183 EUSTIS AVE LLC; 477 THAMES STREET LLC; 517 THAMES ST LLC; MEAGHAN M. ADAMS; DAVID R. AHOUSE, JR.; MICHELE AHOUSE; IRIT ALTMAN; PHILIP ALTMAN; BEAR AND LION LLC; BRENDA E. MORRISON-BOLDT; RICHARD F. BOLDT; ANTHONY CIOFFI; BARBARA CIOFFI; JUSTIN CLOUGHER; KERRY CLOUGHER; PATRICK BRENNAN DANIELS; DAVID S. DROOKER; MARINA M. DROOKER; JAMES G. DUSTY; LISA T. DUSTY; LAURA GILL; LESLIE GILLETTE; HAMISH A. GUNN; GEORGE C. KARAGEORGOS; BRIAN J. KIRACOFE; TIMOTHY LAUGHRIDGE; ANTHONY LORUSSO; MONTGOMERY MCFATE; DANIELLE MCNAMARA; SUSAN AVINO MITCHELL; NANCY O. MORTON; PHILIP A. MORTON; NEWPORT SYNDICATION GROUP, LLC; GAIL M. NORTON; JAMES PALLIS; BRANDON PICO; ANDREA L. RESTREPO; SCHMITZ FAMILY TRUST; STEVEN L. SMITH; LAURIE J. DANIELS; ERICA ZAP, Plaintiffs,
CITY OF NEWPORT; and LAURA L. SITRIN, in her capacity as Finance Director for the City of Newport, Defendants.
Plaintiff: Michael A. Kelly, Esq. Joelle C. Rocha, Esq.
Defendant: Christopher J. Behan, Esq. Michael DeSisto, Esq.
matter arises out of Plaintiffs' short-term rental of
their properties (Properties) and the decision of the City of
Newport (City) to require Plaintiffs to register those
Properties. Plaintiffs move for partial summary judgment on
Counts I and II of the Amended Complaint, and Defendants move
for summary judgment on all counts of the Amended Complaint.
Jurisdiction is pursuant to G.L. 1956 §§ 8-2-13,
8-2-14 and 9-30-1 et seq.
Facts and Travel
are all record owners of different pieces of property
(single-family, two-family, multifamily, and residential
condominiums) located in the City who have rented either
individual dwelling units in multiunit properties or entire
single-family homes to other individuals. They do not rent
individual rooms. All of Plaintiffs' Properties have less
than ten dwelling units, and none of the units are dependent
on external facilities for the furnishing of meals, meaning
there is a full kitchen within each dwelling unit.
City sent notices of violation (Notices) to Plaintiffs,
stating that they are required to register their Properties
under the Newport Code of Ordinances Chapter 5.40, Section
5.40.020 (Section 5.40.020) which provides that
"transient guest facilit[ies]" and "guest
houses" must be registered with the City clerk.
See Pls.' Mot. Partial Summ. J. (Pls.'
Motion), Ex. C. The Notices further advised that the City
intended to begin issuing citations if Plaintiffs did not
discontinue short-term renting or apply for a special use
permit, and the fine for operating an unregistered short-term
rental unit is $200.00 per day. See id. For purposes
of summary judgment, Defendants do not contest these
response to the Notices, Plaintiffs filed a Complaint in
Newport County Superior Court on June 8, 2018, and an Amended
Complaint thereafter on July 8, 2019, that removed the
allegations in the Complaint related to a class action.
Plaintiffs' Amended Complaint contains counts seeking
declaratory relief: Count I, that their Properties are not
subject to the requirements of Section 5.40.020; Count II,
that renting property does not constitute a change in use;
Count III, that the application of Section 5.40.020 to
Plaintiffs' Properties constitutes a taking; and Count
IV, that such application violates Plaintiffs' equal
protection rights. The Amended Complaint also contains Counts
V and VI for violations of procedural and substantive due
process rights, respectively, and Count VII seeks a
prohibitory injunction against the City. Oral argument was
heard on July 16, 2019. During oral argument, all parties
agreed on the record that the Plaintiffs' Motion and
Defendants' Crossmotion for Summary Judgment (the
Motions) applied to the Amended Complaint.
Standard of Review
judgment is a drastic remedy, and a motion for summary
judgment should be dealt with cautiously." Cruz v.
DaimlerChrysler Motors Corp., 66 A.3d 446, 451 (R.I.
2013). "[S]ummary judgment is appropriate when, viewing
the facts and all reasonable inferences therefrom in the
light most favorable to the nonmoving party, the [C]ourt
determines that there are no issues of material fact in
dispute, and the moving party is entitled to judgment as a
matter of law." Quest Diagnostics, LLC v. Pinnacle
Consortium of Higher Educ., 93 A.3d 949, 951 (R.I. 2014)
(internal quotations omitted).
the Uniform Declaratory Judgments Act found in §§
9-30-1 et seq., the Superior Court has the
"power to declare rights, status, and other legal
relations whether or not further relief is or could be
claimed." Sec. 9-30-1. "This power is broadly
construed, to allow the trial justice to facilitate the
termination of controversies." Bradford Assocs. v.
Rhode Island Div. of Purchases, 772 A.2d 485, 489 (R.I.
2001) (internal quotations omitted). Therefore, it is the
function of this Court to "decide whether declaratory
relief is appropriate." Town of Barrington v.
Williams, 972 A.2d 603, 608 (R.I. 2009).
the Court addresses the merits of the Motions as they relate
to the Amended Complaint, it must first address two
preliminary arguments raised by Defendants: first, that
Plaintiffs have no standing to bring this suit and second,
that Plaintiffs have failed to exhaust their administrative
remedies. Standing is a threshold determination, and thus,
the Court will address it first.
first contend that Plaintiffs lack standing to bring the
instant suit because "there is no evidence that the City
has prevented Plaintiffs from renting their dwelling units or
penalized them for these rentals," nor has the City
fined Plaintiffs for their failure to register their rentals.
