Licari v. Ferruzzi

UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT

No. 93-2047

ARTHUR J. LICARI, AS HE IS TRUSTEE OF
COLONIAL DRIVE REALTY TRUST,

Plaintiff, Appellant,

v.

JOSEPH FERRUZZI, PATRICK J. McNALLY,
STANLEY I. BORNSTEIN, KENNETH J. SAVOIE
WILLIAM E. BINGHAM, CATHERINE LEFEBVRE,
ELIZABETH WARE AND THE TOWN OF IPSWICH,

Defendants, Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Rya W. Zobel, U.S. District Judge]

Before

Selya, Circuit Judge,

Bownes, Senior Circuit Judge,

and Stahl, Circuit Judge.

Paul F. Denver, with whom Rossman, Rossman & Eschelbacher were on

brief for appellant.
Patrick M. Hamilton, with whom Richard E. Brody and Morrison,

Mahoney & Miller were on brief for appellees Patrick J. McNally,

Stanley I. Bornstein, Kenneth J. Savoie, William E. Bingham, Catherine
Lefebvre, Elizabeth Ware and the Town of Ipswich, Nancy Merrick, with

whom Douglas I. Louison and Merrick & Louison were on brief for

appellee Joseph Ferruzzi.

April 22, 1994

BOWNES, Senior Circuit Judge. This appeal arises
BOWNES, Senior Circuit Judge.

from an action for damages brought by a developer frustrated

by town planning and permitting authorities. Plaintiff-

appellant, Arthur J. Licari, as trustee of Colonial Drive

Realty Trust (hereinafter "Colonial"), appeals from an order

granting summary judgment for defendants-appellees, the Town

of Ipswich, the town building inspector, the town planner,

and members of the planning board. The complaint alleged due

process violations under 42 U.S.C. 1983, as well as

violations of Massachusetts civil rights laws and tortious

interference with contract. We affirm the decision for

defendants on the 1983 claims, but vacate the judgment on

the pendent state claims and remand so that those claims will

be adjudicated, or dismissed without prejudice.

I.

BACKGROUND

In 1987, Colonial's predecessor in interest sought

to develop property in Ipswich, Massachusetts, and obtained a

"special permit" from the planning board to comply with town

zoning laws.1 One part of the project included three

buildings. The building plans incorporated into the special

permit stated that Building 3 would be set back

1. A special permit is analogous to a variance. Under
Massachusetts law, a town's zoning ordinances may allow
particular developments, such as multifamily dwellings, to be
constructed in a given zoning district only upon the issuance
of a special permit. Mass. Gen. Laws ch. 40A, 9.

-2-
2

"approximately forty-five (45) feet" from the road. Colonial

acquired three building permits and began construction in

1988.

At a hearing held on October 12, 1989, the planning

board discussed whether the location of Building 3 conformed

with the dimensions in the plans incorporated in the special

permit. One week later, the town planner wrote to Colonial

that Building 3 was seven feet closer to the road than the

special permit allowed. The letter requested Colonial's

confirmation or denial of those charges, in writing, before

the next board meeting on October 26 and stated that any

further work would be at the developer's risk. The record

does not indicate whether Colonial attended that meeting or

submitted any information to the board. During the October

26 meeting, the board issued and later recorded at the

registry of deeds a "Notice of Noncompliance," based on the

discrepancy between the special permit and the location of

Building 3.

Building 3's proximity to the road was discussed in

planning board meetings over the following months. Members

of the board informed Colonial at a hearing in November 1989

that Buildings 1 and 2 also contravened the special permit.

In November 1989, Colonial sought an amendment to the special

permit to cure the problems, but the board did not approve

that application until April 2, 1990. Meanwhile, on February

-3-
3

1, 1990, Colonial once again argued to the board that there

were no discrepancies between the special permit and the

project as built.

On February 2, 1990, defendant Joseph Ferruzzi, the

town building inspector, revoked all three building permits

and ordered that further work cease. The reasons for the

revocation were that the buildings did not conform with the

special permit, and that Colonial had represented in applying

for building permits that the project was in compliance with

"project documents" and with zoning requirements. According

to Colonial, the board ordered the permits revoked. Colonial

initiated, but later abandoned, an appeal of Ferruzzi's

action to the Massachusetts Building Code Appeals Board.

Until new building permits were issued, work on the

project could not continue, and bank financing was suspended.

In May 1990, Ferruzzi promised to issue new permits, but did

not actually issue them until August. The bank's financing

commitment also expired in August. Colonial failed to

complete the project and defaulted on its loan.

