Full opinion text
MEMORANDUM OPINION AND ORDER JAMES HARVEY, District Judge. Nearly three years ago, this Court, in 15192 Thirteen Mile Road Inc. v. City of Warren, 626 F.Supp. 803 (E.D.Mich.1985), was called upon to review various constitutional challenges to section 14.02 of the Warren zoning ordinance. Section 14.02 regulated the ability of adult businesses to locate within the City of Warren. The plaintiffs, five different corporations whose principals proposed to open adult businesses in Warren, attacked the ordinance as void for vagueness, overbroad, and deficient under United States v. O’Brien, 391 U.S. 367, 88 S.Ct. 1673, 20 L.Ed.2d 672 (1968). After conducting two hearings for preliminary injunctions and having taken testimony for nearly four weeks, the Court upheld the portion of section 14.02 prohibiting an adult business from locating within 500 feet of a residential use, an area zoned residential, and from within 1000 feet of a church or school. The Court struck down as unconstitutionally vague, however, the site plan review procedure and procedure for special land use approval because they vested an improper degree of discretion in the reviewing officials. While 15192 Thirteen Mile Road was still pending, Karen Christy, one of the principals in 15192 Thirteen Mile Road, and Christy Newsreel Services, Inc. brought this action alleging that defendants precluded them from using the building located at 5583 East Eight Mile to open a retail video sales and service store in violation of the first, fifth and fourteenth amendments to the United States Constitution. The Court refused to consolidate this action with 15192 Thirteen Mile Road because this case raised difficult questions concerning the application of section 14.02 and other city regulations not present in the other actions consolidated under 15192 Thirteen Mile Road. The Court held 46 days of trial in this matter and admitted approximately 200 exhibits. Having reserved its ruling on defendants’ motion at trial for an involuntary dismissal pursuant to Rule 41(b), the Court hereby issues its Findings of Fact and Conclusions of Law in accordance with Rule 52(a). I. FINDINGS OF FACT A. Introduction (1) Karen Christy is the sole shareholder of Christy Newsreel Services, Inc. (Newsreel Services), a Michigan corporation formed on November 1,- 1982. Christy, through Newsreel Services, presently operates three adult entertainment businesses: the “Velvet Touch, Video and Gift Boutique,” in Lansing, “Unique Creations,” in Ypsilanti, and the “Velvet Touch, Video and Gift Boutique,” located on 1-69 and referred to at trial as the “Charlotte store.” She also is attempting to open two other stores in the Lansing area. Newsreel Services presently employs approximately 20-80 people. (2) Christy resides with and has had a social and business relationship with Whitman since 1978; Whitman also is engaged in the operation of several adult oriented businesses throughout the state.. Whii> man presently operates five such stores through Executive Art, Inc.; one each in Lansing, Kalamazoo, Wyoming, Mt. Morris and Warren. Whitman also operates a store in Parma and a store in Flint through a separate corporation, Fashion Design. The sign above each of Whitman’s stores reads “Velvet Touch.” (3) Michael Servitto was appointed Director of the City of Warren’s Department of Public Service in November 1981, by Mayor-Elect James Randlett, and served in that position until Randlett was defeated in the mayoral election in November 1985. As Director of the Department of Public Service, Servitto supervised eight divisions: Building and Safety Engineering, Water, Department of Public Works, Service, Sanitation, Engineering, Sewage and Treatment, and Building Maintenance. Servitto testified that work associated with the Water Division and Department of Public Works consumed the majority of his time. (4) George 0. Bruggeman is Superintendent of the Division of Buildings and Safety Engineering (building department), one of the eight divisions within the Department of Public Service. The building department contains five separate bureaus: Electrical, Building, Plumbing, Heating/Cooling and Zoning. Each bureau employs one or more inspectors who are charged with the responsibility of implementing the City’s ordinances and adopted trade codes which regulate the occupancy of buildings located in the City of Warren. (5) On December 12, 1978, the Warren City Council adopted by reference, with certain modifications, the Basic Building Code, 1978 Edition, published by the Building Officials and Code Administrators Information, Inc. (BOCA). The BOCA Basic Building Code went into effect on January 1, 1979. The 1981 BOCA Basic Building Code was adopted by reference, again with certain modifications, by the City Council, effective June 13, 1983. Prior to January 1, 1979, the building department applied the Warren Building Code. The electrical inspectors apply the Warren Electrical Ordinance, the National Electrical Code (N.E.C.) and the Uniform Reciprocal Rules (adopted by the Uniform Reciprocal Council of Southeast Michigan Communities). The zoning inspectors apply the Warren zoning ordinance. (6) Also within the building department but independent from the other five bureaus is the position of City Plan Examiner. The Plan Examiner reviews building permit applications and any accompanying plans to ensure the application and plans conform to the applicable code provisions. (7) Under section 119.2 of both the 1978 and 1981 edition of the BOCA Basic Building Code (BOCA Code), an owner is required to obtain a “certificate of use and occupancy,” whenever an existing building is “enlarged, extended or altered to change from one use to another or to a different use within the same use group in whole or in part,_” A certificate of use and occupancy for an existing building is referred to in the City of Warren as a certificate of reoccupancy or as a certificate of occupancy for reoecupancy. “Use group” is defined in section 201.3 as the “classification of a building or structure based on the purpose for which it is used.” Section 202.1 establishes nine use groups: (1) Group A: assembly; (2) Group B: business; (3) Group F: factory and industrial; (4) Group H: high hazard; (5) Group I: institutional; (6) Group M: merchantile; (7) Group R: residential; (8) Group S: storage; and (9) Group T: temporary and miscellaneous. “Use” is defined in section 201.3as “The purpose for which the building or structure is designed, used or intended to be used.” (8) In order to obtain a certificate of occupancy, an owner of a building or his agent must first obtain a “special permit” requesting reoccupancy inspections. Once the special permit is secured, a date is established in which the owner or agent agrees to be on the premises during a specific period of time for the inspections. Once the inspections are completed, the owner or agent is then apprised of any outstanding violations either by phone or mail by each of the inspectors. Depending on the nature of the violation, the owner or agent may need to obtain a permit from the particular bureau to remedy the violation. It is not uncommon for a building to require several inspections before all the violations are remedied. Once all the violations are corrected and each inspector has issued his approval, a certificate of occupancy is issued. (9) The determination of whether a building permit is necessary to do certain