David W. Owens
School of Government
The University of North Carolina at Chapel Hill
© 2016
Below are brief digests of reported decisions regarding planning, land use, and related issues in North Carolina. The state supreme court decisions are listed first, followed by court of appeals decisions, followed by federal cases arising in North Carolina. The cases are in chronological order (the more recent cases at the bottom of each list). Index terms are included in italics for each case.
North Carolina Supreme Court
King v. Town of Chapel Hill, 367 N.C. 400, 758 S.E.2d 364 (2014)
Scope of authority; Preemption
Plaintiff towing company brought a declaratory judgment action seeing to invalidate two ordinances regulating towing of cars parked without permission in private parking areas. The towing ordinance specified the size and content of warning notices to be posted in parking lots, set vehicle release requirements, and set maximum fees to be charged. The second ordinance prohibited use of mobile phones while operating a motor vehicle.
The court noted that where enabling legislation is clear and unambiguous, there is no room for judicial construction and the plain and definite meaning of the statute must be applied. The broad rule of construction of G.S. 160A-4 is only applicable when the grant of authority is ambiguous. Here the authority is the general police power of G.S. 160A-174, authorizing regulations to protect or promote the health, safety, and general welfare. This grant of authority is “by its very nature ambiguous” and cannot be placed within fixed definite limits. Therefore it is given a broad construction, tempered by the mandate that it be exercised within constitutional limits. This requires a rational, real, substantial relation to protection of public health, safety, and general welfare. The found the warning sign requirements met that standard. However, the town does not have the authority to create a fee schedule for the towing absent express statutory authority. The court held the ordinance provision prohibiting a “cash only” policy, requiring tow operators to accept credit or debit cards for payment of towing fees, is reasonably related to citizen safety and welfare in allowing owners to have quick and easy access to their towed vehicles. However, as with towing fee, the town does not have the authority to cap the fee by not allowing debit and credit card charges to be passed on to those who illegally parked.
The court invalidated the mobile phone ban as preempted by state law. State law prohibits use of mobile phones by vehicle operators in several specific instances – limiting phone use by drivers under the age of 18, by school bus drivers, and texting by commercial vehicle operators. The court found these sufficient to show a legislative intent to provide a complete and integrated regulatory scheme to the exclusion of local regulation.
North Carolina Court of Appeals
Mount Ulla Historical Preservation Society, Inc. v. Rowan County, 232 N.C. App. 436, 754 S.E.2d 237 (2014)
Reapplication, res judicata
In 2005 Rowan County denied a conditional use permit for a 1,350 foot tall radio tower on this property because the tower posed an unacceptable air safety hazard to a nearby private airport. The denial was affirmed by the court of appeals in 2007. In 2010 the county granted a conditional use permit for a 1,200 radio tower on the same site. The plaintiffs contended res judicata applied, barring the 2010 application. The trial court agreed and reversed the county board of commissioners’ permit approval.
The court held res judicata precludes consideration of the same claim between the same parties in a quasi-judicial matter unless the specific facts or circumstances that led to the prior decision have changed to the extent that the original rationale for the decision is no longer viable, such that these material changes amount in essence to consideration of a new claim. While whether res judicata applies is a question of law subject to de novo review, the question of whether a particular application demonstrates a material change in the original application is a factual question subject to a whole record review. Although the proposed tower in the 2010 application was 150 feet shorter, the record before the board did not indicate this would undermine the reasoning behind the original denial. In both hearings the record produced evidence favoring and opposing the towers on air safety grounds and there was no evidence in the current record indicating the grounds for denial were vitiated by this reduction in height. Therefore the 2010 application was barred by res judicata.
Patmore v. Town of Chapel Hill, 233 N.C. App. 133, 757 S.E.2d 302, review denied, 367 N.C. 519, 758 S.E.2d 874 (2014)
Due process; Preemption; Scope of authority
The town adopted a neighborhood conservation overlay zoning district for the Northside neighborhood, a community of modest homes near the UNC-CH campus. A major land use concern in the neighborhood was the overcrowding, noise, garbage, and traffic generated by overcrowding of rental homes occupied by students. In addition to limits on building height and size, the zoning restrictions were amended to limit parking in the district to four cars per residential lot. If the property was rented rather than owner-occupied, the property owner was to be cited for violations. The plaintiff owned rental housing in the district and was cited for excess parking.
