Constitutional Law

James D. Jenkins, Esquire

Plaintiffs could not use declaratory judgment act to challenge criminal statute that violated the clear title, original purpose, and single subject provisions of Article III of the Missouri Constitution, but had to raise those as defenses in their criminal cases. Schaefer, et al., v. Koster, No. 91130 (Mo. banc, June 14, 2011), Teitelman, J.

Three plaintiffs brought an action for declaratory judgment in the Circuit Court of Cole County, seeking to declare House Bill 1715 unconstitutional. The house bill repealed and reenacted § 577.023, and the section challenged by the plaintiffs was § 577.023.16, which allowed for the admission of evidence regarding the defendant’s prior pleas and sentences to intoxication-related offenses when the pleas were made in a municipal division and resulted in a suspended imposition of sentence. The three plaintiffs sought declaratory relief that the act was unconstitutional under Article III, §§ 21 and 23 of the Missouri Constitution, and alleged that the State may seek, has threatened to seek, or has already sought, chronic offender enhancement status against them under the reenacted statute. The crux of their argument is that the statute was amended as part of a bill entitled “An Act to […] enact […] twenty new sections relating to watercraft,” which did not adequately express the intent of the bill. The plaintiffs alleged that the bill was changed after its introduction, that the bill included more than one subject, and that the title did not fairly apprise members of the legislature or the public of the subject of the bill.

Held: Affirmed.
The Supreme Court, by a 6-1 vote, ruled that the declaratory judgment act was not the appropriate vehicle for challenging the constitutionality of the statute, but that the defendants should raise it as an affirmative defense in their individual criminal cases. Judge Fischer dissented, noting that it was clear the statute was unconstitutional, and pointing out that under § 516.500, challenges to procedural defects in the enactment of a bill into law must be raised within a very limited period of time, and that one of the appellants would have been barred under that statute of limitations from raising the defense; thus, the declaratory judgment action was the only vehicle for her to challenge the statute.

Website that advertised rental properties violated state statute barring engaging in real estate brokerage practice without a license, and website’s commercial speech was not covered by First Amendment. Kansas City Premier Apartments, Inc. v. Missouri Real Estate Commission, No. 91125 (Mo. banc July 19, 2011), Fischer, J.

Kansas City Premier Apartments operated a website that advertised rental properties. Property owners advertised on KCPA’s website and paid a fee to KCPA for each new tenant obtained through KCPA’s referral. The Missouri Real Estate Commission determined that KCPA was engaged in real estate activity without a Missouri real estate license and ordered them to cease and desist. KCPA brought an action for declaratory judgment that their activities were exempt from the real estate licensing statute and that the Commission’s interpretation of § 339.010 violated the free speech provisions of the Missouri and federal constitutions. The Commission brought an action to enjoin KCPA’s activities, the actions were consolidated, and the end result was a denial of KCPA’s declaratory judgment action and entry of an injunction against it. KCPA appealed, arguing that the state’s licensing statute should be struck down for violation of the First Amendment because it dramatically impaired the ability of unlicensed persons to share knowledge about real estate and limited the ability of potential renters to receive that knowledge. KCPA also alleged violation of the equal protection clauses of the state and federal constitutions, violation of Mo. Const. Art. III, § 40(30) pertaining to special laws, and further argued that the statute in question was void for vagueness.

Held: Affirmed.
By a 5-2 vote, the Supreme Court held that Missouri’s interest in regulating real estate activities trumped any freedom of speech claim. Relying on federal precedents, the Court noted that courts have upheld regulations governing the practice of law, psychology, securities brokers, accountants, and interior designers, and found that Missouri had the power to regulate real estate activity. Applying rational basis review, the Court also rejected the equal protection challenge. Finally, the Court rejected the claims that § 339.010.7 is a special law or that it was void for vagueness. Judge Wolff, joined by Judge Teitelman, dissented. Judge Wolff opined that the majority’s opinion is contrary to the First Amendment as applied by the United States Supreme Court in Sorrell v. IMS Health, 131 S.Ct. 2653 (2011). Judge Wolff concluded that “KCPA should not be censored by the government and should be allowed to communicate information to potential customers about the availability and characteristics of apartments,” while noting that the state could seek an injunction against the dissemination of false or deceptive information, but not all information.

Taxpayers did not have standing to challenge issuance of state tax credits, and tax credits do not constitute public expenditures. Manzar, et al. v. State of Missouri, et al. No. 91025 (Mo. banc August 2, 2011), Russell, J.

This case is unusual in that it produced three separate opinions – the principal opinion, authored by Judge Russell, was joined in by Judges Fischer and Breckenridge. A concurring opinion by Judge Wolff also garnered three votes: his, Chief Justice Teitelman and Judge Price’s. A separate concurring opinion by Judge Stith concurred in the principal opinion and concurred in part in Judge Wolff’s concurrence.

The case arose when two taxpayers filed a petition for declaratory judgment, challenging the validity of  § 99.1205, the Distressed Areas Land Assemblage Tax Credit Act. The taxpayers claimed that the tax credits provided by the act constituted an unconstitutional grant or lending of money to private persons, associations, or corporations under Article III of the Missouri Constitution. The trial court held the taxpayers did not have standing to challenge the statute.

Held: Affirmed.
The taxpayers did not meet their burden of demonstrating standing to challenge the tax credits, and the Court agrees with a recent decision of the U.S. Supreme Court that tax credits are not public expenditures, such as are prohibited by Mo. Const. Art. III, § 38(a) and 39(1)-(2).

