Ohio cities violate property rights by using zoning to prohibit more than three unrelated people from living in the same home

Bowling Green, OH – A federal court late Friday, agreeing with arguments made by the 1851 Center for Constitutional Law, held that an Ohio city’s zoning ordinance restricting homes to occupancy by no more than three unrelated adults violates the Ohio Constitution’s greater protection of private property rights.

The 1851 Center’s victory against the City of Bowling Green comes on behalf of 23 Bowling Green landlords and three student tenants threatened with eviction. The landlords own over 161 homes that until the ruling, despite having four or more bedrooms and ample parking, could not be occupied by more than three unrelated people.

“In Ohio, many zoning regulations needlessly interfere with private property rights, drive up the cost of living, fail to accomplish their proclaimed purposes, and are used as political weapons – often to benefit special interests or suppress disfavored minorities. This regulation is no different,” said 1851 Center Executive Director Maurice Thompson. “However, there is no coherent reason why four graduate students or even the  Golden Girls should be prohibited from occupying a large six-bedroom house, even as an unruly family of eight lives in a smaller home next door.”

The 13-page ruling by Judge James R. Knepp of the Northern District Ohio firmly rejects any notion that local zoning ordinances can be used to trample private property rights and equal protection, while embracing the Ohio Constitution’s protection of property and equality at a higher level than the federal constitution.

Specifically, in observing that an unlimited number of unruly, but barely-related family members could live together while a peaceful collection of students or even senior citizens could not, the court ruled as follows:

  • “[U]nder the Ohio Constitution, private property rights are fundamental rights to be strongly protected, such that “homeowners have a constitutionally protected property interest in running their residential leasing businesses free from unreasonable and arbitrary interference from the government” and “the free use of property is guaranteed by the Ohio Constitution.”
  • “[T]he City’s dwelling limit only focuses on the type of relationship between those living together in a home, and as such, is both over- and under-inclusive with respect to either of these interests. The Court thus concludes the dwelling limit is an “unreasonable and arbitrary” restriction on the issue of property.”
  • “[T]he limit is arbitrary, unduly oppressive, fails to substantially advance the avowed government interests of reducing population density or targeting specific issues with college-aged inhabitants, and treats similarly-situated homeowners and tenants differently without any justifiable basis. Consequently, the Court finds the dwelling limit is unconstitutional, as applied, and therefore unenforceable.”

Judge Knepp’s decision paves the way for overcoming overly-restrictive zoning regulations, and especially those, common in Ohio cities and college towns, that forbid unrelated adults from living together.

The 1851 Center draws a distinction between zoning regulations that prohibit homeowners from using their property to directly inflict harm on others and regulations simply aimed at social engineering.

“This regulation is aimed at government-controlled social engineering, i.e. keeping ‘the wrong kind of people’ out of certain neighborhoods, rather than land use. Unruly behavior should be directly regulated, rather than regulated on the basis of the relationships between those who live together,” added Thompson.  “Ohioans should not be forced to pay higher rent or endure longer commutes due to such arbitrary regulations.”

The case was brought in cooperation with Andrew Mayle of Mayle Law, and supported by an amicus brief from the Ohio Association of Realtors.

Read the Court’s Order HERE .

Read the 1851 Center’s Motion for Summary Judgment HERE .

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The  1851 Center for Constitutional Law is a non-profit, non-partisan legal center dedicated to protecting the constitutional rights of Ohioans from government abuse. The 1851 Center litigates constitutional issues related to property rights, regulation, taxation, and search and seizures.

Fourth Amendment prohibits state’s mandate making all business records “available at all times” to state agents

January 22, 2018: Columbus, OH – A federal circuit court late yesterday ruled that Ohio’s policies demanding private business records – – without a warrant or any evidence of wrongdoing – – violate the Fourth Amendment’s protection from unreasonable searches and seizures.

The ruling, made by a unanimous panel of the Sixth Circuit and authored by Judge David McKeague, addresses regulations governing those purchasing gold, silver, and other precious metals under the Precious Metals Dealers Act (“PMDA”).

However, its impact is likely to far exceed just the PMDA. Many Ohio businesses, particularly those requiring government licensing, face materially identical mandates. Accordingly, the ruling paves the way for Ohio businesses, even if heavily licensed and regulated, to protect their privacy and property, especially when such demands are made on-the-spot and without a warrant.

