Court Opinion

ID: 9495968
Source: CourtListenerOpinion
Date Created: 2023-08-05 16:14:24.761169+00
Date Added: 2024-06-11T17:57:17.460081
License: Public Domain

OPINION
BATCHELDER, Circuit Judge.
Plaintiffs, users of the City of Flint’s water and sewer system, appeal the district court’s order granting summary judgment to the defendant in this action *760claiming that the defendant violated their procedural and substantive due process rights by failing to implement a city ordinance giving a five percent discount to residential water users who pay their water bills on time. Because the plaintiffs’ procedural due process claim is either not ripe for adjudication or meritless, and because Flint’s failure to implement the five percent discount on its water bills is outside of the purview of substantive due process doctrine, we affirm the judgment of the district court.
I
On June 13, 1994, the City Council of Flint, Michigan, passed an ordinance intended to encourage local water users to pay their water bills in a timely fashion. The ordinance, Flint Ord. § 46-52.2, provides a five percent discount to residential users who pay their water bills prior to the due date, and directs that the city’s water bills shall, “as soon as practicable,” reflect the discount.1 The five percent discount has still not gone into effect, purportedly because the City’s billing system is not sophisticated enough to handle the processing required to date the receivables and grant the discount to qualified bill payers.2
A group of Flint citizens filed a complaint in Michigan state court on March 13, 2000, alleging violations of “federal due process” and “federal procedural due process” under the Fourteenth Amendment,3 as well as violations of Michigan constitutional, statutory, and common law, for Flint’s continuing failure to give its residential water users the promised five percent discount for individuals who pay their water bills on time. The plaintiffs seek damages, a declaration of their rights under applicable law, an accounting for all monies held by the City of Flint “which Defendant knew for a fact it was not entitled to take or keep,” and an injunction ordering the City to abide by its own ordinance.
The City of Flint removed the case to the Eastern District of Michigan based upon the federal court’s jurisdiction over the federal claims, and the district court remanded to state court the claims based upon Michigan law, leaving in federal court only the due process claims brought *761under 42 U.S.C. § 1983.4 The City moved for summary judgment, and on February 23, 2001, the district court, ruling from the bench, granted the motion. Citing Jung Bu Chun v. New York City Department of Environmental Protection, 989 F.Supp. 494 (S.D.N.Y.1998), the court held that the deprivation of rights alleged by the plaintiffs is not a violation of due process because the state provides a meaningful postdeprivation remedy, and the plaintiffs interest in an accurate water bill is not a fundamental right for purposes of substantive due process.
The plaintiffs appealed, arguing that they have a property interest in the five percent discount and that interest qualifies for due process protection; their due process rights were violated by the City’s “arbitrary and capricious conduct;” the city ordinance is not ambiguous, and if it were, then the federal district court should have abstained from ruling on it; and their takings and procedural due process claims are valid.
While this appeal was pending, the state trial court granted the plaintiffs’ summary disposition motion with respect to their contract law claim, holding that the plaintiffs did have a contractual right to the five percent discount. The state court also denied the defendant’s motion with respect to the equitable claims alleging arbitrary and capricious conduct and granted defendant’s motion to dismiss plaintiffs’ conversion claim, public policy claim, and Michigan “due process” and “procedural due process” claims.
II
We review de novo the district court’s grant of summary judgment, employing the same Rule 56(c) standard used by the district court. We examine the “pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits” in order to determine if there is a “genuine issue as to any material fact” and whether the moving party “is entitled to a judgment as a matter of law.” Fed. R.Civ.P. 56(c); Mansfield Apartment Owners Ass’n v. City of Mansfield, 988 F.2d 1469, 1473 (6th Cir.1993). We view the evidence and any inferences that may be drawn therefrom in a light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).
Though the plaintiffs expended little effort, either in their brief or at oral argument, attempting to state a coherent argument that their procedural due process rights have been violated, the issue is nonetheless before us. The City of Flint points to its established process for disputing water bills as evidence that it offers an adequate procedural remedy — a remedy that the plaintiffs never pursued. A consumer wishing to contest a water bill “which he feels to be unusually large” is entitled to apply for a hearing, investigation, and determination of whether the bill is too high. Flint Ord. § 46-17. The plaintiffs’ response to the City’s charge that they should have pursued their administrative remedies is that such a pursuit would have been futile because the “City’s position in this very litigation has been, still is, and will be until its last gasp, that the law/ordinance made the subject matter of this lawsuit absolutely does not grant a 5% entitlement and/or refund to any of the families.” Bowers Brief at 29.5 *762Before we can reach the merits of the plaintiffs’ procedural due process claim, we must determine whether it is properly before the Court at this time.
We begin by noting the distinction between exhaustion and finality. Exhaustion, the Supreme Court has held, “generally refers to administrative and judicial procedures by which an injured party may seek review of an adverse decision and obtain a remedy if the decision is found to be unlawful or otherwise inappropriate,” and is not required before a plaintiff may bring a suit predicated upon 42 U.S.C. § 1983. Williamson County Reg’l Planning Com’n v. Hamilton Bank, 473 U.S. 172, 193, 105 S.Ct. 3108, 87 L.Ed.2d 126 (1985). Finality, on the other hand, “is concerned with whether the initial decisionmaker has arrived at a definitive position on the issue that inflicts an actual, concrete injury....” Id.
