Roy v. City of Augusta, Maine

• Decision Date: 28 July 1983
• Docket Number: No. 82-1942,82-1942
• Parties: Donald ROY, of Waterville, Kennebec County, State of Maine, Plaintiff, Appellant, v. The CITY OF AUGUSTA, MAINE, et al., Defendants, Appellees.
• Court: U.S. Court of Appeals — First Circuit

Page 1517

712 F.2d 1517

Donald ROY, of Waterville, Kennebec County, State of Maine Plaintiff, Appellant, v. The CITY OF AUGUSTA, MAINE, et al., Defendants, Appellees.

No. 82-1942.

United States Court of Appeals, First Circuit.

Argued April 4, 1983.

Decided July 28, 1983.

Jed Davis, Augusta, Me., with whom Jim Mitchell and Jed Davis, P.A., Augusta, Me., was on brief, for plaintiff, appellant.

Charles E. Moreshead, Augusta, Me., with whom Linda B. Gifford, and Sanborn, Moreshead, Schade & Dawson, Augusta, Me., were on brief, for defendants, appellees.

Before CAMPBELL, Chief Judge, COFFIN and BOWNES, Circuit Judges.

LEVIN H. CAMPBELL, Chief Judge.

This is an appeal from the district court's dismissal of a civil rights action for failure to state a claim upon which relief can be granted. We hold that the action is barred as against defendant City of Augusta by the operation of res judicata but that the complaint should not have been dismissed as against the individual defendants as it states a possible claim against them under 42 U.S.C. § 1982.

Because this appeal is before us from a dismissal of the complaint, we construe the facts and pleadings in the light most favorable to the plaintiff. Cruz v. Beto, 405 U.S. 319, 92 S.Ct. 1079, 31 L.Ed.2d 263 (1972) (per curiam). On September 20, 1976 the city council of Augusta, Maine, granted plaintiff-appellant, Donald Roy, a license to operate a pool and billiard room at 79-81 Cony Street, Augusta, premises which he owned subject to a mortgage. On April 1, 1977 he applied for a renewal of the license. His application was denied following a hearing on April 11, 1977. Roy then commenced an action in the Kennebec County Superior Court seeking a declaratory judgment, injunctive relief, and reversal of the council's actions. On June 3, 1977, the Superior Court determined that the council had failed to provide a transcript of the hearing as required by state law. 1 Me.Rev.Stat.Ann. § 407.1, and ordered the council to hold a new hearing.

A second hearing was held on June 9, 1977, and the council again voted not to renew Roy's license. The council based its decision upon a city ordinance requiring that licenses shall "be granted only if the location is in such a place that it will not disturb the peace and quiet of a family." The council found that large numbers of young people had assembled outside Roy's establishment and had disturbed the peace and quiet of the area. There was no evidence, however, that activities within the pool hall had disturbed the neighborhood.

Roy once again brought suit in the Superior Court, and this time the court affirmed the council's decision. Roy appealed from that judgment to the Maine Supreme Judicial Court. On June 2, 1978 that court ruled that the city's ordinance violated the state's licensing statutes, 8 Me.Rev.Stat.Ann. §§ 1 & 2, ¹ insofar as it enabled the city to deny Roy a license on account of activities that did not occur within his establishment. Roy v. Inhabitants of the City of Augusta, 387 A.2d 237 (Me.1978) (hereinafter "Roy I "). On June 14, 1978, in accordance with the Maine Supreme Judicial Court's directions, the Superior Court ordered the city officers to renew Roy's license. On June 21, 1978 the city clerk issued Roy the 1977-78 license he had originally sought which, however, had expired on May 1, 1978.

Still unlicensed in spite of his victory in the Maine Supreme Court, Roy was advised by defendant Charles Moreshead, the city's counsel, that he should apply for a current license. Roy did so, and a hearing was held on his new application on July 17, 1978. Roy alleges that he had been forced by then, however, to convey the premises to the mortgagees in lieu of foreclosure, as he had been unable to pay his bills because of his inability to run his business. In consideration for conveyance of the premises, Roy says he received an oral right of first refusal to the premises and assurances that he might be able to regain ownership of or obtain a lease to the premises upon receiving a valid license.

Roy's interest in the property was discussed at the July 17 hearing. According to Roy, defendant Moreshead stated at the hearing that a police officer, P. Thomas Baker, was interested in running a pool hall at 79-81 Cony Street. The council then voted to deny Roy a license, because he lacked a sufficient property interest in the premises and because of an intervening conviction for aiding in the illegal sale of liquor.