In January 1993, Colonial filed suit in the United

States District Court for the District of Massachusetts. The

complaint alleged that Ferruzzi and the town failed to

provide due process by revoking the building permits without

a proper inquiry, notice, or hearing. The complaint included

claims that the arbitrary acts of defendants other than

-4-
4

Ferruzzi violated Colonial's due process rights. Finally,

the complaint alleged that defendants interfered with

Colonial's contractual relations, and that defendants

violated Massachusetts civil rights laws. Defendants filed a

motion for summary judgment, which the district court

granted.

II.

ISSUES

Colonial argues on appeal [1] that the district

court erred in granting summary judgment on the 1983

claims; [2] that the court erred in denying Colonial's motion

for leave to engage in discovery under Fed. R. Civ. P. 56(f);

and [3] that the court erred in granting summary judgment for

defendants on the state law claims. We consider those

arguments seriatim.

The first issue is whether the district court erred

in granting summary judgment on the federal due process

claims. Our review of the district court's order is de novo.

Nestor Colon Medina & Sucesores, Inc. v. Custodio, 964 F.2d

32, 39 (1st Cir. 1992). Summary judgment is proper where no

material facts are in dispute, and the moving party is

entitled to judgment as a matter of law. Fed. R. Civ. P.

56(c).

Defendants argue that summary judgment was proper

because this case is analogous to our line of cases upholding

-5-
5

pretrial orders disposing of 1983 due process claims

brought by frustrated applicants against local permitting

officials. See, e.g., Nestor Colon, 964 F.2d 32; PFZ

Properties, Inc. v. Rodriguez, 928 F.2d 28 (1st Cir. 1991),

cert. dismissed, 112 S. Ct. 1151 (1992); Creative Env'ts,

Inc. v. Estabrook, 680 F.2d 822 (1st Cir.), cert. denied, 459

U.S. 989 (1982). We agree. In this case, as in those cases,

the procedural and substantive due process claims were not

actionable under 1983.

III.

DUE PROCESS CLAIMS
DUE PROCESS CLAIMS

To avoid summary judgment on a procedural due

process claim, Colonial must show [1] that it had a property

interest defined by state law; and [2] that defendants,

acting under color of state law, deprived it of that interest

without adequate process. PFZ Properties, 928 F.2d at 30. A

viable substantive due process claim requires proof that the

state action was "in and of itself . . . egregiously

unacceptable, outrageous, or conscious-shocking." Amsden v.

Moran, 904 F.2d 748, 754 (1st Cir. 1990) (emphasis in

original), cert. denied, 498 U.S. 1041 (1991). Procedural

due process guarantees that a state proceeding which results

in a deprivation of property is fair, while substantive due

process ensures that such state action is not arbitrary and

capricious. Id. at 753-54.

-6-
6

A. Revocation of Building Permits

Colonial argues that its right to procedural due

process was violated when defendant Ferruzzi, at the planning

board's behest, revoked the building permits in violation of

state law without prior notice and a hearing. Ferruzzi acted

under color of state law; the letter revoking the permits

cited the discrepancies between the special permit and the

project as built and stated that he could "revoke a permit .

. . in case of any false statement or misrepresentation of

fact in the application or the plans on which the permit . .

. was based." 22 Mass. Regs. Code tit. 780, 114.7.

Because we assume for the purposes of this opinion that

Colonial held a property interest in the permits, see PFZ

Properties, 928 F.2d at 30-31, the key issue is whether

Colonial was afforded adequate process.

To determine whether a procedural due process

violation has occurred, "it is necessary to ask what process

the State provided, and whether it was constitutionally

adequate. This inquiry would examine the procedural

safeguards built into the statutory or administrative

procedure . . . effecting the deprivation, and any remedies

for erroneous deprivations provided by statute or tort law."

Zinermon v. Burch, 494 U.S. 113, 126 (1990). We assess the

adequacy of procedures by balancing the government's interest

against the private interest affected by the action, the risk

-7-
7

of an erroneous deprivation, and the value of additional

safeguards. Mathews v. Eldridge, 424 U.S. 319, 335 (1976).

We begin our analysis by describing the procedural

protections afforded Colonial. Prior to the deprivation,

Colonial was notified of the board's allegations and had an

opportunity to rebut them. We take as true Colonial's claim

that the planning board was the ultimate decisionmaker

because it ordered the permits revoked. Colonial was

notified at planning board meetings in October and November

1989, by a letter from the town planner in October, and by

the "Notice of Noncompliance" filed at the registry of deeds

in November that there were alleged discrepancies between the

plans incorporated in the special permit and the project as

built. Those allegations underlay the finding that there

were false statements in the building permit application.

