Lead Opinion
ON REHEARING EN BANC
Appellants challenge the constitutionality of the District’s Rental Housing Conversion and Sale Act, D.C.Code §§ 45-1601 et seq. (1986 and 1988 Supp.) (hereinafter the RHCSA or the Act). This statute provides in substance that an owner of rental housing may not convert it to condominium use unless fifty per cent of the eligible tenants consent to such conversion. We uphold the validity of the tenant consent requirement and reject the contention that it constitutes an improper delegation of legislative authority. We perceive little, if any, legal basis for the appellants’ alternative conten
I
Appellants own the Savoy, a 203-unit apartment complex in northwest Washington. For many years, they have sought to convert the Savoy into a condominium. In May, 1981, they filed this action in the Superior Court against the Mayor and other District of Columbia officials (the District), alleging that the defendants had unlawfully denied their application for conversion, in violation of their statutory and constitutional rights. In January, 1983, Judge John F. Doyle granted the District’s motion for summary judgment and dismissed all of the owners’ claims.
The owners appealed to this court. On September 11, 1987, a three-judge panel affirmed Judge Doyle’s dismissal of the owners’ statutory claims, but held that the tenant consent requirement constitutes an improper delegation of legislative authority and deprives the owners of property without due process of law. The panel found that there was a genuine issue' of material fact which precluded the entry of summary judgment as to the uncompensated taking claim and remanded for further development of that issue. Hornstein v. Barry,
As this case was proceeding towards resolution, similar contentions regarding the RHCSA were being considered a few blocks away by our federal appellate colleagues. On May 3, 1988, in a suit brought by a different group of owners, a three-judge panel of the United States Court of Appeals dismissed a number of statutory and constitutional claims, some of them identical to those urged upon us in the present case. Silverman v. Barry,
II
The RHCSA forbids the conversion of a rental apartment complex into condominium units unless the Mayor certifies that a majority of the tenants qualified to vote
In enacting the RHCSA, the Council made a number of findings, summarized below, in which it explained the need for the legislation. According to the Council, there exists a continuing housing crisis in
In § 45-1602, the Council enumerated the purposes of the legislation, which parallel and complement the legislative findings summarized above. The Act was designed, among other things,
[t]o discourage the displacement of tenants through conversion or sale of rental property, and to strengthen the bargaining position of tenants toward that end without unduly interfering with the rights of property owners to the due process of law.
§ 45-1602(1).
The comprehensiveness and specificity of the Council’s findings compel us to conclude that the District confronted a serious problem which the Council had the right and duty to address. The question is whether the means by which the Council addressed it are constitutional.
Ill
A. Presumption of Constitutionality.
Our Constitution is the supreme law of the land, and at least since Marbury v. Madison,
Laws adjusting the burdens and benefits of economic life come to the courts
We emphasize that mere lip service to the presumption of constitutionality is insufficient, especially where, as in the present case, the legislation under attack addresses issues which are traditionally a proper subject for the exercise of the police power. Accordingly, the owners must make a very compelling showing indeed before this court may invalidate the RHCSA without impermissibly encroaching upon legislative prerogatives.
B. Delegation, Standardlessness, and Due Process.
Although they acknowledge the applicability of the presumption of constitutionality, the owners contend that the tenant consent requirement impermissibly delegates legislative authority to private citizens. They claim, in effect, that the RHCSA relegates their right to use their property as they see fit to the caprice of tenants who are free to act to promote their own private advantage rather than in the public interest. They argue that no standards are provided for the granting or withholding of consent, so that a majority of the tenants can bar conversion for a good reason, a capricious reason, a selfish reason, or no reason at all. This standard-lessness, say the owners, renders the legislation unconstitutional and denies them property without due process of law.
