Hornstein v. Barry

• Decision Date: 11 September 1987
• Docket Number: No. 83-242.,83-242.
• Citation: 530 A.2d 1177
• Parties: David HORNSTEIN, et al., Appellants, v. Marion BARRY, et al., Appellees.
• Court: D.C. Court of Appeals

530 A.2d 1177

David HORNSTEIN, et al., Appellants, v. Marion BARRY, et al., Appellees.

No. 83-242.

District of Columbia Court of Appeals.

Argued April 24, 1984.

Decided September 11, 1987.

Burton Schwalb, with whom Laura A. Kumin and Patricia L. Maher were on the brief, for appellants. Jerome Nelson, Washington, D.C., also entered an appearance for appellants.

Lutz Alexander Prager, Asst. Corp. Counsel, with whom Inez Smith Reid, Corp. Counsel, John H. Suda, Principal Deputy Corp. Counsel, respectively, at the time the brief was filed, and Charles L. Reischel, Deputy Corp. Counsel, Washington, D.C., were on the brief, for appellees.

Before FERREN and TERRY, Associate Judges, and REILLY, Senior Judge.

PER CURIAM:

This appeal by the title holders of a residential apartment building from an entry of summary judgment and dismissal of the complaint in an action against the District of Columbia government (and certain named officials) raises several issues including a challenge to the constitutionality of the Rental Housing Conversion and Sale Act of 1980, D.C.Code § 45-1601 et seq. (1981). We affirm in part, reverse in part, and remand for trial one issue on which we deem disposition by summary judgment not appropriate.

In this complaint, appellants — sole trustees of a trust which includes the ownership of the Savoy, a 203 unit apartment structure at 1101 New Hampshire Avenue, N.W. — alleged that the Department of Housing and Community Development (the Department), the agency which administers the municipal laws relating to condominium conversion, wrongfully refused to accept and process an application to change the Savoy rental units into condominia. The complaint also assailed as unconstitutional a provision of the Act which makes a consent by the majority of current tenants a condition precedent to conversion and asserted that the operation of the conversion statute in conjunction with District rent control laws disregarded a provision of the Fifth Amendment which forbids "private property [to] be taken for public use, without just compensation." The following facts appear to be undisputed in the record.

On December 29, 1978, the Department issued a certificate of eligibility to appellants to convert the Savoy into condominia based on an application and showing that it qualified as a "high rent" housing accommodation under the later repealed Section 501 of the Condominium Act of 1976, D.C. Code § 5-1281(b)(1)(A) (Supp. V 1978).¹

Section 406 of this Act, still in force and incorporated into existing law as D.C.Code §§ 45-1863, -1866 (1981), provides that once an owner obtains such a certificate, he must then file an additional instrument, viz., an application for registration, before he is authorized to sell a rental unit as a condominium. Within five days after receiving such an application for registration, the District issues a "notice of filing" to the applicant acknowledging receipt of the application. Thereafter, the District reviews the application and within a sixty day period accepts or rejects it. If no action is taken within this period, the condominium is deemed "registered" unless the applicant has consented in writing to the delay.

On May 29, 1979, the District Council passed the first of a series of emergency acts declaring a 90-day moratorium on "high rent" conversions.² These acts were adopted by the Council for the stated purpose of preventing further depletion of the rental housing supply of rental accommodations in the District — a condition of affairs which the Council found to be aggravated by the growing number of conversions of rental properties to condominia and cooperatives. D.C.Code § 45-1601(3) (1981). This Act limited the Mayor's authority to honor certificates of eligibility based on the high rent exemption should the holder file the additional instruments required for conversion.

When the 90 days — the maximum period for which emergency legislation could be effective under the Home Rule Act³ — expired, the Council again invoking its "emergency" powers, passed successive, substantially identical 90 day acts.

The validity of these acts was attacked by another party in an action for declaratory judgment and injunctive relief on the ground that the Council was in effect enacting legislation of a permanent nature under the guise of an emergency, thereby unlawfully avoiding statutory Congressional review. The trial court agreed with this contention and granted an injunction which was stayed pending appellate review.⁴ We affirmed the trial court, District of Columbia v. Washington Home Ownership Council, Inc., 415 A.2d 1349 (D.C. 1980) (en banc), but stayed our mandate for 90 days.

