied for a removal permit in order to purchase and occupy a vacant unit in the same building. Nine months later, that individual permit was granted, but by then the tenant had changed his mind, so the permit was not used. Blevins, allegedly concluding that applying for permits was futile, has never sought removal permits.

II

The federal jurisdictional grounds for this action is the Civil Rights Act of 1871, 42 U.S.C. § 1983. The statute of limitations for a claim under § 1983 is the general personal injury statute of limitations of the state whose action is under review. Owens v. Okure, 488 U.S. 235, 109 S.Ct. 573, 102 L.Ed.2d 594 (1989); Wilson v. Garcia, 471 U.S. 261, 105 S.Ct. 1938, 85 L.Ed.2d 254 (1985). The relevant Massachusetts statute, Mass.Gen.L. ch. 260, § 2A, provides a period of three years from the date of the injury complained of in which to initiate such a suit.4 Because the plaintiffs have not brought suit within that period, this action must be dismissed.

-A-

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