The court held inclusion of the parking limit was not a substantive due process violation as it bears a rational relationship to a legitimate governmental objective. The court found the town’s evidence that the number of cars parked at a residence provided a reasonable approximation of how many people were living at the property provided a rational basis for its use to prevent over-occupation of rental dwellings. Given a transient student population and landlord control of occupancy in leases, citing the owner for violations was likewise deemed reasonable. Since this was a zoning regulation addressing the land use problem of over-occupancy of residences, the regulation is not preempted by statutes regarding regulation of parking in public vehicular areas. The court held it was appropriate to apply the G.S. 160A-4 provisions for a broad construction of G.S. 160A-383, the zoning statute, as the regulation was reasonably related to the statutorily approved purposes of regulating population density and traffic congestions. The Lanvale Properties rule of strict construction applied to authority to impose school impact fees as part of an adequate public facilities ordinance. Since the challenged regulation here was a bona fide zoning regulation, it was unlike the non-zoning regulation voided in that case.
The Royal Oaks Concerned Citizen Association v. Brunswick County, 233 N.C. App. 145, 756 S.E.2d 833 (2014)
Immunity; Judicial procedure
The plaintiffs challenged a rezoning that would accommodate expansion of a landfill in their community. In discovery the plaintiffs sought to depose the county manager and a former county commissioner. Defendant sought a protective order prohibiting the depositions, claiming legislative and quasi-judicial immunity provided a testimonial privilege. The trial court granted conditions protecting that privilege for the county commissioner, but not for the manager (reserving judgment as to whether the manager could assert the privilege). That decision was appealed to the court of appeals. When plaintiffs sought an order compelling the deposition of the manager, the trial court held ordered the deposition, finding the prior ruling to be a non-appealable interlocutory order. The defendants contended the order affected a substantial right as was immediately appealable.
The court held that while assertion of a legislative or quasi-judicial immunity and a resultant testamentary privilege was a substantial right, but this appeal was not ripe because the trial court has not yet issued a final ruling on whether the manager could assert that privilege. The defendant is free to make good-faith objections at the deposition regarding the privilege. Until such an objection is made and the trial court rules on the scope of the legislative privilege, the issue is not properly before the court.
PBK Holdings, LLC v. County of Rockingham, 233 N.C. App. 353, 756 S.E.2d 821, appeal dismissed, 367 N.C. 788 (2014)
Landfills; Preemption; Equal Protection; Commerce Clause
The plaintiffs challenged provisions added to the zoning section of the county’s unified development ordinance that regulated “high impact” land uses. The ordinance was amended to delete requirements for special use permits for these uses and add provisions allowing them to be addressed through conditional zoning. The ordinance established five classes of high impact uses, with more intensive uses requiring greater setbacks and more stringent reviews. “Local” landfills and “regional” landfills (the terms being undefined in the ordinance) were placed in different classes. The plaintiff contended this distinction violated the Equal Protection Clause and the Commerce Clause and that several locational restrictions in the ordinance were preempted by state law.
