Kerns v. Dukes , 153 F.3d 96 ( 1998 )

Opinions of the United
1998 Decisions States Court of Appeals
for the Third Circuit
7-24-1998
Kerns v. Dukes
Precedential or Non-Precedential:
Docket 96-7751
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Recommended Citation
"Kerns v. Dukes" (1998). 1998 Decisions. Paper 172.
http://digitalcommons.law.villanova.edu/thirdcircuit_1998/172
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Filed July 24, 1998
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
NO. 96-7751
JOSEPH KERNS; KATHLEEN KERNS; WILLIAM M.
TORNEY; LOIS A. TORNEY; MAUREEN MOYER; JOHN D.
COFFMAN; MARTHA C. COFFMAN, on behalf of
themselves and other similarly situated property owners,
9 Del.C. 6519 persons and other persons being assessed
for the payment of the "West Rehoboth Expansion of the
Dewey Beach Sanitary Sewer District
v.
DALE R. DUKES, individually and as Sussex County
Government President and Council President; GEORGE J.
COLLINS, individually and as Sussex County Council
Member; WILLIAM D. STEVENSON, SR., individually an d
as Sussex County Council Member; GEORGE B. COLE,
individually and as Sussex County Council Member;
RALPH E. BENSON, individually and as Sussex County
Council Member; ROBERT L. STICKELS, individually a nd
as Sussex County Administrator; ROBERT W. WOOD,
individually and as Sussex County Engineer;
CHRISTOPHE A.G. TULOU, individually and as Delawar e
Department of Natural Resources and Environmental
Control Secretary; GERALD L. ESPOSITO, individuall y
and as a Director of Delaware Department of Natural
Resources and Environmental Control; EDWIN H. CLAR K,
individually and as then Secretary of Delaware
Department of Natural Resources and
Environmental Control
Joseph Kerns and Kathleen Kerns, William M.
Torney and Lois A. Torney, Maureen Moyer,
John D. Coffman and Martha C. Coffman,
individually and as representative Plaintiffs on
behalf of the certified class,
Appellants
On Appeal From the United States District Court
for the District of Delaware
(D.C. Civ. No. 96-113)
Argued May 21, 1997
Before: SLOVITER and ROTH, Circuit Judges, and
POLLAK, District Judge*
(Filed July 24, 1998)
Francis J. Trzuskowski
James F. Kipp
Francis J. Schanne (argued)
Trzuskowski, Kipp, Kelleher &
Pearce
1020 North Bancroft Parkway
Box 429
Wilmington, DE 19899
Attorneys for Appellants
Carl Schnee (argued)
Prickett, Jones, Elliott, Kristol &
Schnee
1310 King Street
P.O. Box 1328
Wilmington, DE 19899
Dennis L. Schrader
Veronica O. Faust
107 West Market Street
P.O. Box 690
Georgetown, DE 19947
Attorneys for Appellees
Dale Dukes, George J. Collins,
William D. Stevenson, George Cole,
Ralph E. Benson, Robert L.
Stickels, Robert W. Wood
_________________________________________________________________
* Hon. Louis H. Pollak, United States District Judge for the Eastern
District of Pennsylvania, sitting by designation.
2
Keith A. Trostle
Department of Justice
820 North French Street, 8th Floor
Wilmington, DE 19801
Attorney for Appellee
Christophe A. Tulou
Kevin P. Maloney
Department of Natural Resources
89 Kings Highway
P.O. Box 1401
Dover, DE 19903
Attorney for Appellee
Gerald L. Esposito
David L. Ormond, Jr.
Department of Justice
820 North French Street, 8th Floor
Wilmington, DE 19801
Attorney for Appellee
Edwin H. Clark
OPINION OF THE COURT
POLLAK, District Judge:
This appeal presents the question whether a suit in the
District Court for the District of Delaware brought by
certain Delaware property owners challenging assessments
charged to them to provide for an expanded sewer system
is barred either by the Tax Injunction Act, 28 U.S.C. S 1341
-- which provides that "[t]he district courts shall not enjoin,
suspend or restrain the assessment, levy or collection of
any tax under State law where a plain, speedy and efficient
remedy may be had in the courts of such State"-- or by
principles of comity. Because we find that the district court
properly dismissed the suit, we affirm the judgment of the
district court.
I.
This civil action challenges decisions taken by the
defendants -- members and officials of the Sussex County
3
Council ("the County defendants"), and officials of the
Delaware Department of Natural Resources and
Environmental Control ("the DNREC defendants")-- to (1)
authorize the establishment of the "West Rehoboth
Expansion of the Dewey Beach Sanitary Sewer District" and
(2) take subsequent steps to implement such authorization.
The plaintiffs -- appellants in this court -- are several
persons owning real property in the expanded sewer district
("the Property Owners"). The Property Owners allege that,
by virtue of the establishment of the expanded sewer
district, they are being compelled to discontinue reliance on
their own septic systems and, in lieu thereof, to join the
expanded sewer system and to pay an array of service
charges and fees for the privilege of obligatory participation
in the expanded sewer system.
The complaint sets forth three counts arising under
federal law. The first count, based upon 42 U.S.C. S 1983,
alleges deprivations by the County defendants of the
Property Owners' Fourteenth Amendment rights to
procedural due process; this count undergirds the Property
Owners' most strongly argued claim -- namely, that under
Delaware law the establishment of the expanded sewer
district could be legally accomplished only pursuant to a
vote (an "election") of the affected Property Owners, a
procedural step not taken in this instance. The second
count, also based upon 42 U.S.C. S 1983, alleges that the
actions of the County defendants and the DNREC
defendants have infringed upon the Property Owners'
Fourteenth Amendment rights to substantive due process:
the Property Owners contend that the defendants' actions
were not based on any rationally supportable public health
concerns and that they "have impinged upon the [Property
Owners'] use and enjoyment of their real property by
mandating a financial charge and legal encumbrance
thereon, as well as limiting, controlling, and charging for
the use of said property." Complaint at p. 15. The third
count, undertaking to set forth a claim pursuant to 33
U.S.C. S 1365(a)(2), the civil enforcement provision of the
Clean Water Act,1 alleges that the DNREC defendants failed
_________________________________________________________________
1. 33 U.S.C. S 1365(a)(2) provides: "[A]ny citizen may commence a civil
action on his own behalf . . . against the [EPA] Administrator where
there is alleged a failure of the Administrator to perform any act or duty
under this chapter which is not discretionary with the Administrator."
4
to perform certain federally mandated environmental and
cost reviews.2
The Property Owners brought this suit as a proposed
class action, alleging their readiness to represent an
estimated 7000 persons said to be similarly situated. The
complaint recites that, by way of relief:
Plaintiffs request, for themselves and all other
members of the class, that:
A. The rights of the class members to have an
election on the establishment of the "West Rehoboth
Expansion of the Dewey Beach Sanitary Sewer
District" be adjudicated and declared, and that the
prior unlawfully decreed Sewer District be declared
void ab initio;
B. The defendants and each of them be
temporarily and permanently restrained and enjoined
from requiring members of the class to connect to the
unlawfully created sewer district and from charging
or assessing said members of the class for the costs
of creating, constructing, maintaining and operating
said sewer district (and any debt thereon), unless
and until such time as the sewer district is lawfully
created by election and compliance with 9 Del.C. Ch.
