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Classy Cycles, Inc. v. Panama City Beach

Florida Court of Appeals, First District

November 13, 2019

Classy Cycles, Inc., Appellant,
Panama City Beach, Appellee.

         Not final until disposition of any timely and authorized motion under Fla. R. App. P. 9.330 or 9.331.

          On appeal from the Circuit Court for Bay County. James B. Fensom, Judge.

          George T. Reeves of Davis, Schnitker, Reeves & Browning, P.A., Madison, and Mark V. Murray, Tallahassee, for Appellant.

          J. Cole Davis and Julia K. Maddalena of Hand Arendall Harrison Sale LLC, Panama City, for Appellee.

          Wolf, J.

         Classy Cycles, Inc. challenges a final summary judgment upholding Panama City Beach's (City) ordinances pertaining to the rental of motorized scooters. Two ordinances are at issue, one prohibiting the overnight rental of scooters and one completely prohibiting the rental of scooters in the city effective September 8, 2020. Appellant claims the ordinances are arbitrary as a matter of law because the City does not have the power to ban a business from the entire city unless the business constitutes a per se legal nuisance. They also argue that the ordinances are preempted by Florida Statutes.[1] We find no error in the trial court's determination that a geographically small city has the right to restrict a business from operating within the city when the undisputed facts demonstrate that the restriction is for the safety of the city's citizens and visitors. We also find that chapter 316 does not preempt the ordinances because it provides the City the right to pass restrictions on types of vehicles which may be operated in congested areas.

         Undisputed Facts

         In 2015, the City passed ordinances requiring drivers of rented scooters to wear vests and requiring businesses renting scooters to the public to carry insurance on the scooters. This court reversed a trial court's order finding the ordinances valid, holding that these ordinances were preempted by state law. Classy Cycles, Inc. v. Bay County, 201 So.3d 779 (Fla. 1st DCA 2016).

         On June 8, 2017, the City enacted two new ordinances: 1415, which prohibits the overnight rental of scooters; and 1416, which completely prohibits the rental of scooters in the City effective September 8, 2020. Both ordinances contain extensive whereas clauses, painting a portrait of the City's rationale for adopting them: The City is geographically small and crowded and is being besieged by inexperienced scooter drivers seeking amusement and driving in a dangerous manner; the City is a tourist destination frequented by tens of thousands, and its streets are congested by scooters that are being driven illegally and in areas where they are not permitted; the City's residents and visitors are put in dangerous situations as a result of the improper use of scooters, especially at night; City businesses have complained about numerous trespasses on their property by people driving scooters while being disruptive; City police have been unable to cope with the situation and essential police resources are being drained; the City has been unable to control the situation through less restrictive means.

         A portion of the whereas clauses describing this situation is setout in the footnote below.[2]

         On June 12, 2017, Classy Cycles commenced the underlying action seeking to have ordinances 1415 and 1416 declared invalid, arguing the ordinances are preempted by state law, they impermissibly burden the statutory right of drivers to operate a motor vehicle on public streets, they treat drivers of scooters differently than other drivers, and the ordinances cannot as a matter of law prohibit renting a scooter. The factual findings contained within the whereas clauses were not challenged in the trial court nor have they been challenged on appeal.

         Both parties filed motions for summary judgment, and the trial court, after several hearings, entered final summary judgment in favor of the City.

         Issues on Appeal

         The specific arguments raised in appellant's brief are: (1) the City's ordinances are arbitrary and unreasonable because they ban an activity that is not a per se nuisance; and (2) the City's ordinances are preempted and thus invalid because they are an attempt by the City to indirectly regulate what this court ruled the City could not directly regulate in Classy Cycles, Inc. v. Bay County, 201 So.3d 779 (Fla. 1st DCA 2016).

         Much of the argument between the parties concerns whether the ordinances are traffic control ordinances or zoning ordinances. Ultimately this question does not control our analysis. No matter how they are categorized they restrict the rental of scooters with the goal of limiting their use within the city. This is the action which we must review.

         Rational Basis Review

         Appellant argues the City's ordinances are arbitrary because they restrict and ultimately eliminate the business of renting scooters within the city. They contend that the rental of scooters to the public is not a per se nuisance, so the City may not enact ordinances completely prohibiting this business because such ordinances would be arbitrary and unreasonable as a matter of law. They rely on the cases of Carter v. Town of Palm Beach, 237 So.2d 130 (Fla. 1970); and Inglis v. Rymer, 152 So. 4 (Fla. 1934).

         The City contends that it is permitted to prohibit activity which threatens the health, safety, and welfare of its citizens and visitors, even when the activity is not a per se nuisance because of a constitutional amendment granting municipalities broad powers and the Municipal Home Rule Powers Act (MHRPA). We first look to the history of a city's ability to adopt ordinances for the health, safety, and welfare of their communities.

         Under the constitution of 1885, the Legislature was required to pass a general or special act to grant municipalities the power to perform any given function. City of Boca Raton v. State, 595 So.2d 25, 27 (Fla. 1992), modified sub nom. Collier County v. State, 733 So.2d 1012 (Fla. 1999), holding modified by Sarasota County v. Sarasota Church of Christ, Inc., 667 So.2d 180 (Fla. 1995). Municipalities thus derived all of their power from the Legislature, and unless the Legislature explicitly granted them the power to perform a given function, the municipalities were without authority to act. Id.

