Smith, Kaufman and Hays, Circuit Judges. Hays, Circuit Judge (dissenting).
J. JOSEPH SMITH, Circuit Judge:
This appeal raises timely and fundamental questions regarding the availability of the federal courts to persons who, displaced by urban renewal programs, claim that they have been deprived of the equal protection of the laws in connection with government efforts to assure their relocation, and that such relocation efforts have not been adequate under the mandate of a federal statute. The plaintiffs' complaint, which attempted to raise these two issues, was dismissed by the District Court for the District of Connecticut. Norwalk CORE v. Norwalk Redevelopment Agency, 42 F.R.D. 617 (1967). We hold that the District Court was in error, and remand for further proceedings not inconsistent with this opinion.
The program involved here is being carried out in the City of Norwalk, Connecticut, and is designated South Norwalk Renewal Project No. 1 (Project No. Conn. R-34). (Hereinafter "the project.") The project plan was approved by the Common Council of Norwalk (the city's legislative body) on August 28, 1962, and on June 24, 1963 the Norwalk Redevelopment Agency ("the Agency") entered into a Loan and Capital Grant Contract ("the Contract") with the Housing and Home Finance Agency (now the Department of Housing and Urban Development, "HUD") under the Housing Acts of 1949 and 1954 ("the Act"). 63 Stat. 413 (1949), as amended, 42 U.S.C. §§ 1441-1460 (Supp.1967); and 68 Stat. 590 (1954), as amended, 42 U.S.C. §§ 1446-1460 (Supp.1967).*fn1
Pursuant to section 105(c) of the Act, 42 U.S.C. § 1455(c), the Contract required that the Agency provide, in the urban renewal area or in other areas not generally less desirable in regard to public utilities and public and commercial facilities, decent, safe and sanitary dwellings within the financial means of the families displaced by the project, equal in number to the number of displaced families, available to them, and reasonably accessible to their places of employment.
The plaintiffs are the Norwalk, Connecticut chapter of the Congress of Racial Equality, two nonprofit tenants' associations comprised of low-income Negroes and Puerto Ricans, and eight individuals representing four classes of low-income Negroes and Puerto Ricans who were allegedly subjected to discrimination in connection with the project.*fn2 They brought this class action in June 1967 against the Norwalk Housing Authority, its Executive Director and its members; the Norwalk Redevelopment Agency, its Administrator and its members; the City of Norwalk, its mayor and city clerk; Towne House Gardens, Inc.; David Katz & Sons, Inc.; Charles J. Horan, Assistant Regional Administrator for Renewal Assistance of the United States Department of Housing and Urban Development; and Robert C. Weaver, Secretary of the United States Department of Housing and Urban Development.*fn3
Since the action was dismissed, the allegations of the complaint, summarized in the following paragraphs, must be accepted as true.
The Agency made its redevelopment plans without providing for the construction of low-rent housing on the ground that the existing low-rent public housing in the City, with its predicted turnover, would adequately meet the relocation needs of the low-income Negro and Puerto Rican families living within the project area. Prior to the time when it entered into the Contract, however, the Agency knew: (1) that its turnover figures were exaggerated, arrived at so as to present apparent facilities for relocation; (2) that there was a long waiting list for low-rent public housing in the City, substantially all Negro and Puerto Rican families and that any plan giving priority to families from the project area in the public housing would impair the housing opportunities of the Negroes and Puerto Ricans on the waiting list; and (3) that there was discrimination against Negroes and Puerto Ricans in the private housing market in the City. Thereafter, the Agency learned from reports by the Commission on Civil Rights of the State of Connecticut and by the Agency's "relocation experts," Urban Dynamics Consultants, that vacancies in housing projects in the City were running less than one-half of the predicted number, that the Housing Authority received an average of over 300 applications per year for public housing units, and that discrimination in rentals in the private or open market was rampant, rentals to Negro and Puerto Rican families averaging twice as much as that charged to white families for comparable housing. The annual report of the City's Department of Health for the year 1964 stated that families formerly living in the project area were being crowded into already overcrowded homes, and that multiple dwelling units were being created from homes which were barely adequate for one family. The Agency knew, plaintiffs allege, that Negro and Puerto Rican families were being subjected to such hardships and deprivations in connection with relocation (not experienced to any substantially equal degree by white families in the City) that many were being forced to leave the City entirely, but it continued, nonetheless, to demolish the homes of low-income Negro and Puerto Rican families in the project area and continued to make additions and revisions in its plans without making any provision for the construction of low-rent housing to be made available to the Negro and Puerto Rican families being relocated. The Agency also entered into a contract with defendant Towne House in May 1967 for the sale of a six-acre parcel of land in the project area to be used for 90 units of moderate-income housing at rentals beyond the financial means of the Negro and Puerto Rican families being displaced, and that parcel is the only plot of land owned by the City which is currently available for the construction of low-income housing.