Colonial had an opportunity to contest those allegations with

respect to Building 3 during the October 12 hearing and in

the two weeks preceding the planning board's issuance of the

Notice of Noncompliance. Although it is unclear from the

record whether Colonial actually responded to those

allegations, it is enough to satisfy the Due Process Clause

that the opportunity for such a response existed.

Furthermore, on February 1, 1990, Colonial disputed the

allegations with respect to all three buildings, several

-8-
8

months after receiving notice of them, and one day prior to

the revocation.

The notice Colonial received prior to the

revocation never specifically informed it that the

inconsistency between the special permit and the project

might be a basis for finding a "misrepresentation" in the

building permit application, justifying the revocation of the

permits. Colonial argues that it was thereby denied an

opportunity to be heard on that issue. We disagree. First,

Colonial received a letter from the town planner describing

the discrepancy between the special permit and the location

of Building 3 and indicating that further work would be at

the developer's risk. That letter, the Notice of

Noncompliance, and later discussions with the board informed

Colonial that town officials deemed the discrepancies

significant. Furthermore, Ferruzzi's letter revoking the

building permits claimed that plans submitted to him prior to

the issuance of the permits stated that the project complied

with zoning and with "project documents." A letter from

Colonial's architect appended to Colonial's Opposition to

Defendants' Motion for Summary Judgment supports that

statement of the facts, and nothing in the record contradicts

it. Cf. 22 Mass. Regs. Code tit. 780, 113.5 (application

for building permit must include site plans). Finally, a

state regulation authorized Ferruzzi to revoke building

-9-
9

permits based on false statements in building permit

applications.2 Id. 114.7. The existence of that

regulation, the warning in the planner's letter, the repeated

discussions with the board, and the contents of plans

submitted on Colonial's behalf to the building inspector

provided Colonial with sufficient notice and an opportunity

to respond.

There is a further reason why the revocation of the

building permits did not violate Colonial's right to

procedural due process: postdeprivation remedies were

available. See Zinermon, 494 U.S. at 126 ("The

constitutional violation actionable under 1983 is not

complete when the deprivation occurs; it is not complete

unless and until the State fails to provide due process.").

Colonial had numerous opportunities to meet formally and

informally with town officials to recover the permits. See

Amsden, 904 F.2d at 755 (informal negotiations are part of

process provided). Such negotiations ultimately yielded the

result Colonial desired, the issuance of new permits.

Moreover, Colonial had the right to an administrative appeal

2. An affidavit of Jason Sokolov, Colonial's attorney before
the planning board, states, "On information and belief, th[e]
accusation [of a misrepresentation in the building permit
application] was untrue." We express no opinion on whether,
as a matter of state law, those statements in the plans
submitted to Ferruzzi constituted "misrepresentation[s] of
fact in the [building permit] application." 22 Mass. Regs.
Code tit., 780 114.7.

-10-
10

of the building inspector's decision, which could have been

heard by the zoning board of appeals or by the state Building

Code Appeals Board, and a right to judicial review

thereafter. See 22 Mass. Regs. Code tit. 780, 126.1,

126.6; 126.7.1.

Colonial misses the mark by arguing that those

remedies are insufficient solely because relief might be

delayed, and damages are unavailable. In the first place,

delays, while endemic to administrative and judicial fora,

are minimized in these proceedings because the Appeals Board

adheres to a timetable. 22 Mass. Regs. Code tit. 780,

126.3.4, 126.4.3. Furthermore, a damage remedy is not an

essential component of constitutionally adequate review

procedures. Chongris v. Board of Appeals, 811 F.2d 36, 44-45

(1st Cir.), cert. denied, 483 U.S. 1021 (1987). We conclude

that Colonial had sufficient notice and an opportunity to be

heard prior to the revocation, and adequate administrative

and judicial review procedures afterwards; no further process

was exigible. Id. at 40.

B. Notice of Noncompliance

Colonial adverts that the planning board violated

procedural due process by summarily issuing and recording at

the registry of deeds a Notice of Noncompliance, which stated

that Colonial's buildings did not comply with the

requirements of the special permit. That issue appears in

-11-
11

the brief without citation to legal authority, and with scant

elaboration on whether or how the board's act affected any

property right. We express no opinion on the merits because

we deem it waived. "Issues adverted to on appeal in a

perfunctory manner, unaccompanied by some developed

argumentation, are deemed to have been abandoned." Gamma

Audio & Video, Inc. v. Ean-Chea, 11 F.3d 1106, 1113 (internal

quotation marks and citation omitted).

