January Newsletter (Issue 01-2016)

Ordinance Adopting Tax Abatement and Approving Redevelopment Agreement Not Subject To Referendum

The City of Clayton (City), in 2010 adopted a “Downtown Clayton Master Plan Update and Retail Strategy” (Master Plan), which was intended to encourage residential growth within walking distance of the Clayton and Forsyth MetroLink Stations.  In 2014, GTE sought to build a 26 story, $72 million residential apartment tower (Tower) within the area where the Master Plan called for an increase in high-density residential development.  The City proceeded with the adoption of Ordinance Numbers 6339, 6340, and 6341 related to the Tower by the unanimous adoption of motions that each bill be read for the first time by title only.  Upon adoption of each motion the bill was read for the first time.  Thereafter, the mayor moved that the board of aldermen (Board) approve each bill for final passage at that evening’s meeting.  That motion was seconded and approved unanimously and the bill was then read for the second time.  Ordinance No’s. 6339 and 6340 were passed on September 23, 2014, unanimously while Ordinance No. 6341 was approved by a vote of 6 to 1.

Residents, who were opposed to the project, circulated referendum petitions that were submitted to the City Clerk who examined the petitions and informed the residents that the petitions were not sufficient because Ordinance Numbers 6339, 6340 and 6341 were not subject to a referendum under the City Charter.

Thereafter, Residents filed a petition seeking a writ of mandamus to compel the Clerk to certify the referendum petitions as sufficient, and to compel the City to either repeal the Ordinances or submit them to a vote of the City’s electors.  Residents also sought a declaratory judgment that the Ordinances were subject to a referendum under the City’s Charter.  All parties thereafter filed cross-motions for summary judgment.
The trial court granted the City’s motion for summary judgment, holding that the three ordinances were not subject to a referendum, under Article XII, Section 2 of City’s charter, or any other provision of City’s charter.  The Residents appealed to the Eastern District.

Procedural Questions With Respect to Passage of the Ordinances: The Residents challenged the passage of Ordinance Numbers 6339, 6340, and 6341 contending that the Ordinances were not passed on the day of their introduction because they were on the agenda for the September 9, 2014, meeting of the Board where there was “lengthy consideration” of the bills and that, at the conclusion of the meeting and public hearing on September 9, 2014, a motion was made to table the bills.  Residents argued that the Ordinances were therefore “introduced” on September 9, 2014, and passed on September 23, 2014, and were not exempt from a referendum under the City Charter.  The Residents also argued that since one member of the Board did not vote to approve Ordinance No. 6341, it was not adopted by the affirmative vote of the entire Board as required by the City Charter.

The City Charter provides that ordinances adopted by the Board are subject to a referendum except for “…ordinances passed on the day of their introduction as provided in Section 8 of Article II of this charter, ordinances levying taxes, and ordinances for the issuance of special tax bills.” (Emphasis Added)

The second paragraph of Section 8 of Article II of the City Charter provides that: “All bills shall be called up for consideration at least twice, and at least one week shall elapse between the time a bill is introduced and its final passage, except that bills may be passed on the day of their introduction by the affirmative vote of all members of the board who are present.” (Emphasis Added)

The City Code provided for very specific procedures to introduce a bill and for its immediate consideration in order to adopt it at the same meeting the bill was introduced. The Eastern District determined that the Board followed the procedures in the Code for adopting an ordinance at the same meeting it was introduced thereby rejecting Residents argument. The Eastern District concluded that the unanimous approval of the procedural motion to take up Ordinance No. 6341 was sufficient to meet the City Charter requirement that the ordinance be adopted by the affirmative vote of all Board members.

Does the Approval of a Tax Abatement Plan Constitute the Levying of Taxes: The Western District also concluded that the adoption of Ordinance No. 6341 approving a tax abatement plan for tax abatement in the amount of 50% of the assessed valuation of the property for the first 10 years and payments based on 50% of the fair market value of the following 10 years constituted the levying of taxes, which was not subject to a referendum.  The Court concluded that the term “ordinance levying taxes” in the City Charter “… encompasses the entire process of determining appropriate levels of taxation of property, not simply the narrow act of imposing taxes.”