work, regardless of whether the planned work is to remedy violations resulting from a request for a reoccupancy inspection or simply to remodel the premises, is governed by section 112.1 of the BOCA Code: 112.1 When permit is required: It shall be unlawful to construct, enlarge, alter or demolish a structure; or change the occupancy of a building or structure requiring greater strength, exitway or sanitary provisions; or to change to another use; or to install or alter any equipment for which provision is made or the installation of which is regulated by this code, without first filing an application with the building official in writing and obtaining the required permit therefor; except that ordinary repairs, as defined in Section 102.0, which do not involve any violation of this code shall be exempt from this provision. Section 102.1 pertaining to ordinary repairs states in relevant part: 102.1 General: Ordinary repairs to structures may be made without application or notice to the building official; but such repairs shall not include the cutting away of any wall, partition or portion thereof, the removal or cutting of any structural beam or bearing support, or the removal or change of any required means of egress, or rearrangement of parts of a structure affecting the exit-way requirements;.... Applications for a building permit are provided at the building department. In filling out an application, section 112.4 provides: 112.4 Description of work: The application shall contain a general description of the proposed work, its location, the use and occupancy of all parts of the building or structure and of all portions of the site or lot not covered by the building or structure, and such additional information as may be required by the building official. Section 112.5 requires the submission of specifications and plans along with the permit applications: 112.5 Plans and specifications: The application for the permit shall be accompanied by not less than two (2) copies of specifications and of plans drawn to scale, with sufficient clarity and detail dimensions to show the nature and character of the work to be performed.... The building official may waive the requirement for filing plans when the work involved is of a minor nature. Although section 112.5 indicates that only two copies of plans need be submitted when required, building permit applications request that four copies be supplied. If the projected cost of the work to be done does not exceed $5,000.00, the Plan Examr iner has discretion to accept a sketch in lieu of an architectual drawing. Once the application is filled out, a clerk at the counter takes the application and assesses the permit fee and determines the amount of the bond to be posted. If necessary, a plan fee is also charged. The Clerk then routes the application and any accompanying plans to the inspectors and Plan Examiner for their approval. The time necessary to process the application is a function of the complexity of the proposed construction and the time of year. Spring and summer are especially busy; an increased number of applications are filed during those months. Approval or rejection of an application may take anywhere from several hours to several weeks. Once the application is approved, a permit is granted. When the work is completed, the owner or agent contacts the building department and requests an inspection. If the work is “up to code,” the inspector issues his approval. (10)With respect to obtaining an electrical permit, section 6-226(a) of the Warren Electrical Ordinance states: It shall be unlawful in the city for any person to install, alter, maintain, service or repair electrical equipment in or on any building, structure or part thereof, or on premises, or cause or permit therein or thereon the installation, altering, maintaining, servicing or repairing of any electrical equipment, without a permit having been obtained therefor as provided herein. Subsection (b) excepts minor repair work from the need to obtain a permit: No permit will be required for minor repair work, such as the replacement of lamps or the connection of portable electrical equipment to suitable permanently installed receptacles. Nothing in this section shall be considered as applying to any person engaged in repairing and maintaining electrical appliances. Section 6-238(13) requires a detailed set of plans and specifications to be submitted “for any wiring or alterations to the electrical system in all buildings using over six circuits_” Section 6-238(13) further states that “electrical drawings shall include such details as lighting layout, circuiting switching, conductor and raceway sizes, wattage schedule, service location and riser diagram, calculations and proposed method of construction drawn with symbols of a standard form.” (11) Any decision pertaining to the application of the BOCA Code may, pursuant to section 126 of the BOCA Code, (as modified by the Warren ordinances), be appealed to the Building Code Board of Appeals. The Board of Appeals then forwards their recommendation to the City Council. Decisions by electrical officials may be appealed by filing a petition with the Board of Electrical examiners. Warren Electrical Ordinance, Section 6-221(e). The Board must rule on the petition within three days of its receipt. Similarly, a zoning decision may be appealed to the Zoning Board of Appeals which has the authority to reverse, modify or affirm the original decision. City of Warren Zoning Ordinance No. 30, Article XX, Section 20.04. B. 22640-44 Van Dyke Avenue (12) The dispute over the use of the building located at 5583 East Eight Mile (5583) was preceded by a confrontation between Whitman and officials from the building department over the use of the buildings at 22640 and 22644 Van Dyke Avenue (22640; 22644) owned by Whitman. (13) Whitman testified that sometime in March or April of 1977, he obtained a copy of the Warren zoning ordinance and found nothing which would preclude him from opening his adult businesses in Warren. Whitman testified that although he did not know what he would use 22644 for when he first bought it, he later decided to sell adult books; with respect to 22640, he planned to offer nude models for photographing and body painting. He also planned to offer the “Velvet Touch,” a technique he invented and describes as a “light fingertip caress of the skin.” He stated that he purposely omitted telling the building department of his true intention to sell adult books at 22644 and offer nude models for photographing and body painting, as well as the “Velvet Touch” at 22640 for fear the City would amend its zoning ordinance before he could obtain certificates of occupancy. Whitman conceded that he used a series of corporations and assumed names to “sneak up” on the City of Warren. He acknowledge that he has employed this clandestine approach of using assumed names in other cities in order to establish adult oriented businesses in those cities. He also stated that the “Velvet Touch” was devised as a means of avoiding regulations existing in many cities restricting the location of massage parlors. (14) The confrontation between the City and Whitman engendered by Whitman’s attempt to sneak up on the City is chronicled in the building department file. (15) On June 20, 1977, Michigan Diversified Properties, through “Tom Johnson,” applied for a special permit for a reoecu-pancy inspection at 22644 for use as a retail record