Loeterman v. Town of Brookline

• Decision Date: 06 November 1981
• Docket Number: Civ. A. No. 80-670-MC.
• Parties: Ben LOETERMAN, et al., Plaintiffs, v. TOWN OF BROOKLINE, et al., Defendants.
• Court: U.S. District Court — District of Massachusetts

524 F. Supp. 1325

Ben LOETERMAN, et al., Plaintiffs, v. TOWN OF BROOKLINE, et al., Defendants.

Civ. A. No. 80-670-MC.

United States District Court, D. Massachusetts.

November 6, 1981.

Philip S. Lapatin, Gaston, Snow & Ely Bartlett, Mitchell S. Ross, Bernkopf, Goodman & Baseman, Boston, Mass., for plaintiffs.

David Lee Turner, Janet B. Fierman, Cathleen C. Cavell, Brookline, Mass., for Town of Brookline.

Roger R. Lipson, Brookline, Mass., for Rent Control Bd., Town of Brookline.

Gerald J. Caruso, Asst. Atty. Gen., Boston, Mass., for intervenor Atty. Gen. of Mass.

MEMORANDUM AND ORDER

McNAUGHT, District Judge.

This matter is before the court on the parties' cross motions for summary judgment. The plaintiffs are Ben and Mardi Loeterman, purchasers of a condominium unit in Brookline, Massachusetts, and the defendants are the Town of Brookline (the Town) and the Rent Control Board of Brookline (Rent Control Board). The Attorney General of Massachusetts has also intervened in this action as a defendant. The plaintiffs seek a declaration that the Town's bylaw amendment prohibiting owners of individual condominium units from recovering possession of their units from tenants under certain conditions is unconstitutional as being a violation of their Fifth and Fourteenth Amendment rights, and an injunction against the enforcement of the bylaw amendment by the Town or its agents or employees. Jurisdiction is based on 28 U.S.C. §§ 1331 and 1343(3).

The bylaw amendment (the so-called Ban Amendment) and its predecessors were discussed by the court in the case of Chan v. Town of Brookline, 484 F.Supp. 1283 (D.Mass.1980), wherein the court denied preliminary injunctive relief against the Town with respect to plaintiffs who had purchased their condominium prior to the Ban Amendment's enactment by the Town. The present action was consolidated with the Chan case in November, 1980. Before reaching the issue of the constitutionality of the Ban Amendment with respect to the Chans, the Chan action was dismissed for mootness in December, 1980, as the tenant occupying the Chans' unit voluntarily vacated the premises. Consequently, the court is not called upon in the instant case to decide the constitutionality of the ordinance as applied to persons who purchased their units with the intent to occupy them in accordance with then applicable eviction procedures (the Six Plus Six Amendment), but who may be subject to a permanent prohibition against evicting tenants in possession by the subsequent enactment of the Ban Amendment.

The gist of the Ban Amendment, amending section 9(a)(8) of Article XXXVIII of the Town bylaws (Rent and Eviction Control Bylaw), is that the owner of an individual condominium unit is precluded from recovering possession of his unit from a tenant who has occupied it continuously since the time before the recording of the master condominium deed.¹ The tenant has the equivalent of a life tenancy in the property so long as the amendment is in effect, and the owner may only recover possession for the use and occupancy of himself or other family members designated in the bylaw provision upon a tenant's voluntary departure or death. The Ban Amendment was approved at a town meeting on May 7, 1979. It was enacted as part of the Town's Rent and Eviction Control Bylaw and applies only to controlled rental units as defined in section 3(b) of Article XXXVIII. The amendment became effective after approval by the Attorney General for the Commonwealth of Massachusetts on August 14, 1979.

There is no dispute among the parties as to the facts relating to the Loetermans' purchase of the condominium and its occupancy by a tenant at the time of sale. The plaintiffs entered into a purchase and sale agreement on March 29, 1979 to purchase the unit for $35,000 in a rent controlled building for the purpose of occupying it as their personal residence. They took title to the unit on May 17, 1979, ten days after the Ban Amendment was passed at the Brookline town meeting. Plaintiffs do not dispute that they knew of the enactment of the amendment at the time they took title to their unit. At the time of sale the unit was, and continues to be occupied by a tenant who has lived there continuously since a time prior to the recording of the master condominium deed. Plaintiffs still desire to occupy the unit for dwelling purposes. The tenant, however, has refused to vacate the premises voluntarily.