Was Ordinance No. 6341 Administrative or Legislative: Ordinance No. 6341, approved a contract with the developer to carry out the City’s previously adopted policies set forth in Ordinance No. 6328, approving a development plan for the property including tax abatement.  This Ordinance was adopted July 22, 2014, which constituted legislative action to approve a development plan for the property and authorize tax abatement.  Residents did not challenge Ordinance No. 6328, which was legislative in nature.  Ordinance No. 6341 adopted at the September 23, 2014, meeting was simply carrying out legislative actions the Board had previously authorized when it adopted Ordinance No. 6328 on July 23, 2014; therefor Ordinance No. 6341 was administrative in nature.  Phillips vs. City of Clayton, (ED103232, 12/22/15)

Comment Howard: This case is significant in that it holds that tax abatement was part of levying a tax; therefore it was not subject to a referendum.  The interpretation by the Court, that moving for immediate consideration of a bill, that was introduced for the first time and unanimously passing the motion to take up the bill satisfied the City Charter, even though Ordinance No. 6341 did not obtain the unanimous approval of all members of the Council.

Hostile Work Environment: Third-Party Harassment Claims

Diaz, an employee (Employee) of AutoZoners (Employer) worked at the Truman Road store, as a Part Sales Manager (PSM), where she was responsible for the do-it-yourself section and the commercial sales section.  Prior to working at the Truman Road store the Employee had successfully completed a training process and was promoted to a PSM and placed in the management in training program, which was an internal succession program that trained current employees to become managers.

While at the Truman Road store, the Employee began having problems with Mark, a commercial sales customer, who would complement the Employee and comment on the size of her breast and rear end.  The Employee advised Mark that his comments were inappropriate and unwelcome, nevertheless Mark persisted getting “touchy feely” with the Employee.  The Employee reported this to the commercial sales manager who laughed it off and told her to “suck it up” and do her job.  The harassment continued and became more personal with questions about lingerie and size of undergarments as well as groping with inappropriate comments.  The Employee continued to complain to the commercial sales manager, nevertheless, the harassment continued and she was told again to suck it up and no action was taken.  When Mark tried to fondle the Employee, she told him that she was going to call the police, unless he stopped.  A similar situation occurred with another customer in front of her supervisor and the supervisor made a rude comment condoning the harassment.  When the commercial sales manager failed to take any action the Employee reported the sex harassment to the store manager who indicated he would talk to those involved.

Since the store manager took no action, the Employee contacted the regional HR director in February 2011, leaving a voicemail that was never returned.  The Employee again telephoned the regional HR director to complain, who told her she could not talk right now but would meet with her to discuss the matter at the store.  The Employee did not hear from the HR director for over a month, at which time an investigation was opened. The Employee was then transferred to another location, where she was very happy with her job.  The Employer fired the commercial sales manager for not reporting the incident to his supervisor and fired the regional HR director for another unrelated matter.

As a result of the harassment, the Employee cried frequently, suffered headaches, was frequently sick, experienced a great deal of stress and anxiety, lost patches of hair, experienced difficulty sleeping and eating, attempted to cut herself and became very angry.  The Employee visited a doctor and was put on a depression medication.  The Employee also became very timid around male customers.

The Employee then filed a lawsuit in circuit court under the MHRA claiming that she was subjected to a hostile work environment and that the Employer retaliated against her when she complained.  A jury returned a verdict for the Employee in the amount of $75,000 in compensatory damages and $1 million in punitive damages against AutoZone and 1.5 million in punitive damages against AutoZone Inc. .  An appeal was taken to the Western District. (Later on appeal AutoZone was found not to be an employer.)

Hostile Work Environment: Negligence Theory: Addressing the Employee’s claim that there was a hostile work environment and that the Employer failed to promptly remedy it the Western District concluded that:

“When an employee suffers discrimination by a third party who the employee comes into contact with because of the employment relationship, and the harassment is sufficiently severe and pervasive to create a hostile work environment, the employer breaches its duty if it knows or should have known of the discrimination and fails to take prompt and effective remedial action.”