C. Delays

Colonial contends that the board's delay in

approving the application for an amended special permit

violated its right to procedural due process. Assuming that

Colonial held a property interest in the permit prior to its

issuance, and that the delay itself constituted a

"deprivation," we disagree with Colonial's contention. We

take as true the allegation that the delay resulted from

defendants' unauthorized intransigence and illegal demands.

We have rejected similar 1983 claims, however, where--as in

this case--the deprivation was unauthorized, the value of

further process was negligible, and the state provided

adequate remedies. E.g., Nestor Colon, 964 F.2d at 40; PFZ

Properties, 928 F.2d at 31; see also Mass. Gen. Laws ch. 40A,

9 (failure of permitting board to act on permit application

within 90 days after public hearing deemed to be approval of

-12-
12

application); id. 17 (final decisions of permitting board

subject to expedited judicial review).

D. Substantive Due Process Claims

The substantive due process claims are based on the

same factual allegations underlying the procedural due

process claims, i.e., the revocation of the building permits,

the unauthorized issuance of enforcement orders, and the

delays in the processing and approval of Colonial's

application for an amended permit. Those acts allegedly

manifest "a persistent and consistent hostility and animus

toward [Colonial]," aimed at coercing Colonial to reduce the

size of the project.

"This Court has repeatedly held . . . that

rejections of development projects and refusals to issue

building permits do not ordinarily implicate substantive due

process." PFZ Properties, 928 F.2d at 31; see also, e.g.,

Creative Env'ts, 680 F.2d at 832 n.9, 833. There is nothing

in the record to differentiate this case from those in which

we have found no viable basis for a 1983 claim. We note

that Colonial has neither argued, nor offered evidence that

defendants' "hostility and animus" was aimed at any political

affiliation, belief, stance, or immutable characteristic of

Colonial. Rather, Colonial's brief states that defendants'

improper conduct "was motivated by the defendants' wrongful,

outrageous goal" of compelling it to reduce the size of the

-13-
13

project. Cf. Creative Env'ts, 680 F.2d at 833 ("Every appeal

. . . from an adverse ruling by a . . . planning board

necessarily involves some claim that the board exceeded,

abused or `distorted' its legal authority . . ., often for

some allegedly perverse (from the developer's point of view)

reason. It is not enough simply to give these state law

claims constitutional labels . . . in order to raise a

substantial federal question under section 1983." (emphasis

in original)).

Colonial argues that this court should "overrule"

the cases in this circuit rejecting substantive due process

claims in local planning disputes, so that its claims might

be litigated. Colonial contends that there are cases from

other circuits permitting 1983 actions based on arbitrary

or capricious conduct by local land use officials, and that

this court should follow suit in this case. See, e.g.,

Littlefield v. City of Afton, 785 F.2d 596 (8th Cir. 1986)

(collecting cases). But see Lemke v. Cass County, 846 F.2d

469, 470-71 (8th Cir. 1987) (en banc) ("Whether a substantive

due process claim may arise from a denial of a zoning permit

is an open question in this circuit . . . .").

There is a problem with Colonial's argument that

goes beyond its assumption that this panel would overrule

precedent in this circuit: we have never announced a rule

precluding district courts from finding substantive due

-14-
14

process violations by land use planning officials in every

conceivable case. Rather, "[o]ur cases make clear that a

regulatory board does not transgress constitutional due

process requirements merely by making decisions `for

erroneous reasons' or by making `demands which arguably

exceed its authority under the relevant state statutes.'"

Amsden, 904 F.2d at 757 (quoting Creative Env'ts, 680 F.2d at

832 n.9); see also, e.g., Chiplin Enters. v. City of Lebanon,

712 F.2d 1524, 1528 (1st Cir. 1983). "We have left the door

slightly ajar for federal relief [based on substantive due

process] in truly horrendous situations." Nestor Colon, 964

F.2d at 45. Nevertheless, "the threshold for establishing

the requisite `abuse of government power' is a high one

indeed." Id.