It cannot be gainsaid that, under this statutory scheme, a tenant majority may act arbitrarily, and that there is no objective standard to which they must conform. Indeed, the Council, by making it an explicit purpose of the Act to strengthen the bargaining power of tenants,
These criticisms of the Act may be thought plausible or persuasive, and perhaps the give and take of the political process has, in this instance as in others, produced less than perfect legislation. Perfection, however, is neither constitutionally required
Allowing a group of intended beneficiaries of legislation to waive its protection is not an impermissible delegation of legislative functions to private decision-makers. “An otherwise valid regulation is not rendered invalid simply because those whom the regulation is designed to safeguard elect to forgo its protection.” New Motor Vehicle Board v. Orrin W. Fox Co.,
Cusack, on which Judge Doyle relied in this case in granting judgment for the District, upheld an ordinance prohibiting construction of billboards in residential areas without the consent of a majority of property owners in the affected blocks. The Court held that the City had not impermis-sibly delegated its legislative authority to private citizens by permitting the prohibition against erection “to be modified with the consent of the persons who are most affected by such modification.” Id. at 531,
Of course, before private persons may legislatively acquire any say with respect to property belonging to others, the legislative regulation must itself be “otherwise valid” in the sense that its provisions must serve a legitimate governmental function.
The distinction between Cusack on the one hand and Roberge and Eubank v. City of Richmond,
C. Uncompensated Taking.
The owners claim that by enacting the RHCSA and the rent control laws, and by effecting “delays through the use of illegal ordinances,” the District has taken their property for public use without just compensation, in violation of the Fifth Amendment. Judge Doyle’s order granting the District summary judgment did not explicitly address this issue. The panel found dismissal of the taking claim on the pleadings to be premature, because resolution of the issue requires an “essentially ad hoc factual inquiry.”
To prove a taking under the Fifth Amendment, it is not necessary to demonstrate that the property was “taken” in the narrow sense of the word, nor need the government have directly appropriated the title, possession, or use of the property. Richmond Elks Hall Assn. v. Richmond Redevelopment Agency,
These principles have been applied to situations similar to the one that confronts us here. In Griffin Development Co. v. City of Oxnard, supra, the Supreme Court of California upheld, against a Fifth Amendment challenge, a regulation which effectively prohibited condominium conversion. The court noted that the owner was “free to continue to rent its apartments, unaffected by the ordinance; the regulations apply only to its plans to convert the apartments to condominiums.”
In the present case, as in Griffin, supra, the owners are free to continue to use the Savoy as rental property. They complain in conclusory fashion that the District’s rent control laws promote expropriation, but the Supreme Court declined, only last term, to reconsider Block v. Hirsh,
We conclude, however, that the procedural posture of the litigation precludes its final disposition on this appeal. The case came before Judge Doyle on the District’s motion for summary judgment. • The District’s statement, pursuant to Super.Ct. Giv.R. 12-I(k), of material facts as to which there was alleged to be no genuine issue, focused entirely on the owners’ statutory claims, and did not address the factual context of the issue of uncompensated taking. The owners’ statement of what they claimed to be genuine disputed issues of material fact, filed in response to the motion and in compliance with the same Rule, also addressed the statutory claims alone. Accordingly, the record as to uncompensated taking is deficient, which is problematical in a situation in which, as the panel noted, an ad hoc case by case inquiry is called for.
The District contends, and we agree, that the owners bear the burden of proof to establish an unconstitutional taking. The District goes on to argue that the owners, having access to the relevant evidence, presented nothing to the trial court which would demonstrate the unavailability of alternative economic uses for the property. The owners having failed to establish that material facts were at issue, says the District, summary judgment followed “as a matter of course.”
The problem with the District’s argument, however, is that although the owners bear the ultimate burden with respect to the substantive issue, the party seeking summary judgment has the burden of showing that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. Super.Ct.Civ.R. 56(c). In the present posture of the case, with the District’s Rule 12-I(k) statement devoted to other matters, we apprehend that the owners were not fully and fairly put on notice that they were required to submit affidavits or other materials from which the court might find that a genuine issue of material fact exists. For all practical purposes, they were given no factual material to which to respond.
Accordingly, in order to ensure that the owners do not forfeit a constitutional claim as a result of a procedural focus by both sides on other matters, we remand the case to the Superior Court for further proceedings with respect to the uncompensated taking claim. In light of the possibility that this claim lacks substance, we suggest, but do not require, that in lieu of proceeding to trial, the parties be permitted to supplement their submissions in support of and in opposition to the motion for summary judgment and to provide affidavits or other materials relevant to the question whether there was an unconstitutional taking. Further consideration may be given to that motion after this has been accomplished.