In a 23 page decision, the three-judge panel struck down a statute declaring “all books, forms, and records, and all other sources of information with regard to the business shall at all times be available for inspection,” and another demanding “free access to the books and papers and other sources of information with regard to the business.”

The Court explained as follows:

  • “Business owners cannot be forced to choose between being arrested on the spot and standing on their Fourth Amendment rights.”
  • “[The challenged statutes] are both unnecessary to furthering Ohio’s state interest and too broad in scope to withstand facial Fourth
  • Amendment scrutiny . . . both statutes effectively allow searches of dealers’ entire businesses . . . They therefore do not provide any standards to guide inspectors in the exercise of their authority to search.”
  • “The provisions’ seemingly unlimited scope, along with the grant of free access to such information at all times, does not sufficiently constrain the discretion of the inspectors.”

“This ruling essentially affirms that while government may request some basic record-keeping, reporting, and inspection of inventory purchased from the public that has been reported stolen, state officials cannot walk into a business without a warrant or evidence of wrong-doing and demand to review our papers, cell phones, laptops, or other business records,” said Maurice Thompson, Executive Director of the 1851 Center. “No entrepreneur deserves to be arrested for questioning the authority of a state agent to show up at his business unannounced, without any evidence of wrongdoing, and confiscate or filter through these records.”

Thompson added “this precedent will guard warrantless searches of business records in all industries, since the Court of Appeals decision acknowledged that even ‘closely regulated’ industries are entitled to greater protection. Ohioans should feel free to decline invasive and costly government searches without fear of retaliation.”

The 1851 Center for Constitutional Law took up the case in 2012 on behalf of Liberty Coins, a coin dealer of Delaware, Ohio, and Worthington Jewelers, a retail jeweler in Worthington, Ohio. Each balked at the prospect of losing their business licenses and being fined and prosecuted for refusing to turn over cell phones, laptops, and paper records simply “upon demand” of state enforcement agents.

Read the Court’s Order HERE.

Listen to the Oral Argument HERE.

Read the Brief HERE.

Watch our video describing the impact of this case:

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The 1851 Center for Constitutional Law is a non-profit, non-partisan legal center dedicated to protecting the constitutional rights of Ohioans from government abuse. The 1851 Center litigates constitutional issues related to property rights, voting rights, regulation, taxation, and search and seizures.

Legal Center: Fees that City’s homeowners were forced to pay to fund unconstitutional “point of sale” inspections must now be returned

Cleveland, OH – A federal court certified a class action lawsuit against the City of Bedford, Ohio, explaining that all homeowners who were forced to endure government searches as a precondition to the sale of their homes are entitled to demand refunds of illegal “Point of Sale” inspection fees.

This ruling paves the way for the return of inspections fees to all affected homeowners, rather than just those who filed the lawsuit.

The Order, made by Judge Benita Pearson of the Northern District of Ohio, confirms class action lawsuits may be maintained against city governments who extort their citizens and businesses in a widespread manner, such as through violating their Fourth Amendment rights through sweeping city-wide home inspection requirements.

Specifically, Judge Pearson certified classes of all individuals or businesses that have been subject to the inspections and paid inspection fees to the City of Bedford in conjunction with the inspections, explaining that “Citizens are entitled to “return of Point of Sale and Rental Inspection fees illegal paid to [the City of Bedford].”

“Class action litigation is an excellent method for average citizens to even the playing field when fighting back against their corrupt and otherwise indifferent local governments. This ruling confirms that Ohio cities must be held just as responsible to their citizens as big corporations are to their customers,” said Maurice Thompson, Executive Director of the 1851 Center.

In May of 2016, the 1851 Center for Constitutional Law moved to immediately enjoin Ohio cities, and the Cities of Bedford and Oakwood in particular, from enforcing “point of sale” and “presale” programs that require citizens to endure and pass arbitrary and warrantless government inspections before they could sell their homes to even the most informed and willing buyers.

In each case, the Cities had threatened to criminally prosecute and even imprison homeowners who sold their homes without first submitting to and passing city inspections. In Bedford, the City also claimed the power to block home sales on account of “architectural style and detail,” “color,” and lack of “orderly appearance.”