Whether finality is required in any given case depends upon the type of harm alleged: “If the injury the [plaintiffs] seek to redress is harm to their property amounting to a ‘deprivation’ in constitutional terms, a final judgment is required; however, if the injury is the infirmity of the process, neither a final judgment nor exhaustion is required.” Hammond v. Baldwin, 866 F.2d 172, 176 (6th Cir.1989). In other words, a due process challenge brought under § 1983 to an allegedly unconstitutional procedure is not subject to a finality requirement, while a claim alleging harm or deprivation of property “is substantive and, so, a final judgment (but not exhaustion) is required.” Id; see also Macene v. MJW, Inc., 951 F.2d 700, 704 (6th Cir.1991) (“In order to make a § 1983 claim for a taking without just compensation, a plaintiff must have attempted to obtain compensation through established state procedures. This is not technically an exhaustion requirement but is a product of the ripeness doctrine.”). Ordinarily, “the plaintiff has the burden of pleading and proving that state damage remedies are inadequate to redress the alleged wrong before he can resort to a damages action for a deprivation of procedural due process under 42 U.S.C. § 1983.” Sproul v. City of Wooster, 840 F.2d 1267, 1270 (6th Cir.1988); see also McLaughlin v. Weathers, 170 F.3d 577, 580 (6th Cir.1999) (“Even if the statute was not facially constitutional, we would require [plaintiff] to prove the absence of adequate state remedies .... ”); Nat’l Communications Sys., Inc. v. Mich. Pub. Serv. Comm’n, 789 F.2d 370, 372 (6th Cir.1986) (“[I]n section 1983 damage suits for deprivation of property without procedural due process the plaintiff has the burden of pleading and proving the inadequacy of state processes ....”) (citation omitted).
In the case before us, it is unclear whether plaintiffs are challenging the City’s procedures for contesting water bills (a challenge not requiring finality), or alleging a deprivation of property rights without due process (requiring finality), or both. It is clear, nonetheless, that they cannot prevail on their procedural due process claim under either legal theory. The substance of plaintiffs’ claim that their property interest in the five percent discount was taken in violation of procedural due process is not ripe for adjudication because they failed to avail themselves of the procedures put in place by Flint for disputing water bills. See Williamson, 473 U.S. at 194, 105 S.Ct. 3108 (“[T]he taking claim is not yet ripe [because] respondent did not seek compensation *763through the procedures the State has provided for doing so.”).
The plaintiffs’ argument that they need not utilize Flint’s procedure for challenging water bills because the City has already decided the issue, if it can be construed as a distinct challenge to the procedure itself, is wholly without merit. In essence, the plaintiffs argue that since the City has taken certain legal positions to defend itself in this lawsuit, it would have taken those same positions if the plaintiffs had brought their request for the five percent discount pursuant to the procedures set out in Flint Ord. § 46-17. We reject plaintiffs’ position because it would effectively allow a litigant to bypass any administrative remedies made available by a municipality by suing the municipality in court and then claiming that the finality requirement was met when the municipality assumed a legal position as part of its defense. This we will not do. Moreover, as we stated in Hammond, 866 F.2d at 177, “the entire government of a state cannot be disqualified from deci-sionmaking on grounds of bias when all that is alleged is a general bias in favor of the alleged state interest or policy.”
Ill
Plaintiffs also allege that the City of Flint violated their substantive due process rights by failing to give the five percent water discount to those water users who paid their bills on time. Though we do not endorse the Michigan trial court’s ruling that the plaintiffs have a contractual right to the five percent discount, nor do we know at this time whether the City has or intends to appeal that ruling, we will take as given for the purposes of deciding this summary judgment motion that such a contractual right is established in Michigan law.
“The doctrine that governmental deprivations of life, liberty or property are subject to limitations regardless of the adequacy of the procedures employed has come to be known as substantive due process.” Pearson v. City of Grand Blanc, 961 F.2d 1211, 1216 (6th Cir.1992) (citation omitted). One aspect of substantive due process is the right to be free of “arbitrary and capricious” action by government actors. Id. at 1217. In County of Sacramento v. Lewis, 523 U.S. 833, 118 S.Ct. 1708, 140 L.Ed.2d 1043 (1998), the Supreme Court discussed at length how the “substantive component of the Due Process Clause is violated by executive action only when it can properly be characterized as arbitrary, or conscience shocking, in a constitutional sense.” 523 U.S. at 847, 118 S.Ct. 1708 (internal quotations and citation omitted). In other words, the “arbitrary and capricious” standard set forth in Pearson is simply another formulation of, but is no less stringent than, the more traditional “shocks the conscience” standard. The plaintiffs allege that they have been deprived of their property interest in the five percent discount by the “arbitrary and capricious” action of the City of Flint.
In Charles v. Baesler, 910 F.2d 1349 (6th Cir.1990), we examined the alleged substantive due process claim of a fireman who complained that he was “deprived of a contractually-based property interest” when the municipal government failed to promote him as required by local law. Id. at 1352. We held that
[m]ost, if not all, state-created contract rights, while assuredly protected by procedural due process, are not protected by substantive due process. The substantive Due Process Clause is not concerned with the garden variety issues of common law contract. Its concerns are far narrower, but at the same time, far more important. Substantive due process affords only those protections so rooted in the traditions and conscience *764of our people as to be ranked as fundamental. ...
State-created rights such as Charles’ contractual right to promotion do not rise to the level of fundamental interests protected by substantive due process.
Id. at 1353 (internal quotations and citations omitted).
We see no principled reason to distinguish the facts before us from the facts underlying our holding in Charles. The state-created contractual right to a discount on one’s water bills, like the contractual right to a promotion, is an “interest [that] is redressed adequately in a state breach of contract action,” id. at 1355 (quoting Ramsey v. Bd. of Educ. of Whitley County, Ky., 844 F.2d 1268, 1274 (6th Cir.1988)), and is simply not a proper subject of federal protection under the doctrine of substantive due process.
IV
Because the plaintiffs’ procedural due process claim is not ripe for adjudication, or, in the alternative, is without merit, and because their substantive due process claim is likewise meritless, we AFFIRM the order of the district court.