Under the negligence theory liability is direct rather than derivative because it makes no difference whether the person who committed the act is an employee, an independent contractor, or a customer. Ability to control the actor plays no role; consequently, the Employer was liable under a negligence theory for the acts of third parties.

Was A Term, Condition, Or Privilege Of Diaz’s Employment Affected: Employer argued that no term, condition or privilege of employment was affected because the Employee continued to successfully perform her job, did not require a leave of absence due to the conduct, only sought medical treatment for symptoms on a single occasion and then only after she transferred to a different store.  The Court rejected this argument concluding that conditions of employment were affected:

“Sexual harassment creates a hostile work environment when sexual conduct either creates an intimidating, hostile, or offensive work environment or has the purpose or effect of unreasonably interfering with an individual’s work performance.”

The Western District concluded that based upon reported incidents of repeated sexual harassment where no action was taken or where action was delayed the terms and conditions of employment were affected.

Notice to Employer and Prompt Remedial Action: Employer also argued that Employee failed to prove that the Employer knew about the harassment.  The Employers harassment and retaliation policy provided that if an employee suffered harassment he or she has a duty to timely report the harassment to the employee’s immediate manager or supervisor.  The Employee reported repeated incidents of sex harassment to her immediate manager and later to her supervisor; nevertheless, no prompt action to remedy the situation was taken.

The Employer also argued that prompt remedial action was taken when it learned of the sex harassment.  Again the facts did not support the Employer’s contentions with respect to notice and prompt remedial action.

Punitive Damages: The Employer argued that the evidence was insufficient to support the jury’s award of punitive damages because the evidence showed that the Employer had a policy prohibiting sexual harassment, it provided training to employees regarding how to handle sexual harassment, and it responded promptly and successfully to Diaz’s complaints.  This defense was an attempt to interject the “good faith” defense, which does not apply in a negligence action since the appropriate standard is whether or not the

Employer’s actions: Under the MHRA, “[a] submissible case [for punitive damages] is made if the evidence and the inferences drawn therefrom are sufficient to permit a reasonable juror to conclude that the plaintiff established with convincing clarity that the defendant’s conduct was outrageous because of evil motive or reckless indifference.” Again the evidence showed that a jury could conclude that there was sufficient evidence to show that the Employer’s actions or lack thereof was outrageous because of reckless indifference.  Diaz v. AutoZoners, LLC, (WD77861, 11/10/15)

Comment Howard: This case has one of the better discussions involving hostile work environment created by third parties.  This case also illustrates the dangers of a hostile work environment claim.  Immediate action, to stop sexual harassment and other forms of discrimination, is required because there is no good-faith defense under the negligence theory.  The employer should consider requiring copies of all such complaints to be forwarded to the attention of the HR department and action monitoring steps taken to investigate and rectify the matter should be in place.

Hostile Work Environment: Employee Harasment 
During 2011 and 2012 Rebecca Nichols drove a semi truck for Tri-National Logistics and RMR Driver Services (collectively “TNI”).  During the period from May 25 until June 1, 2012 her fellow driver, James Paris, made unwelcome sexual advances.  Then on a mandatory layover, he took away her truck keys and cell phone while continuing to proposition her.  On May 25, 2012, Nichols reported his behavior to TNI and raised the issue again on June 1.  After TNI terminated Nichols on June 25, 2012, citing her poor safety record, she brought this action under Title VII, alleging TNI discriminated against her on the basis of sex and termination in retaliation for her complaints.  The district court granted summary judgment to the defendants, and Nichols appealed to the Eighth Circuit, which reversed and remanded on the sex discrimination hostile work environment claim while affirming the trial court’s decision with respect to retaliation.
In order “…to establish a hostile work environment claim Nichols must show that: (1) she is a member of a protected group; (2) she was subject to unwelcome harassment; (3) the harassment was based on sex; (4) the harassment affected a term, condition, or privilege of her employment; and (5) her employer knew or should have known of the harassment and failed to take appropriate remedial action.”

