UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 15-2589
ADAMS HOUSING, LLC,
Plaintiff - Appellee,
v.
THE CITY OF SALISBURY, MARYLAND,
Defendant - Appellant.
Appeal from the United States District Court for the District of
Maryland, at Baltimore. J. Frederick Motz, Senior District
Judge. (1:15-cv-01011-JFM)
Argued: October 26, 2016 Decided: November 29, 2016
Before THACKER and HARRIS, Circuit Judges, and Gerald Bruce LEE,
United States District Judge for the Eastern District of
Virginia, sitting by designation.
Vacated and remanded by unpublished per curiam opinion.
Victoria M. Shearer, KARPINSKI, COLARESI & KARP, P.A.,
Baltimore, Maryland, for Appellant. Luke Americus Rommel,
ROMMEL & ASSOCIATES, LLC, Salisbury, Maryland, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Adams Housing, LLC (“Adams Housing”) filed this action
against the City of Salisbury, Maryland, (“Salisbury”) pursuant
to 42 U.S.C. § 1983 and the Declaratory Judgment Act, 28 U.S.C.
§ 2201(a), alleging a variety of state and federal violations.
Salisbury responded and moved to dismiss all claims. In an
unusual posture, the district court apparently converted the
motion to dismiss into a motion for summary judgment and granted
judgment to Adams Housing, the nonmovant. Because Salisbury did
not receive notice and an adequate opportunity to argue its
case, we vacate the district court’s judgment and remand for
further proceedings.
I.
In 1997, Salisbury enacted its Occupancy Ordinance “to
establish and maintain basic minimum standards and conditions
essential for the protection of health, safety and general
welfare of the public.” Salisbury, Md., Code of Ordinances
§ 15.24.030(A) (“the Ordinance”). 1 The Ordinance limits housing
in certain areas to “one of the following groups”: (1) families
related by blood, marriage, or a “custodial relationship”; (2)
“[u]p to a maximum of two persons who are not so related,
1The Ordinance has been amended on multiple occasions since
1997, and we refer to the version in effect in 2014.
2
hereinafter referred to as ‘unrelated persons’”; or (3) any
group of four persons approved as a “functional family.”
§ 15.24.490.
In July 2014, two brothers and their friend -- all
college students -- rented a house at 418 West College Avenue,
Salisbury, Maryland, from Adams Housing. Shortly thereafter, on
September 26, 2014, Adams Housing received an order to reduce
the number of occupants from the Code Enforcement Officer
(“Order”). See J.A. 135-37. 2 Adams Housing challenged the Order
in a hearing before the Salisbury Housing Board of Adjustments
and Appeals (“HBAA”). The HBAA found Adams Housing to be in
violation of the Ordinance because the Ordinance “was written
with the idea that two unrelated people would [not] share a
house unless they were a family or they went through [the]
functional family clause.” Id. at 214. Adams Housing
challenged the HBBA decision in the Circuit Court for Wicomico
County, Maryland. The action was stayed on May 26, 2015.
On April 8, 2015, Adams Housing filed a complaint
against Salisbury in the Federal District Court for the District
of Maryland alleging: the Ordinance, on its face, violated the
Equal Protection and Due Process Clauses of the Fourteenth
2 Citations to the “J.A.” refer to the Joint Appendix
filed by the parties in this appeal.
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Amendment; the Ordinance as applied to Adams Housing violated
its equal protection and due process rights pursuant to both the
Fourteenth Amendment and the Maryland Declaration of Rights; the
Ordinance was void for vagueness on its face and as applied to
Adams Housing; and Salisbury tortiously interfered with Adams
Housing’s contracts. The complaint requested declaratory
relief, costs, and attorney’s fees.
On June 18, 2015, Salisbury moved to dismiss the
action pursuant to Federal Rule of Civil Procedure 12(b)(6).
Adams Housing responded to the motion to dismiss and reiterated
its litany of constitutional challenges. On September 24, 2015,
the district court conducted a status conference call with all
the parties. No transcript was kept of the phone call.
According to the district court, on the call, “both
parties agreed the facts of the case were undisputed and
discovery was unnecessary.” Adams Hous., LLC v. City of
Salisbury, Md., 147 F. Supp. 3d 390, 391 n.1 (D. Md. 2015). At
oral argument before this court, however, Salisbury explained
that, during the call, it had accepted the allegations in the
complaint as true for the purposes of arguing the motion to
dismiss but neither admitted their actual veracity, nor waived
any discovery rights. See Oral Argument at 12:34, Adams Hous.,
LLC v. City of Salisbury, Md., No. 15-2589 (4th Cir. Oct. 26,
4
2016), http://www.ca4.uscourts.gov/oral-argument/listen-to-oral-
arguments.
