Woodwind Estates v. Gretkowski

• Decision Date: 28 February 2000
• Docket Number: No. 99-3280,99-3280
• Citation: 205 F.3d 118
• Parties: (3rd Cir. 2000) WOODWIND ESTATES, LTD., Appellant v. W. J. GRETKOWSKI; LARRY SEBRING; JAMES DECKER, Individually, and in their capacity as Supervisors of Stroud Township; W. TAYLOR WENCK; EDWARD CRAMER; FRANK HERTING; JOAN KEIPER, Individually, and as members of the Planning Commission of Stroud Township; STROUD TOWNSHIP, MONROE COUNTY, PENNSYLVANIA
• Court: U.S. Court of Appeals — Third Circuit

Page 118

205 F.3d 118 (3rd Cir. 2000)

WOODWIND ESTATES, LTD., Appellant v. W. J. GRETKOWSKI; LARRY SEBRING; JAMES DECKER, Individually, and in their capacity as Supervisors of Stroud Township; W. TAYLOR WENCK; EDWARD CRAMER; FRANK HERTING; JOAN KEIPER, Individually, and as members of the Planning Commission of Stroud Township; STROUD TOWNSHIP, MONROE COUNTY, PENNSYLVANIA

No. 99-3280

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

Argued December 7, 1999

Decided February 28, 2000

On Appeal from the United States District Court for the Middle District of Pennsylvania (D.C. Civil No. 97-cv-00472) District Judge: Honorable James F. McClure, Jr. [Copyrighted Material Omitted]

Counsel for Appellant: Marshall E. Anders, Esq. (Argued) 802 Main Street Stroudsburg, PA 18360

Counsel for Appellees: Eugene F. Hickey, II, Esq. (Argued) Schneider, Gelb, Goffer & Hickey 400 Spruce Street, Suite 500 Scranton, PA 18503

Before: SLOVITER, ROTH and COWEN, Circuit Judg es

OPINION FOR THE COURT

COWEN, Circuit Judge.

This appeal is a civil rights action under 42 U.S.C.S 1983 brought by plaintiff Woodwind Estates, Ltd. (Woodwind) against defendants Stroud Township (the "Township") and individual officers of the Township. The suit emanated from the failure of the Township to approve development plans for specific property. The central issue on appeal is whether the District Court properly granted defendants' motion for judgment as a matter of law on Woodwind's S 1983 substantive due process claim. Because we find that the District Court erred in granting this motion, we will reverse and remand for further proceedings.

Woodwind is a Pennsylvania limited partnership which at all times relevant to this action sought to build a subdivision development on seventy-five acres in Stroud Township, Pennsylvania. In August 1995, Woodwind was awarded approximately $1.1 million in federal low income housing tax credits by the Pennsylvania Housing Finance Agency ("PHFA") for developing an "affordable housing" project. The project was to consist of one hundred single family homes for low income families. In order to retain the federal income tax credits, PHFA required Woodwind to complete the project by December 31, 1997. Woodwind sought to obtain subdivision approval for the project pursuant to the Township's Subdivision and Land Development Ordinance ("SALDO").

Woodwind's first step in the approval process was the submission of a preliminary development plan ("the Plan"). On March 18, 1996, it submitted the Plan and supporting information to the Township. Pursuant to the Township's ordinance the Plan was evaluated initially by the Stroud

Township Planning Commission. The Planning Commission was to issue an advisory opinion to the Board of Supervisors which in turn would make the final decision regarding approval.

At a meeting on March 27, 1996, the Planning Commission first considered the Plan. At the meeting, the attorney for the Planning Commission advised the Commission that the Plan satisfied the criteria for approval as a subdivision.

The March 27, 1996, meeting also was attended by a citizens group known as the "Concerned Neighbors of Woodwind Estates" who opposed the project because they did not want low-income residents living in the neighborhood. The citizens group was represented at the meeting by a private attorney, Marc Wolfe. On behalf of the citizens group, Wolfe urged the Planning Commission to deny approval for the Preliminary Plan insisting instead that Woodwind seek approval for the project as a planned unit development ("PUD"). The requirements for approval of a PUD are more onerous, stringent, and time-consuming than the requirements for subdivision approval.

During the course of the meeting on March 27, 1996, members of the Planning Commission echoed the concerns of the citizens group about the income-level and the socioeconomic background of prospective tenants from the Woodwind project, and the potential adverse economic effects of the project on local property values. None of these concerns, however, are conditions for subdivision approval under the Township's ordinance.

On March 27, 1996, the Planning Commission advised Woodwind that it would not review the Preliminary Plan because it was an "incomplete submission" lacking certain technical information. App. at 690. Woodwind thereafter submitted a revised Preliminary Plan ("the Revised Plan") which contained the requested information.