Within days of the 1851 Center’s lawsuits, each city rescinded its policies. However each has refused to return illegal inspection fees.

Such municipal ordinances, in addition to restricting Ohioans’ property rights, subject homeowners to open-ended warrantless searches of every interior and exterior space of a home, violating the Fourth Amendment to the United States Constitution and Section 14, Article I of the Ohio Constitution.

“Local governments do not have unlimited authority to force entry into Ohioans’ homes or businesses. To the contrary ‘houses’ are one of the types of property specifically mentioned by the Fourth Amendment; and Ohioans have every moral and constitutional entitlement to exclude others, even government agents, from their property,” adds Thompson. “The right to own property in Ohio has little value if local governments can continuously chip away at one’s right to actually make use of that property, requiring government permission slips for basic arrangements such as the sale of one’s home to a willing buyer.”

The legal action against Bedford is filed on behalf of area landlord Ken Pund, who is forbidden from selling to his daughter a home that he owns and she already resides in, and John Diezic who was prohibited from selling his Bedford home due to minor cracks in the asphalt of his driveway.

Read the Court’s Order HERE

Read the Property Owners’ Motion for Preliminary Injunction HERE

Check out Maurice Thompson discussing the case against Ohio governments’ forced home inspections below:

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This lawsuit is brought in partnership with the Ohio Real Estate Investors Association (“OREIA”), the Finney Law Firm in Cincinnati, and the law firm of Berns, Ockner & Greenberger in Cleveland.

Fourth Amendment secures property rights of landlords from unlawful searches and occupational licensing regulations in Ohio and nationwide

Columbus, OH – The Southern District of Ohio ruled that the City of Portsmouth’s occupational licensing requirements imposed upon landlords – – rental property inspections and licensing fees – – violates the Fourth Amendment to the United State Constitution.

The 1851 Center for Constitutional Law’s victory on behalf of Portsmouth rental property owners Ron Baker, Nancy Ross, Thomas Howard, and Darren Oliver means that indiscriminate and warrantless government inspections of rental properties are unconstitutional nationwide, and that unlawfully-extracted “rental inspection fees” must be returned to the rental property owners who paid them.

These property owners had long rented their property in Portsmouth without license or inspections, and their properties had never been the subject of complaint by tenants, neighbors, or others. However, the City threatened to criminally prosecute and even imprison these landlords if they continued to rent their homes without first submitting to an unconstitutional warrantless search of the entire interior and exterior of these homes.

Judge Susan Dlott, of the Western Division of the Southern District of Ohio, held as follows:

  • “[T]he Court finds that the Portsmouth [Rental Dwelling Code] violates the Fourth Amendment insofar as it authorizes warrantless administrative inspections. It is undisputed that the [Rental Dwelling Code] affords no warrant procedure or other mechanism for precompliance review . . . the owners and/or tenants of rental properties in Portsmouth are thus faced with the choice of consenting to the warrantless inspection or facing criminal charges, a result the Supreme Court has expressly disavowed under the Fourth Amendment.”
  • “The inspections are also significantly intrusive. As the Supreme Court has noted, the ‘physical entry of the home is the chief evil against which the wording of the Fourth Amendment is directed.’”
  • “The search inspection sheet details eighty items to be inspected throughout the entirety of the rental property. The Court thus concludes that the intrusion is significant.”
  • “Taking into account the above factors—the significant expectation of privacy, the substantial intrusion into the home, and the inefficacy of the warrantless inspections on the proffered special need—the Court finds the warrantless inspections are unreasonable.”
  • “Having determined that the Code is not saved by special needs or the closely regulated industry exceptions, the Court concludes that the Code’s failure to include a warrant provision violates the Fourth Amendment.”

Both the United States and Ohio Supreme Court have invalidated warrantless inspections of rental property, and repeatedly held that warrantless administrative inspections of business property are generally invalid, absent exigent circumstances.

Nevertheless, Ohio cities had vigorously sought to collect licensing fees from area landlords, and the warrantless searches served as the lynchpin to each of these goals. Ordinances such as Portsmouth’s Rental Dwelling Code established an absolute prohibition on renting out property within a community – – even though the landlord may have long done so and even though his or her property may be in pristine condition – – without a government-approved license that cannot be acquired without first paying a $100 annual fee per rental home and submitting to an open-ended warrantless search of every area of the property, inside and out.

