Atlanta Taxicab Co. Owners Ass'n v. City of Atlanta
Atlanta Taxicab Company Owners Association, Inc. v. City of Atlanta
Attorneys
George B. Spears, for appellant., R. Roger Bhandari, Laura J. Broward, for appellee.
Full Opinion (html_with_citations)
The Atlanta Taxicab Company Owners Association, Inc. (Association) is a nonprofit corporation comprised of several companies. Its members are holders of a Certificates of Public Necessity and Convenience (CPNC) issued by the City of Atlanta (City). A CPNC is required for operation of a cab or limousine in the City. Holders of a CPNC must comply with Chapter 162 of the City Code, pursuant to the provisions of which the City regulates the taxicab industry. As a business investment, the CPNC is transferable “pursuant to a purchase, gift bequest or acquisition of the stock or asset of a corporation . ...” Section 162-62 (a) of the City Code. Moreover, the interest “in a CPNC may be transferred involuntarily and disposed of by public or private sale in the same manner as personal property.” Section 162-62 (a) (8) of the City Code. Notwithstanding these provisions regarding general transferability, the transferee is required to “submit an application for a CPNC and . . . meet all requirements for same.” Section 162-62 (a) (3) of the City Code. One of those requirements is residency in Georgia “for at least one year immediately preceding the date of application —” Section 162-57 (a) (3) of the City Code.
The Association brought suit against the City, seeking damages and a declaration that various sections of Chapter 162 were unconstitutional. After conducting a hearing, the trial court granted summary judgment in favor of the City. The Association brings this appeal from the trial court’s order.
1. The City Council has established a Bureau of Taxicabs and Vehicles for Hire (Bureau), and authorized an administrative hearing procedure for the enforcement of those provisions of the City Code regulating taxicabs. The Association contends that the creation of
“The power granted to municipal corporations . . . shall not be construed to extend to . . . [ajction affecting the jurisdiction of any court. . ..” OCGA § 36-35-6 (a) (6). Thus, the City cannot impede the exercise of the jurisdiction that has been granted to any court. Insofar as the jurisdiction of the City’s municipal court is concerned, § 4-102 (1) of the City Charter provides that that court is authorized to hear cases involving all violations of ordinances, “except those relating to and regulating traffic. . . .” Ga. L. 1996, pp. 4469, 4515. Assuming, without deciding, that an exclusion from the municipal court’s jurisdiction of such ordinance violations as relate to the regulation of “traffic” is not otherwise broad enough to encompass those violations related to the regulation of taxicabs, the fact still remains that the City Charter does not purport to grant that court exclusive jurisdiction over cases involving violations of ordinances relating to and regulating such vehicles for hire. The provisions of § 4-102 (1) of the City Charter are consistent with the concept of concurrent jurisdiction. While the municipal court is granted general jurisdiction over most cases involving ordinance violations, there is nothing to indicate that the City is not authorized to provide for an alternate means of adjudicating cases involving violations of provisions of the City Code, including the violation of those ordinances directed toward the regulation of taxicabs.
To the contrary, § 1-102 (36) of the City Charter expressly provides that the City has the power “ [t] o regulate and license vehicles operated for hire in the city ...Ga. L. 1996, pp. 4469, 4477. Under § 3-401 (a) and (i) of the City Charter, the City Council is also authorized to create boards and commissions and to specify their functions. Ga. L. 1996, pp. 4469, 4506-4507. Thus, in establishing the Bureau and by providing for administrative hearings to facilitate the enforcement of the regulation of taxicabs, the City Council did not act ultra vires and divest the municipal court of any jurisdiction granted exclusively to that court. The City Council exercised the regulatory authority over taxicabs granted to it by the City Charter. Therefore, the trial court correctly upheld the provisions of the City Code creating the Bureau and the administrative hearing procedure.
2. To qualify for a CPNC, the City requires that the holder be a resident of Georgia for at least one year. The Association contends that this residency requirement is unconstitutional because it violates the Commerce Clause.
Nothing about the [Association’s] service affects interstate commerce. The service is incidental to a local operation*344 and we would not be justified in resorting to impractical theorizing in order to conclude that a local ride in a local taxi-cab affects interstate commerce.