This case focused on element # 5, whether or not TNI “ knew or should have known and failed to take appropriate remedial action.” Critical to this answer is when Nichols informed TNI of the sexual harassment and how long did TNI take to correct the situation.  The Eighth Circuit concluded that viewing the evidence favorable to the Nichols that the notice was given on Friday, May 25.

When assessing the reasonableness of an employer’s actions factors to consider “include the amount of time that elapsed between the notice and remedial action, the options available to the employer, . . . and whether or not the measures ended the harassment.”
The Employer, “TNI did not remove Paris from her truck within 24 hours, proceed to investigate the alleged misconduct, or reprimand Paris.  Nichols notified TNI about his harassment on May 25, and seven days elapsed before TNI arranged for Chris Loya to pick her up in Laredo.  TNI could have ordered Nichols to leave Paris’ truck as soon as it learned about the problem and promptly help her find another driving partner, reprimanded Paris for his behavior, or arranged lodging for her in Laredo instead of permitting her to accompany him to Pharr on May 30.” Instead, TNI “…allegedly took no action to remove her despite her consistent complaints of sexual harassment, but allowed her to go to Paris’ apartment in Pharr, and stranded her there with no available alternate form of transportation.” These allegations were sufficient to overcome the motion for summary judgment since they are matters for the trier of the facts.

The Eighth Circuit found that there was no basis for the retaliation complaint because there was sufficient evidence to show that prior to the sex harassment allegation Nichols had an unsafe driving record.  While the Employee could meet the first two prongs of the McDonald’s Douglas test she failed to offer any evidence to rebut the Employers evidence that showed she had an unsafe driving record.

Comment Howard: Hostile work environment cases seem like the worst nightmare and HR director can have considering the need to act as quickly as possible to remedy the situation.  On top of that, the facts will determine how quickly is quick enough.  Obviously, it would seem that one of the first steps is to stabilize the situation by separating the employees while the matter is investigated and resolved.

Breathalyzer In 2013 Had to Be Calibrated For Three Solutions 

Kristin Stiers’ (Driver) was stopped by a Lake St. Louis (City) police officer based upon the HUNA_18404_34444071Aofficer’s observation that she swerved between lanes.  After conducting field sobriety test, which indicated that she was impaired the Driver was placed under arrest and taken to the City Police Department, where she took a breath test that indicated that her blood alcohol concentration was .172%.  At that time, the Driver was given notice of the revocation of her driving privileges.  The Driver obtained a temporary stay of her revocation while she sought administrative review of the revocation.  After the revocation was upheld, she filed a de novo appeal in Circuit Court.  The trial court ruled that evidence of the BAC results offered by the state could not be admitted because the breath analyzer was calibrated using only one solution; therefore, the trial court ruled that the state did not have sufficient evidence to show that the Driver drove a vehicle with a BAC above .08%.  The Department of Revenue appealed the decision to the Missouri Court of Appeals, which upheld the trial court decision and the matter was subsequently transferred to the Missouri Supreme Court.

Since all the relevant facts were admitted the question before the Missouri Supreme Court was a matter of statutory interpretation as to whether one or three separate test were required under the regulations promulgated by the DOR and whether subsequent regulations or the regulations at the time the driver was charged controlled the number of tests required to calibrate the equipment.

Regulation 19 CSR 25-30.051.2 as promulgated by DHSS at the time of Ms. Stiers’ breath test stated:

(2) Standard simulator solutions, used to verify and calibrate evidential breath analyzers, shall be solutions from approved suppliers. The standard simulator solutions used shall have a vapor concentration within five percent (5%) of the following values:
(A) 0.10%;
(B) 0.08%; and (C) 0.04%. (Emphasis added).