and tape store. A certificate of reoccupancy was issued on July 14, 1977. Although Whitman didn’t recall using the name Tom Johnson, Michigan Diversified Properties, Inc. was an assumed name for Michigan Diversified Business Corp., a corporation owned by Whitman. (16) The reoccupancy inspection request submitted June 20, 1977, was also utilized for inspections of 22640, and on July 28, 1977, a certificate of reoccupancy was issued to S.M.R. Corporation. S.M.R. was a corporation formed by Whitman. (17) On August 12, 1977, applications for sign permits were filed for both locations. Sign plans were submitted indicating “Mel-O-Dee Records” would be displayed at 22644 and “Michigan Diversified Corporation” would be displayed at 22640. (18) Despite Whitman’s attempt to open his store before an unfavorable ordinance was adopted, the City Council, still unaware of Whitman’s intent regarding the use of 22640, adopted ordinance No. 30-545, on September 27, 1977, requiring health spas, massage parlors and establishments offering baths of any kind to obtain special use approval from the Planning Commission before a certificate of occupancy could be obtained. Other businesses requiring approval by the Planning Commission included reducing salons and sports facilities of any type. See 15192 Thirteen Mile Road v. City of Warren, 626 F.Supp. 803, 822 (E.D.Mich.1985), for a discussion of the history of the Warren zoning ordinance. (19) On November 30, 1977, Gordon Studios, through “Michael Gordon,” applied for a certificate for reoccupancy for the premises at 22640, indicating the proposed use as “portrait painting.” The special permit issued December 1, 1977, indicated “artist studio and office.” A certificate of reoccupancy was issued on February 23, 1978. Gordon Studios was an assumed name of S.M.R., and Whitman testified that he was Michael Gordon. Whitman testified that he never intended to use 22640 as a portrait painting studio. (20) On March 14, 1978, Detective Gary Maurer of the Warren Police Department visited the premises at 22640-44 Van Dyke pursuant to a complaint that a massage parlor was opening for business. Detective Maurer’s report indicated that the premises was locked. His report further indicated that on the following day he checked both the state and local assumed names divisions for Michigan Diversified Properties, Inc. and Michael Gordon or Gordon Studios, but found nothing filed under those names. (He was unable to locate the filing of the assumed names since none of them were filed with the Michigan Department of Commerce until April 20, 1978, over a month after Maurer’s search.) This information was relayed to Bruggeman later that day. (21) Acting pursuant to the complaint, Bruggeman, along with Assistant Director of the building department Pat Sankuer, gained entrance to the buildings at 22640-44 Van Dyke on March 16, 1978. Brugge-man and Sankuer testified that they noticed 12 three-foot wide booths which were open in the front in 22644. They further testified that a raised platform had been built which Sankuer indicated was approximately 36" high, and Bruggeman indicated was covered with red shag carpet. Bruggeman also observed a shower in one of the side rooms, and a showcase filled with retail tapes. (22) Bruggeman and Sankuer immediately posted “no occupancy” stickers on both addresses. The following day someone removed the stickers. They were replaced by building inspector James Zimmerman. The stickers were either removed or painted over several more times during the next several weeks. New stickers were repeatedly posted. Whitman testified that it was he who had removed and painted over the stickers. (23) On April 6, 1978, Bruggeman notified the building department clerks that the two sign permits reading “Mel-O-Dee Records” at 22644 and “Michigan Diversified Corp.” at 22640 were not to be issued under any circumstances. (24) On April 7, 1978, Bruggeman sent a letter to Servitto’s predecessor, Public Service Director Paul Van Den Branden, updating him on the activity at 22640-44. In that letter, Bruggeman also stated that following his inspection of the two locations, he was contacted by attorney Howard Siecrist who indicated he represented Michael Gordon, the owner of Gordon Studios. Bruggeman reported the following conversation with Siecrist to Van Den Branden: In the conversation with this attorney I requested that Mr. Gordon come into the office in order that we could consult with him as to what the intended use of the two buildings would be. Mr. Siecrist indicated he had no intentions of sending Mr. Gordon into the Building Division and further indicated he had a certificate of occupancy by our Division and he was going to open up the places for business. Bruggeman concluded the latter with the following paragraph: In summary, it appears that both of these commercial buildings have already started some illegal use and are doing it under close scrutiny so as to avoid both our Divisional personnel and the Warren Police Department. This writer personally made daily trips to Mel-O-Dee Records only to find it locked during the day with notices from the gas and electric companies hung on the door handle. The back door of Mel-O-Dee Records, 22644 Van Dyke Avenue, is now sprayed with black paint, making it impossible to see into the building. The one door on the front which is of heavy steel construction has a lock and is only opened by the owner. All entry into the building must be through the back door. (25)On April 13,1978, two Warren police officers attempted to gain entry at the Van Dyke locations. They stated in their report: [We] checked the front and rear doors and found them to be locked. As we were knocking on the backdoor we heard the phone ring. The phone was answered by someone inside and we heard the subject tell the caller that the police were at the door. The subject then came and unlocked the door. As we walked inside the subject went back to the phone and told the caller that we were inside. As we walked past the counter the subject told us it would cost us 50<t to enter the business. We advised the subject that we were there to make out a business card and he relayed this info to the caller. The subject was asked who owned the business and he stated that he didn’t know. The subject was asked for his name and he related all the questions to the caller before he would answer. He was asked who he was talking to and he stated that he was talking to his attorney Howard Siecrist. At this time Siecrist must have told the subject to cooperate, he I.D. [sic] himself as Darth Weigum W/Ml-20-52. We left a business card with him and he stated that he would give it to the owner to have it filled out and we advised that we would return on 4-14-78 to pick it up. Officers asked Weigum the type of business and stated that it was an adult book store. Officers viewed books in racks along the walls, they also had stag films in a case by the rear door. Apparently the rear door is to be used as the main entrance. There were 12 viewing booths along the front of the store to be used for peep shows. The southeast corner of the building is sectioned off and vacant. (26) In a memorandum from Sankuer to Bruggeman dated April 13, 1978, Sankuer indicated that at 9:30 p.m., April 12, 1978, the Van Dyke buildings were locked up and the No Occupancy stickers were still posted. He also indicated that Detective Maurer had called him and told him that he talked