In re Deyo

In re Deyo  (94-422); 164 Vt 613; 670 A.2d 793

[Filed 26-Oct-1995]


                               ENTRY ORDER

                      SUPREME COURT DOCKET NO. 94-422

                            SEPTEMBER TERM, 1995


In re Gerald B. Deyo                 }     APPEALED FROM:
                                     }
                                     }
                                     }     Bennington Superior Court
                                     }
                                     }
                                     }     DOCKET NO. S0287-90BcCa


       In the above-entitled cause, the Clerk will enter:

       Appellant Town of Manchester appeals the Bennington Superior Court's
  ruling that its ordinance banning on-premise signs advertising the sale or
  lease of real estate violates the First Amendment to the United States
  Constitution.  We affirm.

       Appellee Gerald Deyo owns real property in the Town of Manchester and
  uses this property for business purposes.  He operates a mobile home park
  and leases commercial space for office or retail purposes.  Appellant has a
  comprehensive sign ordinance, which it adopted in February 1986 pursuant to
  24 V.S.A., Chapter 117, after public hearings.  The purposes of the sign
  ordinance are:

         to help preserve and improve the existing attractive aspects of the
         Manchester environment, to promote the welfare, convenience and
         safety of its inhabitants and visitors, to conserve the value of
         property, and to encourage a style and scale of outdoor advertising
         that is compatible with a tourist-oriented economy and the more
         attractive features of the Manchester townscape.

  To achieve these purposes, the ordinance limits the number, type, and
  location of signs.  All off-premise signs are prohibited, and only one
  freestanding, on-premise sign is permitted on each commercial  property. 
  The ordinance contains exemptions for certain signs, such as sale, auction,
  special event, directional, window, and political signs.  It also expressly
  prohibits certain types of signs, such as internally illuminated,
  fluorescent, construction, and real estate signs.  Appellee challenged only
  the section of the ordinance that prohibits signs "advertis[ing] the sale
  or lease of real estate and . . . exhibited on such real estate."

       After receiving a permit from appellant, appellee erected a sign in
  front of the office building on his property.  His sign is one of only a
  "handful" of signs in the Town which use removable letters.  In early July
  1990, appellee's commercial tenant vacated its commercial space.  Shortly
  thereafter, appellee changed the lettering on his sign to advertise the
  vacant space as available for lease.  His sign said "office retail space"
  and included his telephone number.

       On July 12, 1990, appellant's zoning administrator sent a notice of
  violation to appellee stating that the sign violated the section of the
  ordinance which prohibited on-premise signs advertising the sale or lease
  of real estate.  Appellee requested and received a stay of enforcement
  while he appealed his violation to the Town of Manchester Zoning Board of
  Adjustment.  The Board upheld the zoning administrator's decision. 
  Appellee further appealed

  

  the Board's decision to the Bennington Superior Court, claiming that
  the Town's sign ordinance violated the First Amendment to the United States
  Constitution.  After a bench trial, the superior court concluded that
  appellant's sign ordinance was unconstitutional.

       Appellant contends that the superior court misapplied the commercial
  speech test.  The court applied the four prong test for commercial speech
  first enunciated by the United States Supreme Court in Central Hudson Gas &
  Elec. Corp. v. Public Serv. Comm'n of N.Y., 447 U.S. 557 (1980), and
  recently reaffirmed in United States v. Edge Broadcasting Corp., 113 S. Ct. 2696 (1993).

         At the outset, [courts] must determine whether the expression is
     protected by the First Amendment.  [1] For commercial speech to come within
     that provision, it must at least concern lawful activity and not be
     misleading.  Next, [courts] ask [2] whether the asserted governmental
     interest is substantial.  If both inquiries yield positive answers,
     [courts] must determine [3] whether the regulation directly advances the
     governmental interest asserted, and [4] whether it is not more extensive
     than is necessary to serve that interest.