Airport Taxi Cab Advisory Committee v. City of Atlanta, 584 FSupp. 961, 964 (1) (N.D. Ga. 1983) (upholding the City’s residency requirement for taxi drivers as against an equal protection challenge). However, the City, through its ordinances, does not limit its regulation of the taxi business to those who actually provide the local services. It also exercises control over who can own and operate a local taxi business. Although a CPNC is needed for operation of a cab or limousine in the City, the ordinance provides that the holder of the CPNC is not required to be the actual operator of the vehicle. Thus, the CPNC is a certificate that the vehicle owner must obtain to authorize its use for hire in the City. Accordingly, the one-year residency requirement restricts to Georgia residents those who can apply for a CPNC and those to whom current CPNC holders can sell or lease their property interest in the certificate. Consequently, the residency requirement prohibits all non-Georgians from engaging in the taxi business in the City.
Whether the Association has standing to raise this issue was addressed below, and the trial court determined that the Association has “associational standing” in accordance with Aldridge v. Ga. Hospitality & Travel Assn., 251 Ga. 234, 236 (1) (304 SE2d 708) (1983):
“(A)n association has standing to bring suit on behalf of its members when: (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization’s purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit.” [Cit.]
Here, every member of the Association is affected by the residency requirement, in that none of them is at liberty to sell or lease his or her CPNC to a non-resident of Georgia. The removal of this impediment to the sale or lease of a CPNC is clearly relevant to the Association’s purpose. Since the ordinance has a common adverse impact on the Association’s collective membership, participation of the individual members themselves is not required to determine the merits of the claim.
Standing does not require a showing that any particular individual member , of the Association has already suffered an actual injury by being prevented from consummating the sale or lease of a
“Before a statute can be attacked by anyone on the ground of its unconstitutionality, he must show that its enforcement is an infringement upon his right of person or property, and that such infringement results from the unconstitutional feature of the statute upon which he bases his attack. [Cits.]”
Crumley v. Head, 225 Ga. 246, 247 (3) (167 SE2d 651) (1969). The ordinance at issue in this case, if enforced according to its terms, serves as an immediate infringement on the property rights enjoyed by all members of the Association, in that the provision erects an existing impediment to the solicitation, as well as the eventual consummation, of any sale or lease of a CPNC to a non-Georgian. Obviously, no out-of-state prospective buyer or lessee would ever seriously consider entering into a contract with a member of the Association knowing that the validity of the agreement is subject to challenge under the residency requirement. The Association, on behalf of its members, is entitled to contest the constitutionality of that residency provision in an effort to remove it as an existing impediment to the marketability of a CPNC to non-residents.
[Enforcement of the local enactment against [them] will impact [their] right to engage freely in those business activities currently authorized by the [CPNC] issued to [them] under the Act. Therefore, [the Association] has standing to assert that the ordinance is unconstitutional as applied to it[s members]. [Cits.] (Emphasis supplied.)
City of Atlanta v. S.W.A.N Consulting & Security Services, 274 Ga. 277, 278 (1) (553 SE2d 594) (2001). The trial court correctly held that the Association has standing and, accordingly, the merits of the attack on the constitutionality of the provision under the Commerce Clause must be addressed. Compare Adams v. Ga. Dept. of Corrections, 274 Ga. 461, 463 (553 SE2d 798) (2001) (appellants mere self-proclaimed champions of the community who were “not directly affected” by the challenged statute).
As a “general principle [,] . . . the Commerce Clause prohibits a State from using its regulatory power to protect its own citizens from outside competition. [Cits.]” Lewis v. BT Investment Managers, 447
thus “overtly blocks the flow of interstate commerce at (the) State’s borders.” [Cit.] Such facial discrimination by itself maybe a fatal defect, regardless of the [ordinance’s] purpose, because “the evil of protectionism can reside in legislative means as well as legislative ends.” [Cit.] At a minimum such facial discrimination invokes the strictest scrutiny of any purported legitimate local purpose and of the absence of nondiscriminatory alternatives.
Hughes v. Oklahoma, 441 U. S. 322, 337 (II) (99 SC 1727, 60 LE2d 250) (1979).