to two white males and a white female leaving the building earlier in the day (April 13, 1978). One of the males identified himself as an attorney and the girl as “flashy trashy”; he also indicated that the businesses would open at noon that day. (27) The business at 22644 opened on April 13, 1978, and shortly thereafter, a sign reading “Danish Adult News” was placed over the store. Danish Adult News was an assumed name of Michigan Diversified Business Corp. The premises at 22640 remained vacant in April. (28) On April 17, 1978, the City of Warren filed suit in Macomb County Circuit Court seeking injunctive relief on the ground that both Van Dyke locations were being occupied without a valid certificate of occupancy contrary to the zoning ordinance and thus were a nuisance per se under Mich.Comp.Laws Ann. § 125.587 (West 1986). After conducting a hearing on May 1, 1978, Judge Denewith found that the certificate of reoccupancy previously issued for the premises at 22644 was issued for use as a retail store and that the present use by defendants for retail sales and peep shows was in contravention of the use for which the certificate of reoccupancy was issued. The Court granted a temporary injunction which enjoined the use and occupancy of the premises at 22644 Van Dyke until the City could conduct its inspection. On May 2, 1978, the premises was inspected by the City inspectors and on May 3, 1978, the second hearing was conducted. Based on the testimony of the inspectors, the Court modified its May 1, 1978, order and lifted the injunction as to retail sales but continued the injunction as to the use of the peep show booths. (29) Shortly after the amended injunction pertaining to 22644 was entered, 22640 opened for business offering nude body painting. Whitman testified that patrons painted such things as faces and lines on nude or partially nude models. The shower was used by both the patrons before touching the models and by models to wash the paint off after the session was over. (30) On May 9, 1978, the Warren City Council passed ordinance No. 30-545, amending its zoning ordinance to add what is defined as “adult designated uses” to the list of other uses which required special use approval before a certificate of occupancy could be issued. Following the passage of ordinance No. 30-545, section 14.02 of the zoning ordinance stated: Section 14.02 — USES PERMISSIBLE ON SPECIAL APPROVAL. Under such conditions as the Planning Commission, after hearing, finds the use not being injurious to the C-2 District and surrounding area and not contrary to the spirit and purpose of this Ordinance subject further to the review by the Board of Appeals and approval, thereof, the following uses may be permitted. 1. Open air business uses when developed in planned relationship with the C-2 District as follows: Retail sales of plan materials not grown on site and sales of lawn furniture, playground equipment, and other home garden supplies. 2. Adult bookstores, adult motion pictures, and adult mini motion picture theatres. A. Definitions. 1. Adult Bookstores. An establishment having as a substantial or significant portion of its stock in trade, books, magazines, and other periodicals which are distinguished or characterized by their emphasis on matter depicting, describing or relating to “Specified Sexual Activities” or “Special Anatomical Areas”, (as defined below), or an establishment with a segment or section devoted to the sale or display of such material. 2.Adult Motion Picture Theatre. An enclosed building with a capacity of 50 or more persons used for presenting material having as a dominant theme materials distinguished or characterized by an emphasis on matter depicting, describing or relating to “Special Sexual Activities” or “Specified Anatomical Areas”, (as defined below), for observation by patrons therein. 8. Adult Mini Motion Picture The-atre. An enclosed building with a capacity for less than 50 persons used for presenting material distinguished or characterized by an emphasis on matter depicting, describing or relating to “Specified Sexual Activities” or “Specified Anatomical Areas”, (as defined below), for observation by patrons therein. 4. Specified Sexual Activities, Specified Anatomical Areas. For the purposes of this Section, “Specified Sexual Activities” is defined as: (1) Human genitals in a state of sexual stimulation or arousal. (2) Acts of human masturbation, sexual intercourse or sodomy. (3) Fondling or other erotic touching of human genitals, pubic region, buttock or female breast. and “Specified Anatomical Areas” is defined as: (1) Less than completely and opaquely covered: (a) human genitals, pubic region, (b) buttock, and (c) female breast below a point immediately above the top of the areola; and (2) Human male genitals in a discemi-bly turgid state, even if completely and opaquely covered. . B. Site Plan Review. Application to establish an adult designated commercial enterprise shall be made in writing to the Planning Commission. Such application shall specify the type of adult use or uses that will be catered to, and shall be accompanied by a detailed site plan. The Planning Commission, having a duty to determine whether a particular use will have a deleterious effect on the surrounding area, will not approve a site plan application if any of the following conditions are found to exist: 1. The site is located on other than a major thoroughfare, as designated in the Master Thoroughfare Plan. 2. The site is closer than 500 feet to the property line of an area zoned residential or a residential use. 3. The site is located closer than 1,000 feet to a site having an adult business designation under this section. 4. The site has failed to gain the approval of 51% of the persons owning, residing or doing business within 500 feet of this location, that approval being evidenced by a petition with notarized signatures, signed by the concerned parties, and presented by the petitioner to the City of Warren for approval and validity of said petition prior to the public hearing. Further, the site plan shall conform to the specifications as articulated in Section 21.07 of this ordinance and shall contain an elevation of the building and its layout shall be in such a fashion so as not to convey the message of its intended use. 3.Recreation space both indoor and outdoor, health science and related uses including but not limited to the following: a) health spas, b) marital arts, instruction in or practice or participation in the martial arts, c) gymnasiums, d) massage parlors, e) turkish baths, bath houses, saunas, or businesses providing whirlpool baths or mineral baths as the primary use, f) racquetball, handball, tennis, badminton squash courts, Jai-Alai, hockey rinks, g) reducing salons, h) skateboard parks, motorcycle rinks roller rinks, children’s amusement park, shuffle board,. miniature golf, and other similar recreation when part of a planned development. (31) On May 10, 1978, Sankuer, acting as director of the building department in Bruggeman’s absence, issued a memorandum to all personnel in the building department indicating that no permits or certificates of occupancy were to be issued for either 22640 or 22644 without the approval of the City Attorney’s office. Sankuer issued the memorandum even though the new ordinance was not effective until May 29, 1978, because he was unsure of whether any requests for permits or certificates of occupancy for 