Campbell v. Mayor of Annapolis

⁵²⁶ Liss, J., delivered the opinion of the Court. We have found that when individuals speak of principles they usually mean that they object to the application of rules connected with certain systems. The objections, though frequently involving matters of minimal financial importance, nevertheless require the expenditure of large sums of money and the investment of great amounts of time on the part of the litigants and the judicial system. Unfortunately, such actions accomplish very little other than the derived satisfaction of one's “standing up for a principle.” In this case the appellee, Mayor and Aldermen of the City of Annapolis (hereinafter, the City) brought this action against the appellants, Robert H. Campbell and Annie Jane Campbell (hereinafter, the Campbells) for injunctive and other relief to enforce the provisions of Chapter 12 of the Annapolis City Code which required owners and operators of residential rental properties within the City to obtain and maintain operating licenses and to pay a prescribed fee for such licenses.

The Campbells contended that the requirement for the payment of such licenses was unconstitutional and invalid. The case was submitted to the trial court on a set of stipulated facts agreed upon by the parties. The chancellor below held that the licensing provisions of the City Code were valid and signed a decree requiring the Campbells to apply for and obtain licenses for the rental units in Annapolis owned by them, and otherwise to comply with the provisions of Section 12-16 of the City Code. He further enjoined the Campbells to allow the City’s agents access to the rental properties for the purpose of inspecting them under Section 12-9 of the City Code.

This appeal is from that decree. The questions presented are stated as follows by the appellants: 1. Does Article XI-E, Section 5 of the Maryland Constitution prohibit the City of Annapolis from imposing, levying and collecting a license fee for the issuance of a required license to operate residential rental units, where the ordinance establishing such license requirements and the imposition of a license fee to obtain the same was enacted ⁵²⁷ subsequent to January 1,1954, and the General Assembly has not expressly authorized municipalities to levy or impose such type of license fee? 2. Was it proper for the lower court to enjoin the appellants to comply with Section 12-9 of the Annapolis City Code when the validity of that section was not an issue before the lower court and the appellants had never refused to comply with that section?

The parties entered into a stipulation that there were no disputed issues of fact between them, and that the controversy was to be submitted to the chancellor upon a bill and answer together with the stipulation for determination as a matter of law as to the validity of Section 12-16 of the Code of the City of Annapolis. The stipulated facts were as follows: “The Plaintiff, The Mayor and Aldermen of The City of Annapolis, is a municipal corporation of the State of Maryland, and, as such, is governed by the provisions of Article XI-E of the Constitution of the State of Maryland, Article 23A of the Annotated Code of Maryland, and the Charter of The City of Annapolis. Chapter 12 of the Code of The City of Annapolis, entitled ‘HOUSING AND PROPERTY MAINTENANCE STANDARDS’ a copy of which is attached hereto, and is made a part of this Stipulation, has been duly adopted and enacted by the Plaintiff. Section 29 of the Charter of The City of Annapolis, a copy of which is attached hereto, and is made a part of this Stipulation, has been duly adopted and enacted by the Plaintiffs.

The Defendants, Robert H. Campbell and Annie Jane Campbell, are the owners and operators of residential rental dwelling units located at the premises known as 119 Prince George Street, 126 Prince George Street, and 25 East Street, all located within the City of Annapolis. ⁵²⁸ Despite notice from authorized representatives of the City to do so, and despite the provisions of Section 12-16 of the Code of the City of Annapolis, as aforesaid, the Defendants have refused, and are continuing to refuse, to apply for and obtain a license to operate a residential rental dwelling unit or units at the properties known as 119 Prince George Street, 126 Prince George Street, and 25 East Street, in the City of Annapolis, respectively on the claimed ground that such a license entails payment of a license fee which is unconstitutional, unlawful and invalidly imposed. Notices of non-compliance with the provisions of Section 12-16 of the Code of the City of Annapolis, as aforesaid, were received by the Defendant, Robert H. Campbell on or about March 19,1978 with respect to the property known as 25 East Street and on or about June 13, 1978 with respect to the property known as 119 Prince George Street. The Defendants have not challenged and in these proceedings do not challenge the validity of any sections or provisions of Chapter 12, entitled ‘HOUSING AND PROPERTY MAINTENANCE STANDARDS’ of the Code of the City of Annapolis, or any rights of inspection under that Chapter of the City Code, except Section 12-16 thereof.” The stipulation further recited: “The Defendants have challenged and in these proceedings are challenging the validity of Section 12-16 of Chapter 12 of the Code of the City of Annapolis, pertaining to ‘Licensing of operation of certain dwellings and rooming houses.' The Defendants assert that said provisions are invalid on the following grounds: A. Said provisions are contrary to the Fourteenth Amendment to the Constitution of the United States in that they constitute a denial of the equal protection of the law, since they apply only ⁵²⁹ to certain types of habitation within the limits of the City of Annapolis and not equally to all types of habitation; and there is no reasonable basis for such discrimination between owners of one type of residential property and owners of other types of residential property. B. Said provisions were enacted without any authority for the same in the Charter of the City of Annapolis.

