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holding that Pullman abstention was inapplicable to substantive due process claim challenging town's moratorium on development, noting that “[t]he resolution of the federal question does not ‘depend’ on the resolution of ... whether the Town acted ultra vires under [the New York Home Rule Law] in enacting the [challenged restriction]”
Summary of this case from Donohue v. ManganoOpinion
01 Civ. 8884 (SAS)
November 15, 2001
James G. Sweeney, Esq., Goshen, NY, Counsel for Plaintiff.
Karen A. Jockimo, Esq., Boeggeman, George, Hodges Corde, P.C., White Plains, NY, Counsel for Defendant.
OPINION AND ORDER
In August 2001, Steven Sherman sued the Town of Chester ("Town") in New York Supreme Court. Sherman alleged that the Town acted unlawfully by enacting Local Law No. 1 of 2001 ("Local Law"), which imposed a moratorium on development that halted Sherman's application for a development permit. Sherman claimed that by refusing to process his permit application, the Town violated his right to substantive due process under the Fourteenth Amendment of the federal Constitution and under Article I, section 6 of the New York State Constitution. Sherman sought (1) a declaration under N.Y. C.P.L.R. § 3001 that the Local Law was unconstitutional; (2) a declaration under N Y C.P.L.R. § 3001 that the Town acted ultra vires of Municipal Home Rule Law (MHRL) § 10 in enacting a Local Law solely to block Sherman's proposed development; (3) $2 million in compensatory damages under 42 U.S.C. § 1983; and (4) reasonable legal fees.
N.Y. C.P.L.R. § 3001 is a general provision authorizing suit for declaratory judgment in New York state courts.
Defendant removed this case to federal court pursuant to 28 U.S.C. § 1441. Sherman now moves to remand the entire case under 28 U.S.C. § 1441(c), and argues in the alternative that this Court should abstain from exercising jurisdiction under both the Burford and Pullman doctrines. For the reasons set forth below, plaintiff's request is granted in part, and denied in part.
I. FACTUAL BACKGROUND
Sherman applied to the Town's Planning Board ("Board") in February 2000 for a site plan and subdivision approval for a 397-unit residential community to be built around an 18-hole golf course. See 10/30/01 Affidavit by James Sweeney, Plaintiff's Counsel ("Pl. Aff.") ¶ 6. The proposed development covered a total of 398 acres of land in the Town. See id. According to Sherman, the proposal conformed to the bulk and density requirements of the Town of Chester Zoning Law. Id. The Town held a public hearing on November 1, 2000 to debate the proposal at which several adjacent neighbors "vigorously objected to the possibility of this 397-unit development in their midst." Id. ¶¶ 7-8. The neighbors subsequently petitioned the Board, and otherwise applied pressure to the Board by appearing at Board meetings held on May 1 and May 8, 2001, and urging the Board to "'stop'" Sherman's proposed development. Id. ¶ 9.
New York state law required the hearing. See Pl. Aff. at 2.
In response to the neighbors' objections, the Board held a "summary public hearing" on June 12, 2001, on the issue of whether it should enact a moratorium on development. Id. ¶ 10. Sherman objected to the proposed moratorium on the grounds that (1) it was "focused only upon his development;" (2) it was being considered "solely in reaction to the hysterical political pressure brought to bear by the immediate neighbors," and (3) there was "no local crisis or dire emergency that necessitated the moratorium as required by New York law." Id.
The Board enacted the moratorium on July 3, 2001, and refused to continue processing Sherman's application for approval of the proposed development. Id. ¶ 11; see also Local Law, Ex. A to Pl. Aff. Sherman thereafter commenced an action against the Town on August 29, 2001, bringing both federal and state law claims, and seeking $2 million in compensatory damages for lost profits. Sherman framed the enactment of the moratorium as an ultra vires action by the Board because it was "directed only at Sherman's project and was the product of strident community opposition to that project and was not rooted in a town wide crisis of dire emergency immediate problem [sic] and was not enacted for the general health, safety and welfare of the community." Id. ¶¶ 14-15; see also Compl. ¶¶ 49-52. The Town then removed this action to federal court, and plaintiff now seeks to remand on grounds of abstention and 28 U.S.C. § 1441(c).
II. ABSTENTION
Plaintiff argues that pursuant to either Railroad Comm'n. of Texas v. Pullman, 312 U.S. 496 (1941) ("Pullman abstention") or to Burford v. Sun Oil, 319 U.S. 315 (1943) ("Burford abstention"), this Court should abstain from exercising its jurisdiction over this case. See Plaintiff's Motion to Remand ("Pl. Mot.") at 1-2.