On July 18, 1978 Roy once again brought an action in the Superior Court, and on August 11, 1978 the court ordered the city to issue a valid license that would not expire until May 1, 1979. Such a license was issued on August 11.

According to the present complaint, the valid license came too late. It is alleged that on July 25, 1978, while the Superior Court action was pending, the new owner of 79-81 Cony Street told Roy that he was no longer willing to rent the premises to Roy because the city's actions on July 17 "evidenced an intent to keep [Roy] from opening a billiard room at that location, regardless of what the Courts might order." On August 15, 1978 Baker applied for a license to operate a billiard hall at 79-81 Cony Street. This license was granted on August 21, 1978, after a hearing at which Roy participated. Roy then filed yet another action in Superior Court seeking to have Baker's license declared void. The Superior Court found against Roy. This judgment was affirmed on appeal by the Maine Supreme Judicial Court because of the fact that Roy lacked a property interest in the premises. Roy v. Inhabitants of the City of Augusta, 414 A.2d 215 (Me.1980) (hereinafter "Roy II ").

On June 6, 1980 Roy filed the instant action in district court charging that the City of Augusta and eight of its officers violated 42 U.S.C. § 1983 by depriving him of his property without due process of law. ² On June 27, 1980 defendants filed a motion to dismiss arguing, inter alia, that the complaint failed to state a claim upon which relief could be granted and that the action was barred by res judicata. The district court, adopting the recommendations of a magistrate, dismissed the action for failure to state a claim. Roy appealed.

I. RES JUDICATA

The first issue we consider is whether the instant action is barred under principles of res judicata. ³ We hold that it is as to the City of Augusta, but that it is not as to the individual defendants.

It is well established that general principles of res judicata apply in civil rights actions. See, e.g., Kremer v. Chemical Construction Corp., 456 U.S. 461, 102 S.Ct. 1883, 72 L.Ed.2d 262 (1982) (Title VII); Allen v. McCurry, 449 U.S. 90, 101 S.Ct. 411, 66 L.Ed.2d 308 (1980) (collateral estoppel applies in section 1983 actions); Isaac v. Schwartz, 706 F.2d 15 (1st Cir.1983). In determining the preclusive effect of a state court judgment, federal courts must look to the state's law. Id. at 16. We therefore turn to the Maine law of res judicata in order to determine whether Roy's Maine litigation bars the present action.

For the doctrine of res judicata to be applied in Maine "the court must satisfy itself that 1) the same parties, or their privies are involved; 2) a valid final judgment was entered in the prior action; and 3) the matters presented for decision were, or might have been, litigated in the prior action." Kradoska v. Kipp, 397 A.2d 562 (Me.1979). In the instant case there is no question that final judgments were entered in the various Maine court actions. Whether the other conditions were met, however, requires a closer look.

In Kradoska, the court stated that whether the "matters presented for decision were, or might have been litigated in the prior action" depends upon whether the same cause of action was before the court in the prior cases. Id. at 568. Under Maine law, "the measure of a cause of action is the aggregate of connected operative facts that can be handled together conveniently for purposes of trial." Id. quoting 1 R. Field, V. McKusick & L. Worth, Maine Civil Rights Procedure § 41.5 (1970). See also Restatement (Second) of Judgments § 24, Comment A (1982). Here, all of the operative facts alleged in the present complaint, except one, were before the state court in Roy II. ⁴ The court in Roy II considered the fact that Roy had initially been denied a license, had litigated that denial, had won a judgment, had been given an expired license, and had lost his hall prior to receiving a valid license. The only presently alleged "fact" which, for obvious reasons, was not then before the Roy II court was that Roy was to be denied relief in that very case. While that "fact," insofar as it demonstrates that Roy was unable to regain his property is material to his current constitutional claim, it does not distinguish the two actions for purposes of res judicata. It often happens that claims do not achieve constitutional stature until a state court has rejected them. Yet as we stated in discussing a similar situation in Lovely v. Laliberte, 498 F.2d 1261, 1263 (1st Cir.), cert. denied, 419 U.S. 1038, 95 S.Ct. 526, 42 L.Ed.2d 316 (1974), "state courts, too, are guardians of the federal constitution." Where a party should reasonably foresee that an adverse state court judgment will create a constitutional issue, that issue should be argued before the state court. Where it is not, the party is barred by principles of res judicata from later raising the constitutional claim against the same parties in a federal section 1983 action.

Roy argues that even if the operative facts in Roy II are the same as those now before us, he should not be barred from bringing this action because the remedy he now seeks--damages--is different from the remedy he sought in the earlier case. This argument is without merit. Under modern principles of res judicata, a party cannot split his claim by first seeking one type of remedy in one action and later asking for another...