“The Federal Court’s ruling victory for all property owners and tenants. Local government agents do not have unlimited authority to force entry into Ohioans’ homes or businesses. To the contrary ‘houses’ are one of the types of property specifically mentioned by the Fourth Amendment; and Ohioans have a moral and constitutional right to exclude others, even government agents, from their property. Entry requires either a warrant or an emergency, and neither is present with respect to these suspicion-less rental inspections,” said Maurice Thompson, Executive Director of the 1851 Center.

“Government inspections of one’s home frequently results in arbitrary orders to make thousands of dollars worth of untenable improvements to even the most well-maintained properties. These enactments were nothing more than a set of back-door tactics to collect revenue on the backs of Ohio property owners, while attempting to chase ‘the wrong type of owners’ out of town.”

Read the Federal Court’s Order HERE

October 4, 2015: Columbus Dispatch: Rental inspections ruled unconstitutional

October 2, 2015: WDTN-TV 2: Federal judge rules Ohio city’s warrantless rental property inspections are unconstitutional

October 1, 2015: Portsmouth Daily Times: The original Portsmouth licensing fee declared unconstitutional

Act regulates business in response to constitutionally-protected advertising, and prohibits legitimate purchases of gold and silver

Columbus, OH – A federal court late yesterday ruled that Ohio’s regulatory scheme governing those purchasing gold, silver, and other precious metals – the Precious Metals Dealers Act- violates the First Amendment.

The ruling, made by Judge Watson of the Columbus division of the Southern District of Ohio, paves the way for Ohio businesses, most prominently coin dealers, to resume purchases of items containing gold and silver content, and in particular, to resume advertising their interest in purchasing inventory consisting of precious metals, free from concern over confiscatory prosecution, fines and regulations.

The 1851 Center for Constitutional Law took up the coin dealers’ case and challenged the state law after the Ohio Department of Commerce threatened to shut down Liberty Coins, of Delaware, Ohio, if it refused to pay considerable fines and obtain a government license to advertise its business.

The lawsuit had sought recognition that the First Amendment applies to and protects “commercial speech,” such as coin dealers’ advertising, and that the Act’s prohibition of advertising by coin dealers was not a means of reducing gold and silver-related theft.

The lawsuit had also made claims asserting that requirements that business owners demonstrate that they have “good character,” “sufficient reputation,” “sufficient financial responsibility,” and “sufficient experience” prior to being permitted to run their businesses were unconstitutionally vague; and that the Act’s authorization of warrantless searches of business owners’ property and records at any time without notice violated their Fourth Amendment rights.

In his 28 page decision, Judge Watson, explaining that “the Act only prohibits the unlicensed buying of precious metals when commercial speech is involved,” emphasized that “a broad injunction completely prohibiting enforcement of the licensing provision is warranted.”

The order, an across-the-board rebuke to Ohio’s regulations and the cavalier enforcement tactics the Ohio Department of Commerce has against Ohio’s small businesses over the past year, concluded as follows:

  • The Department of Commerce failed to show “how holding one’s self out as willing to purchase precious metals contributed to the evils the State seeks to prevent. Moreover, Defendants have not shown how requiring a license only for purchasers of precious metals who engage in commercial speech directly and materially advance those interests.”
  • “[The state] has not shown that forcing those who engage in commercial speech to obtain a license is reasonable,” and “the restriction on commercial speech is more extensive than necessary.”
  • The Department of Commerce “incorrectly” asserts “that the law prevents fraud, money laundering, theft and terrorism by requiring those who wish to engage in the business of buying from the public gold, silver, and other precious metals to be licensed.”
  • “The breadth and number of exemptions undercuts the Defendants’ argument that the licensing scheme is narrowly tailored to protect against theft, fraud, or terrorism.”

The Court added that the Department of Commerce’s aggressive reading of the regulations was “nonsensical,” and that Ohio coin dealers and others “are unable to actually purchase precious metals without facing prosecution due to Defendants’ incorrect interpretation of the Act.”