Despite the requests of various groups and citizens of the City, including some of the plaintiffs, HUD has refused to require the construction of low-cost housing, and has approved the sale of the six-acre parcel. "Further recourse to HUD would be futile."*fn4
The complaint goes on to allege that the homes of various of the plaintiffs and other Negro and Puerto Rican families and individuals have been demolished, that some of them have been moved to rental units within the project area on a temporary basis, and that the City and Agency have "pursued a course of conduct to force the said Negro and Puerto Rican families out of the on-site housing structures by rendering such housing unsafe, unsanitary and indecent, by charging rents beyond the financial means of the families and individuals, by forcing excessive moving of families and individuals from one onsite location to another * * * and by carrying on heavy construction activities around the said on-site houses." Some of the displaced Negro and Puerto Rican families have been compelled to move into overcrowded housing, some into housing at rentals substantially in excess of their financial means, and some into housing outside of the City.
The plaintiffs make three claims based upon the foregoing allegations: (1) that they and those whom they represent have been denied the equal protection of the laws guaranteed by the Fourteenth Amendment and by the laws of the United States; (2) that the local defendants have intended to deprive low-income Negro and Puerto Rican families of the equal protection of the laws, and have intended to force such families out of the City; and (3) that the defendants have acted in violation of section 105(c) of the Act.
Plaintiffs' prayer for relief included requests that the Agency and City, and Towne House and Katz, be enjoined from transferring or encumbering the six-acre parcel, that the Agency be enjoined from demolishing any residential structure within the project area until the residents have been relocated into safe and decent housing at rentals they can afford, and that the District Court require the Agency, City and Authority to proceed "with all deliberate speed," under the supervision of the Court, to propose a plan for and to construct low-income housing units on the six-acre parcel.
The essential ground upon which the District Court dismissed the complaint was that both the association and individual plaintiffs "have no standing to challenge the official conduct here in question." 42 F.R.D. at 622. The District Court also held that the action was not a proper class action under Rule 23, F.R.Civ.P.
The court took into account that the relief asked for in the complaint was in its view inappropriate, but we are not sure of the extent to which this underlay its decision. The opinion concluded that "It is the use of [the] six acre tract for moderate-income housing rather than low-income rental units that forms the basis of the instant action." 42 F.R.D. at 619. This characterization of the action in terms of the prayer for relief was, in a sense, correct, for the complaint summarized the action as one for an injunction restraining the defendants from proceeding with the sale of the six-acre parcel and directing them to build low-rent housing on the parcel, and for an injunction restraining the defendants from evicting families living in the project area until all of the families were permanently relocated in housing within their financial means. Nevertheless, if the complaint was dismissed on the basis that the relief requested was inappropriate, or beyond the Court's power to grant, the Court moved too quickly. Rule 54(c), F.R.C.P., states in relevant part that
Except as to a party against whom a judgment is entered by default, every final judgment shall grant the relief to which the party in whose favor it is rendered is entitled, even if the party has not demanded such relief in his pleadings.
When a motion to dismiss a complaint is made, this rule is read in conjunction with Rules 8, 12 and 15, and its clear and long-accepted meaning is that a complaint should not be dismissed for legal insufficiency except where there is a failure to state a claim on which some relief, not limited by the request in the complaint, can be granted.*fn5
We hold that the allegations of this complaint state constitutional and statutory claims on which relief can be granted, that the individual plaintiffs have standing to make the claims, and that this action was appropriately brought as a class action. We turn first to the issues presented by plaintiffs' constitutional claim.
The plaintiffs contend that they were denied the equal protection of the laws when the defendants acted, knowingly and deliberately, so as to compound the problem of racial discrimination in the Norwalk housing market, with the inevitable and intended result that some Negroes and Puerto Ricans would be forced to leave the city altogether.*fn6
The District Court never reached the merits of this claim, for it concluded that
Members of the public, whether living inside or outside a project area, ordinarily have no standing to challenge planning of an urban renewal project * * * nor, by alleging civil rights violations, do they gain standing they would otherwise not have [citing cases]. If residents of a project area cannot challenge a project while it is in the planning stages and before construction has begun, certainly they can have no standing to assert the same kind of challenge at a time when planning has been ...