[E]ven in regulating to protect local interests, the States generally must act in a manner consistent with the “ultimate ... principle that one state in its dealings with another may not place itself in a position of economic isolation.” [Cit.] However important the state interest at hand, “it may not be accomplished by discriminating against articles of commerce coming from outside the State unless there is some reason, apart from their origin, to treat them differently.” [Cit.]
Lewis v. BT Investment Managers, supra at 36 (II). “ ‘Discriminate’ has been defined ... in this context as ‘differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter.’ [Cit.]” Glazer’s Wholesale Drug Co. v. Kansas, supra at 1240 (III) A. “The burden is on the [City] to show that ‘the discrimination is demonstrably justifiedby a valid factor unrelated to economic protectionism[.]’ [Cit.]” (Emphasis in original.) Chemical Waste Management v. Hunt, 504 U. S. 334, 344 (II) (112 SC 2009, 119 LE2d 121) (1992).
Requiring that the actual operators of the taxis satisfy a residency requirement may be justified on the grounds that it enhances public safety and fosters more efficient service. See Airport Taxi Cab Advisory Committee v. City of Atlanta, supra at 967 (2). However, with regard to eligibility for holding a CPNC and, thus, engaging in the
may regulate business which affects public health, safety and welfare, but it may not deprive an individual of his right to conduct lawful business unless it can be shown that such deprivation is reasonably related to the ... interests sought to be protected. [Cit.] There is no relationship between the required residency and a valid governmental interest. It is economic protectionism which creates an artificial barrier to commerce and violates the Commerce Clause.
Wometco Services v. Gaddy, 616 SW2d 466, 468-469 (Ark. 1981). See also Lewis v. BT Investment Managers, supra; Cooper v. McBeath, 11 F3d 547 (5th Cir. 1994) (one-year residency requirement on holders of liquor license unconstitutional); Glazer’s Wholesale Drug Co. v. Kansas, supra. Therefore, the trial court erred in failing to find that the one-year Georgia residency requirement violates the Commerce Clause of the United States Constitution.
3. The Association also urges that the one-year residency requirement violates equal protection. However, it is unnecessary to consider this additional constitutional challenge, since we have held that the requirement violates the Commerce Clause for the reasons discussed in Division 2.
4. The City Code provides that the Association’s members are subject to the imposition of fines and penalties in the form of suspension or revocation of a CPNC when, in violation of the taxicab regulations, their drivers fail to obtain valid insurance and inspection stickers for the vehicles and fail to obtain or renew a driving permit. The Association urged that this is an imposition of vicarious criminal liability which constitutes a substantive due process violation. See Davis v. City of Peachtree City, 251 Ga. 219 (304 SE2d 701) (1983). However, the trial court held otherwise, concluding that when an ordinance “falls within the circle of the police power, it lies out of the orbit of the due-process clauses.” Davis v. Stark, 198 Ga. 223, 230 (31 SE2d 592) (1944).
“[W]e have held that vicarious criminal liability violates due process. [Cit.]” Perkins v. State, 277 Ga. 323, 325 (2) (588 SE2d 719) (2003). However, subjecting persons to vicarious criminal liability is a distinct proposition from imposing civil sanctions against them for infractions committed by their agents.
[C]ivil violations providing civil penalties such as fines or revocation of licenses [can] be used for offenses for which the*348 individual was not morally blameworthy and does not deserve the social condemnation “implicit in the concept ‘crime.’ ” [Cit.]
Davis v. City of Peachtree City, supra at 222 (1). Thus, the Association does not have a viable substantive due process claim unless its members are subjected to vicarious criminal liability, rather than vicarious civil sanctions, for their drivers’ omissions.
As noted in Division 1, the relevant provisions of the City Code provide that charges brought against individuals and entities for violating the taxicab regulations are initially heard by a Bureau hearing officer who conducts an administrative hearing to determine whether any sanction is authorized. After conducting the hearing, the hearing officer makes a recommendation as to sanctions, and the City Code authorizes the Mayor, upon receiving the recommendation, to suspend and revoke a permit and a CPNC and to impose a civil fine for a violation of the regulations.