This opinion was released on May 20, 1980. More than two months later — on July 25 of that year — appellants, assuming that there was no longer any valid legislation barring the second procedural step to the conversion of high rent apartments, acted upon their certificate of eligibility and filed an application with the Department to register the Savoy as a condominium.

They apparently had overlooked the impact of intervening Council action. Conversions were controlled at that time by D.C.Law 3-53, entitled the Condominium and Cooperative Stabilization Act of 1979, 27 D.C.Reg. 34 (1980), enacted by the Council while the appeal was pending. This Act was submitted to Congress for review. After the expiration of the statutory review period, and in the absence of a disapproval resolution, it became effective on February 23, 1980, and was in force for 180 days thereafter. This Act provided that "the Mayor shall not issue any notice of filing of an application for registration of a condominium pursuant to [the procedure set forth in] § 406 of the Condominium Act of 1976 if that housing accommodation was declared eligible to convert pursuant to § 501(b)(1)(A) [the high rent section] of the Act." 27 D.C.Reg. 37-38 (1980). Under D.C.Law 3-53, notice of filings could be issued only to owners who had applied for registration (as opposed to obtaining a certificate of eligibility) before May 1979, purchased units in contemplation of conversion served tenants with notice of intent to convert, made "substantial financial investment" toward conversion or had obtained tenants' consent to the conversion.

Even though appellants' application failed to qualify under these new requirements, the Department, also in apparent ignorance of Law 3-53, issued a notice of filing to appellants on July 28, 1980. Three weeks later, on August 19, 1980, the Department realized its error. It notified appellants' counsel of its mistake, and informed him that appellants' application for registration would have to be returned as incomplete because it did not include a certificate of eligibility to convert to condominia based on tenant consent. In an effort to resolve the problem, the parties agreed that the Department would retain the Savoy's application until the Superior Court issued an order pursuant to a remand of the Home Ownership Council, supra note 4, decision.

In August and September of 1980, the District enacted still stricter legislation regarding condominium conversion. See Rental Housing Conversion and Sale Act of 1980, D.C.Law 3-86, D.C.Code § 45-1601 et seq. (1981) (hereinafter September 1980 Act). This new legislation recognized only two kinds of conversions: those which had been approved by a majority of the qualified tenant voters⁵ and those for which a notice of filing was issued prior to September 10, 1980, the effective date of the Act. D.C.Law 3-86, § 210, 27 D.C.Reg. 2975, 2985-86.

On December 3, 1980, the Superior Court issued an opinion and order holding that its prior judgment declaring the interim emergency acts invalid, should be given a "purely prospective application" and that all statutes passed prior to August 28, 1980 were of full force and effect until that date. See Washington Home Owners Council, Inc. v. District of Columbia, Civil Action No. 10624-79 (December 3, 1980). No appeal was taken. On December 23, the District returned appellants' registration application unprocessed.

In May 1981, appellants filed a three count complaint in the Superior Court. In the first count, appellants challenged the rejection of its application for conversion, asserting they qualified under the § 210 grandfather clause of the September 1980 Act because they possessed a previously issued notice of filing and hence the tenant election provision was inapplicable. The second count alleged that they were entitled to relief because the invalid emergency acts precluded them from completing what would have been a lawful conversion. Finally, appellants complained that the tenant consent provision of the September 1980 Act unconstitutionally delegated governmental authority to the tenants, and that the Act alone, or in combination with the District's rent control laws, operated to take unlawfully private property without just compensation in violation of the Fifth Amendment. The complaint sought declaratory and injunctive relief, as well as monetary damages.

The District filed a motion to dismiss the complaint, or in the alternative, to grant summary judgment as to each count. Appellants similarly filed a cross motion for summary judgment. The trial court by order of January 28, 1983, granted the District's motion and dismissed appellants' complaint with prejudice. This appeal followed.

I

Appellants' position is that the trial court erred as a matter of law in granting the District's motion for summary judgment. Summary judgment is an appropriate remedy when there are no material facts in issue and when it is clear that the moving party is entitled to judgment as matter of law. Swann v. Waldman, 465 A.2d 844, 846 (D.C. 1983); Burch v. Amsterdam Corp., 366 A.2d 1079, 1083-84 (D.C. 1976); Super.Ct.Civ.R. 56(c). The burden of demonstrating the absence of a genuine issue of material fact is upon the movant. Himmelfarb...