State Ex Rel. North Dakota Department of Labor Ex Rel. Johnson v. Matrix Properties Corp.

2009 ND 137, 770 N.W.2d 290, 2009 N.D. LEXIS 153, 2009 WL 2168747

• Court: North Dakota Supreme Court
• Decided: July 21, 2009
• Docket: 20080224
• Status: Published

Opinions

VANDE WALLE, Chief Justice.

[¶ 1] The State, by the Department of Labor for the benefit of Evert Johnson (“State”), appealed from a summary judgment dismissing its discriminatory housing practice action against Matrix Properties Corporation, formerly known as E.W. Wylie Corporation, Wild & Associates, Ltd., and Ulteig Engineers, Inc. (collectively “Matrix”), on the ground that the action was barred by the applicable statute of limitations. Because we conclude the district court did not err in ruling the State’s action is barred by the two-year statute of limitations in 42 U.S.C. § 3613(a) and N.D.C.C. § 14-02.5-39, we affirm.

I

[¶ 2] In December 2005, the Department received a complaint from Johnson, who is disabled and uses a wheelchair. Johnson alleged that Matrix had committed discriminatory acts by failing to comply with the design and construction requirements under federal and state law for the Stonebridge Apartments in Fargo. Stonebridge Apartments consists of five separate, three-story, walk-up buildings containing 48 units in each building and an underground parking garage. Each building received a certificate of occupancy from Fargo when construction on the building was completed. The building in which Johnson resided received its certificate of occupancy from the city in 1998. Following an investigation, the Department issued a determination of reasonable cause and a charge of discrimination against Matrix in January 2007, and Matrix elected to have the claims decided in district court. See N.D.C.C. § 14-02.5-30.

[¶ 3] Matrix moved for summary judgment dismissal of the action, claiming it was barred by the two-year statute of limitations under the federal Fair Housing Act, 42 U.S.C. § 3601 et. seq. (“FHA”), and the state Housing Discrimination Act, N.D.C.C. ch. 14-02.5. The district court, relying on Garcia v. Brockway, 526 F.3d 456 (9th Cir.) (en banc), cert. denied sub nom., Thompson v. Turk, — U.S. -, 129 S.Ct. 724, 172 L.Ed.2d 725 (2008), held the statute of limitations required that any action concerning the design and construction of the apartment building must be brought within two years from the issuance of the certificate of occupancy in 1998, and because the civil action was not brought until 2005, the court concluded it was time barred and dismissed the action. The court also dismissed without prejudice the State’s alternative claim that Matrix had engaged in a pattern or practice of discrimination because the State had failed to first make an administrative determination of reasonable cause.

II

[¶ 4] The only issue the State raises on appeal is whether the district court erred in ruling its civil action based on an alleged discriminatory housing practice was barred by the two-year statute of limitations in 42 U.S.C. § 3613(a)(1)(A) and N.D.C.C. § 14-02.5-39(1).

[¶ 5] In Grinnell Mut. Reinsurance Co. v. Thies, 2008 ND 164, ¶ 5, 755 N.W.2d 852 (citations omitted), we outlined our standard for review of summary judgments:

Summary judgment is a procedural device for promptly resolving a controversy on the merits without a trial if either party is entitled to judgment as a matter of law, and if no dispute exists as to either the material facts or the inferences to be drawn from undisputed facts, or if resolving disputed facts would not alter the result. A party moving for summary judgment has the burden of proving there are no genuine issues of material fact and that the moving party is entitled to judgment as a matter of law. In considering a motion for summary judgment, a court must view the evidence in the light most favorable to the party opposing the motion and must give that party the benefit of all favorable inferences that reasonably can be drawn from the evidence. Whether a district court properly granted summary judgment is a question of law that we review de novo on the record.

The determination of when a cause of action accrues is generally a question of fact, but if there is no dispute about the relevant facts, the determination is a question of law for the court. See Tarnavsky v. McKenzie County Grazing Ass’n, 2003 ND 117, ¶ 9, 665 N.W.2d 18.