“We are just trying to make it safe for small businesses to operate in Ohio – – a mission that we wish our state government would share, rather than thwart,” said Maurice Thompson, Executive Director of the 1851 Center. “This Act and those enforcing it treat small businesses who make gold and silver available as public utilities at best, and criminals at worst, irrespective of whether they have done harm.”

Heightened enforcement of the PMDA by the Department of Commerce, under the control of the Kasich Administration, comes in response to accelerated lobbying and financial contributions to candidates by the pawn brokers industry, which is exempt from the regulations, and a direct competitor of those who are subject to the Act. The enforcement, which would have put many coin dealers out of business, also comes at a time of rising precious metals prices, where an increasing number of Ohioans seek to use gold and silver to protect their savings against potential inflation caused by federal government increases in the money supply.

Thompson added “the state misguidedly seeks to advance its mission of ‘preventing theft and resale of precious metals’ through gag orders, warrantless searches, and criminalization of innocent small businesses. Fortunately, the First Amendment allows us to protect Ohioans’ rights to engage in truthful promotion of their businesses.”

Read the Court’s Order Granting Liberty Coins’ Motion for Preliminary Injunction HERE.


December 7, 2012: Bloomberg Businessweek: Ohio gold, silver dealers’ law blocked by judge

December 7, 2012: Ohio Watchdog: OH: Judge blocks catch-22 in state law that threatened entire industry

December 6, 2012: WYTV 33 News: Ohio gold, silver dealers’ law blocked by judge

Ohio Townships do not have the power to levy taxes.  That’s why they call them “fees.” This case argues that “fees” on new homeowners and developers are really taxes and are unconstitutional.

Timeline

February 14, 2011 – 1851 Center Files Amicus Brief at Ohio Supreme Court

On February 14, 2011, the 1851 Center for Constitutional Law filed an amicus brief with the Ohio Supreme Court, on its own behalf and on behalf of the Tax Foundation. The brief argues that Ohio townships, which do not have the power to levy taxes, cannot levy back-door taxes on new homeowners and developers merely by labeling those taxes as “impact fees.”

December 15, 2010 – The Ohio Supreme Court Accepts the Case on Appeal

February 1, 2010 –  1851 Center Files Amicus Brief at Appellate Court

The 1851 Center filed an amicus brief with the Twelfth District Court Appeals, arguing that Ohio townships, which do not have the power to levy taxes, cannot levy back-door taxes on new homeowners and developers merely by labeling those taxes as “impact fees.”

Media

March 3, 2011 – Listen to Maurice Thompson on the Tax Policy Podcast here.

Documents

February 14, 2011: 1851 Center’s Amicus Brief (Ohio Supreme Court)

February 1, 2010: 1851 Center’s Amicus Brief (Appellate Court)

A victory came on October 19, 2009 for Ohio bars and restaurants facing fines for breaking the state smoking ban. Up to that point, enforcement methods essentially required small businesses to enforce the smoking ban for the government. The 1851 Center points out that it’s the government’s law and that the state should be required to enforce its own laws.  That’s what the statute said and that’s what the court has said.

“I think we’ve been cited about 12 times and it’s up to about $33,000,” Dick Allen said; he owns Zenos Bar in the Harrison West neighborhood of Columbus.

The state’s 10th District Court of Appeals ruled that the way the ban is enforced is unfair, 10TV’s Kurt Ludlow reported. It all came down to two words “permit smoking.” The court ruled that if a business posts signs prohibiting smoking, and notifies customers that smoking is not allowed, then the business should not be charged with permitting smoking just because a patron is caught doing so.

A Toledo bar challenged a $500 fine it received after a Lucas County health department worker caught a patron smoking inside the bar. In the lawsuit, the Pour House of Toledo argued that they were improperly cited because they had posted signs and told patrons to refrain from lighting up. It’s notable that no one smoking in a bar has been fined as an individual. Now the state is going to have to start investigating whether the patron is smoking without the permission of the owner, or whether the owner gave permission to the patron.

Allen said he would help the state enforce the law if they paid him.  “If the state wants me to be their police officer, they should be paying me $30,000 and then I’d be happy to do it,” Allen said. Zenos Bar has not paid any of the fine money.

Media

August 20, 2009 – ONN: Smoking Ban Lawsuit Goes Before an Appeals Court

Filings

October 15, 2009: Appellate Court’s Decision