65, after proper environmental and cost review, and
from any further construction of said sewer district, or
creation of new debt thereon, without further order
of the Court;
C. The defendants be Ordered to notify all
persons, within the said sewer district, of their right
_________________________________________________________________
2. The complaint also contains a fourth count charging both sets of
defendants with a variety of derelictions of state law. However, there is
not complete diversity of citizenship as between the plaintiffs and the
defendants, with the result that the fourth count is one which could
come within the subject matter jurisdiction of the federal district court
only as a claim "supplemental" to validly pleaded federal claims. 28
U.S.C. S 1367(a). Since the district court concluded that the federal
claims were not cognizable, and it is the correctness of that ruling which
is now before this court, there is no present need for this court to
consider the fourth count.
5
to refuse to connect and/or to disconnect, and the
right to receive a refund, if exercising said right, of
any capitalization fees previously paid and/or any
quarterly rates or other fees and costs paid regarding
said sewer district.
D. The plaintiffs be awarded attorneys' fees and
other applicable costs or fees pursuant to 42 U.S.C.
section 1988;
E. The plaintiff class be awarded money damages
incident to the equitable relief requested and such
moneys be placed in trust. Such monies shall be
sufficient to compensate the plaintiff class members
for any liability and costs incurred on the new sewer
district, including but not limited to costs of
connections, fees previously paid by the plaintiffs to
the defendants plus interest, and to pay for any debt
created from construction of the sewer district; and
F. Plaintiffs have such other legal and equitable
relief as the Court may deem appropriate, including
costs and expenses.3
Complaint at pp. 19-20 (emphases in original).
In the district court, the defendants moved to dismiss all
or part of the suit -- or, in the alternative, to stay the suit
pending state court resolution of state law questions -- on
a variety of grounds. Defendants chiefly argued that: 1) the
Tax Injunction Act ("The district courts shall not enjoin,
suspend or restrain the assessment, levy or collection of
any tax under State law where a plain, speedy and efficient
remedy may be had in the courts of such State") was a bar
to the district court's subject matter jurisdiction; 2)
_________________________________________________________________
3. In their brief on appeal, the Property Owners have characterized the
relief they seek as "(a) A declaration that the``West Rehoboth Expansion
of the Dewey Beach Sanitary Sewer District' is void ab initio; (b)
Injunctive relief barring mandatory connections; barring new
construction on Phase III of the sewer project; and barring related
charges; (c) Attorney's fees and costs under 42 U.S.C. SS 1983 and 1988;
and (d) Compensatory damages resulting from the unlawful creation of
the sewer district and its sewer system." Appellants' Brief on Appeal, pp.
3-4.
6
principles of comity required dismissal of the suit; and 3)
the Clean Water Act claim was not cognizable against the
DNREC defendants. The district court concluded that the
suit should be dismissed. Kerns v. Dukes, 944 F. Supp.
1214 (D. Del. 1996). Central to the district court's analysis
was the determination that the suit was a challenge to the
imposition and enforcement of taxes: as noted above, the
suit seeks inter alia to enjoin the defendants "from charging
or assessing said members of the class for the costs of
creating, constructing, maintaining and operating said
sewer district (and any debt thereon)." As a challenge to a
local taxation scheme, the suit was found by the district
court to run afoul both of federal comity principles and of
the Tax Injunction Act, 28 U.S.C. S 1341. The district court
went on to state:
This holding does not put an end to plaintiffs' chances
of prevailing on their lawsuit in the state court system.
All arguments made by plaintiffs before this Court may
be made in a state court.
Id. at 1222. In an order dated November 8, 1996, the
district court dismissed the action for lack of subject matter
jurisdiction and the Property Owners appealed to this
court.
On appeal, the Property Owners contended that: "The
primary, objective purpose of the present lawsuit is to
address the arbitrary and capricious establishment of a
sewer district. Thus, the relief requested in the case at bar
does not implicate Federal Comity or the Tax Injunction
Act." Appellants' Brief p. 34. After oral argument, and
because the resolution of this appeal potentially implicated
a question of Delaware law, this court issued an order
certifying a question to the Supreme Court of Delaware.4
_________________________________________________________________
4. Delaware Supreme Court Rule 41(a)(ii) provides:
The Supreme Court of the United States, a Court of Appeals of the
United States, the United States District Court or the Highest
Appellate Court of any other State may, on motion or sua sponte,
certify to this Court for decision a question or questions of law
arising in any case before it prior to the entry offinal judgment
if
there is an important and urgent reason for an immediate
determination of such question or questions by this Court and the
certifying court has not decided the question or questions in the
case.
7
Our certification order read, in relevant part; 5
There are two crucial issues on appeal. As to the
first, without now deciding the issue we will assume for
the purposes of this certification order that the district
court is correct that plaintiffs' suit is the sort of
challenge to the processes of state and local taxation
which federal comity doctrines and the Tax Injunction
Act were designed to keep out of a federal district
court. The remaining issue is whether the courts of
Delaware can provide plaintiffs with (in the language of
the Tax Injunction Act, language which we also regard
as applicable to the comity aspect of the case) a"plain,
speedy and efficient remedy." This is of course a federal
question to be determined by this Court. However, the
federal question is one whose basic ingredients
constitute a question of Delaware law. Therefore, as
ordered below, we will certify to the Supreme Court of
Delaware the following question:
To what extent does the jurisdiction of Delaware's
courts (whether taken singly or in combination)
encompass plaintiffs' claims, and to what extent are
Delaware's courts able to provide such relief as those
claims, if sustained, would entail?
We seek, that is, to ascertain the degree to which
plaintiffs are able to pursue in the courts of Delaware
those claims that they have chiefly pressed in the
federal district court: "First, that they were arbitrarily
denied the right to vote on a new district. Second, they
were arbitrarily denied an environmental process which
we believe to be fixed and vested. And third, that the
sewer district that was built is not legitimately or
rationally related to an existing health menace for the
need for that sewer. And that's the basis of the
lawsuit." Argument of Counsel for Plaintiffs at Hearing
Before District Court on Motions to Dismiss, Oct. 16,
1996, Transcript at 16-17. We seek also to ascertain to
what degree the requested relief -- including a
_________________________________________________________________
5. The full text of this court's certification order is annexed hereto as
Appendix A.
8
declaratory judgment, injunctive relief, and money
damages -- may be obtained in the courts of Delaware.
The Delaware Supreme Court, after full briefing and
argument, handed down an opinion carefully and
comprehensively addressing the issues tendered by our
inquiry with respect to Delaware law. Regarding the
Property Owners' S 1983 claims, the Delaware Supreme
Court stated that:6
[T]he state courts of Delaware may hear the Property
Owners' S 1983 claims. . . . While concurrent
jurisdiction over S 1983 claims may lie in either the
Superior Court or the Court of Chancery, the selection
of the forum is dictated by the relief sought. The
Property Owners seek declaratory relief, injunctive
relief and money damages on their S 1983 claims. They
also seek an award of attorney's fees pursuant to 42
U.S.C. S 1988.
The Court of Chancery has exclusive jurisdiction
where injunctive relief is sought. The Court of
Chancery may award declaratory relief, where there is
otherwise a basis for equitable jurisdiction. The
requests for an award of money damages and for
attorneys' fees do not prevent the Court of Chancery
from exercising jurisdiction over the S 1983 claims. The
Court of Chancery, in its discretion, may elect to
exercise jurisdiction over legal claims concurrent to
equitable claims properly before it. Once the Court of
Chancery accepts jurisdiction over the entire
controversy, the court is empowered to resolve the
entire controversy, even if doing so requires an award
of a purely legal remedy, such as money damages.
