Indiana Supreme Court Decides Bloomington Case

Tim Burke, Fraternal Law Partners, tburke@manleyburke.com

After several significant victories challenging zoning ordinances that put the fate of fraternity houses under local zoning ordinances in the hands of local universities, fraternity house owners suffered a significant set-back in the Indiana Supreme Court in a decision issued on February 23, 2021.[1]

Since 2002, UJ-Eighty, the property owner and plaintiff in that case, had owned the house that had been used as either a fraternity or sorority house since the house’s initial construction in 1984. The house was in the middle of a row of similar houses used as fraternity, sorority, Evan Scholars, or similar types of houses. No single-family residences were nearby.

In 2015, the city of Bloomington, where Indiana University (“IU”) is located, amended its zoning code to provide that “all students living in the building are enrolled at the IU Bloomington campus; and IU has sanctioned or recognized that students living in the building as being members of a fraternity or sorority through whatever procedures IU uses to render such sanction or recognition.”[2]In other words, for a property to be used as a fraternity or sorority house in Bloomington, the occupants of the property needed to belong to a fraternity or sorority that was recognized by IU.

The Supreme Court viewed it, the 2015 amendment “recognized IU’s power to define what constitutes a Greek house in good standing.”[3]

In 2016, the Gamma-Kappa chapter of Tau Kappa Epsilon entered into a lease of the UJ-Eighty property that ran through May 2019. However, the chapter, as a result of very serious violations by some members, lost its recognition from the University. Almost all of the dozens of brothers who had lived in the house voluntarily left the house, but when IU learned that two students were still in the house, the University informed the City of Bloomington of the violation of its zoning ordinance. The City then promptly issued orders against UJ-Eighty to ensure the house was entirely vacated. An appeal to the City of Bloomington Board of Zoning Appeals failed, and UJ-Eighty filed suit alleging, among other things, that Bloomington had unconstitutionally delegated its zoning power to IU when it provided that legal use of a fraternity or sorority house required University recognition of the chapter involved. The trial court agreed that the zoning provision was an illegal delegation of legislative authority under both the Indiana and U.S. Constitutions. The trial court therefore struck down the ordinance.[4]Bloomington appealed. IU joined as an amicus in the Court of Appeals and ultimately in the Supreme Court, as well.

In the Court of Appeals, the University argued essentially that it was much easier for the University to punish an entire chapter rather than to take the time to determine who the bad actors were that actually violated University rules and the law.[5]

A three-judge Court of Appeals affirmed, on a two to one vote, finding that Bloomington had “delegated its legislative authority to IU to determine whether the property was being used by students in a sanctioned fraternity” with “no mechanism for reviewing IU’s decision.”[6]The Court of Appeals recognized that it was the property owner that was significantly punished even though it did nothing to violate the zoning ordinance.

The Indiana Supreme Court read the Bloomington ordinance differently, stating “our review of the ordinance reveals Bloomington never empowered IU to define fraternities and sororities, a power IU already clearly possesses. Bloomington, rather—through the legislative process—defined fraternities and sororities based on their relationship with IU.”[7]The Supreme Court did not find that to be a delegation of authority, legislative or otherwise, and as a result, held there was no constitutional violation.

UJ-Eighty had relied on the U.S. Supreme Court case of Washington ex rel. Seattle Title Trust Co. v. Roberge,278 U.S. 116 (1928). Robergeinvolved a Seattle zoning ordinance that required a landowner to obtain the written consent of two-thirds of neighboring landowners within four hundred feet in order to build a new home for the elderly. The US Supreme Court found that was an impermissible delegation of power under the Fourteenth Amendment. In distinguishing Roberge, the Indiana Supreme Court relied heavily on the fact that in Roberge, landowners were required to obtain the consent of private property owners. But in UJ-Eighty, IU was a state actor obligated to afford the rights provided under the state and federal constitution. Curiously, the Indiana Court stated, “UJ-Eighty never had to seek IU’s consent to use its land. IU had no direct power to prohibit UJ-Eighty from lawfully using its land.”[8]

Even the limited record discussed in the Indiana Supreme Court case makes it clear that IU did act to ensure that UJ-Eighty could not use its property to continue to house students after the fraternity chapter lost its recognition.