.In its entirety, the ordinance reads as follows:
§ 46-52.2 WHEN BILLS DUE; DISCOUNT; PENALTY.
(a) Bills shall be rendered approximately 15 days prior to the due date thereof. As to commercial and industrial accounts, if water charges are not paid on or before the due date thereof, then a penalty of 5% shall be added thereto.
(b) Anything in the code of the City of Flint, specifically this chapter, to the contrary notwithstanding, any residential user of water and sewer services shall be entitled to, and shall receive, a five percent (5%) reduction in the amount of the bill if the bill is paid in full, as defined in division (c) of this section, prior to the due date as set forth on said bill.
(c) PAID IN FULL. Receipt of a check or cash by the City Treasurer's Office on or before the day prior to the due date. It is the intent hereof that payment be actually received by the Treasurer or the Treasurer’s authorized representative and the date of mailing or postmark shall not be relevant. If a user pays by a check with [sic] is subsequently dishonored, the discount shall not be granted.
(d)Water and sewer bills shall, as soon as practicable set forth the discounted amount and the last day to take advantage of the discount on the face of the statement.

. At oral argument, counsel for the City of Flint indicated that the city had hired a vendor to update its computer system so as to make implementation of the five percent discount practicable. The vendor, however, failed to perform and was sued by Flint in a case that, at the time of oral argument, was ongoing.

. The plaintiffs bring their federal law claims pursuant to 42 U.S.C. § 1983.

. Plaintiffs' brief also refers to a federal takings claim. Bowers Br. at 1. However, because the plaintiffs’ complaint alleges only two federal counts, both involving violations of the due process clause, we need not address the takings issue.

. At oral argument, in response to being asked whether the plaintiffs could get a fair hearing on their claims pursuant to the local procedures established to contest water bills, the plaintiffs’ attorney Tom Pabst replied, "It doesn’t matter whether they get a fair hearing *762or not.... And [the City of Flint] claim[s] there is such a hearing — an inverse condemnation action — I say there’s not. In any event, isn’t it clear that the City has come to the defendant's position that they don't owe any refund?”