Court Opinion

ID: 9741493
Source: CourtListenerOpinion
Date Created: 2023-08-26 20:56:35.090597+00
Date Added: 2024-06-11T07:24:24.399134
License: Public Domain

KRAHULIK, Justice,
dissenting.
I must dissent from the majority position. I believe that:
(1) The homes at issue are not violative of the restictive covenants; and
(2) Regardless of the aforementioned, Ind. Code § 16-13-21-14 was a proper exercise of state police powers.
I. Restrictive Covenants-
Plaintiffs-Appellants, the residential subdivision property owners, argue that the homes developed by Christole and Hopewell violate certain restrictive covenants in their deeds that prohibit structures other than single or two-family dwellings, and/or commercial activity within the subdivisions. Restrictive covenants typically found in residential deeds are generally aimed at two purposes — controlling the structure’s design and appearance, and controlling the structure’s use. The homes at issue in this case do not infringe upon either of those objectives.
The deeds in both the Fairwood Terrace and Mustin Manor subdivisions make reference to “single family” or “single and two-family” dwellings. Neither deed purports to define “family.” Logically, single family was chosen as a modifier to describe the intended use and thus the design of the structure rather than to profile the persons who could occupy it. Additionally, proscriptions in the deeds regarding the size and height of the structures permitted suggest that the drafters of the restrictive covenants were greatly interested in limiting the design and appearance of the buildings in the subdivision. Therefore, “single family” is used in this sense to define the structure’s design; that is, it must be designed and constructed with the intention *786that it will be used as a dwelling by a single housekeeping unit.
Because the purpose of the Hopewell and Christole homes is to integrate into a typical residential setting to as great an extent as possible, the structure will in no way disturb the physical continuity of the neighborhood. Thus, the homes cannot be said to violate the covenant’s goal of controlling design and structure.
The second purpose behind the restrictive covenants is to control the use of the buildings in the subdivisions. By specifying “single-family homes” and by expressly prohibiting commercial enterprises, the drafters intended that the structures within the subdivisions would be used by single housekeeping units for dwelling purposes. This is the intention of both Christole and Hopewell. The purpose of both organizations is to provide a dwelling for a housekeeping unit, not to engage in trade or commerce on the real estate. Opponents argue that the group homes are, nonetheless, prohibited business or commercial enterprises.
Black’s Law Dictionary defines business as “employment, occupation, profession, or commercial activity engaged in for gain or livelihood.” Black’s Law Dictionary 179 (5th ed.1979). Commercial is defined as “[relating] to or connected with trade and traffic or commerce in general, ... [generic term for most all aspects of buying and selling.” Id. at 245. Using these definitions and taking the covenants in their broadest meaning, they could be said to prohibit not only the not-for-profit activities of Hopewell and Christole, but also the for-profit activities that typically occur in neighborhood homes. Mrs. Smith could no longer provide daycare service in her home; Mr. Jones could not continue his weekend business of repairing and selling antique cars in his garage; the Browns would not be allowed to use the office in their spare bedroom to sell real estate; garage sales and charity fundraising parties would be strictly forbidden. Because there is no evidence that these covenants have ever been or were ever intended to be read so broadly, they must be read in a more narrow fashion.
Residents of the subdivisions might argue that the presence of the group homes may lead to increased traffic and other nuisances. Of course, the same result could occur if our fictional homeowner were to rent his home to several college students, or if he were to himself live in the home with a large family, including teenage children, each with his own car and friends. Drafters of restrictive covenants wishing to address issues such as noise levels and the number of permissible guests should do so explicitly such that the provision is applied equally to all.
My belief that group homes, such as those in question here, are not violative of restrictive covenants that allow only single-family dwellings, or prohibit commercial activities is not novel. This position has been espoused by Judge Ratliff in his dissent in Metropolitan Development Commission v. Villages, Inc. (1984), Ind.App., 464 N.E.2d 367, as well as by Judge Miller in his dissents in Adult Group Properties, Ltd. v. Imler (1987), Ind.App., 505 N.E.2d 459, and Clem v. Christole, Inc. (1990), Ind.App., 548 N.E.2d 1180, and in Judge Miller’s majority opinion in Minder v. Martin Luther Home Foundation (1990), Ind.App., 558 N.E.2d 833. Additionally, each of those opinions lists numerous decisions by our sister states that conclude that group homes are residential uses that do not violate restrictive covenants similar to those in question here.
II. State Police Powers
In analyzing whether Indiana was justified in exercising its police powers when enacting Ind.Code § 16-13-21-14, the majority opinion looks to the United States Supreme Court decision in Allied Structural Steel Co. v. Spanaus (1978), 438 U.S. 234, 98 S.Ct. 2716, 57 L.Ed.2d 727. The Court in Spanaus considered whether the disruption with contractual expectations “was necessary to meet an important general societal problem” and whether it was enacted “to protect a broad societal interest rather than a narrow class.” The majority opinion in our case examines the *787same factors and concludes their inquiry in the negative. I disagree with this conclusion.