The Indiana Supreme Court also referred to a similar case decided by the Delaware Supreme Court, Schweizer v. Bd. of Adjustment of Newark, 980 A.2d 383, 384 (Del. 2009), in which the Delaware court upheld a local zoning ordinance that provided that if the University of Delaware withdrew recognition of a fraternity or sorority for a period of more than one year, the use of the property for such a purpose (as a Fraternity House) was terminated immediately upon University suspension. While the Fraternity in the Schweizercase lost in court, it subsequently settled with the University and later resolved matters with Newark, Delaware, thereby allowing it to preserve its legal zoning status while serving a university suspension.

There is no doubt the Indiana decision is a setback in the protection of the owners of valuable properties designed for only one use: fraternity chapter houses. Interestingly, the Indiana Court went out of its way to point out IU is a state actor required to protect the constitutional rights of those it deals with. But in a footnote, the same court went beyond those institutions of higher education that are “state” schools. Specifically, the court concluded that “today’s holding also makes clear to zoning authorities is Indiana’s other college towns that they can rely on a local college or university’s judgment in defining Greek Houses.”[9]

With that comment, the Court overlooked the fact that private schools are not state actors assumed to have afforded property owners their constitutional protections.  But where the school is a state actor, this decision is sending a message that the owners of chapter houses should be prepared to insist in being involved in a chapter’s disciplinary process that could jeopardize its property rights.

            The court also sends this message: “If UJ-Eighty is unhappy with Bloomington’s zoning laws or the BZA, it can seek change through the political process.” On that score, the Court is correct. After all, imagine the impact if all fraternity and sorority members at IU were registered and voted: Would Bloomington be as anxious to follow IU’s lead? Would smaller college towns that host good sized schools with lots of registered student voters?

The concluding paragraph of the Indiana Supreme Court’s unanimous (five-Justice) decision holds out at least a bit of hope:

The impermissible delegation of power and denial of due process strike at the core of our state and federal constitutions. Courts should guard against such significant constitutional violations. However, for there to be a violation, there must be some delegation or lack of due process. Here there was none. The judgment of the trial court is reversed.[10]

Perhaps, if there could have been a showing of a lack of due process by the University in stripping recognition from the chapter, the result might have been different. What is also unfortunate is that the Indiana Court ignored the recent decisions in Pennsylvania that have held similar local ordinances to constitute an unconstitutional delegation of authority.[11]

[1]City of Bloomington Board of Zoning Appeals v. UJ-Eighty Corp., No. 21S-PL-77, 2021 WL 717972 (Ind. 2021).

[2]City of Bloomington Unified Dev. Ord. § 20.11.020 (2015)

[3]UJ-Eighty Corp., 2021 WL 717972 at *3.

[4]Gary Founds & Mike Allen, Bloomington Ordinance Found Unconstitutional, 158 Fraternal L. 1 (March 2019).

[5]Sean P. Callan, Bloomington Zoning Ordinance Unconstitional Says Indiana Court of Appeals, 164 Fraternal L. 1 (Feb. 2020).  

[6]City of Bloomington Board of Zoning Appeals v. UJ-Eighty Corp., 141 N.E.3d869,876 (Ind. Ct. App. 2020). 

[7]City of Bloomington Board of Zoning Appeals v. UJ-Eighty Corp., No. 21S-PL-77, 2021 WL 717972 at *5 (Ind. 2021).

[8]Id. at *8.

[9]UJ-Eighty Corp., 2021 WL 717972 at *4 n.3.

[10]Id.at *11.

[11]Jeffrey Rosario Turco, Positive Development in Pennsylvania Zoning Case, 165 Fraternal L.7 (July 2020).