Etna Properties et al v. Holladay City

Filing 44

MEMORANDUM DECISION AND ORDER granting 18 Motion for Summary Judgment and denying 21 Motion for Partial Summary Judgment. Signed by Judge David Barlow on 3/13/20. (dla)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH
ETNA PROPERTIES, LLC and SQUARE
ONE RECOVERY, LLC,

v.

MEMORANDUM DECISION AND
ORDER GRANTING [18] MOTION FOR
SUMMARY JUDGMENT AND
DENYING [21] MOTION FOR PARTIAL
SUMMARY JUDGMENT

HOLLADAY CITY,

Case No. 2:17-cv-00980-DBB-CMR

Plaintiffs,

Defendant.

District Judge David Barlow

Before the Court are Defendant Holladay City’s (“the City”) Motion for Summary
Judgment 1 and Plaintiffs’ Motion for Partial Summary Judgment. 2 The City asks the Court to
dismiss Plaintiffs’ Complaint with prejudice in its entirety. 3 Plaintiffs concede that summary
judgment is proper as to their first cause of action, asserting that Holladay City Code § 13.98.020
facially violates the Fair Housing Act, and as to their second cause of action, alleging that §
13.98.020 had a disparate impact on disabled persons. 4 However, Plaintiffs oppose summary
judgment as to their third cause of action, which alleges that the City’s delay in granting
Plaintiffs’ requested accommodation constituted a constructive denial of a reasonable
accommodation, in violation of the Fair Housing Act. 5 Instead, Plaintiffs’ Motion for Partial

1

Holladay City’s Motion for Summary Judgment (“Motion”), ECF No. 18, filed April 30, 2019.

2

Plaintiffs Etna Properties and Square One Recovery’s Motion for Partial Summary Judgment (“Plaintiffs’
Motion”), ECF No. 21, filed May 2, 2019.

3

Id. at 1.

4

Memorandum in Opposition to Holladay’s Motion for Summary Judgment (“Opp’n”) at 5, ECF No. 34, filed
November 4, 2019.

5

Id.

1

Summary Judgment asks the Court to grant them summary judgment on their third cause of
action. Because the requested accommodation was not “necessary” under the FHA, the Court
GRANTS Defendant’s Motion for Summary Judgment. Consequently, the Court DENIES
Plaintiffs’ Motion for Partial Summary Judgment as to their third cause of action. 6
FACTS
Plaintiff SquareOne, LLC (“SquareOne”) creates and operates inpatient facilities for the
treatment of substance abuse. 7 In 2016, SquareOne contracted to purchase a house and property
located in Holladay from Etna Properties, LLC (“Etna”), which SquareOne intended to turn into
one of its treatment facilities. 8 The zoning area where the property is located permits up to four
unrelated people, plus their minor children, to live in a single dwelling. 9 The Holladay City Code
(“City Code”) provides an exception to this zoning rule for residential facilities for persons with
disabilities, permitting up to six residents at such facilities. 10 The same City Code section also
allows for other reasonable accommodations necessary to “allow the establishment or occupancy
of a residential facility for person(s) with a disability.” 11
In October 2016, Etna and Square One requested a “reasonable accommodation” from
the City to allow their proposed substance abuse treatment facility to house twelve unrelated
residents, rather than six. 12 The stated reason for this accommodation was financial—it would

6

Plaintiffs’ Motion, ECF No. 21, filed May 2, 2019.

7

Complaint (“Compl.”) at 2, ECF No. 2, filed August 30, 2017.

8

Id.

9

Compl. at 2–3; Holladay City Code (“City Code”), Chapter 13.04 at 13, 42, ECF No. 18-2, filed April 30, 2019.

10

City Code at 66.

11

Id. at 67.

12

Compl. at 3–4.

