The next day the city building inspector told her to close her business immediately because it somehow did not conform to city laws and regulations. A litany of reasons was given by the Board for revoking her permits, which included claims that the location posed a safety hazard due to its proximity to a busy intersection, that a portable toilet set up next to the business was an eyesore and a health hazard, and that the overall look of the new establishment was inappropriate near an entrance to town.
While those reasons may seem significant, they do not include any actual accidents or data about the public reaction, if any, to the new business. If the business were unsuccessful, then it would likely close up shop on its own without the need to revoke any permits. It sounds like the real objection may have been that the business was more successful than expected.
After her permits were revoked, Bowlby sued in federal court rather than pursue in state court a “taking” of her property without just compensation. But the district court dismissed her lawsuit for lack of ripeness. The court held that if she felt that the City “took” her property by revoking her permits, then she should have pursued a just compensation claim in state court.
Bowlby appealed to the U.S. Court of Appeals for the Fifth Circuit, which ruled in her favor on this point. When the town revoked her permits, she had an immediate federal claim for violation of her due process rights, without need to pursue an eminent domain type of proceeding first. Bowlby v. City of Aberdeen, 2012 U.S. App. LEXIS 9717 (5th Cir. May 14, 2012).
This is music to the ears of many small businesses harmed by capricious interference from local government. “There are many intangible rights that merit the protection of procedural due process although their infringement falls short of an exercise of the power of eminent domain for which just compensation is required under the Fifth and Fourteenth Amendments,” the Court observed, citing a Tenth Circuit precedent.
Bowlby acquired a property interest in her permits once the town granted them to her, and that property could not be taken away without due process. “The provision of adequate due process not only helps to prevent unwarranted deprivations, but also serves the purpose of making an individual feel that the government has dealt with her fairly,” the Court concluded.
This ruling should give small business owners the rights, at a minimum, to prior notice and an opportunity to be heard before their permits are taken away.
In Bowlby’s case, perhaps more people would support having a Sno Cone at the corner of Highway 45 and Meridian Street than those wanting to prohibit it.