The court upheld the ordinance on all counts. The court applied standard dictionary definitions to the terms “local” and “regional” and concluded there was a rational basis to consider the later a larger and more intensive use that would have greater impacts on surrounding properties. So even if the uses were similarly situated, there was a rational basis for differential regulations. The court held the local-regional distinction made no facial distinction between in-state and out-of-state waste generation and that more stringent restrictions for regional landfills were based on greater impact from a more intensive use, rather than upon whether the waste crosses state lines. Thus the court found no Commerce Clause violation. The court found restrictions on floodplain locations for landfills were not preempted as G.S. 130A-309.09C(c) expressly allows stricter local ordinances. Nothing in state or federal regulations regarding landfill siting near airports expressly or impliedly indicate any intent to preclude more stringent local regulation. Further, a county restriction on driveway locations is not a regulation of vehicular traffic preempted by state law
Templeton Properties, LP, v. Town of Boone, 234 N.C. App. 303, 759 S.E.2d 311 (2014), aff’d per curiam by equally divided court, 368 N.C. 82, 772 S.E.2d 239 (2015) [stands without precedential value]
Interpretation; Conditional use permit
This case challenged the town’s denial of a special use permit for a medical clinic. The site had previously been used as a small church (a 2,250 sq. ft. structure built under a special use permit) in a mostly single-family neighborhood, with a nonconforming VFW hall next door. The plaintiff’s initial application for a 13,050 sq. ft. clinic was denied due to an incomplete application. A subsequent application for a 10,010 sq. ft. clinic was denied. On appeal, the court of appeals remanded with instructions to make reviewable findings of fact. The permit was again denied, and the court of appeals eventually remanded a second time with instructions to findings only on the basis of the original hearing. The town again denied the permit, concluding the proposed clinic was not in harmony with the area given the size of the building, the amount of parking, the lighting for parking, and the volume and timing of the traffic expected to be generated. The trial court reversed the permit denial, holding the town had used an unduly narrow geographic interpretation of the “area” around the site with which the project must be in harmony, that the inharmonious features of the project sited where inherent in this type of use and thus deemed permissible by its inclusion as a potential CUP, that the finding regarding the residential nature of the area was not supported by substantial evidence, and that the plan inconsistency was based on a policy too general to be a sufficient basis for denial.
The court held the definition of the area within which to apply the harmony standard was a question of law subject to de novo review; however, the application of that standard to the specific facts was a factual determination subject to a whole record review, rendering the overall determination on harmony a mixed question of law and fact. The court held the town board properly applied a contextual definition of the term “area” that is inherently fact-specific, so the board properly considered proximity, topography, and road curves and alignments. The court agreed that the Woodhouse rule provides that inclusion as a potential conditional use establishes a prima facie showing of entitlement to the permit, that is rebuttable by opponents producing substantial evidence that the standards are not met at a particular site. The court found there was ample evidence in this case to show inharmony with surrounding area.
High Rock Lake Partners, LLC v. N.C. Department of Transportation, 234 N.C. App. 336, 760 S.E.2d 750 (2014)
Attorney fees
The plaintiffs successfully challenged imposition of conditions on a driveway permit issued in connection with a proposed sixty lot subdivision near Salisbury. The courts eventually held the DOT had exceeded its statutory authority in imposing the conditions. The plaintiffs then sought attorney fees under G.S. 6-19.1, which allows attorney fees to be awarded in actions against state agencies if the court finds the agency acted without substantial justification and the award would not be unjust. The trial court denied the motion for fees.
The court held the decision to award fees in these circumstances is within the discretion of the trial court. The court noted that the trial court is not required to award fees in this situation. The court held that even assuming the DOT acted without substantial justification (which the trial court did not find), there was no showing the trial court had abused its discretion in denying an award of fees.
Swan Beach Corolla, LLC v. County of Currituck, 234 N.C. App. 617, 760 S.E.2d 302 (2014)
Exhaustion of remedies; Vested rights
Plaintiffs acquired 1400 acres in the Carova Beach area of the Currituck Outer Banks in 1966. The land at that time, and at the time of the litigation, is unserved by public roads. In 1969 the plaintiffs secured approval of a subdivision. The plat identified some 577 residential lots and six lots as business areas. The county had no zoning ordinance if effect at the time. Between 1968 and 1971 $425,000 Zoning was adopted in 1971, with all of the plaintiff’s land placed in a residential/agricultural district that allowed only limited business uses. Similar zoning was applied in an updated ordinance adopted in 1975. In 1989 a unified development ordinance was adopted and the property was zoned for uses that would not permit the business and commercial uses intended by the plaintiffs. In 2004 the plaintiffs made their initial application for commercial use of the property, to include a convenience store, restaurant, real estate office, and post office. The plaintiff was advised by county staff that such uses were not permitted. Plaintiffs contended they had a vested right to the business use, the county disagreed. No appeals were made to the board of adjustment on the matter. In 2012 this suit was filed, claiming a vested right and alleging equal protection violations (contending other businesses were allowed) and religious discrimination (some individual plaintiffs were Jewish). The trial court dismissed the suit for failure to exhaust administrative remedies.