2

not be economically feasible for SquareOne to operate the facility with only six residents. 13 The
City took approximately eleven months to approve the request for accommodation, but did so on
September 8, 2017. 14 However, by this time, SquareOne had lost necessary investors and
funding for the proposed facility. 15
Plaintiffs allege that the eleven-month period between their submission of the reasonable
accommodation request and the City’s granting it was a constructive denial of the request for
accommodation, thus violating the Fair Housing Act’s prohibition of discrimination against
persons with handicaps. 16
LEGAL STANDARD
Summary judgment is appropriate if “there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.” 17 A factual dispute is genuine when
“there is sufficient evidence on each side so that a rational trier of fact could resolve the issue
either way.” 18 In determining whether there is a genuine dispute as to material fact, the court
must “view the evidence and draw reasonable inferences therefrom in the light most favorable to
the nonmoving party.” 19 Only facts “essential to the proper disposition of a claim” qualify as

13

Reasonable Accommodation Letter, ECF No. 21-4, filed May 2, 2019.

14

Reply in Support of Holladay City’s Motion for Summary Judgment (“Reply”) at 9, ECF No. 39, filed December
20, 2019.
15

Plaintiffs’ Motion at 12.

16

Id.

17

Fed. R. Civ. P. 56(a).

18

Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 670 (10th Cir. 1998).

19
Ribeau v. Katt, 681 F.3d 1190, 1194 (10th Cir. 2012) (quoting Doe v. City of Albuquerque, 667 F.3d 1111, 1122
(10th Cir. 2012)).

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material. 20 The Court therefore focuses on whether reasonable jurors “can properly proceed to
find a verdict for the party … upon whom the onus of proof is imposed.” 21
DISCUSSION
The Requested Accommodation Was Not Necessary
The Fair Housing Act makes it unlawful “[t]o discriminate in the sale or rental, or to
otherwise make unavailable or deny, a dwelling to any buyer or renter because of a handicap of
. . . a person residing in or intending to reside in that dwelling after it is so sold, rented, or made
available.” 22 Discrimination includes “a refusal to make reasonable accommodations in rules,
policies, practices, or services, when such accommodations may be necessary to afford such
person equal opportunity to use and enjoy a dwelling.” 23 Here, Plaintiffs claim that although the
City did eventually grant the requested accommodation to permit twelve residents at the
proposed Square One facility, the eleven-month delay from application to approval constituted a
constructive denial of the accommodation. 24 Plaintiffs do not allege that individuals with
substance abuse addiction could not use the house as a dwelling without accommodation. 25
Neither do they provide evidence that the individuals they wish to treat cannot obtain treatment

20

Crowe v. ADT Sec. Servs., Inc., 649 F.3d 1189, 1194 (10th Cir. 2011).

21

Anderson v. Liberty Lobby, 477 U.S. 242, 252 (1986) (internal quotations omitted)).

22

42 U.S.C.A. § 3604(f)(1).

23
Id. at (f)(3)(B). The Fair Housing Act, in relevant part, defines “dwelling” as “any building, structure, or portion
thereof which is occupied as, or designed or intended for occupancy as, a residence by one or more families.” 42
U.S.C.A. § 3602(b). The parties do not dispute, and the evidentiary record is insufficient for the court to determine,
whether the proposed facility would qualify as a “dwelling.”
24

Plaintiffs’ Motion at 16.

25

See Cinnamon Hills Youth Crisis Ctr., Inc. v. Saint George City, 685 F.3d 917, 923 (10th Cir. 2012) (stating FHA
accommodations provide individuals with disabilities equal opportunity “to live in . . . housing facilities”) (emphasis
added), Haws v. Norman, No. 2:15-CV-00422-EJF, 2017 WL 4221064, at *6 (D. Utah Sept. 20, 2017) (finding issue
of fact as to whether emotional support dog was necessary for plaintiff to live in an apartment).