Indeed, after the phone call, Salisbury sent a letter
to the district court requesting “the Court permit the case to
move forward to discovery” if the court denied the motion to
dismiss. J.A. 240. The district court acknowledged receiving
the letter but otherwise ignored its content. See Adams Hous.,
LLC, 147 F. Supp. 3d at 391 n.1 (“I conducted a call with Adams
Housing and Salisbury’s counsel on September 24, 2015, where
both parties agreed the facts of the case were undisputed and
discovery was unnecessary. On the call, both parties consented
to the issuance of a final opinion; however, on October 8, 2015,
defendant’s counsel wrote a letter requesting the court move
forward with discovery if I denied defendant’s motion for [sic]
dismiss.”).
On November 30, 2015, the district court entered its
Memorandum Opinion and Final Order. The district court
dismissed Adams Housing’s facial challenges under the Equal
Protection and Due Process Clauses, the facial vagueness
challenge, and the tortious interference with contract claim. 3
However, instead of simply denying the motion to dismiss as it
3 The court did not reach the as-applied due process and
equal protection challenges. See Adams Hous., LLC, 147 F. Supp.
3d at 399.
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related to the as-applied vagueness challenge, the district
court awarded judgment to Adams Housing, “declar[ing]
Salisbury’s interpretation and enforcement of the Occupancy
Ordinance unconstitutionally vague as-applied to Adams Housing.”
Adams Hous., LLC, 147 F. Supp. 3d at 399.
The district court was cryptic. Its opinion never
uses the words “summary judgment” nor does it cite any rule of
procedure or precedent to support this unusual disposition. As
best we can decipher, the district court sua sponte converted
the motion to dismiss into cross-motions for summary judgment
and granted summary judgment to Adams Housing. See Adams Hous.,
LLC, 147 F. Supp. 3d at 391. The district court simply stated
the action was “ripe for declaratory judgment” and declared
Salisbury’s occupancy ordinance vague as-applied. Id. at 391,
399. During argument before this court, both parties
interpreted the district court’s opinion as granting summary
judgment. See Oral Argument, Adams Hous., LLC, No. 15-2589, at
12:34, 33:44. We too classify the declaration as a grant of
summary judgment.
Salisbury timely filed this appeal. Because we
conclude the district court failed to follow the proper
procedure for granting summary judgment, we vacate its judgment.
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II.
District courts have inherent power to grant summary
judgment. See Allstate Ins. Co. v. Fritz, 452 F.3d 316, 323
(4th Cir. 2006). However, before granting summary judgment, a
court must afford the losing party notice and an opportunity to
be heard. See id. The court must give notice to ensure that
the party is aware that it must “come forward with all of [its]
evidence.” Celotex Corp. v. Catrett, 477 U.S. 317, 326 (1986).
Once such party has sufficient notice, the party also needs an
“adequate opportunity” to present its case and “demonstrate a
genuine issue of material fact.” U.S. Dev. Corp. v. Peoples
Fed. Sav. & Loan Ass’n, 873 F.2d 731, 735 (4th Cir. 1989).
These requirements serve to provide the party with a “full and
fair opportunity to present its case.” aaiPharma Inc. v.
Thompson, 296 F.3d 227, 235 (4th Cir. 2002).
Here, the district court failed to provide notice and
an opportunity to respond. The only possible attempt to do so
was during the status conference call, but that call was
inadequate for both tasks.
At that juncture, when the only pending matter was a
motion to dismiss, Salisbury could not have known it needed to
come forward with all of its evidence. See U.S. Dev. Corp., 873
F.2d at 735 (explaining that the notice must be viewed in the
context of “the procedural, legal, and factual complexities of
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the case”). Similarly, the call did not provide an adequate
opportunity for Salisbury to present its case. See id. On the
call, it would have been impossible for Salisbury to
spontaneously marshal all of its evidence and demonstrate its
relevance to the legal allegations.
In sum, when no motion for summary judgment was
pending, no opportunity for discovery was provided, and no
hearing was conducted, the district court could not grant
summary judgment. This was not a fair chance to litigate.
Therefore, the district court’s grant of summary judgment was
improper.
III.
For the foregoing reasons, we vacate and remand for
further proceedings to allow an adequate opportunity for
discovery and for each side to argue its case.
VACATED AND REMANDED
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