A. Legal Standard
"Abstention is an extraordinary and narrow exception to 'the virtually unflagging obligation of the federal courts to exercise the jurisdiction given them.'" Hickerson v. City of New York, 932 F. Supp. 550, 553 (holding that Pullman abstention was nevertheless warranted to avoid deciding state constitutional claims in city zoning case), aff'd, 143 F.3d 99 (2d Cir. 1998), cert. denied, 525 U.S. 1067 (1999). It is only warranted in "exceptional circumstances in which the court's decision not to exercise jurisdiction would clearly serve an important countervailing interest." Id. at 554. Burford abstention is proper where a case involves basic matters of state policy complicated by nonlegal considerations of a predominantly local nature, and the state has specially concentrated all judicial review of administrative orders of the sort involved in a single state court. See Wright Miller et al., Fed. Pract. Proc., Juris. 2d § 4244 at 81.
The Second Circuit has held that Pullman abstention "may be appropriate when three conditions are met: (1) an unclear state statute is at issue; (2) resolution of the federal issue depends on the interpretation of state law; (3) the law is susceptible to an interpretation by a state court that would avoid or modify the constitutional issue." Vermont Right to Life Comm., Inc. v. Sorrell, 221 F.3d 376, 385 (2d Cir. 2000) (emphasis added) (summarizing Pullman doctrine). But see Hickerson, 932 F. Supp. at 556 (addressing defendants' argument that abstention was unwarranted because the federal claims do not depend on the state claims by noting that "the federal claims in Pullman also did not depend on the state law claim raised there"). Satisfaction of all three criteria does not automatically require abstention because of a federal court's obligation to exercise jurisdiction where it is proper. Sorrell, 221 F.3d at 385. A federal court must cautiously weigh all factors in a decision to abstain, placing the most weight on the obligation to exercise jurisdiction. Id.
Sorrell was decided after Hickerson.
B. Analysis
Burford abstention is inappropriate in this case. First, it would require the Court to dismiss a federal claim that is properly before this Court, which would preclude the parties from returning to federal court in the event that the state court cannot offer prompt relief. See Wright et al. § 4245 at 102. Second, neither party contends that the state has concentrated review of all land use disputes in a single state court, or has a comprehensive regulatory scheme to deal with land use disputes. See id. Third, "it would make little sense to hold that federal court adjudication would unduly interfere with local policy when it is the local government defendants who brought the case to federal court, and who seek to keep it here." Hickerson, 932 F. Supp. at 557; see Defendant's Affirmation in Opposition to Plaintiff's Motion to Remand ("Def. Opp'n.") ¶ 18. Nor should this Court abstain under Pullman, although it presents a closer call. Sherman meets the first and third prongs of the test set forth in Sorrell. Sorrell, 221 F.3d at 385 ("(1) an unclear state statute is at issue . . . (3) the law is susceptible to an interpretation by a state court that would avoid or modify the constitutional issue."). The state law is "unclear" in the sense that the state court has not yet ruled on the Local Law at issue, nor has it spoken definitively on the issue of whether Sherman has a property right to the permit under the circumstances. As for the third requirement, this Court may never have to rule on the federal claim if the state court finds that the Town violated Article I, Section 6, of the State Constitution. See Sorrell, 221 F.3d at 385; see also Brockett v. Spokane Arcades, 472 U.S. 491, 510 (1985) ("[A]bstention may be required in order to avoid . . . tentative decisions on questions of state law, and premature constitutional adjudication) (citing cases)). It is also true that "[t]he reign of law is hardly promoted if an unnecessary ruling of a federal court is thus supplanted by a controlling decision of a state court." Pullman, 312 U.S. at 500.
Defendant fails to cite a case in which a New York state court has ruled on similar facts.
Nevertheless, plaintiff has not met the second requirement of the Second Circuit's test for Pullman abstention. See Sorrell, 221 F.3d at 385. The resolution of the federal question does not "depend" on the resolution of either state law question, (1) whether the Town acted ultra vires under MHRL § 10 in enacting the Local Law allegedly intended to block Sherman's proposed development, or (2) whether the Town violated Sherman's property right under the State constitution. Id. Instead, the federal claim turns on whether Sherman had a federally protectable property right in the permit. See Natale v. Town of Ridgefield, 170 F.3d 258, 261 (2d Cir. 1999) (ruling that plaintiff must demonstrate a federally protectable property right in the issuance of zoning and building permits to prevail on a section 1983 claim for violation of substantive due process). A state court decision on whether the Town acted ultra vires is in no way "antecedent" to resolving this issue. Arizonans for Official English v. Arizona, 520 U.S. 43, 76 (1997).
Nor will this federal issue be affected by the state court's determination as to whether Sherman had a property right in the permit under state law. See Natale, 170 F.3d at 261-62. The Second Circuit ruled in that case that although the Connecticut Superior Court had previously held that the plaintiffs had a "clear right" to the issuance of the building permit in question, that finding did not aid plaintiffs in their federal action. Id. The court stated that:
Whether or not proof of [a property right in a permit under state law] could entitle [plaintiffs] to damages in state court on some state law cause of action, such proof does not support a judgment based on a federal claim of denial of property without due process of law.