[A] substantive due process analysis . . . considers both the interest of the public and the individual and whether, considering the legitimate public interests involved, there are other, less onerous means by which the public interest might be protected. [Cits.]
Davis v. City of Peachtree City, supra at 220 (1). Here, the ordinance in question is of the type which
“dispenses with the conventional requirement for criminal conduct — awareness of some wrongdoing. In the interest of the larger good it puts the burden of acting at hazard upon a person otherwise innocent but standing in responsible relation to a public danger.” [Cit.]
United States v. Parks, 421 U. S. 658, 668 (I) (95 SC 1903, 44 LE2d 489) (1975).
[A] municipal ordinance is a valid exercise of the police power if it is substantially related to the public health, safety, or general welfare. [Cits.]... So long as an ordinance realistically serves a legitimate public purpose, and it employs means that are reasonably necessary to achieve that purpose, without unduly oppressing the individuals regulated, the ordinance must survive a due process challenge. [Cits.] . . . [W]here “legislative action is within the scope of the police power (as exists here), fairly debatable questions*349 as to its reasonableness, wisdom and propriety are not for the determination of the courts, but for that of the legislative body on which rests the duty and responsibility of (the) decision.” [Cit.]
City of Lilburn v. Sanchez, 268 Ga. 520, 522 (2) (491 SE2d 353) (1997). When these principles are applied in this case, the City was authorized to find that, in the legitimate interest of promoting and protecting the public safety, subjecting the Association’s members to civil sanctions for infractions committed by their drivers was a reasonably necessary and less onerous alternative than the imposition of vicarious criminal liability. Compare Davis v. City of Peachtree City, supra. Thus, the trial court did not err when it found that the Association’s substantive due process challenge to the constitutionality of the ordinance was without merit.
5. In addition to a substantive due process attack on the constitutionality of the ordinance itself, the Association also asserted a separate claim against the City for an alleged procedural due process violation. According to the allegations of the original complaint filed in July of 2004, the City had engaged in a pattern of failing to provide the Association’s members with sufficient notice when a citation was issued to a driver that would result in the imposition of vicarious liability. For this alleged procedural due process violation, the Association sought damages. However, the answer filed by the City alleged that the Association had not complied with OCGA § 36-33-5 by providing the City with notice of the procedural due process claim before filing suit. Thereafter, the Association amended its complaint so as to withdraw all claims for damages. On October 8, 2004, the Association served an ante-litem notice on the City. When, more than a month later, the City had not responded to the notice, the Association again amended its complaint on November 17, 2004 so as to allege compliance with OCGA § 36-33-5 and to reassert the procedural due process claim for damages.
In contrast to the substantive due process claim which the trial court found to be meritless, the trial court found that a procedural due process violation had occurred because “the City’s actions pursuant to the challenged ordinances, prior to July 2004, [were] unconstitutional as applied.” Nevertheless, it concluded that the claim must be dismissed for failure of the Association to provide the City with ante-litem notice before filing the original complaint. The Association urges that this is erroneous, because it was authorized to reassert the procedural due process claim by amendment after providing the notice.
*350 No person, firm, or corporation having a claim for money damages against any municipal corporation on account of injuries to person or property shall bring any action against the municipal corporation for such injuries, without first giving notice as provided in subsection (b) . . . . Within six months of the happening of the event upon which a claim against a municipal corporation is predicated, the person, firm, or corporation having the claim shall present the claim in writing to the governing authority of the municipality for adjustment____No action shall be entertained by the courts against the municipal corporation until the cause of action therein has first been presented to the governing authority for adjustment. Upon the presentation of such claim, the governing authority shall consider and act upon the claim within 30 days from the presentation ....
OCGA§ 36-33-5 (a), (b), (c). Satisfaction of this notice requirement is “a condition precedent to bringing suit against a municipal corporation for damages resulting from injuries to person or property . . . .” City of Chamblee v. Maxwell, 264 Ga. 635, 636 (452 SE2d 488) (1994). “[T]he purpose of the notice requirement is to apprise the city of the claim in order for it to determine whether or not to adjust the claim without suit. [Cits.]” Jones v. City of Austell, 166 Ga. App. 808, 809 (305 SE2d 653) (1983). Thus, the failure to give the City any antelitem notice prior to July 2004 vitiated the Association’s claim for damages alleged in its original complaint.
