850 F.

2d 1483

A.A. PROFILES, INC., Plaintiff-Appellant,

v.
CITY OF FT. LAUDERDALE, et al., Defendants-Appellees.
No. 87-5219.

United States Court of Appeals,

Eleventh Circuit.
Aug. 1, 1988.

Philip M. Cullen, III, Ft. Lauderdale, Fla., for plaintiff-appellant.

Robert H. Schwartz, Ft. Lauderdale, Fla., for defendants-appellees.
Appeal from the United States District Court for the Southern District of
Florida.
Before FAY and VANCE, Circuit Judges, and HOFFMAN* , Senior
District Judge.
VANCE, Circuit Judge:

A.A. Profiles, Inc. filed suit against the City of Fort Lauderdale and the
members of the City Commission, individually and in their official capacity
(collectively "the City"), seeking relief under 42 U.S.C. Sec. 1983 1 for the
taking of property without just compensation in violation of the fifth
amendment and the deprivation of property without due process in violation of
the fourteenth amendment. The case proceeded to a non-jury trial on the issue
of liability only. At the conclusion of the plaintiff's case the district court
granted a motion for dismissal under Fed.R.Civ.P. 41(b). The district court
found no taking and no denial of substantive or procedural due process because
appellant did not avail itself of state remedies. We reverse the district court's
judgment and remand.

I.
2

In 1979 appellant contracted to purchase a twenty-eight acre tract of land in the

northwest section of Fort Lauderdale, Florida. The land was zoned M-1, the
city's least restrictive industrial and manufacturing classification. Because
appellant planned to operate a wood-chipping business on the site, the sales
contract was conditioned on the City's approval of the proposed development.
3

As its first step in the approval process, appellant submitted its proposal to the
City's Planning and Zoning Department. The proposal was reviewed and
approved initially by several city and county agencies. The proposal submitted
to the Planning and Zoning Department provided that a ten foot concrete wall
would be built around the entire site. After a public hearing, the Planning and
Zoning Department voted to recommend that the City Commission approve the
development. The City Commission held a public hearing on December 4,
1979 and unanimously passed Resolution No. 79-440 approving the woodchipping development planned by appellant.

Having obtained the necessary approvals, appellant completed the purchase of

the land, obtained building permits and commenced construction on the land.
Thereafter appellant asked the City's Chief Building Inspector if it could begin
receiving organic materials in order to relieve some cash flow problems.
Although the wall was not completed, the Inspector approved this activity, but
warned appellant that if there were any complaints the activity would have to
cease. Advertising the development as "Le Dump," appellant began to receive
and store materials.

The city began receiving complaints from area residents and on April 22, 1980
the Chief Zoning Inspector ordered the project stopped on the grounds that the
plans used for permitting purposes were not the same as the plans approved by
the Planning and Zoning Board and the City Commission. At the same time the
city manager ordered appellant to cease operations after an inspection had
revealed that appellant was operating an illegal dump. Due to the new
developments the City Commission held a public hearing on May 6, 1980 to
address the growing concerns. At the meeting the City Commission voted to
"temporarily suspend" the approval of the development granted by Resolution
No. 79-440. The next day a "stop work" order was posted on the project by the
Director of Building and Zoning.

At a subsequent hearing on July 1, 1980 the City Commission again addressed

the wood-chipping operation and asked the city attorney to draft a resolution to
modify the original resolution. The proposed resolution was submitted to the
City Commission at a public hearing on July 30, 1980.2 Once again numerous
residents voiced their opposition to the project and hinted that violence might
ensue if the City Commission permitted the project to proceed. The discussion

ended shortly after appellant announced that it would not proceed with the
project until it clarified its legal position with the City.
7

Although open to reasonable alternatives appellant subsequently requested the

City to "cease its attempts to make the continuance of this project unfeasible"
and demanded damages for losses. On March 10, 1981 the City Commission
unanimously passed Ordinance No. C-81-16 rezoning the site from M-1 to B-3C, light industrial use. Ultimately, appellant became unable to meet expenses
and the lenders foreclosed on appellant's property.

II.
8

In order to prevail in an action under 42 U.S.C. Sec. 1983, a plaintiff must show
a constitutional violation. See Rymer v. Douglas County, 764 F.2d 796, 800
(11th Cir.1985). Appellants in this case allege that the City's actions violated
the constitutional prohibition against taking private property without just
compensation and the constitutional requirement of procedural due process.