Id. at 261-62. Rather, "[t]he federal claim is based on the Fourteenth Amendment, as implemented by section 1983, and requires the existence of a federally protectable property right." Id. at 262. In sum, Sherman's federal claim only depends on a finding of a property right under federal law, but does not depend on a finding that the Town violated state law MHRL § 10 in enacting a moratorium targeting his project or that Sherman had a property right under state law.
III. STATE COURT CERTIFICATION
A. Legal Standard
Although not raised by the parties, another option is to certify the question of the validity of Local Law No. 1 of 2001 to the New York Court of Appeals, the State's highest court. The United States Supreme Court stated not long ago that abstention is "[a]ttractive in theory because it place[s] state-law questions in courts equipped to rule authoritatively on them, [but has] prove[n] protracted and expensive in practice, for it entail[s] a full round of litigation in the state court system before any resumption of proceedings in federal court." Arizonans, 520 U.S. at 76 (citation omitted). In fact, the Supreme Court in that case appeared to discourage abstention as an outmoded method and suggests that certification of a question to the state's highest court is the better procedure. See id. "Certification today covers territory once dominated by a deferral device called 'Pullman abstention' . . . ." Id. at 75; see also Allstate Ins. Co. v. Serio, 261 F.3d 143, 150 (2d Cir. 2001) (advocating certification of question to state court as preferable to Pullman abstention). Arizonans stated that a federal district court, a federal court of appeals, or the Supreme Court may avail itself of the certification procedure, depending on the state's certification statute. Arizonans, 520 U.S. at 75.
The Pullman doctrine, at least, is still viable in this Circuit. See, e.g., Sorrell, 221 F.3d 376; Hickerson, 932 F. Supp. 550.
B. Analysis
This Court declines to certify the state questions in this case to the state court, despite the time-saving benefit of that method. The Supreme Court's concern regarding the delay that abstention may entail stems from concern for the parties' federal rights. Here the party seeking to vindicate a federal right is the same party who is causing the delay by advocating remand of this action. Further, neither party is requesting certification.
IV. PARTIAL REMAND
A. Remand of the State Claims Under 28 U.S.C. § 1367, 1441
Remand of the state claims is proper pursuant to 28 U.S.C. § 1367(c) and 1441(c). Section 1367(c) permits a federal court to decline to exercise supplemental jurisdiction where the claim "raises novel or complex issues of state law" or where the state claim "substantially predominates over the [federal] claim." 28 U.S.C. § 1367(c). Section 1441(c) allows a federal court to remand "matters where state law predominates." Id. § 1441(c). The crux of plaintiff's state law claim is that the Town's attempt to block his proposed development exceeded the authority granted to municipalities under MHRL § 10. This issue is virtually identical to that in City of New Rochelle v. Mamaroneck, 111 F. Supp.2d 353, 369 (S.D.N.Y. 2000). There the plaintiff alleged that under state law, a municipality had exceeded its authority under MHRL § 10 by enacting a Local Law regulating development. See id. at 357. The plaintiff also brought various federal constitutional claims, including a damages claim pursuant to section 1983. Id. at 358. The court remanded the state law claim under sections 1367(c) and 1441(c)), reasoning that the state law claim raised "unique and critical questions of New York law," and that to remand would serve "the interests of comity and federalism." Id. at 370. The court stated that
[r]esolution of the State issues here [regarding municipalities' "power to adopt and amend local laws relating to their property"] require [sic] a determination of the parameters of state and municipal authority, and will therefore have wide-reaching impact on issues fundamental to governance of New York State.
Id. at 371. Those same reasons apply here.
B. Retention of the Federal Claim Under § 1441(c)
Sherman's request to remand the entire case is rejected because this Court has an obligation to exercise jurisdiction over federal claims properly before it. Sherman seeks to remand the entire case, including the federal claim, pursuant to section 1441(c). See Pl. Mot. at 2. Section 1441(c) provides:
Whenever a separate and independent claim or cause of action within the jurisdiction conferred by section 1331 of this title is joined by one or more non-removable claims or causes of action, the entire case may be removed and the district court may determine all issues therein, or in its discretion, may remand all matters in which State law predominates.28 U.S.C. § 1441(c) (1994) (emphasis added). This District has interpreted the statute to require that a federal court may remand the state claims but retain the federal claim. See Hickerson, 932 F. Supp. at 556 (holding that where the statute applies, its plain language does not authorize remand of the federal claims); see also New Rochelle, 111 F. Supp.2d at 371-72 (summarizing and following the conclusion in Hickerson as to section 1441(c)). It is clear that the "[h]istory, language and logic compel the conclusion that under section 1441(c), the phrase 'matters in which state law predominates' does not encompass federal claims." Id. at 558.
V. CONCLUSION
For the foregoing reasons, plaintiff's state law claims that (1) the Town acted ultra vires in enacting a moratorium on development aimed only at Sherman and (2) the Town violated Sherman's rights under the New York State Constitution are remanded. Jurisdiction over the federal claim is retained, but the case will be placed on suspense pending the state court's resolution of the state claims.
SO ORDERED.