The Missouri Supreme Court held that three separate test were required based upon plain reading of the regulations applying rules of statutory construction.  There is no ambiguity; furthermore “and” means “and”.  In addition, there is nothing in the language which supports that the word “and” was intended to be used in any other way then it’s ordinary plain meaning as a conjunctive.  Furthermore, the regulations state:

“[t]he standard simulator solutions used shall have a vapor concentration within … the following values: …” and then listed three values connected by the word “and.” Id. (emphasis added).

The court also held that the regulations in place at the time of the arrest when the breath test was calibrated apply.  Stiers vs. Director of Revenue, (SC94840, 01/12/15)

Comment Howard: This was a 4 to 3 decision, with a vigorous dissent.  Both the opinion and the dissent are models of statutory construction depending on whether you are applying the plain meaning of the statute or looking for intent as the controlling factor.

No Cause of Action For Excessive Force When Injuries Are De Minimus

jail_photoHollingsworth was detained for booking at the police station in St. Ann (City) after being arrested for stealing wine coolers from a convenience store at a gas station.  She was highly intoxicated and very belligerent to the officers.  At the police station she was placed in a small processing room that was monitored by a video camera.  She was asked to remove her clothing, except her undies, and change into an orange jumpsuit several times but refused.  She was informed that if she did not remove her clothing and don the jumpsuit she would be Tased.  Again she refused, was warned again, and was Tased two times before she changed into the jumpsuit.

Hollingsworth suffered excruciating pain and two days later when she continued to suffer leg spasms she visited a hospital where doctors prescribed muscle relaxants. Hollingsworth brought a civil rights action against the police officer who Tased her, the two correction officers who observed the Tasing and allowed it to occur, and the City alleging the City policy with respect Tasing was unconstitutional because it violated her rights under the Fourth Amendment.

The federal district court dismissed the claims against all of the parties ruling that the officers were entitled to qualified immunity because it was not clearly established at the time of Hollingsworth’s arrest that the use of force that resulted in only a de minimus injury constituted an unreasonable seizure.  In addition, the claim against the City was dismissed on the grounds that the City’s policy on the use of Tasers did not cause any violation of Hollingsworth’s rights under the Fourth Amendment.  Hollingsworth appealed to the Eighth Circuit.

The Eighth Circuit held that the law in 2009, when the Taser incident took place, did not clearly establish an excess of force claim under the Fourth Amendment, when the injury from the Taser was de minimis.  Hollingsworth conceded that her injuries were de minimus.  The Defendants also showed there was a legitimate safety concern for requiring the change of clothes because of contraband or weapons concealed in street clothing.  The officers were shielded by qualified immunity from the use of an excess force claim or from an unreasonable failure to intervene because the use of excess force by the officers was not clearly established at the time of the 2009 incident.  Hollingsworth v. City of St. Ann, (Eighth Circuit, 14–1583, 01/13/15

Comment Howard: If you are looking for a case involving the use of excessive force that resulted only in injuries that were de minimus this is a case for you.  There was a concurring opinion (really a dissent) in this case, which is well worth the read.  I would be very leery of taking too much stock in the opinion of the court because it seems to tilt the facts very much in the favor of the officers.

Other Matters And Issues

DWI Issue: Lisa Soronen, Executive Director, of the State & Local Legal Center alerts state and local government lawyers to recent case Supreme Court’s acceptance of case that could have a profound impact on DWI prosecutions.  A 2013, United States Supreme Court case involving the state of Missouri figures prominently in this matter.  I suspect that defense lawyers may object to the use of the BAC if no search warrant was issued in order to preserve this issue while the Supreme Court decides this matter.

“All 50 states have adopted implied consent laws requiring motorists as a condition of driving in the state to consent to a blood alcohol content (BAC) test if they are suspected of drunk-driving.  The Supreme Court will decide whether state statutes criminalizing a person’s refusal to take a chemical BAC test where police have not obtained a warrant are unconstitutional.  Thirteen states criminalize the refusal to take a warrantless BAC test.  In Missouri v. McNeely (2013) the Supreme Court held that police generally have to obtain a warrant to conduct a blood draw.  So the argument goes, it is unconstitutional to criminalize the refusal to take a BAC test if a warrant was required to conduct the test but not obtained.  The three decisions that the Supreme Court has agreed to review all upheld the state statutes: Bernard v. Minnesota, Birchfield v. North Dakota, and Beylund v. Levi.