Ill

[¶ 6] The Legislature adopted North Dakota’s Housing Discrimination Act, N.D.C.C. ch. 14-02.5, in 1999. See 1999 N.D. Sess. Laws ch. 134. The legislation was designed to accomplish two goals: “First, it establishes a regulatory authority and administrative process for receiving and investigating charges of housing discrimination under state law ... Second! ], ⅛ provides for state enforcement of federal fair housing law, provided that its provisions are ‘substantially equivalent’ to ... those in the Federal Fair Housing Act.” Hearing on HB 1043 Before House Judiciary Comm., 56th N.D. Legis. Sess. (Jan. 12, 1999) (written testimony of Mark Bachmeier, Interim Department of Labor Commissioner). The “substantial equivalency” component was “the key to the federal portion of funding” because “[ajgencies enforcing state or local laws with provisions substantially equivalent to those of the Federal Fair Housing Act are eligible to receive federal funds from HUD [Department of Housing and Urban Development] to investigate charges of housing discrimination filed under federal law.” Hearing on HB 1043 Before Senate Appropriations Comm., 56th N.D. Legis. Sess. (March 25, 1999) (written testimony of Mark Bachmeier, Interim Department of Labor Commissioner). According to the State, North Dakota’s Housing Discrimination Act has been certified by the Secretary of HUD as being substantially equivalent to the rights, procedures, and remedies created under the federal FHA. See 42 U.S.C. § 3610(f)(3)(A). Under the federal and state acts, “discrimination” is defined to include a failure to “design and construct” covered multifamily dwellings that comport with certain accessibility requirements for handicapped persons. See 42 U.S.C. § 3604(f)(3)(C); N.D.C.C. § 14-02.5-06(3)(c).

[¶ 7] Under 42 U.S.C. § 3613(a) and N.D.C.C. § 14-02.5-39, an aggrieved person may bring a civil action to enforce these design and construction requirements. However, the civil action must be brought “not later than the second year after the date of the occurrence or the termination of an alleged discriminatory housing practice.” N.D.C.C. § 14-02.5-39(1); see also 42 U.S.C. § 3613(a)(1)(A) (“not later than 2 years after the occurrence or the termination of an alleged discriminatory housing practice, whichever occurs last”). The State argues the two-year limitation period began to run only when Johnson discovered the design and construction flaws in the Stonebridge Apartments, and the lawsuit was therefore brought in a timely manner. Matrix and the other defendants argue, and the district court concluded, the two-year limitation period began to run in 1998 when Fargo issued the certificate of occupancy, and because the lawsuit was not brought until 2005, it is time barred.

[¶ 8] The interpretation of 42 U.S.C. § 3613(a)(1)(A) and N.D.C.C. § 14-02.5-39(1) presents a question of law. See Sauby v. City of Fargo, 2008 ND 60, ¶ 8, 747 . The rules of statutory construction are well established:

The primary objective in interpreting a statute is to determine the intent of the legislature by first looking at the language of the statute. Amerada Hess Corp. v. State ex rel. Tax Comm’r, 2005 ND 155, ¶ 12, 704 N.W.2d 8. Words in a statute are given their plain, ordinary, and commonly understood meaning, unless defined in the code or unless the drafters clearly intended otherwise. N.D.C.C. § 1-02-02. Statutes are construed as a whole and are harmonized to give meaning to related provisions. N.D.C.C. § 1-02-09.1. If the language of a statute is clear and unambiguous, “the letter of the statute cannot be disregarded under the pretext of purs[u]ing its spirit.” N.D.C.C. § 1-02-05. A statute is ambiguous if it is susceptible to different, rational meanings. Amerada, at ¶ 12. If the language is ambiguous or doubtful in meaning, the court may consider extrinsic aids, such as legislative history, to determine legislative intent. N.D.C.C. § 1-02-39.

Sauby, at ¶ 8 (quoting Simon v. Simon, 2006 ND 29, ¶ 12, 709 N.W.2d 4).

[¶ 9] The operative language in 42 U.S.C. § 3613(a)(1)(A) and N.D.C.C. § 14-02.5-39(1) is identical. A civil action must be commenced not later than two years after the “occurrence or the termination of an alleged discriminatory housing practice.” Although the issue of when the statute of limitations begins to run in a design and construction case brought under the FHA is a question of first impression in North Dakota, the question has been addressed in other jurisdictions.

