Lee County v. Brown

• Decision Date: 09 June 2006
• Docket Number: No. 2D05-2711.,2D05-2711.
• Citation: 929 So.2d 1202
• Parties: LEE COUNTY, Florida, Appellant, v. Tina BROWN, individually and on behalf of others similarly situated; First Home Builders of Florida, a Florida partnership, on its own behalf and on behalf of other general contractors similarly situated; Lee Building Industry Association, Inc., a Florida corporation, on its own behalf and on behalf of its members and others similarly situated; and Patricia Shatto, individually, and on behalf of others similarly situated, Appellee.
• Court: Florida District Court of Appeals

929 So.2d 1202

LEE COUNTY, Florida, Appellant, v. Tina BROWN, individually and on behalf of others similarly situated; First Home Builders of Florida, a Florida partnership, on its own behalf and on behalf of other general contractors similarly situated; Lee Building Industry Association, Inc., a Florida corporation, on its own behalf and on behalf of its members and others similarly situated; and Patricia Shatto, individually, and on behalf of others similarly situated, Appellee.

No. 2D05-2711.

District Court of Appeal of Florida, Second District.

June 9, 2006.

Gregory T. Stewart and Harry F. Chiles of Nabors, Giblin & Nickerson, P.A., Tallahassee; and David M. Owen, Lee County Attorney, and John S. Turner, Assistant County Attorney, Fort Myers, for Appellant.

Jeffrey R. Garvin, Theodore L. Tripp, Jr., and Elisa W. Worthington of Garvin & Tripp, P.A., Fort Myers, for Appellees.

STRINGER, Judge.

Lee County seeks review of the final summary judgment, in which the trial court found that a school impact fee ordinance constitutes a facially unconstitutional impairment on construction contracts. Because there are circumstances under which the school impact fee ordinance would be valid, the trial court's determination that it is facially unconstitutional is erroneous. Accordingly, we reverse and remand for further proceedings.

In November 2001, the Lee County Board of County Commissioners adopted Lee County Ordinance No. 01-21 ("the Ordinance"). Pursuant to the Ordinance, a person who applies to Lee County or to any municipality within Lee County for issuance of a building permit, mobile home move-on permit, or mobile home park development order for the purpose of making a residential improvement to the land for one of the uses specified in the Ordinance must pay a school impact fee. The Ordinance imposes a school impact fee of $2232 for single-family residences; $691 for multi-family residences, duplexes, two-family attached homes, or townhouses; and $425 for mobile homes. The Ordinance became effective December 1, 2001.

Lee County subsequently adopted Ordinance No. 01-22, which amended the Ordinance to allow those applicants who had submitted their applications for building permits prior to December 1, 2001, and who were issued building permits prior to March 1, 2002, to avoid paying the school impact fee.

The Ordinance thus requires payment of the school impact fee prior to the issuance of building permits after December 1, 2001, but exempts those whose permit applications had been submitted prior to December 1, 2001, and were issued prior to March 1, 2002. The school impact fee is assessed regardless of when the contracts for the sale or development of land were executed.

On behalf of a class of persons who had executed such contracts prior to December 1, 2001, but had not qualified for the exemption, Tina Brown, First Home Builders of Florida, and Lee Building Industry Association, Inc., ("Plaintiffs") filed an action seeking a declaratory judgment that the assessment of the school impact fee constitutes an unconstitutional impairment of their contract rights under the contract clause in article I, section 10 of the Florida Constitution, both facially and as applied.¹ Plaintiffs subsequently filed their first amendment to the complaint, which joined Patricia Shatto as a named plaintiff. The trial court eventually certified a class/subclass, with Shatto as the sole class/subclass representative, defined as: "All parties who have paid or been assessed an impact fee pursuant to the Lee County school impact fee Ordinance (01-21) in order to obtain a building permit, mobile home move-in permit or mobile home park development order."

The trial court granted summary judgment in favor of Plaintiffs based on its finding that the Ordinance was facially unconstitutional as an impairment of contracts in violation of the contract clause. The trial court held that the Ordinance placed an impermissible burden on contracts executed prior to December 1, 2001, and, therefore, was facially unconstitutional as to all Plaintiffs who had executed contracts prior to December 1, 2001. The court reasoned:

Citizens cannot be charged reasonably with notice of the consequence of impending legislation before the effective date of that legislation. Dewberry v. Auto-Owners Insurance Company, 363 So.2d 1077, 1080 (Fla.1978). Furthermore, rights existing under a valid contract enjoy protection under the Florida Constitution. Green v. Quincy State Bank, 368 So.2d 451 (Fla. 1st DCA 1979).

