State Supreme Court’s opinion on ‘takings’ aspect of case expected soon
An area legislator said he considers a Tuesday decision by the New Mexico Supreme Court regarding pandemic-related fines and business closures to be “unfortunate.”
The five justices issued a verbal order in a case brought June 1 to the court by Gov. Michelle Lujan Grisham, Secretary of Health Kathyleen Kunkel and Secretary of Public Safety Mark Shea.
They asked the court to assert control over two legal issues, whether the state can issue large administrative fines if it alleges businesses have violated public health orders and whether forcing businesses to close or restrict operations for public health reasons constitutes “regulatory takings” of private property requiring financial compensation.
After oral arguments that lasted a bit more than an hour, the justices decided late Tuesday morning to allow the $5,000 administrative fines, but they declined to make a decision regarding the takings issue. A written formal opinion is expected within a few days.
In declining to make a ruling on the takings issue, they lifted a stay that had been placed June 5 on a case filed more than two months ago with the New Mexico Ninth Judicial District Court of Curry County. The lower court can now decide the matter.
Support Local Journalism
Subscribe to the Roswell Daily Record today.
Support Local Journalism
Townsend expresses his views
Rep. James Townsend, R-Artesia, was among those who joined in several “friends of the court” or amicus briefs to argue that the actions taken by state officials are not granted by state laws and public health statutes and should not be permitted.
“I think the actions of the Supreme Court today greatly undermine the Legislature. I think it is unfortunate,” Townsend said. “I believe our laws and we’ll go with what has been said, but I think the statutes are very clear. And the statutes specifically say what the fines are for those instances. It certainly was not the outcome that many attorneys that we work with expected, and we believe in this case that they may have missed the mark.”
In the amicus brief that Townsend joined, the other parties were District 1 Rep. Rod Montoya, R-Farmington, the New Mexico Cattle Growers Association and the New Mexico Business Coalition.
“I represent District 54 and a number of small businesses. Some of them are affected by this decision — many of which are affected by this decision,” he said. “I thought it was the right thing to do, and it was overwhelmingly supported by my constituents.”
Businesses sue state
The case that gave rise to the Supreme Court ruling started May 20 in Curry County and was filed by about 14 plaintiffs, which were various businesses and the people who own them. They included restaurants, a gym, a massage business, an outdoor market and auto business, and they were located in Clovis, Lovington, Albuquerque, Maxwell, Socorro and Hobbs.
The plaintiffs said that their businesses had been forced to close or been severely restricted in doing business because of public health orders issued by the state starting in March.
In addition to claiming a loss of revenues as a result, some plaintiffs received $5,000 administrative fines for allegedly violating public health orders. Others were warned that they could receive the hefty fines, which they said could amount to tens of thousands of dollars because the state had indicated that it would assess fines for each day a business is considered to be in violation.
They argued that the law that allows the state to make public health orders does not give it the authority to issue administrative fines, only the criminal citations that carry the possibility of a $100 fine and a misdemeanor charge.
They also said state officials cannot order business closures. But, if they do “regulatory takings” of businesses, financial compensation is due.
Rather than argue the case in the district court, the state asked the state Supreme Court to decide the legal issues.
“By weighing in on these two legal matters, the court can provide timely guidance to courts and litigants throughout the state on these pressing matters of statewide importance,” according to the state’s petition.
State lawyer: At least 8 other cases
In his arguments on behalf of the state, lawyer Matt Garcia said that the Public Health Act was developed by the will of the Legislature and allows for business closures and the limiting of mass gatherings. He also said authority to coordinate emergencies is granted by the Public Health Response Act.
“I think the law is pretty clear, so that is one reason to decide it now,” Garcia said. “I think the other reason to decide it is conservation of judicial resources.”
He said he personally was aware of at least eight other cases filed in courts across the state that involve the “takings” issue.
At least two cases have been filed in Roswell, one by local restaurateur and businessman Madux Hobbs and the other involving local fitness center owner Sean Schooley.
In terms of the fines, Garcia said that the large administrative fines only come after less stringent measures are tried, including a cease-and-desist notice and then the criminal citation. He also said the $5,000 penalty could be protested in the district court if a business thinks it has been assessed inappropriately.
“What we are trying to get here is immediate compliance because the only tool we have currently to stem COVID-19 is social distancing,” he said. “We need immediate compliance. We can’t say, well, hopefully you will comply eight months down the road. We need immediate compliance.”
In response, the lawyer representing the original plaintiffs from the district court case, Carter Harrison IV, said that the administrative fee is only allowed by the Public Health Response Act and is only supposed to be related to violations of such provisions as isolation, quarantine or proper procedures for handling the bodies of the deceased.
He said that PHERA does not explicitly allow for business closures, and he is unsure whether business closures should be considered a “quarantine.”
He added that decisions about balancing public welfare with public health and deciding which businesses should be shut down belong to the New Mexico Legislature.
“Those are both decisions fundamentally that ultimately should be made by the Legislature,” Harrison said.
Senior Writer Lisa Dunlap can be reached at 575-622-7710, ext. 351, or at email@example.com.