The City of Fort Lauderdale v. Scott

• Decision Date: 28 February 2011
• Docket Number: Case No. 10–61122–CIV.
• Citation: 773 F.Supp.2d 1355
• Parties: The CITY OF FORT LAUDERDALE, Plaintiff,v.Hezzekiah SCOTT, Defendant/Counter-claimant,Virgil Bolden, Gloria Burnell, The Estate of Walter Tirschman and Karen McNair, Counter–Plaintiffs/Third Party Plaintiffs,v.The City of Fort Lauderdale, Counter-defendant,Alfred G. Battle, Jr., Director of Community Redevelopment Agency, in his official and individual capacities, Shaun Donovan, in his official capacity as Secretary of United States Department of Housing and Urban Development, and United States Department of Housing and Urban Development, Third–Party Defendants.
• Court: U.S. District Court — Southern District of Florida

773 F.Supp.2d 1355

The CITY OF FORT LAUDERDALE, Plaintiff,

v.Hezzekiah SCOTT, Defendant/Counter-claimant,Virgil Bolden, Gloria Burnell, The Estate of Walter Tirschman and Karen McNair, Counter–Plaintiffs/Third Party Plaintiffs,

v.The City of Fort Lauderdale, Counter-defendant,Alfred G. Battle, Jr., Director of Community Redevelopment Agency, in his official and individual capacities, Shaun Donovan, in his official capacity as Secretary of United States Department of Housing and Urban Development, and United States Department of Housing and Urban Development, Third–Party Defendants.

Case No. 10–61122–CIV.

United States District Court, S.D. Florida.

Feb. 28, 2011.

Alain E. Boileau, Yoss LLP, Fort Lauderdale, FL, for Plaintiff/Counter–defendant.Sharon Bourassa, Plantation, FL, for Defendant/Counter–claimant.Marilynn Koonce Lindsey, United States Attorney's Office, Fort Lauderdale, FL, for Counter–defendant.

ORDER GRANTING FEDERAL COUNTER–DEFENDANTS' MOTION TO DISMISS and GRANTING LEAVE TO FILE AN AMENDED COUNTERCLAIM

JAMES I. COHN, District Judge.

THIS CAUSE is before the Court upon Alfred Battle and the City of Fort Lauderdale's (“City”) Motion to Dismiss [DE 29], the Counter–Plaintiffs' Response [DE 64], the Counter–Defendants' Reply [DE 78], Counter–Plaintiffs' Motion to Certify Class [DE 16], the Counter–Defendants' Responses [DE 38], Counter–Plaintiffs' Replies [DE 57 and 62], the City's Motion to Enforce State Court Stay [DE 43], Counter–Plaintiffs' Response to Motions to Stay [DE 55], the City's Reply [DE 60], Counter–Plaintiffs' Motion to Strike a Portion of Reply [DE 70], the City's Response to the Motion to Strike [DE 82], Counter–Plaintiffs' Motion to Amend Scheduling Order [DE 71], the City's Response [DE 83], Counter–Plaintiffs' Motion to Allow Interim Discovery [DE 84], the City's Response [DE 87] and Counter–Plaintiffs' Reply [DE 88]. The Court has considered all of the filings in this case, and is otherwise fully advised in the premises.

I. BACKGROUND

This case originated in the Circuit Court in and for Broward County, Florida, as an action by the City of Fort Lauderdale (“City”) to foreclose a Special Master Order and Claim of Lien on non-homestead real property owned by Defendant/Counter–Plaintiff Hezzekiah Scott. Although the state court filings are not all part of the docket in this Court, the City states that Scott and four other property owners (hereinafter “Counter–Plaintiffs”) filed an Amended Counterclaim asserting various claims, to which the City filed a Motion to Dismiss. After only a few issues were resolved by the state court after a partial hearing, Counter–Defendants Shaun Donovan, as Secretary of the United States Department of Housing and Urban Development (“HUD”), and HUD itself (hereinafter “Federal Counter–Defendants”), removed this action before a further hearing on the remaining issues in the City's state court motion.

After removal, Counter–Plaintiffs filed a Second Amended Counterclaim (“Counterclaim”), containing twenty counts against the City, Alfred Battle, Director of the City's Community Redevelopment Agency, and the Federal Counter–Defendants [DE 12]. In general, the Counterclaim alleges that the City and Battle engaged in unconstitutional code enforcement operations in the Northwest portion of the City of Fort Lauderdale against Black property owners to obtain their property through a fine and foreclosure scheme, fraudulently obtained federal funds by certifying to HUD that the City was complying with HUD's mandates to use the funds to help low and middle income families obtain housing, and then using the federal funds to redevelop the Northwest portion to the benefit of high-end developers. Counterclaim, ¶¶ 42–61. By separate order, this Court dismissed the claims against the Federal Counter–Defendants for lack of standing and lack of subject matter jurisdiction [DE 91].