Finally, sovereign immunity does not bar an action
brought pursuant to S 1983. Accordingly, the Court of
Chancery has jurisdiction over the Property Owners'
S 1983 claims.
Kerns v. Dukes, 707 A.2d 363, 367-68 (Del. 1998)
(footnotes and citations omitted). With respect to the
_________________________________________________________________
6. The full text of the Delaware Supreme Court's opinion is annexed
hereto as Appendix B.
9
Property Owners' claim that they were arbitrarily denied an
environmental review under the Clean Water Act, the
Delaware Supreme Court stated that:
Under 29 Del.C. S 8003(12) and the State Revolving
Fund Agreement, the DNREC Secretary is required to
conduct an environmental review. This review is
mandatory and may be enforced in equity. DNREC is
not protected from injunctive relief by the doctrine of
sovereign immunity. Thus, it appears that the Property
Owners would be able to obtain an injunction ordering
performance of the reviews they seek.
Id. at 369 (footnotes and citations omitted).
II.
Aided by the opinion of the Delaware Supreme Court, we
now are in a position to resolve the issues posed by this
appeal.
The Tax Injunction Act bars a federal court from
enjoining "the assessment, levy or collection of any tax
under state law" where state law provides a "plain, speedy
and efficient" remedy. In Rosewell v. LaSalle National Bank,
450 U.S. 503 (1981), the Supreme Court recognized that
"[t]he statute ``has its roots in equity practice, in principles
of federalism, and in recognition of the imperative need of
a State to administer its own fiscal operations.' " Id. at 522
(quoting Tully v. Griffin, Inc. 429 U.S. 68, 73 (1976)). In
California v. Grace Brethren Church, 457 U.S. 393 (1982),
the Court held that the Tax Injunction Act bars federal
courts from hearing declaratory judgment actions in state
tax cases. Id. at 407.
In Fair Assessment in Real Estate v. McNary, 454 U.S.
100 (1981), the Court determined that suits seeking
damages because of the imposition of allegedly wrongful
taxes are not cognizable in a federal court; while not
expressly barred by the Tax Injunction Act, damage actions
are barred by principles of comity provided that effective
relief is obtainable in state court. The Court reasoned that
damage actions "would be no less disruptive of [a state's]
tax system than would the historic equitable efforts to
10
enjoin the collection of taxes, efforts which were early held
barred by considerations of comity." Id. at 112. Taken
together, the Tax Injunction Act and the Supreme Court's
decision in McNary make it clear that a federal court cannot
entertain a suit posing either an equitable or a legal
challenge to state or local taxes ("any tax under state law")
if a sufficient remedy (a remedy which the Tax Injunction
Act terms "plain, speedy and efficient" and which comity
views as "plain, adequate and complete")7 is available in
state court. See 454 U.S. at 115.
Therefore, this appeal presents two principal issues:
First, whether the Property Owners' suit constitutes a
challenge to the processes of state or local taxation; and
second, whether the courts of Delaware can provide the
Property Owners with a "plain, speedy and efficient" remedy
for the Property Owners' claims.
Subsequent to the issuance of the Delaware Supreme
Court's opinion, the Property Owners submitted to
this court a supplemental memorandum captioned
"Memorandum of Appellants Addressing the Delaware
Supreme Court's Answer to the Certified Question of Law."
In that memorandum, the Property Owners have
acknowledged that state law "affords them the potential for
all of the relief that they request in the Federal Complaint."
Appellants' Supplemental Memorandum, p. 3. Accordingly,
the Property Owners have narrowed their argument on
appeal to the following: "[w]hile the state forum may afford
all the relief requested, it is submitted that federal court
jurisdiction should remain open to the Property Owners
because this is not a state tax case (i.e., prong one of the
two part Federal Comity/Tax Injunction analysis)."8
_________________________________________________________________
7. In McNary, the Court stated that:
We discern no significant difference, for purposes of the
principles
recognized in this case, between remedies which are"plain,
adequate, and complete," as that phrase has been used in
articulating the doctrine of equitable restraint, and those which
are
"plain, speedy and efficient," within the meaning of S 1341.
454 U.S. at 115.
8. The Property Owners couple this argument with a contention that
"federal court jurisdiction should remain open to the Property Owners
11
Appellants' Supplemental Memorandum, p.4. The Property
Owners do not dispute the characterization of the
assessments in this case as a tax. They insist, however,
that the primary purpose of their suit is to "address the
arbitrary and capricious establishment of a sewer system"
and not to challenge the sewer assessments. Therefore,
according to the Property Owners, maintenance of this suit
would not constitute federal judicial interference with
Delaware's state or local tax system.
In McNary, the Supreme Court quoted with approval
Justice Brennan's explanation in an earlier case of the
rationale behind federal deference to state courts in state
tax cases:
The special reasons justifying the policy of federal
noninterference with state tax collection are obvious.
The procedures for mass assessment and collection of
state taxes and for administration and adjudication of
taxpayers' disputes with tax officials are generally
complex and necessarily designed to operate according
to established rules. State tax agencies are organized to
discharge their responsibilities in accordance with the
state procedures. If federal declaratory relief were
available to test state tax assessments, state tax
administration might be thrown into disarray, and
taxpayers might escape the ordinary procedural
requirements imposed by state law. During the
pendency of the federal suit the collection of revenue
under the challenged law might be obstructed, with
consequent damage to the State's budget, and perhaps
a shift to the State of the risk of taxpayer insolvency.
Moreover, federal constitutional issues are likely to
turn on questions of state law, which, like issues of
state regulatory law, are more properly heard in the
state courts.
_________________________________________________________________
because . . . state law was uncertain at the time of the filing of the
federal complaint." Appellants' Supplemental Memorandum, p. 4. We do
not think the authority of a federal district court to entertain a
plaintiff's
case can turn on the degree of the plaintiff's lack of certainty at the
inception of the litigation as to whether the plaintiff's claims are of a
kind that could be adequately addressed in a state court.
12
454 U.S. at 108 n.6 (quoting Perez v. Ledesma, 401 U.S.
82, 127-28 n.17 (1971) (Brennan, J., concurring in part
and dissenting in part)).
Viewing appellants' complaint in the light of Justice
Brennan's words, we are persuaded that maintenance of
this suit would impinge on exactly the state turf that
Congress and the Court have sought to protect against
federal judicial intrusion. The Property Owners are
challenging the actions of the County and DNREC
defendants in establishing the sewer system which has
given rise to the assessments they are now required to pay.
Given the relief sought -- that the sewer district be
"declared void" and that the defendants be "enjoined from
requiring members of the class to connect to the unlawfully
created sewer disrict and from charging or assessing said
members of the class for the costs of creating, constructing,
maintaining and operating said sewer district"9 -- we agree
with the district court that this action, if permitted to go
forward, would heavily involve the federal courts in
Delaware tax matters. And, given this direct and
substantial challenge to a system of assessments -- i.e.
taxes -- that is now in place, we find unpersuasive the
argument that the Property Owners' primary target is"the
arbitrary and capricious establishment of a sewer system"
and that this somehow insulates the Property Owners' suit
from the Tax Injunction Act and the demands of comity.10
_________________________________________________________________
9. Complaint, p. 19. See also supra note 3.
10. The proposition contended for by the Property Owners is illustrated
by Pendleton v. Heard, 824 F.2d 448, 451 (5th Cir. 1987), a case
strongly relied on by the Property Owners in their brief on appeal.