IV
The judgment is affirmed with respect to the owners’ statutory and due process claims. The case is remanded to the Superior Court for further proceedings consistent with this opinion with respect to the uncompensated taking claim.
So ordered.
Notes
. Qualifications for ■ voting are governed by § 45-1612(d). Basically, a head of household may vote if he has lived in the accommodation at least 90 days before the election and is not and has not recently been an employee of the owner.
. The owners’ statutory claims are grounded in •this history of restrictions and in the invalidation of one emergency measure in District of Columbia v. Washington Home Ownership Council, Inc.,
.For other aspects of this regulatory scheme, see, e.g., §§ 45-2501 (rent control); 45-2531 (tenant assistant); 45-2551 (eviction controls).
. To the purist who winces when Latin is misused, the plural of condominium is condominia.
. The courts of this jurisdiction have also long adhered to the doctrine that statutes are not to be pronounced unconstitutional on the basis of “slight implication and vague conjecture,” and that the opposition between the Constitution and law must be such "that the judge feels a clear and strong conclusion of their incompatibility with each other.” Thompson v. Riggs,
. Another stated purpose of the legislation is "to encourage the formation of tenant organizations.” § 45-1602(6).
. “The demand for perfection must inevitably compromise with the hard facts of political life." Vance v. Bradley, supra,
. Given the Council’s stated purposes, we know of no flawless legislative solution that would achieve all of them. The Council could have made the ban on conversion absolute, see Griffin Development Co. v. City of Oxnard,
. We think that in the present case the tenant consent provision, like its functional counterpart in Cusack, probably inures to the benefit of the owners rather than to their disadvantage. The RHCSA contains a very broad severability clause, § 45-1663, which directs that if any "provision, section, clause, phrase or word" is held invalid, the remainder of the Act shall not be affected. See abo Gary v. United States,
. In Eubank, which was decided before Cu-sack, the Court struck down as fatally lacking in standards an ordinance which directed a municipal agency to prohibit construction of buildings beyond a certain line if two thirds of the abutting landowners requested it.
. See, e.g., the panel decision in the present case,
. See, e.g., Note, The Validity of Ordinances Limiting Condominium Conversions, 78 Mich.L. Rev. 124 (1979). Drawing upon a level of certitude as to who knows best which is often directly proportional to youth but inversely proportional to experience, the student editors allude contemptuously to the "fatuousness" of a distinction which the Supreme Court justices almost unanimously found persuasive. Id. at 137-38.
. As the court explained in Silverman, supra,
In order for a legislative delegation to private citizens to survive a due process challenge, t e. <rourt instructs that two criteria must be satisfied. First, the underlying exercise of authority must be a reasonable regulation within the power of the government. Cusack,242 U.S. at 528 ,37 S.Ct. at 190 . Second, the legislature’s restriction must be in the form of a general prohibition, and the delegation must be in the form of permitting private citizens to waive the protection of that prohibition. Id. at 531,37 S.Ct. at 192 ....
The court held, and we agree, that the RHCSA meets each prong of this test because "[t]he interest of a municipality in the conversion of its apparent stock to condominiums and cooperatives cannot be gainsaid,” and because “[i]ts tenant election provision is phrased as a blanket prohibition that can be overcome through a tenant election.” Id. at 342,
. Both New Motor Vehicle Board v. Orrin W. Fox Co., supra and Eastlake v. Forest City Enterprises, Inc.,
. Although only a decision of the Supreme Court of the United States is binding on us, even with respect to a federal constitutional issue, we believe that we should treat Silverman as per
Concurrence Opinion
concurring in part and dissenting in part:
I join in so much of the judgment of the court as holds constitutionally valid the tenant consent part of the statute. I dissent from the remand on the “taking” issue. Given the fact that Hornstein’s complaint did not allege an unconstitutional uncompensated taking (as distinguished from the tenant consent issue) it is not surprising to me that the District did not move for summary judgment on that question. In his opposition to summary judgment, Horn-stein never raised this as an issue. Thus, it
Concurrence Opinion
with whom TERRY, Associate Judge, joins, concurring and dissenting:
I concur in Part III C (“Uncompensated Taking”) of the opinion for the court, but I respectfully dissent from Part III B (“Delegation, Standardlessness, and Due Process”) for the reasons set forth in Part II of the vacated opinion of the division, Hornstein v. Barry,
I.