The court held the staff decision regarding the vested right claim did not have to be appealed to the board of adjustment. If the claim involved an interpretation of the ordinance, an appeal to the board of adjustment would be a prerequisite for judicial review. But here the ordinance clearly did not allow the business use so there was no interpretation issue and only a constitutional claim to a vested right. As the board of adjustment cannot adjudicate a constitutional claim, there was no requirement for an appeal to the board and thus there was no failure to exhaust administrative remedies.
With a motion to dismiss under Rule 12(b)(6) the facts alleged are assumed to be true and are construed liberally. Given this, the court held there were sufficient allegations of substantial expenditures subsequent to plat approval and prior to zoning adoption to sufficiently plead a claim for a common law vested right. Likewise, it was improper to dismiss constitutional claims regarding substantive due process and equal protection as there is no jurisdiction for the board of adjustment regarding constitutional claims and such sovereign and governmental immunity are not defenses to these claims. The court held it was property to dismiss claims of non-uniform property taxation as there was no allegation of non-uniform taxation. [Note: On remand, a default judgment was entered for the plaintiff, affirmed in unpublished court of appeals opinion.]
Cox v. Town of Oriental, 234 N.C. App. 675, 759 S.E.2d 388 (2014)
Standing; Street closing
The town and a landowner agreed to a land exchange that involved the town closing a street right of way. The plaintiff, who owned property some three blocks away, sought to appeal the street closing under G.S. 160-299. That statute allows appeals by a “person aggrieved.” The court applied the zoning case law requiring a showing of special damages for standing in zoning appeals to hold the plaintiff here had provided no factual basis to establish he had any damages distinct from the community at large.
Atkinson v. City of Charlotte, 235 N.C. App. 1, 760 S.E.2d 395 (2014)
Amendments; Plan consistency statement
The city considered a text amendment to the zoning ordinance proposed by Queens College and others. The proposed amendment exempted parking decks constructed as accessories to an institutional land use from the floor area ratio requirements in single-family and multifamily zoning districts. The planning staff made a written statement that the amendment was consistent with the city’s adopted policies and was reasonable and in the public interest. The Planning Commission’s Zoning Committee unanimously recommended adoption and their recommendation included a statement on plan consistency. The city council subsequently unanimously approved the statement of consistency and the proposed amendment. The plaintiff neighbor contended the adopted statement was inadequate and that a recommendation from less than the entire planning commission was insufficient.
The court held the consistency statement adopted by the council was inadequate. It contained only the conclusion that the proposed amendment “is found to be consistent with adopted policies and to be reasonable and in the public interest.” At a minimum the statement must include a description of plan consistency and an explanation as to why it is reasonable and in the public interest. Here the statement adopted merely tracked the conclusory language of the statute could not reasonably be said to include any “explanation.” Accordingly, the amendment to the ordinance was void. [Note: The parking deck that precipitated this litigation had already been built at the time the case was decided.]
Eastern Pride, Inc. v. Singh, 235 N.C. App. 15, 760 S.E.2d 94 (2014)
Covenants; Definitions
A restrictive covenant applicable to the plaintiff’s property prohibited construction of a “convenience store.” The plaintiff proposed construction and operation of a Family Dollar store on the site. The court applied the ordinary meaning of the term as it was not defined in the covenant. The dictionary definition was “a small retail store that is open long hours and typically sells groceries, snacks, and sometimes gasoline.” The court found the proposed store was more accurately described as a “discount store” or “small retail store,” not a “convenience store.”
Osborne v. Town of Nags Head, 235 N.C. App. 121, 760 S.E.2d 766 (2014)
Procedure; Voting majority
The owner of two adjoining lots secured a variance in 1997 from the town to construct a shared driveway (given the topography of the lot and setbacks, the board had concluded separate driveways were not feasible). In 2012 the plaintiff contracted to acquire one of the lots, contingent upon securing a variance for a single driveway. The plaintiff applied for a new variance for a separate driveway, which was denied on the basis that the shared driveway authorized by the 1997 variance could still be used. The owner of the adjacent lot then refused to enter a cross-easement for a shared driveway. The plaintiff then submitted a motion to reconsider denial of the variance based on this new evidence. The board voted 3-2 in favor of denying the motion to reconsider, but the board concluded a 4/5 majority was required and thus the motion to deny reconsideration had failed. The board then proceeded to hear the matter and denied the variance.