Pendleton v. Heard was a suit alleging that a proposed county bond
issue to finance bridge and road construction, if permitted to go forward
without any opportunity for county voters to seek a county election on
the bond issue, would contravene section 5 of the federal Voting Rights
Act. Noting that "the purpose of this suit is the vindication of voting
rights," and that "[a]ny effect on the issuance of bonds or the subsequent
imposition of taxes is incidental," id. at 452, the Fifth Circuit reversed
the district court's order dismissing the suit and remanded for trial
before a statutory three-judge court as required by the Voting Rights Act.
In the case at bar, the Property Owners, in challenging assessments that
have already been imposed, are seeking to recover the assessments that
13
Finally, we turn to the question whether the Delaware
courts can provide a "plain, speedy and efficient" remedy to
the Property Owners. In order for a remedy in Delaware's
state courts to satisfy this standard, it must be
procedurally adequate, Rosewell, 450 U.S. at 512, and
provide a " ``full hearing and judicial determination' at which
[the Property Owners] may raise any and all constitutional
objections to the tax." Id. at 514 (quoting LaSalle National
Bank v. County of Cook, 312 N.E.2d 252, 255-56 (Ill.
1974)).
The opinion of the Delaware Supreme Court makes it
clear that the courts of Delaware can indeed provide the
forms of judicial inquiry and (as appropriate) judicial
remedy that meet the requirements of the Tax Injunction
Act and the principles of comity. Indeed, as noted above,
the supplemental memorandum submitted to this court by
the Property Owners subsequent to the issuance of the
authoritative opinion of the Delaware Supreme Court has
affirmed the Property Owners' recognition that Delaware
law "affords them the potential for all of the relief that they
request in the Federal Complaint."11 And should it be the
_________________________________________________________________
have been paid and to enjoin collection of the assessments in the future.
Closer to the mark than Pendleton v. Heard is Carson v. City of Fort
Lauderdale, 293 F.2d 337 (5th Cir. 1961), in which the Fifth Circuit
affirmed dismissal, pursuant to the Tax Injunction Act, of a suit in which
"[p]laintiffs . . . seek an injunction to restrain the city from carrying
forward its plan to install sewers and make the consequent assessments
and service charges." Id. at 338. See also Burris v. City of Little Rock,
941 F.2d 717 (8th Cir. 1991) (holding that the Tax Injunction Act barred
review of a S 1983 action to challenge an assessment to pay for sewer
improvements).
11. In assessing the scope of the phrase "all of the relief that [the
Property Owners] request in the Federal Complaint," it should be borne
in mind that the complaint embraces two S 1983 claims and a Clean
Water Act claim under 33 U.S.C. S 1365(a)(2). The district court
"dismiss[ed] plaintiff 's action based on considerations of comity and the
Tax Injunction Act. As a result . . . the applicability of the Clean Water
Act [was] not considered." 944 F. Supp. 1218. Given our disposition of
the antecedent comity and Tax Injunction Act issues, it would not
appear appropriate for this court to undertake to resolve the academic
14
case that the anticipated proceedings in the Delaware
courts fail to resolve issues of federal law in a manner
deemed by the Property Owners to be satisfactory, the
Property Owners would, pursuant to the Federal Judicial
Code, be able to seek certiorari review by the Supreme
Court of the United States. 28 U.S.C. S 1257.
III.
For the foregoing reasons, the judgment of the district
court will be affirmed.
_________________________________________________________________
question whether the Clean Water Act claim, were it separable from the
companion counts of the complaint and from the broad relief sought,
would have been cognizable. Suffice it to note that it is at least
doubtful
that a claim that state officials failed to perform certain federally
mandated environmental and cost reviews fits within the framework of
33 U.S.C. S 1365(a)(2), which authorizes a citizen to "commence a civil
action on his own behalf . . . against the [EPA] Administrator where
there is alleged a failure of the Administrator to perform any act or duty
under this chapter which is not discretionary with the Administrator." In
any event, it appears from the opinion of the Delaware Supreme Court
that a lawsuit seeking a court order requiring the DNREC Secretary to
conduct a mandated environmental review is tenable under Delaware's
equity jurisprudence.
15
APPENDIX A
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
NO. 96-7751
JOSEPH KERNS, et al.
Appellants
v.
DALE R. DUKES, et al.
Appellees
On Appeal From the United States District Court
for the District of Delaware
(D.C. Civ. No. 96-113)
Present: SLOVITER, Chief Judge,
ROTH, Circuit Judge, and POLLAK, District Judge*
ORDER CERTIFYING A QUESTION OF LAW PURSUANT
TO DELAWARE SUPREME COURT RULE 41
This 31st day of July 1997, the Court having found that:
(1) This matter came before the United States Court of
Appeals for the Third Circuit on May 21, 1997, on appeal
from a final judgment of the United States District Court for
the District of Delaware, Honorable Murray M. Schwartz,
United States District Judge, dismissing plaintiffs'
complaint on grounds of comity and/or for lack of
jurisdiction, see 944 F. Supp. 1214 (D. Del. 1996);
_________________________________________________________________
* Hon. Louis H. Pollak, United States District Judge for the Eastern
District of Pennsylvania, sitting by designation.
16
(2) The following facts are undisputed:
(a) This civil action challenges decisions taken by the
defendants -- members and officials of the Sussex County
Council ("the County defendants"), and officials of the
Delaware Department of Natural Resources and
Environmental Control (DNREC) -- to (1) authorize the
establishment of the "West Rehoboth Expansion of the
Dewey Beach Sanitary Sewer District" and (2) take
subsequent steps to implement such authorization. The
plaintiffs -- appellants in this Court -- are several persons
owning real property in the expanded sewer district. The
plaintiffs allege that, by virtue of the establishment of the
expanded sewer district, they are being compelled to
discontinue reliance on their own septic systems and, in
lieu thereof, to join the expanded sewer system and to pay
an array of service charges and fees for the privilege of
obligatory participation in the expanded sewer system.
(b) The complaint sets forth three counts arising under
federal law. The first count, based upon 42 U.S.C.S 1983,
alleges deprivations by the County defendants of plaintiffs'
Fourteenth Amendment rights to procedural due process;
this count undergirds plaintiffs' most strongly argued claim
-- namely, that under Delaware law the establishment of
the expanded sewer district could be legally accomplished
only pursuant to a vote (an "election") of the affected
property owners, a required procedural step not taken in
this instance. The second count, also based upon 42 U.S.C.
S 1983, alleges that the actions of the County defendants
and the DNREC defendants have infringed upon plaintiffs'
Fourteenth Amendment rights to substantive due process:
plaintiffs contend that the defendants' actions were not
based on any rationally supportable public health concerns
and that they "have impinged upon the plaintiffs' use and
enjoyment of their real property by mandating afinancial
charge and legal encumbrance thereon, as well as limiting,
controlling, and charging for the use of said property."
Complaint at 15. The third count, undertaking to set forth
a claim pursuant to 33 U.S.C. S 1365(a)(2), alleges that the
DNREC defendants failed to perform certain federally
mandated environmental and cost reviews. (The complaint
also contains a fourth count charging both sets of
17
defendants with a variety of derelictions of state law.
However, there is not complete diversity of citizenship as
between the plaintiffs and the defendants, with the result
that the fourth count is one which could come within the
subject matter jurisdiction of the federal district court only
as a claim "supplemental" to validly pleaded federal claims.
28 U.S.C. S 1367(a). Since the district court concluded that
the federal claims were not cognizable, and it is the
correctness of that ruling which is now before this Court,
there is no present need for this Court to consider the
fourth count.)