22640 or 22644 Van Dyke should be reviewed under the new ordinance. (32) On May 16, 1978, Whitman, as president of Michigan Diversified Business Corporation, filed an application for a building permit for 22644 for “interior alteration” and “projection booths”. Plans depicting the work to be done were filed either with the application or the next day. (33) On May 26, 1978, Sankuer notified Whitman’s counsel, Carl Rubin, by letter that the drawings submitted with the application needed further detail and resubmission before the permit could be processed to completion. No new plans were submitted until October 1978. (34) Sometime during the latter part of May 1978, the business at 22460 began providing an escort service in which the customer could purchase the escort service of models on a hourly basis. In addition, hot baths with nude models for an hourly fee were also offered. There were two California hot tubs and a seven-foot bath at 22640. (35) On June 15, 1978, Sankuer sent a letter to Van Den Branden updating him on the activity at 22640. Sankuer stated that a sign face had been installed in the sign frame above 22640 which read “Art Studio” and “Bath and Escort Service” and showed a bikini-clad female. Sankuer noted that as of the date of his letter, there was no certificate of occupancy issued for either the escort service or the baths, and that it appeared the owner would be challenging the City regarding the occupancy of the building. (36) On June 26, 1978, Judge Denewith denied a motion to set aside the injunction issued against 22644 on May 1, 1978. On the same day, Noel Lippman, acting as an agent for “Michigan Diversified Business,” filed a reoccupancy request for “book store-movie arcade/mechanical device peep show.” Also on the same day, Sankuer received a call from a Warren police officer who indicated that an undercover agent entered the premises at 22640 and enlisted the aid of a model for a stated price of $20.00. Upon payment, the model bared herself from the waist up for the undercover agent to fingerpaint the upper portion of her body. The model indicated that for $75.00, both he and the model would remove their clothing and fingerpaint one another’s nude bodies. (37) In a June 30, 1978, memorandum issued to Van Den Branden, Sankuer indicated in part that Judge Denewith denied the June 26, 1978, motion to set aside the injunction because he believed the defendants should attempt to procure a valid certificate of occupancy. Sankuer further recounted Judge Denewith’s warning that if the application was denied, he would review the City’s decision to determine if it was reasonable; In a subsequent memorandum sent to Van Den Branden on July 5, 1978, Sankuer apprised Van Den Branden of Lippman’s application for a certificate of occupancy for 22644 and warned that Rubin stated he might file a suit in federal court accusing the City of arbitrarily denying a certificate of occupancy to permit the peep shows installed at 22644. Sankuer requested direction on the application of the new zoning ordinance to both 22640 and 22644. He requested a joint meeting between himself, Van Den Branden, Assistant City Attorney David Dalenburg, Zoning Inspector Gerry Weckesser and City Plan Examiner Les Johnson. No such meeting ever took place. (38) In mid-July 1978, the City moved for a further preliminary injunction asserting that the premises at 22640 was being used for the painting of nude models in violation of a section of the City’s obscenity ordinance. In early August 1978, Michael Gordon/Gordon Studios filed a counter-complaint attacking, in part, the constitutional validity of the ordinance. On September 13,1978, Michigan Diversified Business Corporation/Danish Adult News/Mel-O-Dee Records filed a separate complaint, seeking an order requiring the City to grant a certificate of occupancy for 22644. Michigan Diversified Business Corporation, d/b/a/ Danish Adult News, d/b/a Mel-O-Dee Records and Tapes v. Bruggeman, Sankuer, City of Warren, (Macomb County Circuit Court Dkt. No. 78-26275-CZ.) (39) Supplemental architectural plans pertaining to construction at 22644 were submitted to the building department sometime between the 26th and 30th of October, 1978, with changes and additional detail required by the building department. (40) On November 3, 1978, Sankuer sent a letter to Rubin noting receipt of the revised blueprints, indicating that the building department could not approve the certificate of reoccupancy for 22644 because of insufficient information. Sankuer stated that the building department needed more information to determine whether the peep shows advertised on the sign above the store depicted matter defined as “specified sexual activities” or “specified anatomical areas” under the newly enacted zoning ordinance. (41) On November 21, 1978, Rubin sent a letter to Assistant City Attorney Dalenberg explicitly stating that his clients intended to use coin operated devices to exhibit movies containing specified sexual activities and specified anatomical areas as defined under the zoning ordinance. Rubin requested that the building department issue a certificate of occupancy or deny the June 20, 1978, application. This letter was transmitted to Sankuer on December 8, 1978. (42) On December 12,1978, Sankuer sent a letter to Van Den Branden discussing Rubin’s November 21,1978, letter acknowledging that movies containing speech defined under the ordinance as specified sexual activities and specified anatomical areas would be shown at 22644. Sankuer stated that the certificate of reoccupancy would be denied because the films described by Rubin were covered under the portion of the zoning ordinance pertaining to adult mini-motion picture theatres of 60 persons or less. (43) On December 16, 1978, Dalenberg contacted Sankuer concerning a letter Dal-enberg received two days earlier from Rubin reiterating his desire for a decision on the certificate of occupancy application. In a letter sent to Rubin the following day, Sankuer stated: This office has received a letter from the Assistant City Attorney David L. Dalenberg with regards to the Circuit Court of Macomb File No. 78-2669-CZ. The place in question is 22644 Van Dyke Ave. Attached was the letter from Taylor and Rubin, Attornies [sic] at Law requesting a certificate of re-occupancy and stating that the Danish Adult News intends to operate devices commonly called “peep” shows that exhibit movies containing specified sexual activities and specified anatomical areas. Based on the above this office denies the certificate of re-occupancy for the use of these devices and/or for the showing and viewing of films as aforementioned under the enacted amendment of Ordinance No. 30 of the City of Warren’s Ordinances, specifically Article 14, Section 14.02 under Paragraph C — Adult Mini-Motion Picture Theatre of 50 persons or less and Paragraph D, specifically sexual activities and specified anatomical areas. (44) On December 22, 1978, another amendment to section 14.02 of the zoning ordinance was passed by the City Council. It became effective on January 16, 1979. The amendment added escort services and nude body painting or modeling studios to the list of adult uses requiring site plan review and special land use approval before a certificate of occupancy could be issued. (45) On February 8, 1979, Rubin filed written interrogatories in the action filed by Michigan Diversified Business Corp. These interrogatories were