The trial court did not reach Plaintiffs' as-applied challenge under the contract clause.

On appeal, Lee County argues that the Ordinance is not facially unconstitutional because it does not impair each and every contract executed prior to its effective date. Lee County also asserts that the contract clause is not applicable when the government establishes regulations pursuant to its police powers. Alternatively, Lee County asserts that the trial court erred in failing to apply the balancing test adopted by the Florida Supreme Court in Pomponio v. Claridge of Pompano Condominium, Inc., 378 So.2d 774 (Fla.1979), to determine whether the Ordinance constitutes an unconstitutional impairment of Plaintiffs' contract rights.

Plaintiffs argue that the Ordinance is facially unconstitutional regardless of whether it impairs each and every contract executed prior to its effective date because it does not contain a savings clause exempting all contracts in existence prior to its effective date. Plaintiffs also argue that, in Florida, contract rights enjoy nearly absolute protection from governmental interference irrespective of whether the interference is pursuant to the government's police powers. Plaintiffs assert that the trial court properly applied the per se analysis as explained in Dewberry. Plaintiffs also assert that, even if the Pomponio balancing test did apply, the Ordinance would fail to satisfy it.

We reverse on a variation of the first basis argued by Lee County. We conclude that the trial court erred in determining that the Ordinance is facially unconstitutional because circumstances exist under which the statute could be validly applied to require payment of the school impact fee prior to issuance of building permits.

"[A] determination that a statute is facially unconstitutional means that no set of circumstances exists under which the statute would be valid." See Fla. Dep't of Revenue v. City of Gainesville, 918 So.2d 250, 256 (Fla.2005); State v. Bales, 343 So.2d 9, 11 (Fla.1977). The trial court determined that the Ordinance "retroactively places an impermissible burden on those contracts which were executed prior to December 1, 2001, and clearly constitutes an impairment of contract which is facially unconstitutional." However, this finding only suggests that the Ordinance is unconstitutional as applied to contracts that were executed prior to December 1, 2001. The court did not find, and Plaintiffs have not argued, that the Ordinance cannot be constitutionally applied to those contracts executed after the effective date of the Ordinance, which will encompass the greater part of the Ordinance's application. Thus, the trial court misapplied the standard for determining the facial constitutionality of the Ordinance.

Lee County argues that the Ordinance is not facially unconstitutional because it does not impair each and every contract executed prior to its effective date. This argument is based on the fact that several of the contracts specifically provide for the payment of impact fees or state that payment of impact fees is not governed by the contract. This argument is well taken, but for purposes of determining the facial validity of the Ordinance, our review is not limited to those contracts executed prior to the effective date of the Ordinance.

We are aware that the First District in Department of Revenue v. Florida Home Builders, 564 So.2d 173 (Fla. 1st DCA 1990), declared an analogous law facially unconstitutional. In Florida Home Builders, the First District held that the chapter law that provided for a construction tax unconstitutionally impaired contracts executed before May 1, 1987, but not completed by June 30, 1989. 564 So.2d at 176. The provision at issue imposed a tax on prime contractors for "sales, use and other transactions on the sale and use of services." Id. at 174. The provision was effective on April 23, 1987, and exempted those whose contracts had been signed prior to May 1, 1987, and whose performance was fully rendered prior to June 30, 1989. The construction tax was otherwise assessed for contracts executed prior to May 1, 1987. The court held that the tax law was facially unconstitutional in violation of the contract clause "[w]ith regard to contracts entered into prior to May 1, 1987 but not completed by June 30, 1989" because it added "an unknown, uncontemplated cost" to the contracts. Id. at 174-75. It based its holding on a prior finding by the supreme court in In re Advisory Opinion to the Governor, 509 So.2d 292 (Fla.1987), that a previous version of the same law was facially unconstitutional. Id.

We do not agree with the First District's conclusion in Florida Home Builders that its determination that the construction tax was unconstitutional as to "contracts entered into prior to May 1, 1987 but not completed before June 30, 1989" is a determination of the law's facial validity. The court did not declare the tax law unconstitutional in its entirety or void; in fact, it expressly held that the tax law was constitutional "as it affects those contracts entered into between May 1, 1987 and the effective date of [the chapter law], July 1, 1987" because the enactment of the chapter law placed contractors on notice that they should consider the tax burden when executing new contracts. Id. at 176. We think the First District's reliance on the supreme court's previous decision in In re Advisory...