Sandy Mazza|The Tennessean
Metro Nashville government "willfully and contemptuously" violated a Chancery Court order blockingthe city from revoking numeroushome-rental permits, several judgessaid in a dozen orders released Friday.
The chancellorsblamedMetro Zoning Administrator Jon Michael for continuing to demand that the plaintiffs stop operating vacation rentals at their properties, despite a court order barring any action until the cases are decided.
"Michael acted in a matter inconsistent with a known duty and, in doing so, caused Metro to be in contempt," Chanceller Anne C. Martin wrote, in a Friday order. "While the court does not relish holding Metro in contempt for violation of the order, the court feels it necessary."
In response to the decision, Metro attorney Jon Cooper said: "The Metropolitan Government is prepared to comply with the court's orders."
Metro is ordered to pay plaintiffs' attorney fees and costs related to the contempt cases.
Theserare, possibly unprecedented, civilcontempt rulingscomeas the city's battles over short-term vacation rentals reach a fever pitch.
On Feb. 19,29-year-old Layton Jones received thefirst-ever jailsentence in Davidson Countyfor renting his property on Airbnb.Jonesrepeatedly ignoredcourt orders to stop renting his house without a permitand was sentenced with three days in jail and a $20,050 fine. He is appealing the decision.
More than 6,000 short-term vacation rentals have been permitted across Nashville in recent years. And the Board of Zoning Appeals now hears cases from hundreds of people a yearpleading for reversals of their permit denials.
Airbnb rental law at issue
The contemptcharges against the cityarose out of lawsuitsfiled by dozens of homeowners who were ordered to stop renting their properties to tourists on sites like Airbnb.com and VRBO.comby Metro Codes and ZoningAdministration in January.The permits were recalled.
The department failed to enforce a February 2018 city law that limits the rental oftwo-family homes, such as duplexes and so-called tall-and-skinnies,in residential areas. It states that homeowners must live in one of the units, in order to be eligible to rent out the other.
But Codes Department officials said they realized late last year that they had overlooked thatrule.
The departmentthen sentletters in Januaryto 144 property owners who officials said were accidentally grantedpermits in violation of Metro law, demanding they stop renting their properties by Feb. 15.
In response, 45 or 46 impacted residents filed lawsuits seeking to hold onto the permits. Thecases are divided among allfour sitting Davidson County Chancery Court chancellors.
Metro officials then agreed to stop demanding that the plaintiffs ceaseoperating their rentals, in a court order.
Despite that order, Metro sent another letter to the plaintiffs insisting theystop renting their units on Feb. 15.
"The law requires you to immediately cease operations as a short term rental, remove any online listings of the property, and cancel any future bookings," the letter to plaintiffs states. "Should you continue to advertise and/or operate ... the matter will be referred to Metro Legal for prosecution."
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'Evidence establishes civil contempt'
The first group of plaintiffs brought their contempt case before Chancellor Martin on Feb. 27.
City attorney Cate Pham argued in that hearing that the Feb. 15 letter was an exampleof "poor judgement" rather thancontempt. She saidMetro lawyers subsequently reassured plaintiffs that they would not be prosecuted.
"To the extent that that was an unintentional violation of the agreed order it has been cured," Pham said.
But Chancellor Ellen Hobbs Lyle said Metro's defense wasn't convincing.
"It seems that Metro is saying it merely made a mistake and should not have sent the February 15, 2019 notice of revocation," Lyle wrote, in her Friday order. "There also was proof and testimony from Metro that it took the time and did consult its attorneys before sending out the letter. That proof shows that Metro’s actionwas deliberate and detracts substantially from its claim of mistake."
Chancellors have so far issued contempt orders against Metro for 12 of a total of 21 plaintiffs, with nine remaining to be heard.
"(Metro's)violation, although cured 11or so days later, had immediate consequence to the plaintiff," Lyle wrote, in her order. "The plaintiff had to incur attorneys’ fees to file a contempt petition to protect themselves. This evidence establishes civil contempt."
Three more contempt hearings are set for 10 a.m. March 27 in front of Chancellor Pat Moskal.
The remaining six will be decided by Chancellor Russell Perkins after an April 8 hearing.
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LITIGATION: Judge slaps Metro government with contempt ruling in Airbnb fight
PERMITS: Nashville recalls more than 100 short-term rental permits issued by mistake
SENTENCED: Man sentenced to jail after city officials said he operated an illegal Airbnb
Sandy Mazza can be reached via email at smazza@tennessean.com, by calling 615-726-5962, or on Twitter @SandyMazza.