apparently forwarded to Bruggeman. On February 22, 1979, Bruggeman sent a memorandum to Dalenberg which included the answers to each question. The first interrogatory asked whether the resubmitted plans complied with the building code. In response, Bruggeman’s answer was “no.” In response to a follow-up question asking what specific provisions were violated, he indicated that the plans and specifications did not comply with the electrical, plumbing, and zoning codes. (46) On February 28, 1979, Rubin filed a motion to compel answers to the interrogatories on the ground the answers submitted by the City were evasive and incomplete. On March 1, 1979, Dalenberg sent a memo to Bruggeman through Van Den Branden with a copy of the interrogatories and motion to compel attached. Dalenberg stated that at a hearing before Judge Denewith on November 20, 1978, he had been told by Johnson and Sankuer that the plans conformed to the building code. Based on this information, Dalenberg indicated in a response to a question posed by Judge De-newith that the plans were in compliance with the building code but were not in compliance with section 14.02 of the zoning ordinance. Because Bruggeman’s answers to the February 9, 1979, interrogatories indicated that the plans did not comply with the electrical, plumbing and zoning codes, Dalenberg requested that Bruggeman provide the following amended answers to the interrogatories: (a) What requirements of the building code are violated in the plans and specifications? (b) State with specificity which items need amendment or correction? (c) What changes have been made in the plans and specifications submitted prior to the November 20, 1978, hearing which make them now violative of the electrical, plumbing and zoning codes? Dalenberg further indicated that it was not possible to contend that the recently adopted BOCA Code (January 1, 1979) was applicable since the plans were submitted prior to the effective date of the BOCA Code. (47)Bruggeman responded to Dalen-berg’s directive by way of a letter to Van Den Branden dated March 12, 1979. Initially, Bruggeman indicated that although Sankuer recalled testifying that the plans were in accordance with the building code, Johnson could not recall any statements to that effect. He then opined that the plans, initially submitted May 16, 1978, must comply with the 1970 edition of the BOCA Code adopted by the City Council on November 6, 1974, as an emergency ordinance. During the late 1970’s, the City had become engaged in litigation with the state over whether the City could maintain its own local building code. The emergency ordinance was passed to ensure that some code existed in the event that the Warren Building Code was struck down and the City was forced to adopt the BOCA Code or another nationally accepted code. Based on several communiques issued during the litigation, Bruggeman concluded in his letter that the emergency ordinance was in effect, thus placing the 1970 edition of the BOCA Code in effect at the time the plans were first submitted. Bruggeman described these communiques as follows: 1. A letter dated April 25, 1978, from the City Attorney W. Thomas Marrocco, Jr. addressed to Mr. Paul Van Den Branden, Director of Public Service bringing to our attention the current status at that time of our litigation with the State Construction Code concerning the administration of the BOCA Code. 2. The letter of May 5, 1978 from the Director of Public Service addressed to the undersigned notifying this Division that we were to commence at once with the enforcement of the 1970 Edition of the BOCA Basic Building Code. 3. A letter under the date of June 13, 1978 from Mr. Patrick J. Sankuer who was the Acting Director at that particular time, to all our personnel informing them that the enforcement of the 1970 Edition of the BOCA Basic Building Code was mandatory. Bruggeman thus concluded that any statements made during the hearing before Judge Denewith that the plans were in compliance with the building code in effect at that time (BOCA, 1970 edition) were in error. He then proceeded to answer the three questions posed by Dalenberg. (48) Sometime after November 1979, the location at 22640 began offering the “Velvet Touch” with nude or partially nude females at prices dependent upon the degree of nudity of the female. (49) With the legal status of the businesses at both 22640 and 22644 yet unsettled, and the two actions before Judge De-newith still pending, the conflict between Whitman and Warren city officials began at 5583 Eight Mile Road. C. 5583 East Eight Mile (50) The building located at 5583 East Eight Mile is a long narrow two-story building approximately 30 feet wide by 80 feet long. It is located at the corner of East Eight Mile and Blackmar: the parties stipulated that it is within 500 feet of a residential use. (51) In 1968, the owner of the building located at 5583 opened a retail carpet outlet. On May 8 and 9, 1968, the building was inspected by all the divisions of the building department; all inspections were approved except the electrical inspection conducted by electrical inspector George Gower. On May 14, 1968, less than a week later, an electrical permit was pulled to correct the violations. Two days later, on May 16, 1968, the work was approved by Gower. A certificate of occupancy was issued on June 11, 1968. (52) In 1976, the use of the building changed to that of a paint store. A special permit for reoccupancy inspections was issued on April 27, 1976. The building file maintained by the building department indicates that once again Gower refused to approve the electrical inspection. An electrical permit was pulled on May 10,1976, to correct the violations. Inspecting the premises for a second time on May 10, 1976, Gower listed six violations. On May 12, 1976, Gower conducted a third inspection, and indicated that not all the violations cited on May 10 had been remedied, and rejected the work for a third time. Gower finally issued his approval the next day, May 13, 1976. A certificate of occupancy was apparently then issued. (53) The building was vacated by the paint store in 1978; the owners apparently began preparing the building for reoccu-pancy by another commercial enterprise. This is evident from the building department file which indicates that a special permit for reoccupancy inspections was issued on December 28, 1978. Once again, the building failed the electrical inspection; inspector William Carr listed seven violations during his January 4, 1979, inspection. Approximately one week later an electrical permit was pulled to correct the violations, and on January 16, 1979, Carr reinspected the building. He again rejected the work, citing several new violations. Carr inspected the premises for a third time on January 19, 1976, and again rejected the work, this time adding three new violations. The work was finally approved on January 26, 1979, by inspector Ralph Dinger. The plumbing inspection had also failed because of the absence of a back-flow pre-venter. On January 23, 1979, a plumbing permit was pulled to install a back-flow preventer, and the work was inspected and approved on January 30, 1979. (54) Acting on behalf of Whitman, Lippman located the building at 5583 sometime in 1979, and recommended it to Whitman because of its high drive-by and potential for expansion. Whitman testified that he was not interested in the building for his own use, but was interested