At a meeting on April 24, 1996, the attorney for the Planning Commission advised the Commission that the Revised Plan met the criteria for subdivision approval. Nevertheless, attorney Wolfe urged the Planning Commission to deny approval for the Revised Plan, again insisting that Woodwind obtain approval for the project as a PUD rather than as a subdivision.

The Planning Commission took no action on the Revised Plan for approximately six months. Finally, on October 30, 1996, the Planning Commission voted 4-2 to recommend to the Board of Supervisors to deny approval of the Revised Plan.

The Board of Supervisors adopted the recommendation of the Planning Commission voting unanimously to deny approval. Shortly after the vote, the Board of Supervisors issued a written notice denying approval, which notice gave no reason to Woodwind for the denial. Attorney Wolfe contacted a member of the Board of Supervisors and advised him that the Board's denial letter was legally inadequate because it did not state any reason for the decision.

Following the above conversation, Wolfe himself drafted a second letter of denial which he sent to the Board of Supervisors but not to Woodwind setting forth the alleged violations or shortcomings of the Revised Plan. Quite obviously Woodwind was not even in a position to respond to Wolfe's letter. Relying heavily upon significant portions of the denial letter drafted by Wolfe, the attorney for the Board of Supervisors subsequently sent a letter dated November 27, 1996, notifying Woodwind of the reasons for the denial. The letter included as the primary reason for the denial the exact same reason which Wolfe previously had proposed in his draft: "The Board of Supervisors considers the above application to constitute a Planned Unit Development in that the project includes residential units located on a tract of land at least 50 acres in size which is planned for development in its entirety under single ownership or control." App. at 707.

After the Revised Plan was denied, Woodwind determined that it was impossible to complete the project by the December 1997 deadline. When Woodwind could not meet the deadline, PHFA subsequently withdrew financing and the project was canceled.

Woodwind initiated this action by filing a complaint in United States District Court for the Middle District of Pennsylvania alleging that the defendants unlawfully denied its application for a planned real estate subdivision. Named as defendants were Stroud Township and seven individual defendants who are members of the Planning Commission and Board of Supervisors. Woodwind brought suit under 42 U.S.C. SS 1983 (Count 1), 1981 (Count 2), 1985 (Count 3), and various supplemental state law claims (Counts 4-6).

Before submitting the case to the jury, the District Court granted defendants' motion for judgment as a matter of law under Rule 50(a) of the Federal Rules of Civil Procedure. The District Court subsequently issued a memorandum explaining its dismissal of Woodwind's S 1983 substantive due process claim.

Woodwind appeals only the dismissal of its S 1983 substantive due process claim. We will reverse and remand for further proceedings.

We exercise plenary review of an order granting or denying a motion for judgment as a matter of law and apply the same standard as the District Court. See Lightning Lube, Inc. v. Witco Corp., 4 F.3d 1153, 1166 (3d Cir. 1993). "The question is not whether there is literally no evidence supporting the party against whom the motion is directed but whether there is evidence upon which the jury could properly find a verdict for that party." Patzig v. O'Neill, 577 F.3d 841, 846 (3d Cir. 1978) (citation omitted) (quotation omitted). Such a motion should be granted only if, viewing the evidence in the light most favorable to the nonmovant and giving it the advantage of every fair and reasonable inference, there is insufficient evidence from which a jury reasonably could find liability. See Lightning Lube, 4 F.3d at 1166.

Substantive due process "is an area of the law `famous for its controversy, and not known for its simplicity.' " DeBlasio v. Zoning Bd. of Adjustment, 53 F.3d 592, 598 (3d Cir. 1995) (quoting Schaper v. City of Huntsville, 813 F.2d 709, 716 (5th Cir. 1987)). On the one hand, federal courts are reluctant to sit as appeal boards for disputes between land developers and a Township's planning body. On the other hand, developers have a due process right to be free from "arbitrary and irrational zoning actions." Arlington Heights v. Metropolitan Housing Corporation, 429 U.S. 252, 263 (1973). During the past decade this court has been called upon quite frequently to grapple with the obvious tension between these two principles in a line of substantive due process cases. See, e.g., Blanche Road Corp. v. Bensalem Twp., 57 F.3d 253 (3d Cir. 1995); DeBlasio v. Zoning Bd. of Adjustment, 53 F.3d 592 (3d Cir. 1995); Parkway Garage v. Philadelphia, 5 F.3d 685 (3d Cir. 1993); Midnight Sessions, Ltd. v. City of Philadelphia, 945 F.2d 667 (3d Cir. 1991); Bello v. Walker, 840 F.2d 1124 (3d Cir. 1988).

The Fourteenth Amendment provides, in part, that "no State [shall] deprive any person of life, liberty, or property without the due process of law . . . ." U.S. Const. amend XIV, S 1. To prevail on a substantive due process claim under S1983, a plaintiff must establish as a threshold matter that he has a protected property interest to which the Fourteenth Amendment's due process protection...