The majority opinion determines that the justification behind Ind.Code § 16-13-21-14 is insufficient in that it does not address a broad, generalized societal problem and it is not “resonably necessary for the protection of the health, safety, and welfare of the general public.” I disagree with this determination.
In analyzing the relationship between a state’s right to exercise its police powers in a manner that impairs private contracts, the U.S. Supreme Court has said:
[I]t is to be accepted as a [sic] commonplace that the Contract Clause does not operate to obliterate the police power of the States. ‘It is the settled law of this court that the interdiction of statutes impairing the obligation of contracts does not prevent the State from exercising such powers as are vested in it for the promotion of the common weal, or are necessary for the general good of the public, though contracts previously entered into between individuals may thereby be affected. This power, which in its various ramifications is known as the police power, is an exercise of the sovereign right of the Government to protect the lives, health, morals, comfort and general welfare of the people, and is paramount to any rights under contracts between individuals.’
Keystone Coal Assn. v. DeBenedictis (1987), 480 U.S. 470, 503, 107 S.Ct. 1232, 1251, 94 L.Ed.2d 472, 500, quoting Home Building & Loan Assn. v. Blaisdell (1934), 290 U.S. 398, 54 S.Ct. 231, 78 L.Ed. 413.
As the Court in Keystone explains, the first inquiry is whether the right to contract has been impaired. Certainly it has been in this case. The next inquiry must be into whether the public purpose asserted is “significant and legitimate.” Keystone, 480 U.S. at 505, 107 S.Ct. at 1252, 94 L.Ed.2d at 501.
It is certainly true that statistically the mentally handicapped comprise less than a majority of the general public. In fact, in purely numeric terms, they may be considered insignificant. The care and treatment of this statistic minority, however, is of tremendous concern to society generally.
The care and treatment of the mentally and physically handicapped in our State represents a significant financial obligation. Consequently, each individual taxpayer, regardless of his personal contact with or need for such services, has at least an economic interest in how they are managed. Each taxpayer has a direct interest in ensuring that every patient within the State system receives the most cost efficient, beneficial care possible, thus allowing them to function at their highest possible level of independence and productivity. Mainstreaming is regarded as an effective, efficient treatment option. Thus, mainstreaming creates economic benefits to society as a whole.
The project of mainstreaming patients is designed not only to alleviate a substantial tax drain, but also to provide the social contact necessary to improve the patient’s condition. By placing the patient in a situation closely replicating average day-to-day life, the patient will become a more productive citizen. It is certainly the goal of our State that each citizen should be encouraged to be as productive and independent as possible. Again, society as a whole is benefitted.
Finally, mainstreaming provides a benefit to the neighborhood. As with any policy of integration, mainstreaming places the mentally and physically handicapped into an environment not generally acquainted with their nature and the daily challenges they face. Placing handicapped and non-handicapped persons side by side helps to break stereotypes, overcome prejudices, and create a more understanding society. Again, society as a whole is benefitted.
The argument that any legislative act aimed at benefiting society generally by first directly benefiting a minority of the population is improper sets a dangerous precedent. This rationale could be used to attack any social legislation aimed at protecting any racial, ethnic, physical, or religious minority. Our inquiry must be whether the legislative act was designed to *788protect the health, safety and welfare of the general public. The fact that it accomplishes this goal by first directly impacting a minority group and then secondarily impacting society in general is irrelevant so long as it can be shown that the action taken does, in fact, address a matter of general societal concern. Certainly, ensuring that the mentally and physically impaired receive effective treatment designed to aid them both in independent living and general productivity as citizens and that such treatment is conducted in a manner aimed at alleviating the financial burden on the State is a matter of general societal concern. Thus, the public purpose asserted is both legitimate and significant.
Once satisfied of this point, the Court in Keystone directs us to our last test: “A court must also satisfy itself that the legislature’s adjustment of the rights and responsibilities of contracting parties is based upon reasonable conditions and is of a character appropriate to the public purpose justifying the legislation's adoption." Keystone at 505, 107 S.Ct. at 1252, 94 L.Ed.2d at 501. (Citations omitted.) The Court then goes on to recite what I believe to be the crucial consideration on this point. “But, we have repeatedly held that unless the State is itself a contracting party, courts should properly defer to legislative judgment as to the necessity and reasonableness of a particular measure.” Id. (Citations omitted.)
I believe that Ind.Code § 16-13-21-14 was clearly a proper exercise of this State’s police powers and thus not unconstitutional. The enactment represents a reasonable, rational approach to a significant problem impacting the general citizen population. Accordingly, the impairment of contractual obligations by the State was justified. The summary judgments entered against Christole and Hopewell should be reversed.
DeBRULER, J., concurs.