(c) The plaintiffs have brought this suit as a proposed
class action, alleging their readiness to represent an
estimated 7000 persons said to be similarly situated. The
complaint recites that, by way of relief:
Plaintiffs request, for themselves and all other
members of the class, that:
A. The rights of the class members to have an
election on the establishment of the "West Rehoboth
Expansion of the Dewey Beach Sanitary Sewer District"
be adjudicated and declared, and that the prior
unlawfully decreed Sewer District be declared void ab
initio;
B. The defendants and each of them be temporarily
and permanently restrained and enjoined from
requiring members of the class to connect to the
unlawfully created sewer district and from charging or
assessing said members of the class for the costs of
creating, constructing, maintaining and operating said
sewer district (and any debt thereon), unless and until
such time as the sewer district is lawfully created by
election and compliance with 9 Del.C. Ch. 65, after
proper environmental and cost review, and from any
further construction of said sewer district, or creation of
new debt thereon, without further order of the Court;
C. The defendants be Ordered to notify all persons,
within the said sewer district, of their right to refuse to
connect and/or to disconnect, and the right to receive
a refund, if exercising said right, of any capitalization
18
fees previously paid and/or any quarterly rates or
other fees and costs paid regarding said sewer district.
D. The plaintiffs be awarded attorneys' fees and
other applicable costs or fees pursuant to 42 U.S.C.
section 1988;
E. The plaintiff class be awarded money damages
incident to the equitable relief requested and such
moneys be placed in trust. Such monies shall be
sufficient to compensate the plaintiff class members for
any liability and costs incurred on the new sewer
district, including but not limited to costs of
connections, fees previously paid by the plaintiffs to
the defendants plus interest, and to pay for any debt
created from construction of the sewer district; and
F. Plaintiffs have such other legal and equitable
relief as the Court may deem appropriate, including
costs and expenses.
Complaint at 19-20 (emphases in original).
(d) In the district court, the defendants moved to
dismiss all or part of the suit -- or, in the alternative, to
stay the suit pending state court resolution of state law
questions -- on a variety of grounds. The district court
concluded that the suit should be dismissed. Central to its
analysis was the determination that the suit was a
challenge to the imposition and enforcement of taxes: as
noted above, the suit seeks inter alia to enjoin the
defendants "from charging or assessing said members of the
class for the costs of creating, constructing, maintaining
and operating said sewer district (and any debt thereon)."
As a challenge to a local taxation scheme, the suit was
found by the district court to run afoul both of federal
comity doctrines, see, e.g., Fair Assessment in Real Estate
Ass'n v. McNary, 454 U.S. 100 (1981), and of the Tax
Injunction Act, 28 U.S.C. S 1341, which provides: "The
district courts shall not enjoin, suspend or restrain the
assessment, levy or collection of any tax under State law
where a plain, speedy and efficient remedy may be had in
the courts of such State." Specifically, the district court
held:
19
Mindful of the fact that Sussex County already has
invested $70,000,000 in the sewer district and the
plaintiffs have been assessed taxes, the Court finds
that permitting the present case to go forward will
result in substantial federal court interference in the
County's revenue collecting ability. The Court
alternatively dismisses the case based on the Tax
Injunction Act.
944 F. Supp. at 1222. The district court went on to state:
This holding does not put an end to plaintiffs' chances
of prevailing on their lawsuit in the state court system.
All arguments made by plaintiffs before this Court may
be made in a state court.
Id. This latter recital was not developed in detail in the
district court's opinion;
(3) The question of law set forth below should be certified
to the Supreme Court of Delaware for the following reasons:
(a) There are two crucial issues on appeal. As to the
first, without now deciding the issue we will assume for the
purposes of this certification order that the district court is
correct that plaintiffs' suit is the sort of challenge to the
processes of state and local taxation which federal comity
doctrines and the Tax Injunction Act were designed to keep
out of a federal district court. The remaining issue is
whether the courts of Delaware can provide plaintiffs with
(in the language of the Tax Injunction Act, language which
we also regard as applicable to the comity aspect of the
case) a "plain, speedy and efficient remedy." This is of
course a federal question to be determined by this Court.
However, the federal question is one whose basic
ingredients constitute a question of Delaware law.
Therefore, as ordered below, we will certify to the Supreme
Court of Delaware the following question:
To what extent does the jurisdiction of Delaware's
courts (whether taken singly or in combination)
encompass plaintiffs' claims, and to what extent are
Delaware's courts able to provide such relief as those
claims, if sustained, would entail?
20
We seek, that is, to ascertain the degree to which plaintiffs
are able to pursue in the courts of Delaware those claims
that they have chiefly pressed in the federal district court:
"First, that they were arbitrarily denied the right to vote on
a new district. Second, they were arbitrarily denied an
environmental process which we believe to be fixed and
vested. And third, that the sewer district that was built is
not legitimately or rationally related to an existing health
menace for the need for that sewer. And that's the basis of
the lawsuit." Argument of Counsel for Plaintiffs at Hearing
Before District Court on Motions to Dismiss, Oct. 16, 1996,
Transcript at 16-17. We seek also to ascertain to what
degree the requested relief -- including a declaratory
judgment, injunctive relief, and money damages -- may be
obtained in the courts of Delaware.
(b) Resolution of the issues of law presented in the
certified question will guide this Court's analysis of the
federal question whether a "plain, speedy and efficient"
remedy is available to plaintiffs in the courts of Delaware.
In the absence of such an available remedy, this case will
be heard in federal courts rather than state courts whether
or not this Court concludes that the complaint constitutes
a challenge to processes of state and local taxation. An
appropriate regard for the delicate balance between state
and national judicial authority counsels that, insofar as
feasible, decisions relating to the jurisdiction and remedial
capacity of the Delaware state courts -- decisions central to
the resolution of this case -- be made by the Delaware
courts themselves.
(c) Our concern about the remedy available in the
Delaware courts arises in part from the potential tension
between the decision of the Court of Chancery in Delaware
Bankers Ass'n v. Division of Revenue of the Dep't of
Finance, 298 A.2d 352, 356 (Del. Ch. 1972) (holding that in
some cases there is an adequate remedy at law for an
attack on an illegal or unconstitutional tax through the Tax
Appeal Board), and that of the Superior Court in Tatten
Partners v. New Castle County Bd. of Assessment Review,
642 A.2d 1251, 1262-65 (Del. Super. 1993) (holding that
taxpayer could not have presented substantive due process
claim to the Board of Assessment Review because of the
limited jurisdiction of that board);
21
(4) The important and urgent reasons for an immediate
determination by the Supreme Court of Delaware of the
question certified are:
(a) Determination of the certified question is important
to the resolution of a controversy that assertedly affects
some 7000 Delaware property owners and challenges
outlays of at least $70,000,000. The State of Delaware has
a substantial interest in ensuring the most authoritative
possible determination of the issues on which this litigation
turns.
(b) A definitive determination by the Supreme Court of
Delaware of the remedies available to plaintiffs in the
Delaware state courts will obviate the need for this Court to
speculate on that question, and will avert the possibility
that this Court would arrive at a conclusion inconsistent
with the authoritative result that might be obtained from
Delaware's highest court;
(5) If certification is accepted, it is recommended that the
plaintiffs (Joseph Kerns, et al.) be appellants, and that the
defendants (Dale R. Dukes, et al.) be appellees, for
purposes of the caption on any filings in the Supreme
Court of Delaware with respect to the question certified.