[¶ 10] In analyzing the language of the statutes, we believe the court’s decision in Moseke v. Miller and Smith, Inc., 202 F.Supp.2d 492 (E.D.Va.2002), is instructive. In Moseke, at 502, the court examined the language of 42 U.S.C. § 3613(a)(1)(A) to determine when the statute of limitations was triggered. The court focused on the words “occurrence,” “termination,” and “practice.” Moseke, at 502. The court noted the word “practice” applied to both “occurrence” and “termination,” and reasoned:

The plain meaning of “practice” as defined by Black’s Law Dictionary is: “Repeated or customary action; habitual performance; a succession of acts of similar kind; custom; usage.” BLACK’S LAW DICTIONARY 1172 (6th ed.1991). Similarly, another dictionary define[s] the term as: “[H]abitual or customary performance; operation; habit; custom; repeated performance or systematic exercise.” RANDOM HOUSE DICTIONARY OF THE ENGLISH LANGUAGE — THE UNABRIDGED EDITION 1041 (1973). [U]nder the FHA, it is either the “occurrence” or the “termination” of the discriminatory “practice,” which triggers the statute of limitations. The definition of “occurrence” is: “A coming or happening. Any incident or event....” BLACK’S LAW DICTIONARY 1080 (6th ed.1991). When combined, the plain meaning of the “the occurrence ... of a discriminatory housing practice” is a discrete event or incident that encompasses a discriminatory custom. This statutory phrase is also commonly known as the “occurrence rule.” Cf. Hamilton [v. 1st Source Bank], 928 F.2d [86,] 89 [(4th Cir.1990)(en banc) ] (“An occurrence rule is based upon the supposition that the adverse act serves to put the employee on notice.”) Generally speaking, the occurrence rule ties the running of the limitations period to the occurrence of the act, or omission causing the injury. Douglas v. Stallings, M.D., Inc., 870 F.2d 1242, 1249 (7th Cir.1989); BLACK’S LAW DICTIONARY 1107 (7th ed.1999) (explaining that the “occurrence rule” is “[t]he rule that a limitations period begins to run when the alleged wrongful act or omission occurs, rather than when the plaintiff discovers the injury.”)

Turning next to “termination,” the definition is: “End in time or existence; close; cessation; conclusion.” BLACK’S LAW DICTIONARY 1025 (6th ed.1991). The phrase “the termination of a discriminatory housing practice” thus plainly means the cessation of a discriminatory repeated action.

Moseke, at 502-03. The court said “the plain language of the FHA indicates that an act, whether one in a series of many, or a single discrete occurrence, is necessary within the limitations period or the claim falls outside the statute of limitations.” Id. at 503.

[¶ 11] The State argues the limitation period does not begin to run in design and construction cases until units in the challenged housing development become available to persons with disabilities by conforming to the accessibility requirements under the law, and so long as the units do not conform to those requirements, there is an ongoing discriminatory practice. The State supports its argument by citing to Havens Realty Corp. v. Coleman, 455 U.S. 363, 102 S.Ct. 1114, 71 L.Ed.2d 214 (1982), and analogizing design and construction eases to race discrimination cases under the FHA. The State is essentially arguing that the continuing violation doctrine should be applied to design and construction claims under the FHA to extend the statute of limitations.

[¶ 12] In Havens, 455 U.S. at 368, 102 S.Ct. 1114, the plaintiffs alleged that apartment employees falsely informed potential black renters there were no available apartments, but informed potential white renters that apartments were available. The United States Supreme Court noted the plaintiffs’ claims were “based not solely on isolated incidents ... but a continuing violation manifested in a number of incidents.” Id. at 381, 102 S.Ct. 1114. The Court adopted the continuing violation doctrine in that context, concluding that “where a plaintiff, pursuant to the Fair Housing Act, challenges not just one incident of conduct violative of the Act, but an unlawful practice that continues into the limitations period, the complaint is timely when it is filed within [the statutory period, running from] the last asserted occurrence of that practice.” Id. at 380-81, 102 S.Ct. 1114 (footnote omitted).