Request For Assistance: Lisa Soronen is asking for some real world examples for a Supreme Court amicus brief involving permits where an entity (city, county, state, business) that has been issued an unfavorable Waters of the United States jurisdictional determination by the US Army Corps of Engineers regarding land it would like to develop or (2) have land within your jurisdiction that has not been developed because of an unfavorable Waters of the United States jurisdictional determination or a concern about potential wetlands issues.

If so, State and Local Legal Center amicus brief writers would like to talk to a representative of the entity.  Please contact Lisa Soronen lsoronen@sso.org with any helpful information.

Top Priority In My Opinion

Senate Bill #572 is another legislative bill designed to curb municipality powers.  The Springfield News-Leader wrote an article on the bill  News-Leader Article

I am also attaching the bill for you to read.  Senate Bill #572.

(Ragan Comment) I rarely comment because I tend to be bombastic and very vocal on issues.  Right now is an important time for our organization.  Year after year, court case after court case, the powers of municipalities have slowly been eroded by those who love to stick it to (local) government, and it undermines the very principles and values of local control.  Local government is the tip of the spear for good governance but it gets hit early and often because it is an easy target for state judges and state legislators.  We need to pull all our resources and work together to stop bad legislation.   How many of us have puzzled over Senate Bill 5?  Does anyone want to spend any more time trying to figure out what the legislature meant on a bill that makes it impossible for us to deliver quality services to our community by limiting our powers?  Consider this confusing defintion the legislature wants to add in SB #572.

(4) “Municipal ordinance violation”, a municipal or county ordinance violation prosecuted for which penalties are authorized by statute under sections 64.160, 64.200, 64.295, 64.487, 64.690, 64.895, 67.398, 71.285, 89.120, and 89.490. Municipal ordinance violation shall include amended charges for municipal ordinance violations.

So what does that definition mean when it is inserted into Chapter 479?  You might find yourself in court arguing whether you have authority to prosecute a person because it is not authorized by any of those state statutes which relate to zoning.  Does your jurisdiction write amended informations for stealing, common assault, property destruction, and indecent exposure?  If you write an amended information then would it fall under this definition?  Under the new Missouri state statutes a stealing offense only qualifies as a felony if the person steals more than $750.  Under this legislation the maximum fine you could impose would be $200.  If you amended a stealing charge does that mean a person who stole $700 worth of merchandise would be punished with only a $200 fine?  Are you going to start using jail on first time offenders because the crime far exceeds the financial punishment you could impose?  Would you have to prove stealing involves the health and welfare of a person?  You should also consider the Hancock issue on community service.

When you talk to the members of our legislature and when you talk to city council your first words should be that our top priority should be to increase the standards and professionalism of our courts and not limit their powers.  The legislature is creating a legal system that won’t protect law abiding citizens.  This law would be a great law for criminals and we will continue to see increases in crime throughout the state just as we are seeing increases in traffic fatalities.  How many jurisdictions amend moving violations to parking violations?  Have you been in the court room when the defense attorney demands you amend the vehicular accident or speeding ticket to a parking violation because that is what he gets in every other jurisdiction and his client is a very important person?  Nothing in this law prohibits a prosecutor from amending a moving violation to a parking ticket.  The law just makes it cheaper for defense attorneys, legislators, and those politically connected to solicit  unethical behavior from prosecutors.  I think we would be far better off with a classification system for municipal courts with very tight rules and standards set out by the Missouri Supreme Court.  We need to improve training standards for prosecutors and judges.  Ethical standards should prevent defense attorneys from requesting or demanding amendments that are not supported by facts.  The new bill will do little prevent the problems because bad actors will always find a way to bend the rules.  However, setting out standards and granting authority and power based on achieving those standards will ensure that good actors are not punished for the failings of bad actors.



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