Posted by: Patricia Salkin | December 22, 2010

Second Circuit Court of Appeals Finds City of New York Violated Equal Terms Provision of RLUIPA

In affirming the decision of the federal district court, the Second Circuit Court of Appeals held that the City of New York violated the Equal Terms Provision of the Religious Land Use and Institutionalized Persons Act (RLUIPA) when they allowed secular institutions in the Church’s neighborhood to conduct catered events but prohibited the Church from using its facilities for private catered events.

The congregation needed to renovate its 80-year old building to keep it in usable condition.  Because the congregation was small and unable to raise the millions of dollars needed on its own, they decided to contract with a catering company who would pay for capital improvement to the building and for ongoing building expenses in exchange for the right to hold private functions in the church building. After obtaining an accessory use permit from the Department of Buildings, the church and the catering company executed the contract and the catering company began to make the renovations and book events.  Following complaints from neighbors, the City issued a Notice of Intent to Revoke the permit it had previously issued, stating that “the catering establishment is not an accessory use because…it appears to be a principal commercial establishment at the premises.” 

The Church then sued the City under RLUIPA’s equal terms provision, which prohibits a “government [from] impose [ing] or implemt[ing] a land use regulation in a manner that treats a religious assembly on less than equal terms with a nonreligious assembly or institution.”   As evidence of unequal treatment, the Church asserted that two other secular institutions in the area offered similar catering and event services – the Beekman Apartments and the Regency Hotel, both located in the same R-10 Residential district, and both operating restaurants and event facilities in violation of their certificates of occupancy. Although the City asserted at oral argument before the district court that it had issued Notices of Violation to the Beekman and Regency, the district court concluded that a Notice, which did no more than start an administrative process, was a very different type of sanction from the revocation of an accessory-use permit, and imposed a permanent injunction barring the City from revoking the church’s permit.

In a case of first impression for the Second Circuit, the Court affirmed, that the institutions were similarly situated “for all functional intents and purposes relevant here,” and that the City’s later actions against the Beekman and the Regency were not the same as the action against the Church.  The Second Circuit relied on holdings in three other circuits to determine a valid comparator under RLUIPA’s equal-terms provision.  The Court agreed with the district court’s conclusion that the catering activities at issues were similarly situated with regard to their legality under New York City law: all were within the same zoning category and neighborhood, and all were engaged in large-scale catering activities. While the City contended that, because the hotels never sought permission for their catering activities, they were not similarly situated to the church, the court disagreed. “In a formal sense, the City may be correct that the hotels and the Church were differently situated from this point of view. RLUIPA, however, is less concerned with whether formal differences may be found between religious and non-religious institutions—they almost always can—than with whether, in practical terms, secular and religious institutions are treated equally.” In this case, all of the entities were allegedly operating in violation of the zoning rules, and the district court reasonably concluded that the City responded differently to each entity. “Most notably, the City’s revocation letter appears, under threat of sanction, to deny the Church the opportunity to hold any catering events, thus denying it the benefit of the accessory-use law altogether … in contrast to the firm prohibition embodied in the Intent to Revoke, there is no evidence that the City ever threatened to shutter the catering facilities at either hotel.”

Third Church of Christ v City of New York, 2010 WL 4869763 (2nd Cir. 12/1/2010).

The opinion can be accessed at: http://caselaw.findlaw.com/us-2nd-circuit/1546458.html


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