The Counterclaim alleges that the City violated the Fifth and Fourteenth Amendments to the United States Constitution by denying Counter–Plaintiffs their rights of substantive due process, procedural due process and equal protection (Section 1983 claims); that the City violated various provisions of the federal Fair Housing Act and Florida statutes governing code enforcement; that the City committed the common law torts of fraud, nuisance and slander of title; and that the City violated a prior settlement agreement in a related case, Velva Turner, et al. v. City of Fort Lauderdale, Case No. 06–61635–Civ–Ungaro [DE 101–2 in that case]. The City has moved to dismiss the Second Amended Counterclaim, while the Counter–Plaintiffs have moved to certify this action as a class action under Rule 23 of the Federal Rules of Civil Procedure. All Counter–Defendants have moved to stay discovery, while the Counter–Plaintiffs have sought permission to take discovery.

II. ANALYSIS

A. Motion to Dismiss Standard

Under the Supreme Court decision in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), to survive a motion to dismiss, a complaint must now contain factual allegations which are “enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact).” 550 U.S. at 555, 127 S.Ct. 1955. “While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the ‘grounds' of his ‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. Taking the facts as true, a court may grant a motion to dismiss when, “on the basis of a dispositive issue of law, no construction of the factual allegations will support the cause of action.” Marshall Cty. Bd. of Educ. v. Marshall Cty. Gas Dist., 992 F.2d 1171, 1174 (11th Cir.1993). In Ashcroft v. Iqbal, ––– U.S. ––––, 129 S.Ct. 1937, 1949–50, 173 L.Ed.2d 868 (2009), the Supreme Court further stated that a court need not accept legal conclusions as true, but only well-pleaded factual allegations are entitled to an assumption of truth.

A pleading must also comply with Fed.R.Civ.P. 8(a)(2) by setting forth a “short and plain statement of the claim showing that the pleader is entitled to relief,” and with Fed.R.Civ.P. 10(b), which requires a plaintiff to have only one claim per count in a complaint. Anderson v. District Board of Trustees of Central Florida Community College, 77 F.3d 364, 366–67 (11th Cir.1996). These rules ensure due process with proper notice to each defendant as to what claims are actually being alleged against each defendant.

B. Procedural Bars

1. Res Judicata

The City argues that Counter–Plaintiffs' claims are barred by the doctrine of res judicata because they did not appeal the code enforcement fines or challenge the code enforcement process when those fines were levied in administrative actions. There is no factual dispute that Counter–Plaintiffs did not file appeals or pursue additional administrative remedies. In fact, Counter–Plaintiffs allege that as to certain Counter–Plaintiffs, they did not attend the hearings and were not informed of any rights to appeal.¹

Counter–Plaintiffs instead argue that under Florida law they were unable to file constitutional claims in an administrative code enforcement proceeding, and therefore, that proceeding could not act as res judicata, relying upon Wilson v. County of Orange, 881 So.2d 625 (Fla.Dist.Ct.App.2004). In Wilson, a trailer park owner filed an action asserting a § 1983 claim for Fifth Amendment and Eighth Amendment violations and three claims attacking the facial constitutionality of various code enforcement statutes and ordinances. 881 So.2d at 628. The District Court of Appeal reversed the lower court's granting of a motion to dismiss, allowing the claims to go forward. As to the § 1983 claim, the Court did not even consider the arguments that res judicata or failure to exhaust administrative remedies precluded such an action. Rather, as to the claims attacking the constitutionality of the relevant statutes, the Court held that the plaintiff had the right to challenge the constitutionality of statutes by filing a separate declaratory action in circuit court.

Applying Wilson to the case at bar, Counter–Plaintiffs have not alleged a facial constitutional challenge to code enforcement ordinances. Rather, they primarily allege § 1983 claims against the City for the manner in which code enforcement actions were taken, akin to the first claim in the Wilson action.² Thus, the City's attempt to distinguish Wilson by pointing out that Counter–Plaintiffs failed to file a declaratory action misses the mark—the relevance of Wilson is allowing the similar § 1983 claims to go forward. Neither res judicata nor collateral estoppel bar the claims in this action.

2. Florida Statutory Notice Provision

The City contends that Counter–Plaintiffs have failed to allege compliance with the presuit, statutory notice provision contained in Florida Statutes § 768.28(6)(a). The City acknowledges that Counter–Plaintiffs sent such notices (Exhibit C to Motion to Dismiss—DE 29–3), but argue that the notices are insufficient because they lack the dates of when the alleged conduct of the City occurred. The Notices do state that injuries were suffered because of the City's imposition of excessive fines for the sole purpose of depriving them of their property by foreclosure and demolition, and that the constitutional claims are based upon § 1983, with additional claims for slander of title and nuisance. Under federal law, the presuit notice requirement does not apply to § 1983 claims, Majette v. O'Connor, 811 F.2d 1416, 1418 (11th Cir.1987), but could apply to the state common law claims.

The City asserts that the failure to include specific dates in the notices means that the notices were not filed within three years of the alleged...