Parvati Corporation owned a hotel in Oak Forest, Illinois. Parvati sought sell the hotel in order to convert it to a retirement home, likely occupied primarily or exclusively by black people. The City refused to permit the sale, so Parvati sued alleging racial discrimination in zoning and that the City’s zoning ordinance was unconstitutionally vague. The district court granted summary judgment in favor of the City on both charges, and the Seventh Circuit affirmed.
The hotel was located in a Manufacturing zoning district where highway-oriented commercial uses were permitted at the time. The hotel qualified for such a use due to its proximity to a major highway. After the hotel failed, Parvati attempted to sell it as a senior living home or equivalent. In 2004 Parvati signed a contract to sell the hotel to a company affiliated with the Bethlehem Missionary Temple Baptist Church of Harvey (“Church”), Illinois. The court stated that there was a high probability that many of the members of this church, who are black, would seek to be residents of this new retirement home. The sale was contingent upon Parvati being granted a zoning change, however, because the retirement home would not qualify as “highway oriented.” When Parvati and the Church’s reverend met with city officials, the City learned then that the retirement home would house primarily black people.
Two weeks after the meeting, the City’s development department asked the City’s zoning commission to recommend to the City Council that the M zoning classification be replaced by two new classifications – M–1 for light industrial uses and M–2 for heavy industrial uses – to which the Council complied. Neither district supported any residential or highway oriented use, leaving the hotel a non-conforming use though its highway oriented use was grandfathered. The reverend requested that an additional amendment be added to the zoning ordinance to permit the hotel to convert to a retirement home, but the Council denied the application.
Parvati persisted, and entered into a sales contract with another company affiliated with the Church. This company applied to the City for a license to convert the hotel into an “extended stay hotel,” a term that encompasses retirement homes. However, this use was forbidden was the new M-1 and M-2 districts, as well as the predecessor M district. The City Administrator rejected the application on this point and also on the grounds that the hotel was currently a non-conforming use and the zoning ordinance forbade replacing one non-conforming use with another. Following this denial, Parvati’s last hope was to obtain a “special use” permit for the sought-after conversion. In 2007, the City amended the zoning amendment divided the original M district by adding “extended stay hotels” as “special permitted uses” in both the M-1 and M-2 districts. Parvati applied for a special use permit now, but again was denied because “the inclusion of ‘extended stay hotels’ in the list of specially permitted uses had been a scrivener’s error.” Following this, Parvati lost the hotel to foreclosure.
In a suit against the City, Parvati claimed that the City discriminated against them in order to prevent the future establishment of a black retirement home. The primary basis for this claim is irregularities in the rezoning of the district the hotel was located in, though no evidence of racially tinged remarks or actions by City officials was presented. The court conceded that there were numerous irregularities in the zoning process relating to the hotel’s conversion. Such irregularities included, “besides the quick retraction of the authorization for special-use permits for extended-stay hotels in M–2 districts, failing to indicate in the original amendment which former M districts were now M–1 and which M–2 (eventually this omission was repaired and the district in which the hotel is located was designated M–2); omitting from the amended ordinance “Appendix A,” which was supposed to list the land uses permitted in M–1 and M–2 districts; and providing 13 days’ notice of the public hearing on the proposed amendment that created the new districts rather than the 15 days that the City’s zoning ordinance required.” Furthermore, the City provided no explanation as to why the amendment was adopted when it was – that is, two weeks after learning of the Church’s intent to convert the hotel.
However, Parvati offered no evidence demonstrating that these irregularities were more numerous or serious than in other zoning proceedings in the City. Apart from the timing and irregularities, no evidence of racial discrimination was provided. The decision to separate light and heavy industrial uses was not unique, and the court provided examples of other cities doing so, and was therefore not an “obvious pretext” argued by Parvati. Also, part of the reason the conversion was blocked was because the M-2 district where the hotel is located has no sidewalks and considerable truck traffic, making the location not a safe and salubrious environment for the elderly. If permanent residents moved in, amenities such as street lights and sidewalks would likely be demanded, and acquiescence to these demands might chase away industrial business due to the likelihood of accidents and lawsuits for nuisances. Parvati also presented no evidence that a similar facility, serving white clientele, has been permitted to operate in close proximity to the highway and industrial businesses. For these reasons Parvati failed to make a prima facie case of racial discrimination.
Parvati’s second claim was for unconstitutional vagueness when, because of the lack of clear designations of appropriate uses in the 2004 amendment, Parvati did not know which kind of district the hotel was in. as it relates to property rights, vagueness in zoning confuses owners on their rights to their property in that they will not know what uses are permitted. However, Parvati did not seek damages for any confusion over property rights, such as damaged born from delay in obtaining a definitive ruling on its hotel situation. Instead, it sought the difference in value of the building as a hotel and retirement home. The court noted that the classification omission was rectified so there was no longer an issue of vagueness, and such determination notwithstanding, Parvati did not show it suffered any harm as a result of any confusion over property rights.
Parvati Corp. v. City of Oak Forest, 709 F.3d 678, 684-85 (7th Cir.3/1/ 2013)
The opinion can be accessed at: http://media.ca7.uscourts.gov/cgi-bin/rssExec.pl?Submit=Display&Path=Y2013/D03-01/C:12-1954:J:Posner:aut:T:fnOp:N:1092099:S:0
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