Case: Hernandez v. City of Hanford, No. S143287 (Cal. Sup. Ct. 6/7/07)

The One Sentence Summary: California Supreme Court held that City of Hanford’s zoning ordinance restricting the sale of furniture in shopping mall district in order to protect retail furniture stores deemed vital to economic viability of city’s downtown commercial district was not unconstitutional.

What They Were Fighting About: The challenged zoning ordinance generally prohibited the sale of furniture in the city’s Planned Commercial (PC district) area, which contained a large shopping mall anchored by several department stores. There was a limited exception that permitted department stores with more than 50,000 square feet of floor space in the PC district to sell furniture within a prescribed area of no more than 2,500 square feet. City of Hanford enacted this zoning ordinance in 2003 to protect the economic viability of its downtown commercial district, which featured many retail furniture stores. Plaintiffs were owners of a home furnishing and mattress store in the PC district who wanted to sell bedroom furniture in their store. Their lawsuit asserted equal protection clause challenges to the validity of the ordinance under the United States and California Constitutions. Although the trial court rejected plaintiffs’ constitutional challenges, the court of appeal struck down the ordinance.

Court Holdings: In reversing the court of appeal’s decision and upholding the city’s zoning ordinance, the California Supreme Court held:

  • The legislature had two legitimate purposes in enacting the zoning ordinance: (1) protecting and preserving the economic viability of the city’s downtown commercial district, by generally prohibiting in the PC district the retail sale of furniture, and (2) attracting and retaining for the PC district large department stores, which typically carry furniture and which the city deemed essential to the viability of the PC district.
  • Limiting the exception for sale of retail furniture within the PC district to only large department stores is rationally related to the legislature’s second purpose in enacting the challenged zoning ordinance. Rational basis test applies to such economic legislation. Differential treatment of large department stores and other retailers in the PC district was rationally related to a legitimate governmental purpose.
  • The Court also rejected the plaintiffs’ sweeping challenge to the ordinance as improperly “regulating economic competition.” A zoning ordinance is legal despite affecting economic competition so long as its primary objective is to achieve a valid public purpose such as futhering a city’s plan for controlled growth or localized commercial development, rather than an impermissible anticompetitive private purpose such as favoring or disfavoring a particular business or individual. A city may divide land into districts and reasonably regulate the uses permitted therein in exercising its policy power.