Defs.' Mem. 3-4. Plaintiffs counter that they have
standing because the Notices assert that the City intends to
begin imposing fines in the amount of $200 per day.
Additionally, Plaintiffs contend that they have suffered a
"destruction of property rights, loss of due process
protections, and . . . future economic harm." Pls.'
Reply Defs.' Obj. to Pls.' Motion 3. Plaintiffs
contend that their Properties were reclassified from single
family residential to guest houses that require a special use
permit, which destroys their grandfathered rights to dwell in
houses built in the 1880s. Id. at 3-4.
standing is at issue, the focal point shifts to the claimant,
not the claim, and a court must determine if the plaintiff
whose standing is challenged is a proper party to request an
adjudication of a particular issue and not whether the issue
itself is justiciable." McKenna v. Williams,
874 A.2d 217, 226 (R.I. 2005) (internal quotations omitted).
To have standing, the claimant must allege an injury in fact,
which must be "an invasion of a legally protected
interest which is (a) concrete and particularized . . . and
(b) actual or imminent, not conjectural or
hypothetical." Narragansett Indian Tribe v.
State, 81 A.3d 1106, 1110 (R.I. 2014) (internal
quotations omitted). "The line is not between a
substantial injury and an insubstantial injury. The line is
between injury and no injury." Pontbriand v.
Sundlun, 699 A.2d 856, 862 (R.I. 1997). Where future
harm is the injury alleged, such allegations "require
greater caution and scrutiny because the assessment of risk
is both less certain, and whether the risk constitutes injury
is likely to be more controversial." Kerin v.
Titeflex Corp., 770 F.3d 978, 982 (1st Cir. 2014).
Standing remains a requirement when the Court is faced with a
request for a declaratory judgment. "[W]hen confronted
with a UDJA claim, the inquiry is whether the Superior Court
has been presented with an actual case or controversy.
Without making this determination, the Court will not have
jurisdiction to entertain the claim." Key, 163
A.3d at 1168 (internal quotations and citations omitted).
date, the only injury the City has inflicted on Plaintiffs is
the issuance of the Notices. Those Notices state that the
Plaintiffs-recipients have "30 days from the issuance of
[the Notice] to apply for a special permit with the City or
discontinue" renting the properties or the City will
assess penalties in the amount of $200.00 per day. This is
not a hypothetical injury nor is the risk to Plaintiffs
uncertain because the Notices give both a timeframe for
compliance and a specific penalty that will be assessed for
noncompliance. Thus, the Court finds that Plaintiffs have
standing to bring this suit as it relates to the
determination of whether Plaintiffs must register their
allegation that their Properties have been rezoned and their
argument that renting does not constitute a change in use for
zoning purposes is a separate issue requiring a separate
analysis of standing. Plaintiffs admit that they have not
received Notices of Violation or any other administrative
notice from the City Zoning Official that their Properties
are not in compliance with City Zoning Ordinances. Am. Compl.
¶ 51. The City also confirmed in oral argument that it
has taken no zoning action against these Plaintiffs.
Additionally, all parties conceded at oral argument that the
City Director of Finance who sent the Notices regarding
Plaintiffs' failure to register, has no authority to make
zoning determinations; therefore, Plaintiffs cannot use the
Notices to show standing to contest the City's alleged
categorization of short-term renting as a special use because
it has done no such thing. Because the Notices do not relate
to zoning and the City has taken no zoning-related actions,
there is no case or controversy between these Plaintiffs and
Defendants regarding zoning. Moreover, some Plaintiffs may
need to apply for a special use permit to rent their
Properties and some may not; therefore, even if there was a
case or controversy related to zoning, any zoning-related
injury is speculative, at best. There is no controversy and
no injury to Plaintiffs concerning zoning of the Properties,
and thus, as to zoning, Plaintiffs lack
standing.Consequently, the Court declines to address
whether short-term renting constitutes a change in use.
Defendants argue that Plaintiffs have failed to exhaust their
administrative remedies, and thus cannot come to this Court
seeking relief. To support this contention, Defendants cite
to Nardi v. City of Providence, 89 R.I. 437, 449,
153 A.2d 136, 143 (1959). Defendants point to Plaintiffs'
arguments that the City has characterized Plaintiffs'
Properties as uses which are inapplicable, that renting is a
change in use, and that the Properties fit within the
City's definition of a guest facility to contend that a
zoning question is at issue, and this suit circumvents the
administrative process. Defendants note that if the City
determined a zoning violation existed, it would have filed a
complaint against the offending party in Newport Municipal
Court to adjudicate the same.
counter that the issues in this case are outside of the scope
of powers given to municipal zoning boards under the Rhode
Island Zoning Enabling Act of 1991 (ZEA) found at G.L. 1956
§ 45-24-27 et seq. Plaintiffs note that they
are not appealing from a zoning board decision, and there is
no power under ZEA for the board to review determinations
made by the Director of Finance. Alternatively, Plaintiffs
argue that even if there were an administrative remedy
available, such availability does not preclude a party from
seeking declaratory relief because the questions presented in
this case are purely questions of law which the Court can
existence of another adequate remedy does not preclude a
judgment for declaratory relief in cases where it is
appropriate." Super. R. Civ. P. 57. Likewise, the Rhode
Island Supreme Court has held that "persons whose rights
are affected by an ordinance . . . are entitled to bring a
declaratory judgment suit despite the possibility that
administrative remedies might be available." Taylor
v. Marshall, 119 R.I. 171, 180, 376 A.2d 712, 717
(1977). Furthermore, a party is not required to
exhaust administrative ...