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Ethan Dean v. City of Winona. MN constitutionality of rental ordinance
In 2004, the Winona, Minnesota, city council issued a six-month moratorium on the certification of new rental housing. This was followed up by a series of hearings and studies. Eventually, the city decided to limit the amount of rental housing to 30%. On any given block, the number of lots that are eligible to obtain certificates as rental property is limited to 30%. This step was taken because the city believed that the large number of rental units, especially near the Winona State University campus, were resulting in parking problems.
Ethan Dean had purchased a house in 2006 and planned to live in it. In 2009, he was preparing for a military tour of duty in Iraq and decided to rent out the house. But he was unable to obtain a rental certification because of the 30% rule.
Holly Richard also purchased a house in Winona in 2006. In 2009, she got a job in another state but was unable to sell her house. She decided to rent it out, and agreed to a rental with option to buy with a tenant. The City of Winona caught wind of the rental arrangement in 2010 and ordered the tenant out.
Ted and Lauren Dzierzbicki were residents of Illinois who had bought a house in Winona in 2007 when their daughter was in college. They improved the house so that their daughter could live in it and rent out space to other students. But they couldn't get a rental certificate, and the property has been empty since 2010 when the daughter graduated.
These property owners all sued the City in Winona County District Court, and claimed that the ordinance was unconstitutional and in violation of state law. The court granted the city's motion for summary judgment, and the plaintiff's appealed to the Minnesota Court of Appeals.
The plaintiffs first argued that the ordinance was outside the city's powers under its home rule charter. The Court of Appeals noted that a home rule charter city has very broad powers, including the general police power to act in the general welfare. The Court of Appeals held that the ordinance was a legitimate use of the police powers, and that regulation of the landlord-tenant relationship was traditionally part of the police power.
The owners next argued that the ordinance was unconstitutional, since it deprived them of their property without due process, and violated equal protection. The court held that the ordinance was facially neutral, and there was no evidence of discriminatory or arbitrary application.
Finally, the property owners argued that the ordinance violated substantive due process since it violates their right to rent their property. The court assumed, without deciding, that there was such a right. However, the court held that there was a legitimate public purpose, and that the ordinance was not unreasonably arbitrary.
Since the Court of Appeals held the ordinance constitutional, it affirmed the trial court's dismissal of the lawsuit.
No. A13-1028 (Minn. Ct. App. Feb. 24, 2014).
Please see the original opinion for the court's exact language.
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Richard P. Clem is an attorney and continuing legal education (CLE) provider in Minnesota. He has been in private practice in the Twin Cities for 25 years. He has a J.D., cum laude, from Hamline University School of Law in St. Paul and a B.A. in History from the University of Minnesota. His reported cases include: Asociacion Nacional de Pescadores a Pequena Escala o Artesanales de Colombia v. Dow Quimica de Colombia, 988 F.2d 559, rehearing denied, 5 F.3d 530 (5th Cir. 1993), cert. denied, 510 U.S. 1041 (1994); LaMott v. Apple Valley Health Care Center, 465 N.W.2d 585 (Minn. Ct. App. 1991); Abo el Ela v. State, 468 N.W.2d 580 (Minn. Ct. App. 1991).
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