NOW, THEREFORE, IT IS ORDERED that the following
question of law is certified to the Supreme Court of the
State of Delaware for disposition in accordance with Rule
41 of that Court:
To what extent does the jurisdiction of Delaware's
courts (whether taken singly or in combination)
encompass plaintiffs' claims, and to what extent are
Delaware's courts able to provide such relief as those
claims, if sustained, would entail?
In accordance with Supreme Court Rule 41, it is
recommended that briefs shall be filed in the Supreme
Court in the following order: the initial brief shall be filed
by the plaintiffs as appellants, and any responsive brief(s)
shall be filed by the defendants as appellees.
This Court shall retain jurisdiction meanwhile.
BY:
Louis H. Pollak
22
FOR: Dolores K. Sloviter
Chief Judge
United States Court of Appeals
for the Third Circuit
Jane R. Roth
Circuit Judge
United States Court of Appeals
for the Third Circuit
Louis H. Pollak
District Judge
United States District Court
for the Eastern District of
Pennsylvania
(sitting by designation)
DATED: July 31, 1997
Counsel for the Parties:
FRANCIS J. TRZUSKOWSKI
JAMES F. KIPP
FRANCIS J. SCHANNE
Trzuskowski, Kipp, Kelleher & Pearce
1020 N. Bancroft Parkway
P.O. Box 429
Wilmington, DE 19899
Attorneys for Appellants
CARL SCHNEE
PATRICIA A. PYLES
Prickett, Jones, Elliott,
Kristol & Schnee
1310 King Street
P.O. Box 1328
Wilmington, DE 19899
23
DENNIS L. SCHRADER
VERONICA O. FAUST
Wilson, Halbrook & Bayard
107 West Market Street
P.O. Box 690
Georgetown, DE 19947
Attorneys for Appellees
Dale Dukes, George J. Collins,
William D. Stevenson, Sr.,
George B. Cole, Ralph E. Benson,
Robert L. Stickels, and Robert W. Wood
KEITH A. TROSTLE
DAVID L. ORMOND, JR.
KEVIN P. MALONEY
Department of Justice
Carvel State Office Building
820 N. French Street
Wilmington, DE 19801
Attorneys for Appellees
Christophe A.G. Tulou,
Edwin H. Clark, and
Gerald Esposito
24
APPENDIX B
Joseph KERNS, Kathleen Kerns, William M. Torney, Lois
A. Torney, Maureen Moyer,
John D. Coffman and Martha C. Coffman, individually
and as representative
plaintiffs on behalf of the certified class, Defendants
Below,
Appellants,
v.
Dale DUKES, individually and as Sussex County
Government President and Council
President, and George J. Collins, individually and as
Sussex County Council
Member, and William D. Stevenson, individually and as
Sussex County
Council Member, and George B. Cole, individually and as
Sussex County Council
Member, and Ralph E. Benson, individually and as
Sussex County Member, and
Robert L. Stickels, individually and as Sussex County
Administrator, and Robert
W. Wood, individually and as Sussex County Engineer,
and Christophe A. Tulou,
individually and as Delaware Department of Natural
Resources and Environmental
Control Secretary, and Gerald L. Esposito, individually
as a Director of
Delaware Department of Natural Resources and
Environmental Control, and Edwin
H. Clark, individually and as then Secretary of Delaware
Department of Natural
Resources and Environmental Control, Plaintiffs Below,
Appellees.
No. 338, 1997.
Supreme Court of Delaware.
Submitted: Jan. 20, 1998.
Decided: March 27, 1998.
Court Below: United States Court of Appeals for the Third
Circuit, Docket No. 96-7751.
25
Francis J. Trzuskowski, James F. Kipp, Francis J.
Schanne (argued), and F.L. Peter Stone, Trzuskowski, Kipp,
Kelleher & Pearce, P.A., Wilmington, for Appellants.
Dennis L. Schrader (argued) and Veronica O. Faust,
Wilson, Halbrook & Bayard, Georgetown and Carl Schnee,
and Patricia A. Pyles McGonigle, Prickett, Jones, Elliott,
Kristol & Schnee, Wilmington, for Appellees Dale R. Dukes,
George J. Collins, William D. Stevenson, Sr., George B.
Cole, Ralph E. Benson, Robert L. Stickels, and Robert W.
Wood.
Keith A. Trostle, Deputy Attorney General, Department of
Justice, Wilmington, for Appellees Department of Natural
Resources and Environmental Control and Secretary
Christophe A. Tulou.
Kevin P. Maloney, Deputy Attorney General, Department
of Justice, Wilmington, for Appellees Department of Natural
Resources and Environmental Control and Director Gerald
P. Esposito.
David L. Ormond, Jr., Deputy Attorney General,
Department of Justice, Wilmington, for Appellees Delaware
Department of Natural Resources and Environmental
Control and Secretary Edwin H. Clark.
Before VEASEY, C.J., WALSH and BERGER, JJ.
WALSH, Justice:
This matter originated through the filing of a civil action
in the United States District Court for the District of
Delaware. Plaintiffs in that action are Sussex County,
Delaware, property owners (the "Property Owners"), who
challenged the decision to create a new sewer district, in
which they are included, and the actions taken to
implement that decision by defendants, the members and
officials of the Sussex County Council (the "County") and
officials of the Delaware Department of Natural Resources
and Environmental Control ("DNREC"). The District Court
dismissed the action on jurisdictional grounds, and the
Property Owners appealed to the United States Court of
Appeals for the Third Circuit (the "Third Circuit").
By order dated July 31, 1997, the Third Circuit certified
the following question of law to this Court:
26
To what extent does the jurisdiction of Delaware's
courts (whether taken singly or in combination)
encompass plaintiffs' claims, and to what extent are
Delaware's courts able to provide such relief as those
claims, if sustained, would entail?
For the purpose of this certification, the Third Circuit
assumes that the Property Owners' suit is the sort of
challenge to the processes of state and local taxation that
federal comity doctrines and the Tax Injunction Act were
designed to preclude from the jurisdiction of federal district
courts.1
We conclude, in answer to the certified question, that the
Court of Chancery would have jurisdiction over a state
action based on the Property Owners' claims and could
provide full relief on those claims, if sustained.
I.
The Property Owners' suit was brought as a purported
class action, with the class estimated at 7,000 Sussex
County property owners. They assert standing to pursue
their claims as taxpayers. The Property Owners contend
that they are being compelled to discontinue reliance on
their own septic systems, and to join and to pay the costs
of, and fees for, the expanded sewer system. In the
complaint, the Property Owners allege: (i) violation of their
procedural due process rights, under the 14th Amendment
and 42 U.S.C. S 1983, by the County's failure to hold a vote
on expansion of the sewer district; (ii) violation of their
substantive due process rights, under the 14th Amendment
and 42 U.S.C. S 1983, by actions taken by the County and
DNREC, which were not based on any rationally
supportable public health concern and which impinge upon
their use and enjoyment of their real property though
financial charge and legal encumbrances thereon; and (iii)
failure by DNREC to undertake environmental and cost
_________________________________________________________________
1. The Tax Injunction Act provides that federal courts "shall not enjoin,
suspend or restrain the assessment, levy or collection of any tax under
State law where a plain, speedy and efficient remedy may be had in the
courts of such State." 28 U.S.C. S 1341.
27
reviews federally mandated in the Clean Water Act (the
"CWA"), see 33 U.S.C. S 1251,et seq.2 The Property Owners'
counsel summarized their claims as
[f]irst, that they were arbitrarily denied the right to vote
on a new district. Second, they were arbitrarily denied
an environmental process which we believe to befixed
and vested. And third, that the sewer district that was
built is not legitimately or rationally related to an
existing health menace....