The fifth amendment provides that "private property [shall not] be taken for
public use, without just compensation." The fifth amendment applies to the
states through the fourteenth amendment. See First English Evangelical
Lutheran Church of Glendale v. County of Los Angeles, --- U.S. ----, 107 S.Ct.
2378, 2383 n. 4, 96 L.Ed.2d 250 (1987); Chicago, B. & Q.R. Co. v. City of
Chicago, 166 U.S. 226, 241, 17 S.Ct. 581, 586, 41 L.Ed. 979 (1897); Fountain
v. Metropolitan Atlanta Rapid Transit Auth., 678 F.2d 1038, 1040 n. 4 (11th
Cir.1982). This amendment "does not prohibit the taking of private property,
but instead places a condition on the exercise of that power." First English
Evangelical Lutheran Church, 107 S.Ct. at 2385; Hodel v. Virginia Surface
Mining & Reclamation Ass'n, Inc., 452 U.S. 264, 297 n. 40, 101 S.Ct. 2352,
2371 n. 40, 69 L.Ed.2d 1 (1981).

10

The Supreme Court has recognized that a taking may occur where a
governmental entity exercises its power of eminent domain through formal
condemnation proceedings, see, e.g., Berman v. Parker, 348 U.S. 26, 75 S.Ct.
98, 99 L.Ed. 27 (1954), or where a governmental entity exercises its police
power through regulation which restricts the use of property. See Nollan v.
California Coastal Comm'n, --- U.S. ----, 107 S.Ct. 3141, 97 L.Ed.2d 677
(1987); Kaiser Aetna v. United States, 444 U.S. 164, 178, 100 S.Ct. 383, 392,
62 L.Ed.2d 332 (1979); Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 415,
43 S.Ct. 158, 160, 67 L.Ed. 322 (1922). In the latter situation the government
regulation must "substantially advance" a "legitimate state interest" or deprive
an owner of an economically viable use of the land. Keystone Bituminous Coal

Ass'n v. DeBenedictis, 480 U.S. 470, 107 S.Ct. 1232, 1242, 94 L.Ed.2d 472
(1987); Nollan, 107 S.Ct. at 3146; Agins v. City of Tiburon, 447 U.S. 255, 260,
100 S.Ct. 2138, 2141, 65 L.Ed.2d 106 (1980). "[I]f regulation goes too far it
will be recognized as a taking." Pennsylvania Coal Co., 260 U.S. at 415, 43
S.Ct. at 160.
11

On numerous occasions the Supreme Court has noted that a takings claim based
on the application of a governmental regulation "is not ripe [for adjudication]
until the government entity charged with implementing the regulations has
reached a final decision regarding the application of the regulations to the
property at issue." Williamson County Regional Planning Comm'n v. Hamilton
Bank, 473 U.S. 172, 105 S.Ct. 3108, 3117, 87 L.Ed.2d 126 (1985); see
MacDonald, Sommer & Frates v. Yolo County, 477 U.S. 340, 106 S.Ct. 2561,
2566, 91 L.Ed.2d 285 (1986); San Diego Gas & Elec. Co. v. City of San Diego,
450 U.S. 621, 101 S.Ct. 1287, 67 L.Ed.2d 551 (1981); Agins, 447 U.S. at 260,
100 S.Ct. at 2141; Anthony v. Franklin County, 799 F.2d 681, 683-84 (11th
Cir.1986). This finality requirement is necessary so that the court can evaluate
the "economic impact" and the extent of interference with "reasonable
investment-backed expectations" by the challenged state action. Williamson
County, 105 S.Ct. at 3119. A plaintiff also must establish that "no adequate
state remedy, such as inverse condemnation, is available to redress the injury
occasioned by the final decision." Corn v. City of Lauderdale Lakes, 816 F.2d
1514, 1516 (11th Cir.1987); see also Williamson County, 105 S.Ct. at 3121 (a
property owner cannot claim a violation of the Just Compensation Clause until
the property owner has used the state procedure for obtaining compensation and
been denied).

12

Appellant asserts that the temporary suspension action by the City Commission
amounts to a regulatory taking and that the state does not provide an adequate
procedure for seeking just compensation. The City does not dispute appellant's
contention that no state remedy is available to address the alleged injury,3 but
maintains that the City Commission never reached a final decision with respect
to appellant's property. The City argues that there was no final decision because
appellant never completed the wall that was a condition precedent to
commencing business.