         In 1968, the State amended the Florida Constitution and provided for broad inherent municipal powers, "except as otherwise provided by law." Id. (quoting Art. VIII §2(b), Fla. Const.). The legislature further adopted this view when it passed the Municipal Home Rule Powers Act (MHRPA), which codified the constitution's recognition of the broad powers inherent in municipalities and authorized them to wield any power not expressly prohibited by law. See § 166.021, Fla. Stat.

         Specifically, under section 166.021, the MHRPA provides that municipalities have inherent governmental powers that do not require legislative authorization:

(1) As provided in s. 2(b), Art. VIII of the State Constitution, municipalities shall have the governmental, corporate, and proprietary powers to enable them to conduct municipal government, perform municipal functions, and render municipal services, and may exercise any power for municipal purposes, except when expressly prohibited by law.
(2) "Municipal purpose" means any activity or power which may be exercised by the state or its political subdivisions.
(3) The Legislature recognizes that pursuant to the grant of power set forth in s. 2(b), Art. VIII of the State Constitution, the legislative body of each municipality has the power to enact legislation concerning any subject matter upon which the state Legislature may act.

§ 166.021, Fla. Stat.

         Under this framework, the parties dispute to what extent a municipality can prohibit a certain activity. Appellant argues a municipality cannot totally prohibit any business activity that is not a per se nuisance. The City contends it can prohibit any activity, provided the reasoning supporting the prohibition is not arbitrary or unreasonable. We agree with the City.

         Prior to the enactment of the MHRPA, courts routinely struck down ordinances prohibiting certain business or leisure activities because the respective municipalities were not banning activity that was considered a per se nuisance and the municipalities were acting outside of valid authority conferred by the legislature. See Inglis v. Rymer, 152 So. 4 (Fla. 1934) (holding that an ordinance prohibiting skating rinks that charged a fee was invalid because the municipality had no express authority to enact such an ordinance unless the activity was considered a per se nuisance); Carter v. Town of Palm Beach, 237 So.2d 130 (Fla. 1970) (holding that an ordinance prohibiting surfing was invalid because even though the municipality had authority to regulate surfing, the ordinance was arbitrary and unreasonable because it sought to prohibit an activity that was not a per se nuisance). We find appellant's argument unpersuasive for several reasons.

         First, the case law cited by appellant is at least partially based on the outdated analysis from Inglis that one had to look to the city charter to determine whether the city had the right to ban the particular activity. 152 So. at 5. Second, while the court in Inglis held that banning a business activity throughout the city was arbitrary and unreasonable under those particular circumstances, the facts in this case indicate that the limitation on the rental of motor scooters constitutes reasonable exercise of police powers by the City.

         As the City points out, the law has changed since Inglis and Carter were decided. The Legislature passed the MHRPA and provided municipalities with inherent authority to pass ordinances pertaining to a legitimate exercise of municipal power. Municipal ordinances no longer require an express statutory provision authorizing their enactment, but the ordinances must pass the rational basis test to be upheld. Kuvin v. City of Coral Gables, 62 So.3d 625, 632 (Fla. 3d DCA 2010) (citing Dep't of Cmty. Affairs v. Moorman, 664 So.2d 930, 933 (Fla. 1995)).

         The "per se nuisance" requirement is no longer in effect because it was attached to the now defunct rule requiring municipalities to only exercise authority expressly granted to them by the legislature. The modern test is an application of the rational basis test, which requires that the ordinance in question be reasonable and not arbitrary. Id.

         The trial court addressed the applicability of Carter and the per se nuisance rule cogently by pointing out that the holding in Carter did not survive the expansion of municipal home rule power as evidenced by modern case law upholding prohibitions of activities that are not per se nuisances. See Kuvin v. City of Coral Gables, 62 So.3d 625, 628 (Fla. 3d DCA 2010) (upholding prohibition of parking trucks in residential areas); Exile v. Miami-Dade County, 35 So.3d 118, 119 (Fla. 3d DCA 2010) (upholding prohibition of sex offenders from residing within 2500 feet of a school); Lamar-Orlando Outdoor Advert. v. City of Ormond Beach, 415 So.2d 1312, 1315 (Fla. 5th DCA 1982) (upholding prohibition of off-site advertising); Lambros, Inc. v. Town of Ocean Ridge, Fla., 392 So.2d 993, 993 (Fla. 4th DCA 1981) (upholding prohibition of all commercial uses of property); Blank v. Town of Lake Clarke Shores, 161 So.2d 683 (Fla. 2nd DCA 1964) (upholding prohibition of all commercial activity).

         Thus, under modern home rule power, municipalities have broad authority to regulate activities impacting public health, safety, and welfare so long as such regulations are not arbitrary or unreasonable. See, e.g., City of Jacksonville v. Sohn, 616 So.2d 1173, 1174 (Fla. 1st DCA 1993). Accordingly, to the extent that appellant argues on appeal that the City was without authority to prohibit the leasing or rental of motor scooters because motor scooters are not a "per se ...

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