in opening a store for Christy as payment for money owed by Whitman to Christy as a result of services rendered by Christy to several of Whitman’s businesses. (55) Christy first worked as a masseuse at a store owned by Whitman in Ann Arbor in July 1978. Christy was promoted to the position of manager by September 1978. She expressed an interest to Whitman in starting and running her own business. Whitman told Christy that she could work as a secretary for Sun Services, a Whitman corporation which serves as the bookkeeping entity for each of his businesses, learn the business, and that after a couple of years he would help her open her own store. (56) Christy started as a secretary sometime in September 1978, and was to be paid $200.00 per week. In October or November 1978, Whitman bought the Cornerstone Grocery store; Christy managed the store when it opened and was to be paid $100.00 per week. Christy testified that she worked long hours during the next eighteen months, not only working as a secretary for Sun Services and manager of Cornerstone Grocery, but also doing any other tasks she was asked to do for Whitman’s businesses. (57) Christy was never paid for her services and testified that by January 1980, Whitman owed her $13,000.00. As payment for debt, both Christy and Whitman testified they agreed that Whitman would find a building for Christy, remodel the building, and fill it with stock from his warehouse. The agreement was never reduced to writing. (58) On January 1, 1980, Karen Christy leased the building at 5583 from X.O.N. Development Corporation. Although neither Whitman nor Christy knew it at the time, Lippman was one of the principals of X.O.N., and X.O.N. had purchased the building from B & B Management on land contract. The lease between X.O.N. and Christy was for two years with an option, later exercised, to renew for an additional three-year period. The lease payments were established at $675.00 per month for the first year and $775.00 per month for all ensuing years, plus insurance, taxes, and utilities. The lease payments were paid by Whitman through Sun Services. (59) Sometime in late 1982 or early 1983, Lippman stopped making payments to B & B Management. B & B Management began foreclosure proceedings against Lippman; Whitman then discovered that Lippman was the moving force behind X.O. N. and that he was pocketing the difference between the amount Sun Services paid and the amount Lippman paid B & B Management. On June 22, 1983, Christy purchased the land and building at 5583 for $50,000.00, simultaneously transferring title to Newsreel Services. The $15,000.00 down payment, however, was paid by Sun Services. Sun Services also paid each payment through July 1984. The rent payments to Lippman, the $15,-000.00 down payment and the mortgage payments paid by Whitman totaled approximately $17,000.00. (60) At the time Christy entered into the lease, she testified that she intended to use the building as a retail outlet to sell women’s lingerie and as a full service video store. She described the clothing she intended to sell as sheer, romantic, sexy lingerie which is flattering to the female body. The video component of the store was to be geared towards the sale and rental of videos, as well as the transfer of home films to video cassettes. (61) Sometime in April 1980, Whitman or Christy contacted general contractor George Ketchum to perform certain work at the building at 5583 in order to prepare the premises for opening. Ketchum is from the Lansing area. He testified that his work for Christy and Whitman comprises between 60 and 80 percent of his entire work-load. He testified that he was told by either Christy or Whitman that the building was to be used for video sales and service, as well as the sale of women’s lingerie. (62) On April 21, 1980, Ketchum went to the building department and filled out a building application indicating that he intended to fill in an overhead door opening with masonry and install a three-foot exit door; he also indicated he was going to enclose an exterior front window. He listed Christy as the owner, although he was unsure whether Christy or Whitman was the owner. He was informed by the clerks at the desk that he would have to have a plan; he was ushered into the zoning office where he talked to Bruggeman and Les Johnson, the Plan Examiner, who helped Ketchum sketch the drawings. The application was approved within an hour, and a building permit was issued. The work was completed within the next several days, and approved by a building inspector on April 30, 1980. (63) Ketchum also hired an electrician, Paul Tucker, to install several outlets in the building. Ketchum called Tucker after seeking an advertisement of Tucker’s in the paper. On May 29, 1980, Tucker obtained an electrical permit authorizing electrical work to be done on up to six circuits. After Tucker completed the work, Ket-chum testified he inspected the work and it appeared to have been properly and neatly done. The primary work done by Tucker was the installation of six receptacles containing four outlets each allegedly to service the transfer tape operations. The receptacles were located on the floor in the middle of the building. (64) On June 6, 1980, Inspector Nielson from the electrical bureau conducted an inspection of the work done by Tucker; neither Tucker nor Ketchum was present during the inspection. Upon entering the building, Nielson noticed that a good deal of construction was taking place. He observed a platform under construction with sheets of plywood partially covering the joists; he saw a mansard roof covered with wooden shingles which he testified looked fairly new, and a newly constructed partition around the boiler. He testified that it was obvious from the sawdust and lumber strewn about the building that the construction was of recent origin and still ongoing. In addition to the receptacles laying on the floor in the middle part of the building, Nielson observed what is known as a “false ceiling”; only a portion of the ceiling tiles were installed. Nielson also noticed that the cords to the fluorescent lights hanging level with the false ceiling were plugged into outlets attached to the original ceiling. (65) Nielson rejected the inspection and notified Ketchum of the denial in writing several days later. Nielson made the following comments in his report: “(1) Building Permit Required; (2) C. of O. Required (Sec. 119-6 of BOCA); (3) Must meet contractor on job for inspection; (4) Cannot have cord above the false ceiling; and (5) Inspection not complete.” (66) Neilson testified that although he was not a building inspector, it was not uncommon for inspectors to indicate to owners or their agent during an inspection that a permit might be required for work being done even though not in the inspector’s area of expertise. Neilson indicated that he thought the construction of the stage, mansard roof, partition and new ceiling may have required a permit. Neilson did not explain why he cited the need to obtain a certificate of occupancy; Brugge-man testified that a certificate of occupancy could be obtained either before or after a permit is obtained to alter or remodel a building. With respect to the need to have a contractor on the premises, Neilson indicated that it was necessary for him to know exactly what the building would be used for before he could conduct an inspection. He stated that the use of outlets laying on