There is a sound basis for our approach to such

claims in land use planning disputes:

Substantive due process, as a theory for
constitutional redress, has . . . been
disfavored, in part because of its
virtually standardless reach. To apply
it to claims [alleging that permitting
officials were motivated by political
factors and parochial views of local
interests] would be to insinuate the
oversight and discretion of federal
judges into areas traditionally reserved
for state and local tribunals.

Id.

We are not persuaded by Colonial that the

allegations and evidence in this case distinguish it from

-15-
15

Nestor Colon and the other cases in this circuit rejecting

substantive due process claims in similar disputes. In

Amsden, 904 F.2d at 757, for example, in deciding an issue of

qualified immunity, we stated that plaintiff had not produced

evidence of conduct so "shocking or violative of universal

standards of decency" as to violate the Due Process Clause,

although the evidence suggested that plaintiff's license was

revoked to force his partner out of business. Id. (internal

quotation marks and citation omitted). Defendants' conduct

in this case, allegedly designed to force Colonial to reduce

the size of its project, is similarly not sufficiently

"conscious-shocking." Id. at 754. We hold that the district

court properly granted summary judgment on the due process

claims.

-16-
16

IV.

DENIAL OF RULE 56(f) MOTION

Colonial argues that the district court erred in

denying its motion under Fed. R. Civ. P. 56(f) for leave to

engage in discovery. The district court stated that it was

denying the motion because "defendants are entitled to

judgment as a matter of law."

"To satisfy Rule 56(f), a party must `articulate a

plausible basis for the belief that discoverable materials

exist which would raise a trialworthy issue.'" Nestor Colon,

964 F.2d at 38 (citation omitted). With respect to the

federal claims that we consider in this appeal, Colonial's

motion asserted that discovery would yield evidence of

defendants' "animus" towards Colonial, and evidence of what

defendants "knew or believed" about the location of the three

buildings. We consider whether the denial of the motion was

an abuse of discretion. Id.

We find no abuse of discretion in this case because

the evidence sought by Colonial is not the type that would

render the 1983 claims viable. Colonial alleged that

defendants' improper conduct was motivated by the defendants'

goal of compelling it to reduce the size of the project.

Such a motive might be illegitimate as a matter of state law,

but it is not a basis for a 1983 claim. See Chiplin

Enters., 712 F.2d at 1528. Similarly, there would be no

-17-
17

basis for relief under 1983, even if discovery yielded

proof that defendants knew that the buildings conformed with

the special permit. Id. ("A mere bad faith refusal to follow

state law in such local administrative matters simply does

not amount to a deprivation of due process where the state

courts are available to correct the error."). Consequently,

we conclude that the district court did not err in denying

the Rule 56(f) motion.

V.

DISMISSAL OF STATE CLAIMS

Finally, we consider whether judgment was properly

entered on the pendent state law claims. The district

court's summary judgment order consists of the following

notation on the first page of defendants' motion: "Allowed,

Nestor Colon Medina & Sucesores, Inc. v. Custodio, 964 F.2d

32 (1st Cir. 1992), PFZ Properties, Inc. v. Rodriguez, 928

F.2d 28 (1st Cir. 1991). Judgment may be entered for

defendants." We read that order as resting on Nestor Colon

and PFZ Properties, not as an endorsement of all arguments in

defendants' brief.

The reference to Nestor Colon and PFZ Properties

makes clear that the district court considered Colonial's

1983 claims. Nothing, however, indicates that the state

civil rights and tort claims were weighed. That adequate

state appeals procedures and remedies might protect a

-18-
18

developer's federal due process rights, and thus preclude

1983 litigation, see Nestor Colon, 964 F.2d at 40, 45; PFZ

Properties, 928 F.2d at 31-32, is not germane to Colonial's

state law claims.

Although there is no indication that the district

court ever considered the pendent claims, the court's order

effectively dismissed those claims with prejudice. The

court's order on those claims was an abuse of discretion.

Defendants have not answered the complaint; there is support

in the record for the pendent claims; and Colonial has not

yet had the opportunity to engage in discovery.

Consequently, while we affirm the judgment on the 1983

claims, we vacate the judgment on the state law claims and

remand the case so that those claims will be adjudicated, or

dismissed without prejudice. See 28 U.S.C. 1367(c)

(district court may decline to exercise jurisdiction over

pendent claims if it has dismissed all federal claims);

Mercado-Garcia v. Ponce Federal Bank, 979 F.2d 890, 896 (1st

Cir. 1992); Figueroa Ruiz v. Alegria, 896 F.2d 645, 650 (1st

Cir. 1990).

It is so ordered.

-19-
19