The majority opinion states that the Council of the District of Columbia “could have made the ban on conversion [to condominiums] absolute,” ante at 534 n. 8, without violating due process. The court implies that this constitutional power to prohibit all conversion necessarily includes the power to impose a less absolute ban.
A.
In City of Lakewood v. Plain Dealer Publishing Co., — U.S. -
In contrast, in Posadas de Puerto Rico Assocs. v. Tourism Co. of Puerto Rico,
The present case is like Posadas in that the policy and constitutional concerns underlying absolute and conditional bans, as
B.
I turn to the delegation issue. The en banc majority acknowledges that a tenant majority, in approving or disapproving such conversion, “may act arbitrarily, and there is no objective standard to which they must conform.” Ante at 534. The tenants, say my colleagues, may “act in their own financial interest and consent to conversion only if the owners would sweeten the pie by buying them out at an attractive price.” Ante at 534. Indeed, “their parochial interest in allowing the landlord to take the affected units off the rental market may collide with the needs of tenants city-wide and with the prime goal of the legislation, which is to avoid the erosion of affordable rental housing.” Ante at 534. In short, the en banc majority acknowledges that the statutory scheme is not calibrated in a way that assures a virtual congruence between the collective private interests of tenant majorities and the public’s interest in having the most beneficial possible mix of housing for the community, present and future. Indeed, the court sustains the statute against constitutional attack while candidly acknowledging that the required consent provision institutionalizes a shakedown scheme — pressure to “sweeten the pie,” ante at 534 — for the private financial benefit of incumbent tenants, not necessarily for the overall benefit of the community of tenants-at-large. I cannot agree.
I do not believe the government constitutionally may empower self-interested tenant majorities to make governmental decisions that “arbitrarily” determine landlords’ property rights, as well as the interests of tenant minorities. If exceptions to a governmental policy banning condominium conversion are to be made, then in my view, to comport with due process, a governmental body — not a wholly private group — must make those decisions and must do so with reference not to “parochial” interests but to adequate legislative guidelines reflecting the public interest. See Washington ex rel. Seattle Title Trust Co. v. Roberge,
The Supreme Court itself has limited the opinion on which the majority primarily relies, Cusack Co. v. City of Chicago,
If this were merely a matter, as in Cusack, of the only affected residents waiving supposedly beneficial legislation, then the en banc majority’s argument might have force. But, in this case, the Council has granted such waiver authority to private groups who collectively wield substantial governmental power having citywide impact on the housing stock available not only to incumbent tenants but also to prospective tenants. It is one thing for a group of neighbors to waive a prohibition of a billboard on a city block that presumably affects only them; it is another when a group of tenant neighbors waives a ban on conversions of rental property to condominiums that ultimately affects other people. In the latter situation we face here,
In sum, under the statute at issue here, the en banc majority upholds a “standard-less delegation of power”
II.
The legislation here, if struck down, would not necessarily leave without a remedy those tenants who, as a community, oppose condominium conversion in individual instances or altogether. If the Council does not want to impose a complete ban, there is no reason why an existing or newly-created governmental agency could not be charged with monitoring the rental housing stock available to tenants of low, moderate, and high income, respectively, and authorized to approve or reject all proposed conversions to condominiums. The agency could be required, as part of that process, to consider local and citywide tenant views, as well as the views of the landlords and others, on all proposed conversions. The majority is concerned about the inefficiency of such an alternative, ante at 534 n. 8, but this is the administrative law approach we traditionally require— with good reason — if the government is to regulate property rights consistent with the interests of all persons affected. See, e.g., D.C.Code § 25-115(a)(6) (1981) (Alcoholic Beverage Control Board shall be satisfied that place for which license is to be issued is an appropriate one considering, among other things, “the wishes of the persons residing or owning property in the neighborhood”).