[¶ 13] However, several courts have refused to apply the continuous violation doctrine to design and construction cases under the FHA. The leading case is Garcia, 526 F.3d at 461, in which the en banc Ninth Circuit Court of Appeals held the statute of limitations in a design and construction case under the FHA is “triggered at the conclusion of the design-and-construction phase, which occurs on the date the last certificate of occupancy is issued.” In rejecting application of the Havens continuing-violation doctrine in design and construction cases, the court reasoned:

Plaintiffs and HUD confuse a continuing violation with the continuing effects of a past violation. “Termination” refers to “the termination of an alleged discriminatory housing practice.” The Supreme Court has “stressed the need to identify with care the specific [discriminatory] practice that is at issue.” Ledbetter v. Goodyear Tire & Rubber Co., 550 U.S. 618, 127 S.Ct. 2162, 2167, 167 L.Ed.2d 982 (2007). Here, the practice is “a failure to design and construct,” which is not an indefinitely continuing practice, but a discrete instance of discrimination that terminates at the conclusion of the design-and-construction phase. This violation differs from the one Congress codified as “continuing” in light of Havens, where the claims were “based not solely on isolated incidents ..., but a continuing violation manifested in a number of incidents— including at least one ... that [wa]s asserted to have occurred within the [limitations] period.” 455 U.S. at 381, 102 S.Ct. 1114, 71 L.Ed.2d 214 (emphasis added).

Put differently, “[a] continuing violation is occasioned by continual unlawful acts, not by continual ill effects from an original violation.” Ward v. Caulk, 650 F.2d 1144, 1147 (9th Cir.1981) (citing Collins v. United Air Lines, Inc., 514 F.2d 594, 596 (9th Cir.1975)); see also Moseke v. Miller & Smith, Inc., 202 F.Supp.2d 492, 507 (E.D.Va.2002) (“[An] FHA non-compliant building which contains inaccessible features to disabled persons is more akin to a continuing effect rather than a continuing violation under the FHA.”). The Supreme Court last Term reiterated the distinction between a continuing violation and continual effects when it held that “current effects alone cannot breathe life into prior, unchanged discrimination; as we held in Evans, such effects in themselves have ‘no present legal consequences.’ ” Ledbetter, 127 S.Ct. at 2169 (quoting United Air Lines, Inc. v. Evans, 431 U.S. 553, 558, 97 S.Ct. 1885, 52 L.Ed.2d 571 (1977)). Although the ill effects of a failure to properly design and construct may continue to be felt decades after construction is complete, failing to design and construct is a single instance of unlawful conduct. Here, this occurred long before plaintiffs brought suit. Were we to now hold the contrary, the FHA’s statute of limitations would provide little finality for developers, who would be required to repurchase and modify (or destroy) buildings containing inaccessible features in order to avoid design-and-construction liability for every aggrieved person who solicits tenancy from subsequent owners and managers .... This is not what Congress provided in erecting a two-year statute of limitations for FHA design-and-construction claims. If Congress wanted to leave developers on the hook years after they cease having any association with a building, it could have phrased the statute to say so explicitly.

Garcia, at 462-63 (footnotes omitted); see also, e.g., United States v. Taigen & Sons, Inc., 303 F.Supp.2d 1129, 1140-41 (D.Idaho 2003) (refusing to apply continuing violation doctrine); Moseke, 202 F.Supp.2d at 507 (same); State ex rel. Claypool v. Evans, 757 N.W.2d 166, 171-72 (Iowa 2008) (same). But see, e.g., Kuchmas v. Towson Univ., 553 F.Supp.2d 556, 563 (D.Md.2008) (applying continuing violation doctrine); Eastern Paralyzed Veterans Ass’n v. Lazarus-Burman Assocs., 133 F.Supp.2d 203, 213 (E.D.N.Y.2001) (same). Although there is a split of authority on the issue, Garcia is the only federal circuit court of appeals decision to date to directly address the specific issue here. The reasoning in Garcia is persuasive and we follow it.