Section 6 of the bylaw provides that the rents established for controlled rental units shall be adjusted "to assure that rents ... are established at levels which yield to landlords a fair net operating income for such units." Prior to November 27, 1979, the tenant occupying the Loetermans' unit paid a monthly rent of $315.00. On November 27, 1979, plaintiffs were granted a rent increase by the Brookline Rent Control Board of $96.00 per month, raising the monthly maximum rent to $411.00. Thereafter, on June 30, 1981, plaintiffs received a rent increase of $110.00 per month, increasing the monthly maximum rent to $521.00.

The plaintiffs argue that the amendment unlawfully effects a redistribution of property by transferring from the owner to the tenant the right to use the property in a particular way for a public purpose. See South Terminal Corp. v. Environmental Protection Agency, 504 F.2d 646, 679 (1st Cir. 1974). They do not dispute the existence of an increasing shortage of rental housing accommodations in the Town, exacerbated by a rapid and an increasing rate of conversion of rental units to condominiums, or that such a rental housing shortage poses a threat to the public health, safety, and welfare, particularly that of the elderly and low income households.² The thrust of their opposition to the Ban Amendment is that the amendment, unlike its predecessor, the "Six Plus Six" Amendment, effectively prohibits an owner from ever occupying his unit and that such a prohibition constitutes a "taking" of property violative of the Fifth and Fourteenth Amendments. According to plaintiffs, the fact that the Ban Amendment may operate to extinguish an owner's right of possession altogether distinguishes the present case from other cases where courts have upheld the government's right to prohibit particular uses of property, but where the owner nevertheless remains in possession or retains the right to use and occupy the premises he owns. Plaintiffs further urge that the Town's grant to the tenant of a right to occupy the premises indefinitely compels a property owner to dedicate his property indefinitely to the rental market, a practice held unlawful in another context in Rivera v. R. Cobian Chinea and Co., 181 F.2d 974 (1st Cir. 1950).

The defendants and defendant-intervenor respond that the Ban Amendment does not operate as a taking of property in that the bylaw serves a legitimate public purpose of assuring an adequate supply of rental housing and allows purchasers of individual condominium units the right to receive rent and enjoy all other traditional incidents of ownership except occupancy. It is argued that a prohibition of only one use does not render plaintiffs' property worthless so as to amount to a taking requiring compensation. Defendants also contend that the plaintiffs here, as distinguished from the property owner in Kaiser Aetna v. United States, 444 U.S. 164, 100 S.Ct. 383, 62 L.Ed.2d 332 (1979), had no legitimate investment-backed expectation that has been thwarted by the Town. In this regard defendants focus upon the chronology of events surrounding the Loetermans' purchase of their unit.

The Fifth Amendment's prohibition against the taking of private property for a public purpose is applicable against a state and its political subdivisions through the Fourteenth Amendment. Penn Central Transportation Co. v. New York City, 438 U.S. 104, 122, 98 S.Ct. 2646, 2658, 57 L.Ed.2d 631 (1978). Recent "takings" cases indicate that there is no set formula for determining when governmental action results in a taking; rather, the particular circumstances in each case must be examined. Kaiser Aetna v. United States, 444 U.S. 164, 165, 100 S.Ct. 383, 385, 62 L.Ed.2d 332 (1979); Penn Central Transportation Co. v. New York City, supra, 438 U.S., at 124, 98 S.Ct. at 2659. Generally, "taking" analysis requires a weighing of private and public interests, as all governmental regulation by definition involves some curtailment of private rights to promote a public purpose. Agins v. City of Tiburon, 447 U.S. 255, 260, 100 S.Ct. 2138, 2141, 65 L.Ed.2d 106 (1980); Andrus v. Allard, 444 U.S. 51, 65, 100 S.Ct. 318, 326, 62 L.Ed.2d 210 (1979).

Penn Central Transportation Co. v. New York City dictates that the court must scrutinize the character of the action and the nature and extent of the interference, both physical and economic, with rights "in the parcel as a whole". 438 U.S. at 130-131, 98 S.Ct. at 2662-2663. In connection with the court's assessment of the economic impact of...