C. Said provisions were enacted contrary to Article XI-E, Section 5 of the Constitution of the State of Maryland, in that said section requires owners of rental properties to apply for and obtain a license and to pay a license fee or tax, which provisions were not in effect on or prior to January 1, 1954. The provisions of Section 12-16 of the Code of the City of Annapolis were enacted subsequent to January 1, 1954. Section 29 of the Charter of the City of Annapolis was in effect prior to January 1,1954.” [End of stipulation.] Article 23A, Section 2 of the Annotated Code of Maryland (1957, 1973 Repl. Yol.), provides in pertinent part that: The legislative body of every incorporated municipality in this State, except Baltimore City,... shall have general power to pass such ordinances not contrary to the public general or public local laws and the Constitution of Maryland as they may deem necessary in order to assure the good government of the municipality, to protect and preserve the municipality’s rights, property, and privileges, to preserve peace and good order, to secure persons and property from danger and destruction, and to protect the health, comfort and convenience of the citizens of the municipality.... ⁵³⁰ Article. 23B, Section 22(1) enumerates the powers of the council as follows: General powers. — The council shall have the power to pass all such ordinances not contrary to the Constitution and laws of the State of Maryland or this charter as it may deem necessary for the good government of the town; for the protection and preservation of the town’s property, rights and privileges; for the preservation of peace and good order; for securing persons and property from violence, danger, or destruction; and for the protection and promotion of the health, safety, comfort, convenience, welfare, and happiness of the residents of and visitors in the town.

Pursuant to the exercise of the police power contained in the above sections, the Mayor and Aldermen of the City of Annapolis adopted Section 12-9 of the Code of the City of Annapolis. That section grants to the city engineer and city health officer the power to make inspections of dwellings and rooming units located in the city in order to determine whether the conditions of the units comply with the provisions of the building and health laws of the city. The owners of such units are required to grant to the city’s representatives free access to the premises at reasonable times for the purposes of inspection. Section 12-16 (a) of the Code of the City of Annapolis provides, in pertinent part, that “[n]o person shall operate a single rental unit, multiple dwelling or rooming house unless he holds a current unrevoked operating license ... approved by the city engineer with the concurrence of health officer.” The city clerk is authorized to issue the original licenses and renewals thereof provided the units are found after inspection to meet the requirements of the City Code.

We come now to the tremendous matter of principle which is the bone of contention in this case. Section 12-16 (f) provides that “[t]he operating license fee shall be ten dollars ($10.00) annually per dwelling unit which shall be payable in advance of the issuance of the license or renewal.” ⁵³¹ As we understand appellants’ contentions in this case, they do not question that under Chapter 29 of the Charter of the City of Annapolis, the City is required to protect the health, safety and welfare of its citizens, nor do they have any quarrel with the City’s contention that under Article 23A of the Annotated Code of Maryland, the City is granted certain broad police powers to effectuate its obligation. What the appellants do place their reliance upon in this case is the language contained in Article XI-E, Section 5 of the Constitution of Maryland which the City acknowledges to be the governing law. That section provides, in pertinent part: Notwithstanding any other provision in this Article, the General Assembly may enact, amend, or repeal local laws placing a maximum limit on the rate of which property taxes may be imposed by any such municipal corporation and regulating the maximum amount of debt which may be incurred by any municipal corporation.

However, no such local law shall become effective in regard to a municipal corporation until and unless it shall have been approved at a regular or special municipal election by a majority of the voters of that municipal corporation voting on the question. No such municipal corporation shall levy any type of tax, license fee, franchise tax or fee which was not in effect in such municipal corporation on January 1, 1954, unless it shall receive the express authorization of the General Assembly for such purpose, by a general law which in its terms and its effect applies alike to all municipal corporations in one or more of the classes provided for in Section 2 of this article. Appellants argue strenuously that Section 12-16 of the Code is unconstitutional because that section requires a license to operate residential rental units and provides for the exacting of a fee for the issuance of that license despite the fact that the license fee was not in effect on January 1, 1954 in derogation of Article XI-E, Section 5 of the Constitution of ⁵³² Maryland. The appellants also contend that the fee is of the type which the General