The court conducted a de novo review of the legal question of what majority was required under the statute. The court held that G.S. 160A-388(e)(1) clearly required a 4/5 majority to grant a variance and a simple majority to decide any other matter. Thus only a simple majority was required to decide the motion to reconsider. As the motion to reconsider was actually denied by majority vote, the board had no jurisdiction to again take up the variance.
Etheridge v. County of Currituck, 235 N.C. App. 469, 762 S.E.2d 289 (2014)
Spot zoning
Plaintiff neighbors challenged the rezoning of a 1.1 acre parcel previously used as a granary from agricultural to a conditional heavy manufacturing district. The site was surrounded on three sides by agricultural zoned land and the fourth side zoned for general business. The landowner sought the rezoning to accommodate a recycling center to collect, stockpile, and sell scrap metal, rock, concrete, and dirt. The planning board recommended denial on the grounds it was inconsistent with the current rural zoning classification and inconsistent with the County’s comprehensive land use plan. After adoption by the county board of commissioners, the plaintiffs contended this was illegal spot zoning and sought attorney fees and costs under G.S. 6-21.7.
The county conceded that this was spot zoning but contended it was reasonable. The defendants did not dispute that the small size of the parcel rezoned and plan inconsistency weigh against reasonableness, but contended the benefits outweighed detriments and that the proposed uses were consistent with uses allowed on adjacent properties. The court found the purported benefits—that the surrounding community would benefit and that there was a need for the facility at this site—were not supported by any evidence presented at the hearing. To the contrary, the court noted a recycling center only provided generalized benefit with no specific connection to the surrounding rural community. The vast majority of those speaking at the hearing opposed the project, two real estate professionals contended the use would harm adjoining property values. The sheriff expressed concerns that similar businesses had experienced increases in crime and the state Department of Cultural Resources expressed concern about effects on two nearby historic properties. Thus the county failed to make a clear showing that the benefits of the rezoning outweighed its detriments. The court similarly concluded that the change in districts from the least intensive to the most intensive use district, along with no indication that the project was designed to be integrated into the surrounding area, was inconsistent with the surroundings.
As for attorney fees, G.S. 6-21.7 makes award of attorney fees permissible in the court’s discretion if the local government acts outside the scope of its authority and mandatory if there was an abuse of discretion. The court held that while spot zoning is outside the scope of the county’s authority, acting outside the scope of authority is not always an abuse of discretion. To be an abuse of discretion, the action must have been so arbitrary that it could not have been the result of a reasoned decision. Here, the court noted the county board explicitly considered the Chrismon factors and there was information before the board to suggest those factors were met. Although the court reached a contrary conclusion, the board’s action was not so unreasonable as to be an abuse of discretion.
Fort v. County of Cumberland II, 235 N.C. App. 541, 761 S.E.2d 744, review denied, 367 N.C. 798 (2014)
Interpretation; Standard of review
This case involves the permitting of a weapons and firearm safety training facility on a 978 acre site located within the county’s A-1 zoning district. Most of the activity on the site involved outdoor gun ranges. The zoning ordinance provided that if a use was not specifically addressed in the terms of the ordinance, the standards for the land use that is “most closely related” to that use applied. As this particular use was not specifically addressed in the ordinance, the county determined the use “Recreation/Amusement, Outdoor (with mechanized vehicle operations” had the most similar impacts. As this was a permitted use, the project was approved. Neighboring property owners appealed, contending “Schools,” which was not a permitted use in this zoning district, was the most similar land use. [The county had previously classified this project as a “private school,” a determination overturned by the court of appeals in 2012.] The board of adjustment upheld the staff determination, concluding the proposed facility was not similar to a vocational school and was most similar to outdoor recreation. The trial court reversed, concluding the facility was more like a vocational school as the recreational firing range was only open one day per week.