As relief, the Property Owners request, "for themselves
and all other members of the class," that:
A. The rights of the class members to have an
election on the establishment of the "West Rehoboth
Expansion of the Dewey Beach Sanitary Sewer District"
be adjudicated and declared, and that the prior
unlawfully decreed Sewer District be declared void ab
initio;
B. The defendants and each of them be temporarily
and permanently restrained and enjoined from
requiring members of the class to connect to the
unlawfully created sewer district and from charging or
assessing said members of the class for the costs of
creating, constructing, maintaining and operating said
sewer district (and any debt thereon), unless and until
such time as the sewer district is lawfully created by
election and compliance with 9 Del.C. ch. 65, after
proper environmental and cost review, and from any
further construction of said sewer district, or creation
of new debt thereon, without further order of the
Court;
C. The defendants be Ordered to notify all persons,
within the said sewer district, of their right to refuse to
connect and/or disconnect and the right to receive a
refund, if exercising said right, of any capitalization
_________________________________________________________________
2. Property Owners also bring a fourth claim, based solely on state law,
which is before the federal court as a claim supplemental to validly
pleaded federal claims. Because only the validity of the federal claims is
now before the Third Circuit, there is no need to consider the fourth
claim at this time.
28
fees previously paid and/or any quarterly rates or
other fees and costs paid regarding said sewer district;
D. The plaintiffs be awarded attorneys' fees and
other applicable costs or fees pursuant to 42 U.S.C.
section 1988;
E. The plaintiff class be awarded money damages
incident to the equitable relief requested and such
monies placed in trust. Such monies shall be sufficient
to compensate the plaintiff class members for any
liability and costs incurred on the new sewer district,
including but not limited to costs of connections, fees
previously paid by plaintiffs to the defendants plus
interest, and to pay for any debt created from the
construction of the sewer district; and
F. Plaintiffs have such other legal and equitable
relief as the Court may deem appropriate, including
costs and expenses.
(Complaint at 19-20 (emphasis in original).) In sum, the
Property Owners seek declaratory relief, injunctive relief,
money damages, and counsel fees.
The County and DNREC moved, on various grounds, to
dismiss all or part of the suit, or, in the alternative, to stay
the suit pending state court resolution of state law
questions. The United States District Court for the District
of Delaware dismissed the suit for lack of jurisdiction based
on the Tax Injunction Act.3 Kerns v. Dukes, D.Del., 944
F. Supp. 1214, 1219-22 (1996). The District Court
concluded, in part, that allowing the Property Owners to
pursue their claim in federal court would result in
"substantial federal court interference in [Sussex] County's
revenue collecting ability." Id. at 1222.
The Property Owners appealed the dismissal to the Third
Circuit, where the appeal is now pending. To address fully
the Property Owners' claims on appeal, the Third Circuit
must determine the federal question of whether a"plain,
_________________________________________________________________
3. The District Court also dismissed the suit on the alternative ground of
comity. Because the question as certified implicates only the
jurisdictional ruling, we do not address comity concerns.
29
speedy and efficient"4 remedy is available for the Property
Owners in Delaware's courts. Specifically, the Third Circuit
seeks guidance from this Court as to the following:
We seek, that is, to ascertain the degree to which
plaintiffs are able to pursue in the courts of Delaware
those claims that they have chiefly pressed in the
federal district court: ``First, that they were arbitrarily
denied the right to vote on a new district. Second, they
were arbitrarily denied an environmental process which
[they] believe to be fixed and vested. And third, that the
sewer district that was built is not legitimately or
rationally related to an existing health menace for the
need for that sewer....' We seek also to ascertain to
what degree the requested relief--including a
declaratory judgment, injunctive relief, and money
damages--may be obtained in the courts of Delaware.
The Third Circuit certified its question to this Court out of
concern for what it sees as "potential tension" between the
decision of the Court of Chancery in Delaware Bankers
Association v. Division of Revenue of the Department of
Finance, Del.Ch., 298 A.2d 352 (1972), and the Superior
Court's holding in Tatten Partners v. New Castle County
Board of Assessment Review, Del.Super., 642 A.2d 1251
(1993).
II.
This Court must examine a certified question of law in
the context in which it arises. Rales v. Blasband, Del.Supr.,
634 A.2d 927, 931 (1993). "The scope of issues that may be
considered in addressing a certified question is limited by
the procedural posture of the case." Id. The matter before
the Third Circuit on appeal arises from a motion to dismiss.
On appeal from a motion to dismiss, all well-pled
allegations of the complaint are accepted as true. Precision
Air, Inc. v. Standard Chlorine of Del., Inc., Del.Supr., 654
A.2d 403, 406 (1995). Moreover, our certification
acceptance is limited to the facts stated in the Third
Circuit's Order of certification. Supr.Ct.R. 41(c)(iv). This
_________________________________________________________________
4. Tax Injunction Act. 28 U.S.C. S 1341.
30
requirement necessarily limits the scope of our holding to
the facts recited infra.
A.
We first consider the Property Owners' claims brought
pursuant to 42 U.S.C. S 1983, alleging violation of
substantive and procedural due process rights by the
County and by DNREC. State courts have concurrent
jurisdiction with the federal courts over actions brought
under S 1983. Martinez v. California, 444 U.S. 277, 100
S. Ct. 553, 62 L. Ed. 2d 481 (1980). Thus, the state courts of
Delaware may hear the Property Owners' S 1983 claims.
The Property Owners express concern about an apparent
conflict between the holdings in Delaware Bankers and
Tatten Partners. A closer examination of the two cases,
however, reveals that there is no actual tension. In
Delaware Bankers, the Court of Chancery declined to
exercise equitable jurisdiction because there was an
adequate remedy at law for the alleged constitutional
violations resulting from the application of a tax--review by
the State Tax Commissioner, followed by appeals, as of
right, first to the Tax Appeal Board and finally to the
Superior Court.5 298 A.2d at 358. Tatten Partners holds
that a taxpayer's S 1983 claim against the county Board of
Assessment is not properly before the Superior Court on
appeal from the Board because judicial review is limited to
the merits of the assessment proceeding. 642 A.2d at 1262.
These cases, however, do not prevent primary jurisdiction
in either the Superior Court or the Court of Chancery over
direct claims made pursuant to S 1983. Further, the
Property Owners are not barred from access to the Superior
Court by Tatten Partners because there is no administrative
remedy that they must first exhaust. See Del.C., title 9;
Carr v. Board of Assessment Review, Del.Super., C.A. No.
93A-04-008, Graves, J., 1995 WL 109003 (Feb. 22, 1995);
Riley v. Banks, Del.Super., 62 A.2d 229 (1948).
While concurrent jurisdiction over S 1983 claims may lie
_________________________________________________________________
5. Delaware Bankers also addresses the requirements for class actions
under Court of Chancery Rule 23.
31
in either the Superior Court or the Court of Chancery, the
selection of the forum is dictated by the relief sought. The
Property Owners seek declaratory relief, injunctive relief
and money damages on their S 1983 claims. 6 They also seek
an award of attorney's fees pursuant to 42 U.S.C. S 1988.