  Edge Broadcasting, 113 S. Ct.  at 2702 (quoting Central Hudson, 447
  U.S. at 566).  This appeal concerns only the fourth prong of the Central
  Hudson test.

       Appellant argues that the superior court misapplied the Central Hudson
  test when it balanced public benefit and private cost to evaluate the fit
  between legislative means and ends. This argument is based on the court's
  conclusion that "the actual benefits to traffic safety and esthetics which
  are derived from this total prohibition of real estate sign advertising are
  too remote when weighed against the cost to the appellant of this
  prohibition."  An inquiry into the means-ends fit with respect to an
  individual challenger is appropriate under the fourth prong of the Central
  Hudson test.

       In Edge Broadcasting, the Supreme Court said that whether the costs
  and benefits of the challenged regulation are justified with respect to the
  individual challenger is a relevant inquiry under the fourth prong of the
  Central Hudson test.  113 S. Ct.  at 2704.  In Edge, federal law prohibited
  a radio station operating in North Carolina, but with a significant portion
  of its listeners in Virginia, from broadcasting advertisements for the
  Virginia lottery because North Carolina did not have a lottery. The radio
  station brought a First Amendment challenge against this federal law.  The
  Supreme Court first criticized the lower courts for examining the means-
  ends fit with respect to the individual challenger under the third prong of
  the Central Hudson test.  The Court then continued: "This is not to say
  that the validity of the statute's application to Edge is an irrelevant
  inquiry, but that issue should be dealt with under the fourth factor of the
  Central Hudson test."  Id. at 2704.  In conducting its analysis under the
  fourth prong, the Court noted that barring Edge from broadcasting lottery
  advertisements reduced exposure to radio lottery advertising by 11% in the
  relevant listening area of North Carolina.  This result satisfied the
  fourth prong of the test because the marginal reduction in exposure to
  lottery advertising sufficiently served the federal purpose of the law -- 
  accommodating non-lottery states' interest in discouraging participation in
  the lottery.  Here, the superior court could consider the means-ends fit
  with respect to the plaintiff without misapplying the Central Hudson test.

       The superior court did not limit its analysis of the costs and
  benefits of the ordinance with respect to only appellee; it also considered
  the costs to others in the same position. Appellant had the burden of
  affirmatively establishing that the means-ends fit is reasonable and that
  the "scope of the restriction is in proportion to the interest served." 
  Board of Trustees of State Univ. of N.Y. v. Fox, 492 U.S. 469, 480 (1989). 
  In determining whether appellant had satisfied its burden, the court first
  concluded that the sign ordinance substantially limited

  

  property owners' ability to market their property because the 
  alternatives available --  listing with real estate agents or advertising in
  the classified section of newspapers --  were less than satisfactory.  See
  Linmark Assocs. v. Township of Willingboro, 431 U.S. 85, 93 (1977).
  Earlier, in its analysis under the third prong of the commercial speech
  test, the court had concluded that, by permitting other types of signs that
  are distracting to motorists, the traffic safety benefits of the ordinance
  were undermined.  The court also concluded that a more finely tuned
  ordinance would serve appellant's interest in preventing the proliferation 
  of signs while allowing limited forms of real estate advertising.  After
  weighing the cost of the sign ban to owners of real estate in the town with
  the remote traffic safety and aesthetic benefits derived from the sign ban,
  the court concluded that the appellant had failed to affirmatively
  establish the reasonable fit required by the Central Hudson test.

       The superior court analyzed the means-ends fit from both a narrow and
  a broad perspective, and its analysis comported with the Central Hudson
  test.  Therefore, its conclusion was not error.

       Affirmed.



     BY THE COURT:



     _______________________________________
     Frederic W. Allen, Chief Justice

     _______________________________________
     Ernest W. Gibson III, Associate Justice

     _______________________________________
     John A. Dooley, Associate Justice

     _______________________________________
     James L. Morse, Associate Justice

     _______________________________________
     Denise R. Johnson, Associate Justice