. See also Silverman v. Barry,
. City of Eastlake v. Forest City Enterprises, Inc.,
. Id. at 677,
Dissenting Opinion
dissenting m part:
Despite the scholarly tone of the majority opinion which overrules the conclusion we reached when our division first considered the issue, see Hornstein v. Barry,
Stripped of its nonessentials like the lengthy discourse on the duty of judges to refrain from invalidating federal and local statutes, irrespective of reservations concerning the wisdom of the particular enactment unless it is clearly unconstitutional
In my view, the basic premise that an absolute prohibition of condominium conversion is within the power of our* local government to enact rests upon shaky grounds. Only one judicial authority is cited by the majority for that proposition: a decision of the California Supreme Court,
The real fallacy of this rationale, however, is that even though a general prohibition of conversions to condominia might survive a due process challenge, the tenant election provision would be enough to render such a statute unconstitutional.
In my view, the basic reliance of the circuit court and the majority opinion upon Thomas Cusack Co. v. City of Chicago,
In Roberge, as we pointed out in the panel opinion,
We need not decide whether, consistently with the Fourteenth Amendment, it is within the power of the state or municipality by a general zoning law to exclude the proposed new home from a district, defined as is the first district in the ordinance under consideration.
In short, what the Roberge Court held was that even though a municipality might have authority to pass a law restricting a particular district to purely private residential use, a waiver provision which could
Apparently refusing to concede our point that a referendum limited only to a small segment of the community can be upheld only when the legislation is directed at some kind of nuisance, e.g., unsightly billboards, the majority contends that because the tenant election process here was expressly intended to confer greater bargaining power on the occupants of the rental units and to encourage the formation of tenant organizations for negotiating purposes, such Council findings justify a delegation of legislative power to a narrow group for whose protection the statute was enacted.
The majority candidly notes that, under the challenged statutory scheme, a majority of tenants in a particular complex may bar conversion for purely arbitrary or capricious reasons, or may agree to it, only because the financial offer of the landlords to buy them out appeals to selfish reasons. It then concedes that such parochial reasons for responding to their landlord’s largesse “may collide with the needs of tenants city wide and with the prime goal of legislation, which is to avoid the erosion of affordable rental housing.”
I submit that this aspect of the legislation conclusively demonstrates that the challenged provision flies in the face of the Eastlake test. What it reveals is not a mere imperfection, but rather a fatal defect in the challenged legislative scheme.
So far as the separate issue of an unconstitutional taking without compensation is concerned, I also believe that in this posture of the case a remand for the purpose of an evidentiary proceeding is required. Although the petitioners for rehearing dispute this part of the order entered by the panel, it is plain that this argument is premature under the holding of the Supreme Court in Pennell v. City of San Jose,
. The opinion fails to point out that where the Supreme Court has pronounced as repugnant to the due process clause similar and indistinguishable provisions in statutes passed in other states, courts in this jurisdiction are under an obligation to defer to such pronouncements when the validity of a local statute is drawn into issue, irrespective of its public popularity.
. We note in passing that this is the first time since Swain v. Pressley,
. Griffith Development Co v. City of Oxnard,
. The Council, apparently recognizing that its laws intended to prevent erosion of the supply of rental units was having the opposite effect and would deprive the District of federal housing subsidies, has recently enacted legislation exempting new construction from its current rent control laws, which include the restrictions on condominium conversion. See Seman v. D.C. Rental Housing Comm'n.,
. City of Eastlake v. Forest City Enterprises, Inc.,
. The opinion also notes that the Council was properly concerned with protecting the rights of tenants, "particularly poor and elderly tenants, who ... merit and need such protection.” It should be observed, however, that the challenged legislative scheme is not limited to poor or elderly tenants, but also applies to high rent apartments inhabited by well-to-do persons whose tenure in the particular building may be for reasons of only temporary convenience.