[¶ 14] The State argues we should not follow Garcia because “[although both Acts are substantially similar, the clear words used by the North Dakota legislature in enacting N.D.C.C. ch. 14-02.5 show that the legislature did not intend for the statute of limitations triggering date to be at the completion of the construction of a dwelling.” The State mainly focuses on statutes in the Housing Discrimination Act other than the statute of limitations in N.D.C.C. § 14-02.5-39(1) to support its argument. However, the plain language of the statute of limitations requires an “occurrence or the termination of an alleged discriminatory housing practice,” and a “[discriminatory housing practice” is defined as an “act prohibited by sections 14-02.5-02 through 14-02.5-08.” N.D.C.C. § 14-02.5-01(7). Consequently, an act or the last of a series of acts triggers the limitation period. In the context of a design and construction case, it is the completion of the construction, rather than the mere existence of a noncompliant building, which constitutes the act that triggers the limitation period. Even if we were to conclude the statute of limitations was ambiguous and considered the legislative history, it provides no support for the State’s interpretation. The legislative history sheds no light on when the statute of limitations is triggered, and does not suggest the Legislature intended greater protections for the disabled than provided by the FHA. Rather, the legislative history reveals an overriding concern that the state law be “substantially equivalent” to federal law. See Hearing on HB 1013 Before Senate Appropriations Comm., 56th N.D. Legis. Sess. (March 25, 1999) (written testimony of Mark Bachmeier, Interim Department of Labor Commissioner). We have construed the state statute of limitations in the same manner as the only federal circuit court of appeals to address the question has interpreted the federal statute of limitations.

[¶ 15] Amici curiae argue upholding the district court’s decision converts the statute of limitations into a statute of repose and runs afoul of Hanson v. Williams County, 389 N.W.2d 319, 320 (N.D.1986), in which a majority of this Court held a products liability statute of repose violated the equal protection provision of the North Dakota Constitution. The State did not raise this issue on appeal, and “[a]n amicus brief must be limited to issues raised on appeal by the parties.” N.D.R.App.P. 29(a). Moreover, even if N.D.C.C. § 14-02.5-39(1) was a statute of repose, statutes of repose are not invariably unconstitutional, see, e.g., Hoffner v. Johnson, 2003 ND 79, ¶ 1, 660 N.W.2d 909; Bellemare v. Gateway Builders, Inc., 420 N.W.2d 733, 736-37 (N.D.1988), and amici curiae have failed to marshal a sufficient argument to challenge the constitutionality of the statute. See, e.g., Ramsey Fin. Corp. v. Haugland, 2006 ND 167, ¶ 23, 719 N.W.2d 346.

[¶ 16] The State and amici curiae contend the FHA and the Housing Discrimination Act should be liberally construed and posit several persuasive public policy arguments to support their proposed interpretation that the statute of limitations is triggered when the aggrieved person discovers the design and construction defect. However, “we do not ignore the clear language of a statute under the guise of liberal construction.” Stein v. Workforce Safety and Ins., 2006 ND 34, ¶ 11, 710 N.W.2d 364. Whether public policy would be better served by extending the limitation period indefinitely until an aggrieved person discovers the design or construction defect is a decision to be made by Congress or the Legislature, the policy-making bodies of government. See, e.g., Loken v. Magrum, 380 N.W.2d 336, 341 (N.D.1986); see also The Lilly Ledbetter Fair Pay Act of 2009, Pub.L. No. 111—2, 123 Stat. 5 (Jan. 29, 2009) (superseding United States Supreme Court’s holding in Ledbetter v. Goodyear Tire & Rubber Co., 550 U.S. 618, 127 S.Ct. 2162, 167 L.Ed.2d 982 (2007)).

[¶ 17] We conclude the two-year statute of limitations was triggered when the building in which Johnson resided received its certificate of occupancy from Fargo in 1998. Because this civil action was not commenced until 2005, the district court did not err in concluding the action was time barred and in granting summary judgment dismissal of the action.

rv

[¶ 18] The summary judgment is affirmed.

[¶ 19] DALE V. SANDSTROM and DANIEL J. CROTHERS, JJ., concur.