13

We believe that this case is ripe for adjudication. The City not only decided to
temporarily suspend the project's approval granted by Ordinance No. 79-440
and the building permits, but it also passed an ordinance rezoning appellant's
property approximately nine months later. As in Corn, the temporary
suspension of the enabling resolution and the rezoning ordinance put a
"complete moratorium" on the development. 816 F.2d at 1516. Appellant could

not proceed with the construction of the wall because of the stop work order.
The City therefore made it impossible for appellant to fulfill the condition
precedent on which the City insisted. The rezoning ordinance4 undeniably
constituted a final, definitive position.5
14

The City argues that the South Florida Building Code establishes an appellate
procedure whereby an aggrieved property owner may appeal a stop work order
and the revocation or suspension of a permit to the Board of Rules and Appeals
and then ultimately, by certiorari, to the Circuit Court of Broward County. The
City claims that appellant should have exhausted these available state remedies
before filing this section 1983 action.

15

"The question whether administrative remedies must be exhausted is

conceptually distinct, however, from the question whether an administrative
action must be final before it is judicially reviewable." Williamson County, 105
S.Ct. at 3119. The powers of the Board of Rules and Appeals enumerated in the
South Florida Building Code include the power to interpret the code, review
decisions by building officials on matters regulated by the code, take certain
actions with respect to unsafe buildings and suspend or revoke permits issued
under the code. While the Board of Rules and Appeals is empowered to review
the propriety of a stop work order, the Board does not have the power to
overrule the City's zoning decision. Because the rezoning ordinance was a final
decision by the City with respect to appellant's property and because the Board
does not review the City's zoning decisions, we now address the merits of the
takings claim.

16

For there to be a taking in this case the City's action must have failed to
substantially advance a legitimate state interest. A government regulation will
constitute a taking if it is "not reasonably necessary to the effectuation of a
substantial public purpose...." Penn Cent. Transp. Co. v. City of New York, 438
U.S. 104, 127, 98 S.Ct. 2646, 2660, 57 L.Ed.2d 631 (1978). This court found a
regulatory taking in violation of the Constitution in Wheeler v. City of Pleasant
Grove, 664 F.2d 99 (5th Cir. Unit B Dec.1981), cert. denied, 456 U.S. 973, 102
S.Ct. 2236, 72 L.Ed.2d 847 (1982). In Wheeler a property owner obtained a
permit from the city to construct an apartment complex. The permit was issued
pursuant to a city ordinance. The property owner began construction on the site
in reliance on the permit. Local residents opposed the development, and after a
referendum the city passed a new ordinance forbidding the construction of new
apartments. The new ordinance "prohibited the plaintiffs from proceeding with
the construction." Id. at 100. This court affirmed the district court's finding that
the issuance of the new ordinance was "arbitrary and capricious" and "a
confiscatory measure" violative of the developer's fourteenth amendment

rights. Id.
17

Wheeler is indistinguishable from this case.6 The original resolution granted

appellant a property interest. The rezoning ordinance denied appellant this
property interest because the new classification did not accommodate a
development like the wood-chipping operation. The City Commission's action
therefore was a confiscatory measure. "[I]f a regulatory undertaking is
confiscatory in nature, it is a taking." Id. at 100. We note also that although the
taking did not occur simply because appellant expended a great amount of
money to begin the project, this expenditure in reliance on the resolution
underscores the importance of the original resolution.7

18

The City argues that the Supreme Court has held that land use regulations
which promote health, safety, moral or general welfare must be upheld. See
Penn Central, 438 U.S. at 125, 98 S.Ct. at 2659. Based on appellant's
acceptance of refuse and the numerous complaints and threats of violence by
area residents, the City asserts that the district court correctly held that the City
properly exercised its police power in stopping work on the project. Appellant
admits that it violated Resolution No. 79-440 by receiving inorganic materials.
Appellant maintains, however, that assuming the public complaints were
justified, criminal and civil remedies were available to solve any public health
problems. Indeed, the city attorney recommended several alternatives to the
City Commission at one of its early meetings.8 While local regulations may
have been violated, the City cannot cure such violations with a measure that
violates the Constitution. As Justice Holmes stated in Pennsylvania Coal Co. v.
Mahon, "a strong public desire to improve the public condition is not enough to
warrant achieving the desire by a shorter cut than the constitutional way of
paying for change." 260 U.S. at 416, 43 S.Ct. at 160. In light of the variety of
avenues available to the City, its action was impermissible.9 III.

19

We therefore reverse the district court's finding that there was no taking and
remand for further proceedings.

20

REVERSED and REMANDED.