The Court began by discussing the history of taxpayer standing in Missouri. In Newmeyer v. Missouri and Mississippi Railroad, 52 Mo. 81 (1873), the Court held that taxpayers had standing to bring suit to challenge the county’s subscription to the capital stock of a railroad. In subsequent cases, Missouri courts have held that when a public interest is involved and public monies are being expended for an illegal purpose, taxpayers have a right to sue to enjoin the action. The Court, however, in this case, relied heavily on a recent U.S. Supreme Court case, Arizona Christian School Tuition Organization v. Winn, 131 S.Ct. 1436 (2011), which held that tax credits are not public expenditures. Thus, if the tax credits were not public expenditures, the taxpayers lacked standing to challenge them. Judge Wolff’s concurrence would have decided the case on narrower grounds and avoided the question of standing. Judge Wolff would have found instead that the expenditure of the tax credits was for a “public purpose,” which would have rendered a standing analysis irrelevant. Judge Wolff’s concurrence predicts future problems arising from the principal opinion in this case, including the possibility that the Legislature may in future spend state resources through tax credits which will now be unchallengeable by taxpayers. He further argues that the Court has distorted precedent, but nonetheless concurs in the result, since the current state of Missouri law allows the granting of public funds to a private entity for a “public purpose.”  Judge Stith, concurring separately, agreed with Judge Wolff that the tax credits were for a public purpose and that there was no need to consider whether the test for taxpayer standing should be modified. Were the issue of standing dispositive, Judge Stith would have wanted supplemental briefing about whether a different test should apply to challenges to tax credits as opposed to direct expenditures.

Trial court erred in finding hunting regulations promulgated by the Missouri Department of Conservation were void for vagueness and overbroad where the plaintiffs’ suit was purely hypothetical and there was no actual case or controversy. Turner, et al. v. Missouri Department of Conservation, No. 30817 (Mo. App. S.D., August 12, 2011), Burrell, J.

Turner and Jones brought a declaratory judgment action to have certain state regulations pertaining to hunting declared unconstitutional, and after a bench trial, the trial court entered judgment declaring the challenged regulations unconstitutionally vague and overbroad and enjoined the Department from enforcing them. The challenged regulations prohibited “hunting from or with a motor-driven conveyance,” “deer hunting with a motor-driven land conveyance,” and “deer hunting with the aid of dogs.”  Despite conflicting testimony at trial by Department officials as to whether, for example, hunting with the aid of “dogs” would prohibit hunting with the aid of only one dog, the Southern District reversed.

Held: Reversed. The testimony at trial was based on hypothetical situations and not based on the actual conduct of the plaintiffs. The court held that the declaratory judgment statute does not grant “a plaintiff an ability to challenge the validity of a regulation based on something other than the factual circumstances of the litigant. In other words, neither statute expressly permits the issuance of purely advisory judgments concerning hypothetical situations.” Here, the trial court made no express findings in the context of the plaintiffs’ specific circumstances and resolved no actual, specific, and immediate controversy involving the plaintiffs.

Where State failed to raise claim at trial that ex post facto clause, rather than clause regarding retrospective application of laws, should apply in criminal cases, the claim was not properly preserved for appellate review and would not be considered. State v. Davis, No. 91368 (Mo. banc August 30, 2011), Breckenridge, J.

This case is probably of no importance to anyone except the defendant, Mr. Davis. However, it presages further litigation to come regarding the application of Mo. Const. Art. I, § 13’s ban on retrospective laws in the sex offender context and perhaps other contexts as well. In this case, Melvin Ray Davis was charged with a felony count of being a sex offender within 500 feet of a public park that contains playground equipment or a swimming pool. He moved to dismiss, claiming that § 566.150 was unconstitutional as applied to him because it violated the Missouri constitutional ban on laws retrospective in their application, since his sex offense was committed in 1983, long before the Missouri legislature enacted § 566.150 in 2009. The trial court granted the motion to dismiss, relying on F. R. v. St. Charles County Sheriff’s Dept. (Mo. banc 2010). In its appellate brief, the State argued persuasively that the ban on retrospective laws applies only to civil laws, while the ex post facto clause applies to criminal laws, and that F. R. and other similar cases were wrongly decided, relying heavily on Ex parte Bethurum, 66 Mo. 545 (1877), which made clear that the ex post facto clause applied to criminal charges, while the ban on retrospective laws applied only to civil rights and remedies. Practitioners in this area should be prepared to face this argument, and it is likely that this issue will soon end up before the Supreme Court again and may result in the overruling of the F.R. case and other similar cases. The Court avoided resolving the issue in this case, but it will surely present itself again in the near future.

Held: Affirmed.
The State failed to raise its arguments at the trial court level and the Supreme Court would not consider them on appeal.

Challenge to constitutionality of state statutes regarding compensation when a homestead taking occurs were within the exclusive appellate jurisdiction of the Missouri Supreme Court. City of Richmond Heights v. Ruth L. Gasway, No. 95791 (Mo. App. E.D., Sept. 20, 2011), Mooney, J.

The City of Richmond Heights sought to acquire property belonging to Ms. Gasway, where she had lived for twenty-five years. After the City was unable to reach an agreement with Ms. Gasway for the purchase of her home, the City obtained a condemnation order. The Commissioners assessed damages for the appropriation of Ms. Gasway’s home at $264,717. Both parties appealed, and after a jury trial, Ms. Gasway was awarded $413,519.92. The City appealed, contending that the award exceeded “just compensation” for the property under Article I, § 26 of the Missouri constitution.

Held: Transferred to Missouri Supreme Court.
The Eastern District found that the case fell within the exclusive appellate jurisdiction of the Supreme Court, since it involved a challenge to the constitutionality of a state statute and transferred all issues in the case to the Supreme Court.