The Court of Chancery has exclusive jurisdiction where
injunctive relief is sought. 10 Del.C. S 341; Clark v. Teeven
Holding Co., Del.Ch., 625 A.2d 869, 875 (1992) (citing 1
Pomeroy, Equity Jurisprudence S 139 (5th ed. 1951)). See
also, du Pont v. du Pont, Del.Supr., 85 A.2d 724 (1951). The
Court of Chancery may award declaratory relief, where
there is otherwise a basis for equitable jurisdiction. 10
Del.C. S 6501. The requests for an award of money damages
and for attorneys' fees do not prevent the Court of
Chancery from exercising jurisdiction over the S 1983
claims. The Court of Chancery, in its discretion, may elect
to exercise jurisdiction over legal claims concurrent to
equitable claims properly before it. Clark, 625 A.2d at 881-
82. Once the Court of Chancery accepts jurisdiction over
the entire controversy, the court is empowered to resolve
the entire controversy, even if doing so requires an award
of a purely legal remedy, such as money damages. Wilmont
Homes v. Weiler, Del.Supr., 202 A.2d 576, 580 (1964).
Finally, sovereign immunity does not bar an action brought
pursuant to S 1983. See Will v. Michigan Dept. of State
Police, 491 U.S. 58, 71 n. 10, 109 S. Ct. 2304, 2312 n. 10,
105 L. Ed. 2d 45 (1989) (injunctive relief is available under
S 1983 against a state official in his or her official capacity);
Monell v. Department of Soc. Servs., 436 U.S. 658, 690, 98
S. Ct. 2018, 2035-36, 56 L. Ed. 2d 611 (1978) (S 1983 applies
to municipalities and other local governments). Accordingly,
the Court of Chancery has jurisdiction over the Property
Owners' S 1983 claims.
With respect to the equivalency of the relief available in
_________________________________________________________________
6. To the extent that it is later determined that an adequate remedy at
law exists for the Property Owners' S 1983 claims, which the Third
Circuit has assumed to be challenges to state taxation, neither a
Delaware court nor a federal court could award injunctive or declaratory
relief. National Private Truck Council v. Oklahoma Tax Cmm'n, 515 U.S.
582, 592, 115 S. Ct. 2351, 2357, 132 L. Ed. 2d 509 (1995).
32
Delaware's courts, the concurrent jurisdiction of state
courts over S 1983 claims allows for relief identical to that
available in federal courts. Further, the Property Owners
would be entitled to recover attorneys' fees, pursuant to 42
U.S.C. S 1988, in Delaware's courts, provided that they
establish that disposition of the case was on "substantial"
constitutional grounds. Slawik v. State, Del.Supr., 480 A.2d
636, 640-41 (1984). In any event, the inability to recover
attorneys' fees does not render the state remedy
inadequate. National Private Truck Council, 515 U.S. at 592,
115 S.Ct. at 2357. Accordingly, the answer to the certified
question is that Delaware's courts would have jurisdiction
over the Property Owners' S 1983 claims and, should the
Property Owners prevail, they would be entitled to relief
equivalent to that available in a federal court.
B.
Turning next to the Clean Water Act claims, we are asked
to determine whether Delaware's courts would have
jurisdiction over a state action embracing the substance of
those claims and, should the Property Owners prevail,
whether Delaware's courts could grant relief equivalent to
that available in federal court. The answer to the relief
question controls the jurisdiction question and, thus, must
be addressed first. Upon careful review of the Property
Owners' complaint, it appears clear that they seek
injunctive relief requiring DNREC to perform federally
mandated environmental and cost reviews. See Western Air
Lines, Inc. v. Allegheny Airlines, Inc., Del.Ch., 313 A.2d 145
(1973). The relief available in a citizen suit brought
pursuant to 33 U.S.C. S 1365(a)(2)7 is limited to: (i) an order
_________________________________________________________________
7. 33 U.S.C. S 1365(a)(2) provides that
any citizen may commence a civil action on his own behalf--
* * *
(2) against the Administrator where there is an alleged failure of
the Administrator to perform any act or duty under this chapter
which is not discretionary with the Administrator.
The district courts shall have jurisdiction ... to enforce such an
effluent standard or limitation, or such an order, or to order the
Administrator to perform such act or duty....
33
directed to the EPA Administrator8 requiring performance of
a nondiscretionary duty, such as performing the
environmental and cost reviews; and (ii) an award of costs,
including attorneys' fees pursuant to 33 U.S.C.S 1365(d),
to be made at the discretion of the District Court.
Under 29 Del.C. S 8003(12)9 and the State Revolving Fund
Agreement,10 the DNREC Secretary is required to conduct
an environmental review. This review is mandatory and
may be enforced in equity. See Choma v. O'Rouke, Del.Ch.,
300 A.2d 39, 41 (1972) (Court of Chancery may review a
decision by an state agency administrator where the
decision was arbitrary or an abuse of discretion). DNREC is
not protected from injunctive relief by the doctrine of
sovereign immunity. See Will, supra. Thus, it appears that
the Property Owners would be able to obtain an injunction
ordering performance of the reviews they seek. With respect
to attorneys' fees, the Court of Chancery may award
attorneys' fees as costs pursuant to 10 Del.C. S 5106 and
Court of Chancery Rule 54(d), where, in its discretion, the
equities so dictate. Wilmington Trust Co. v. Coulter, Del.Ch.,
208 A.2d 677, 681-82 (1965). Accordingly, it appears that
equivalent relief is available in the Court of Chancery.
Because injunctive relief is sought, jurisdiction lies in the
Court of Chancery. 10 Del.C. S 341; Clark, supra. It does
not appear that there are any requirements incident to
securing preliminary injunctive relief in the Court of
Chancery that would not be required of the Property
Owners in a federal action. The Property Owners could be
_________________________________________________________________
8. The parties agree that the EPA Administrator would not be a
necessary party to any state action.
9. 29 Del.C. S 8003(12) provides, in pertinent part, that "[t]he Secretary
shall conduct an environmental review of projects otherwise qualifying
under this subsection which shall be sufficiently consistent with the
provisions for environmental review established under 40 C.F.R., Part 6,
and the Secretary's environmental review standards established in Title
7."
10. The State Revolving Fund Agreement is the agreement between the
EPA Administrator and the State of Delaware that permits the grant of
federal funds, pursuant to 33 U.S.C. S 1381(a), to provide assistance in
the construction, implementation or development of water pollution
control programs. 33 U.S.C. S 1382(a).
34
required to post a bond under either Federal Rule of Civil
Procedure 65(c) or under Court of Chancery Rule 65(c).11 33
U.S.C. S 1365(d). Further, there are no administrative
remedies that the Property Owners would be required to
exhaust before bringing their suit directly in the Court of
Chancery.
In sum, the answer to the certified question is that the
jurisdiction of Delaware's courts encompasses claims based
on the CWA and that Delaware's courts are capable of
providing such relief as those claims, if sustained, would
entail.
On the basis of the foregoing, we conclude that the
answer to the certified question is as follows:
The jurisdiction of the courts of Delaware encompasses
the Property Owners' S 1983 claims as brought, and
such courts may provide relief equivalent to that
available in federal court, should the claims be
sustained. The jurisdiction of the courts of Delaware
also encompasses state law claims upon which the
Property Owners may recover relief equivalent to that
available in federal court on their CWA claims, should
they prevail.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
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11. Both Fed.R.Civ.P. 65(c) and Ch.Ct. R. 65(c) provide that
[n]o restraining order or preliminary injunction shall issue except
upon the giving of security by the applicant, in such sum as the
court deems proper, for the payment of such costs and damages as
may be incurred or suffered by any party who is found to have been
wrongfully enjoined or restrained.
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