However, the Association did not pursue that original claim. After amending the complaint to withdraw it, the Association gave the City notice on October 8, 2004 and then reasserted the claim by another amendment the following month. The reasserted claim was not precisely the same as that alleged in the original complaint, as only those occurrences happening within six months of October 8, 2004 were viable. However, there is no impediment to asserting a new claim by amendment. McDonald v. Rogers, 229 Ga. 369, 378 (7) (191 SE2d 844) (1972), overruled on other grounds, Gilman Paper Co. v. James, 235 Ga. 348, 349 (219 SE2d 447) (1975); Cooper v. Mason, 151 Ga. App. 793, 794 (1) (261 SE2d 738) (1979). The Association filed the amendment before entry of a pre-trial order, so not even leave of the trial court was required. “Amendment is a resource against waste. [Cits.] The practice as to the allowance of amendments is very liberal. [Cits.]” McRae v. Britton, 144 Ga. App. 340, 345-346 (2) (240 SE2d 904) (1977). After giving notice in October of 2004, the Association could have filed a separate action against the City seeking damages. There is no reason why it could not also pursue the claim by filing an amendment to the complaint.
However, the Association did not attempt to add the ante-litem notice by amendment to the complaint alleging a claim for damages against the City. Instead, it dismissed that claim by amendment to the original complaint, gave the City pre-litigation notice and then again amended its complaint to reallege the claim. This satisfied the procedural requirement of giving the City an opportunity to investigate the claim so as to determine whether to settle it without resort to litigation. The trial court erred in concluding that the Association was procedurally barred from pursuing that claim for such alleged violations of due process as occurred in the six months prior to October 8, 2004 when the ante-litem notice was given.
On appeal, the City urges that, even if it was permissible for the Association to withdraw and then to reassert the claim by amendment in November of 2004, the ante-litem notice that was served the preceding month was substantively deficient because, contrary to the mandate of OCGA § 36-33-5 (b), “the time, place, and extent of the injury” were not stated therein “as nearly as practicable . . . .” However, assuming, without deciding, that the alleged substantive deficiency of the notice was raised below as a ground for summary judgment, the trial court never ruled on it and, instead, based its grant of the City’s motion solely on the procedural failure of the Association to comply with OCGA § 36-33-5 (b) prior to filing the original complaint. The Association has not briefed the question of the substantive sufficiency of the ante-litem notice that it gave the City, presumably because the trial court granted summary judgment only on the basis of the erroneous legal theory that the notice was procedurally deficient and also because the City did not file a cross-appeal expressly raising the alleged substantive insufficiency as a
There is no precise standard for determining whether any given ante-litem notice is substantively sufficient, since substantial compliance with the statute is all that is required. City of Arlington v. Smith, 238 Ga. 50 (2) (230 SE2d 863) (1976). The information supplied will be deemed sufficient if it puts a municipality on notice of the “general character of the complaint, and, in a general way, of the time, place, and extent of the injury. The act recognizes, by the use of the words ‘as near[ly] as practicable,’ that absolute exactness need not be had.” Langley v. City Council of Augusta, 118 Ga. 590, 600-601 (11) (45 SE 486) (1903). Since substantial compliance with OCGA § 36-33-5 (b) cannot be determined as a matter of law, but depends upon an examination of the underlying factual basis of the claim and an appraisal of the text of the notice so as to determine whether it is sufficient to inform the municipality of those facts “in a general way,” consideration of the issue is best left in the first instance for the trial court. Because the trial court in this case did not examine the record to determine whether, considering the facts upon which the Association’s claim rests, the ante-litem notice substantially complies with OCGA § 36-33-5 (b) “as nearly as practicable,” it is not an appropriate issue to be addressed in the context of this appeal. “The tenet that the appellate courts do not rule on issues not ruled on by the trial courts preserves the appellate courts’ jurisdiction and delineates the proper roles of the courts at the trial and appellate levels.” City of Gainesville v. Dodd, supra at 838. However, the City is free to raise that issue and obtain an appealable ruling when the case is returned to the trial court.
Judgment affirmed in part and reversed in part.