the floor, for example, would indicate which provisions under the N.E.C. he would have to apply in conducting his inspection. The electrical permit did not list the intended use of the building; when he returned to the building department he apparently discovered from the April 21, 1980, building application that the building was to be used for video sales and service, but was unsure whether the tapes were for sale or to be shown to the public. The cords above the ceiling were cited as a violation by Neilson because they were not encased in conduits as required under section 400-4 of the N.E.C. Nielson finally concluded that it was useless to continue the inspection since he would have to return when a contractor was on the prem-sies. (67)Ketchum testified that the only construction he had done other than that for which he had been issued a permit was the building of a raised platform and partition around the boiler and the installation of pegboard underneath the mansard roof. The stage was T-shaped and was constructed with 2' X 8' joists with tongue and groove plywood nailed on top of the joists. It was located in the front of the store and was to be encompassed with four and five-foot showcases along the perimeter. Both Christy and Whitman testified that they presently use such raised platforms in their stores to provide the clerks a vantage point from which to monitor browsing customers in an attempt to guard against shoplifting. Ketchum testified that he didn’t think he needed a permit to construct the stage because it was freestanding and unattached to the floor. Ketchum also stated that he didn’t think a permit was necessary to build the partition and install the pegboard. Ketchum indicated that the mansard roof was already there, as was the false ceiling; all he had done to the ceiling was replace some of the ceiling tiles. Ketchum also testified that he was unaware that a certificate of reoccupaney was necessary when the change was only from one use to another within a use group. He indicated that his conclusion was based on his experience in other cities where he had remodeled buildings for Whitman previously used as retail stores and no certificate of reoccupancy was required. (68) On June 11,1980, Ketchum acquired a special permit for reoccupancy inspections and the inspections were scheduled for June 17, 1980. On June 17, 1980, Inspectors Mills, Wineski, Zimmerman and Nielson arrived at the premises from the plumbing, zoning, building and electrical bureaus, respectively. Ketchum, who was present during the inspections, testified that the inspectors only asked him two questions — what the premises was to be used for and the name of the owner. In response to the first question, Ketchum told the inspectors that it was to be used for video sales and service. Upon further questioning, Ketchum told the inspectors that that was all he knew. In response to the second question, he told them Karen Christy was the owner. Bill Henry from the heating bureau did not attend the June 17, 1980 inspection and attempted to inspect the premises on July 1, 1980. Ketchum was not there, however, and the building was locked. (69) Only the plumbing inspection was approved. The zoning, building, electrical, and heating inspections were all rejected. Wineski indicated in his report, that he needed more information before he could approve the zoning inspection and indicated that Christy should contact him. Zimmerman listed the following nine violations in his report: “(1) Repair gutter in rear; (2) Point up block, (3) Fill voids over doors; (3) Caulk front door; (4) Question on use of building; (5) Building Permit required for new ceiling and interior work done; (6) New floor tile; (7) Fire proof self-closing door to garage; and (8) Ceiling under upstairs living area may not be fire proof?” The results of the inspections were sent to and received in the mail by Ketchum sometime in late June or early July 1980; Ketchum forwarded the results to Christy. (70)Neilson listed 17 violations in his report. The final four were not added until Nielson returned to the building department. (1) install conduit correctly; (2) anchor all conduit and boxes; (3) install all k.o. blanks; (4) install all covers; (5) need disconnenct [sic] switch at boiler; (6) remove open wiring — all wire must be in conduit; (7) must have a slight switch controlling a light for each room that can be walked into; (8) cannot have cords and plugs above the false ceiling. Wire lights to code; (9) see violations on Permit # 147841; (10) all work must be done by an electrical contractor and permit required; (11) all fuse holders (plug type) must be Type “S;” (12) identify all circuits; (13) check with the building inspector for building permit; (14) emergency lights, if required, shall comply with Article 700 NEC and BOCA Code; (15) each occupant shall have access to their over current devices; (16) install exit lights to code; and (17) service shall have sufficient capacity for the building. Plaintiffs Exhibit J-7. Henry rejected the inspection because he could not gain entrance to the building. Nielson and Gower testified that it was common practice to reject an inspection when, for some reason, the inspector is unable to gain entrance to a building. They testified in most instances the owner or agent will call the building department to establish a new inspection time. (71) Shortly after the inspection was conducted, Bruggeman, accompanied by Niel-son, inspected the premises. Bruggeman verified the presence of the mansard roof, the partially completed stage, the partition and the outlets on the floor. He also noted the presence of what looked like a ticket booth. Bruggeman testified that he surmised the construction had been recently done based on his communication with Niel-son and Zimmerman’s report. Bruggeman further testified that he thought the stage and ticket booth resembled those at 22640. He also testified that he thought the receptacles located on the floor were consistent with the use of peep shows. (72) Believing that work requiring a permit had been done without a building permit, and that someone was trying to sneak another adult use into the City in violation of the 500-foot location restriction contained in section 14.02, Bruggeman placed a stop-work order on the building. Section 122.1 of the BOCA Code provides for the issuance of such an order. Section 122.2 provides: 122.2 Unlawful continuance: Any person who shall continue any work in or about the structure after having been served with a stop-work order, except such work as he is directed to perform to remove a violation or unsafe condition, shall be liable to a fine of not less than [amount] or more than [amount]. The stop-work order used by the City of Warren is a red rectangle card measuring approximately six inches by seven inches. Bruggeman testified that stop-work orders are frequently used when an owner attempts to perform work requiring a permit without first obtaining a permit. Once a stop-work order is placed on a building, no work, not even ordinary repair work as defined under section 102 of the BOCA Code can be performed unless directed by the building department. Bruggeman stated that the purpose of a stop-work order under such circumstances is to induce the owner or agent to secure a permit for the desired work. (73) Bruggeman testified that contrary to common practice, neither Ketchum nor Christy attempted to contact him rega