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without the accommodation sought. 26 Instead, Plaintiffs essentially assert that their particular
business model will not work at this specific house unless they are permitted to provide their
services to up to twelve unrelated individuals.
The Tenth Circuit has found that “the object of the statute’s necessity requirement is a
level playing field for the disabled.” 27 “The point of the reasonable accommodation mandate” is
to “require changes in otherwise neutral policies that preclude the disabled from obtaining “the
same . . . opportunities that those without disabilities automatically enjoy.” ” 28 However, the
level playing field for housing opportunities required by the FHA does not mandate “more or
better opportunities.” 29 In Cinnamon Hills, the operators of a residential treatment facility for
disabled youth wanted to create a new residential facility on the top floor of a motel, in an area
where the zoning both disallowed any residential use and prohibited anyone from staying in a
motel for longer than 29 days. 30 In deciding that the city had not violated the FHA by denying
the requested zoning variance, the court held, “[W]hen there is no comparable housing
opportunity for non-disabled people, the failure to create an opportunity for disabled people
cannot be called necessary to achieve equality of opportunity in any sense.” 31 Similarly, this
court has held that where a city’s zoning ordinance disallowed any group living arrangements in
an area, an accommodation increasing the number of residents allowed in a treatment facility for

26

See Recovery Landholdings, LLC v. City of S. Ogden, No. 1:17-CV-152 TS, 2019 WL 1489003, at *6 (D. Utah
Apr. 4, 2019) (stating plaintiff provided no evidence that treatment in larger groups than zoning permitted was
medically necessary, but such evidence would not have been of “paramount importance” to residents’ ability to
enjoy a dwelling) (emphasis added).
27

Cinnamon Hills, 685 F.3d at 923.

28

Id. (quoting U.S. Airways Inc. v. Barnett, 535 U.S. 391, 397–98 (2002)).

29

Id.

30

Id. at 920.

31

Id. at 923.

5

the disabled from eight to twelve was not necessary to achieve “equality of opportunity” in
housing between disabled and non-disabled people. 32
The facts of this case are comparable. The City Code permits no more than four unrelated
individuals and their minor children, if any, to live together in a single housekeeping unit. 33
However, residential facilities for persons with disabilities already receive some preferential
treatment under the City Code, because the maximum number of residents increases to six
unrelated people. 34 The additional accommodation that Plaintiffs asked for is not “necessary” to
create a level playing field or to ensure that people with disabilities receive the same housing
opportunities as everyone else; instead, the requested accommodation would grant the disabled
residents of Square One’s facility a group housing opportunity not available to anyone else in
that particular zone. Therefore, even had the City denied the accommodation request
(constructively or otherwise), they would not have been in violation of the FHA’s prohibition on
discrimination against persons with disabilities.
Because the Court finds that the requested accommodation was not necessary to ensure
equal opportunity for persons with disabilities to use and enjoy housing, as required under the
FHA, it is not necessary to reach the question of constructive denial. Even viewing the facts in
the light most favorable to Plaintiffs, there is no genuine dispute of material fact in this case, and
the City is entitled to judgment as a matter of law. 35

32

Harper v. Lindon City, No. 2:18-CV-00772-DAK, 2019 WL 2188910, at *6 (D. Utah May 21, 2019), see also
Recovery Landholdings, 2019 WL 1489003, at *6 (increase in number of disabled residents at treatment facility
from twenty to thirty-two, where this number of unrelated residents in one home was unavailable to non-disabled
people, was not a necessary accommodation to allow persons with disabilities equal opportunity to enjoy a
dwelling).
33

City Code at 13, 42.

34

Id. at 66.

6

CONCLUSION
Because the Court finds that no genuine dispute of material fact exists in this case,
Defendant’s Motion for Summary Judgment is GRANTED. Consequently, Plaintiffs’ Motion for
Partial Summary Judgment as to their third cause of action is DENIED. The clerk of court is
directed to close this case.

Signed March 13, 2020.
BY THE COURT

________________________________________
David Barlow
United States District Judge

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