Honorable Walter E. Hoffman, Senior U.S. District Judge for the Eastern
District of Virginia, sitting by designation

The complaint also sought relief under sections 1981 and 1988, and various
common law theories. The section 1981 claim was not pursued

The proposed resolution required that a buffer zone be established along all
sides of the property and that the wall be built before the commencement of
operations. In addition, the proposal required that the wood-chipping machine
be operational prior to the acceptance of materials
"If the government has provided an adequate process for obtaining
compensation, and if resort to that process 'yield[s] just compensation,' then the
owner 'has no claim against the Government for a taking.' " Williamson
County, 105 S.Ct. at 3121 (quoting Ruckelshaus v. Monsanto Co., 467 U.S.
986, 1018 n. 21, 104 S.Ct. 2862, 2881 n. 21, 81 L.Ed.2d 815 (1984) ).
Appellant argues that Florida law fails to provide a means for obtaining just
compensation for a regulatory taking. In Corn we held that under Florida law
the exclusive remedy available to a property owner challenging a zoning
ordinance was a suit to invalidate the zoning ordinance and enjoin its
enforcement. 816 F.2d at 1517. We concluded that because an action to recover
just compensation is not available under Florida law to a property owner injured
as a result of an invalid zoning ordinance, the property owner's section 1983
action was ripe for review. Id. at 1519, 1520
The Florida Supreme Court recently held in an inverse condemnation action
that a taking occurred when the state destroyed healthy trees. Department of
Agric. & Consumer Servs. v. Mid-Florida Growers, Inc., 521 So.2d 101
(Fla.1988). The court stated that although the action was a valid exercise of
police power, full and just compensation was due to the nursery owners. Id. at
105. Implicit in the court's holding is a determination that a property owner
may bring an inverse condemnation suit for the valid exercise of police power
which results in a taking. We do not believe, however, that Mid-Florida
Growers provides that an action for inverse condemnation is available to
property owners for recovering just compensation for injuries sustained as a
result of a zoning ordinance. While the question certified to the Florida
Supreme Court characterized the state action as an exercise of police power,
Mid-Florida Growers involved the destruction of trees, which is better
described as an exercise of the right of eminent domain. The Corn court, after
reviewing several Florida court decisions, concluded that zoning matters were
"entirely distinct" from the availability of inverse condemnation suits in the
context of the exercise of eminent domain power under Florida law. 816 F.2d at
1519. We therefore do not believe that Mid-Florida Growers should be
extended to the facts of this case. Accordingly, absent the ability to recover
money damages under Florida law, appellant's action is ripe for our review.

The City's effort to characterize the May 6 suspension as "temporary" is

questionable as well. As the district court noted, the temporary suspension "in
effect became permanent" because "there was no lifting of the suspension."

A representative of Landmark First National Bank of Fort Lauderdale, the

second mortgage holder on appellant's project, testified at the rezoning hearing
that the first mortgage on appellant's property was in foreclosure and
foreclosure on the second mortgage was imminent. The first foreclosure was
not final until March 23, 1981. Thus while foreclosure proceedings were in
progress at the time of rezoning, technically appellant was the property owner
who was injured as a result of the taking

Appellees attempt to distinguish Wheeler by arguing that in Wheeler the public

opposed the project originally approved by the city, whereas in this case
adverse public sentiment arose due to a change in the proposed use, which led
to the City's reappraisal of the project and issuance of the stop work order. We
believe that this distinction is irrelevant. In each case a taking occurred with the
passage of a new ordinance which in essence repealed the city's prior approval
of a development

We reject appellant's contention that the City did not have the authority to
amend the ordinance and to require that the wall be completed before the
operations began. Because the wall was included in appellant's proposal,
appellant is estopped from preventing the City from amending the resolution to
reflect this understanding

Citing Hollywood Beach Hotel Co. v. City of Hollywood, 329 So.2d 10

(Fla.1976), and Sakolsky v. City of Coral Gables, 151 So.2d 433 (Fla.1963),
the city attorney concluded in a May 2, 1980 communication to the city
commissioners that appellant had acquired a vested right to proceed with the
wood-chipping development. According to the minutes of the May 6 public
hearing, the city attorney suggested that although appellant had a right to
proceed with the planned development, the operation of a dump, which was
feared by area residents, "could result in criminal penalties ... which could
serve as the basis for an injunction or civil remedy."

Appellant also maintains that it was deprived of procedural due process in

violation of the fourteenth amendment. Appellant states that the "commission
meeting of May 6, 1980 was, at best, government by applause meter conducted
in wholesale defiance of the state law mandated procedures for legitimate
Commission action." It is unclear from the district court's opinion whether it
considered this claim. We therefore will not address the merits of this claim