The court conducted a de novo review of the interpretation, noting it must consider, but is not bound by, the board of adjustment’s interpretation. The court held the intent of the adopting board was critical and in that context noted the ordinance expressly stated that all uses of property are allowed as a matter of right except where the ordinance specifically provides otherwise. The court held the board of adjustment properly applied the plain and ordinary meaning of “vocational school.” Since the facility provides training to existing members of a profession (military, law enforcement, and private security contractors primarily) to practice and refine their skill levels, with little classroom instruction, this use does not fall within the meaning of a vocational school. The court held a whole record review was appropriate to determine if there was substantial evidence in the record to support a conclusion that this use was most nearly similar in impacts to an outdoor recreation activity with mechanized vehicles. Given evidence of consideration of noise, traffic, and safety for neighboring properties, the board’s determination on this point should not be second guessed by the courts.
Shearl v. Town of Highlands, 236 N.C. App. 113, 762 S.E.2d 877 (2014)
Nonconformities; Record on appeal; Zoning map
The petitioner was cited in 2009 for operating a commercial business (a lawn and landscape business) in a residential district. In 1983 the portion of the property 230-feet from the highway centerline was zoned for commercial use and the rear portion of the property was zoned for residential use. The 1988 official zoning map still showed the boundary at 230-feet. In 1990 town had adopted a new zoning ordinance and map. The town contended that the depth of the commercial zoning along the highway was reduced from 230 feet to 150 feet from the centerline at that time. The petitioner’s business had a shop building within the 150-feet area, but also had a storage building at the rear of the lot that was within 230-feet of the centerline, but not within 150-feet, which was the basis of the notice of zoning violation. The petitioner acquired the property in 1993. The plat recorded in conjunction with the petitioner’s 1993 purchase reflected that revised zoning boundary line and the town submitted a 1996 zoning map showing the revised line. The board of adjustment held the burden of proof as on the petitioner to establish that his use was a lawful nonconformity and upheld the violation on that basis.
However, the 1990 official zoning map and all copies were lost and they were not produced at trial. The court noted state law requires the city to maintain an official copy of all ordinances, which includes the zoning map since it is a part of the zoning ordinance. While the burden is normally on a landowner to establish the existence of a valid nonconforming use, that was not possible in this case since the 1990 map was not available when the petitioner acquired the property in 1993. So the court vacated the ruling and remanded the case. On remand, the court held the burden was on the town to establish that the 1990 ordinance moved the zoning district line and the existence of a current zoning violation (and the petitioner can present rebuttal evidence). The plat submitted is not a zoning map and would not in and of itself have greater weight than the 1988 official map, which will be conclusive in the absent of new evidence regarding the 1990 amendment. Also, the court noted that the record on appeal was incomplete as it did not include the 1996 zoning map, which could be reintroduced on remand, but would not address the location of the line in 1993 for purposes of determining whether the use was a lawful nonconformity.
Town of Black Mountain v. Lexon Insurance Co., 238 N.C. App. 180, 768 S.E.2d 302 (2014), review denied, 771 S.E.2d 307 (2015)
Subdivisions; Performance guarantees; Statute of limitations
Buncombe County approved several subdivisions for which the defendant issued performance bonds to guarantee completion of required infrastructure. The subdivisions were later annexed into the Town of Black Mountain. The county assigned the bonds to the town. When the companies developing the subdivisions failed and the required improvements were not completed, the town sought payment of the bonds. The defendant bond company refused to pay, contending neither the county or the town had standing – the county having lost jurisdiction for subdivision ordinance enforcement upon annexation of the property and the bonds not being assignable to the town.
The court held the county did not have jurisdiction after annexation and thus had no standing to call the bonds. However, the bonds could be and were assigned to the town and the town could demand payment upon nonperformance. The court also held the three-year statute of limitations on actions concerning liability under a contract did not apply bar the action. Since enforcement of subdivision regulations is a governmental function, the statute of limitations does not apply to the town. Even if the statute did apply, the developers had stated less than two years prior to commencement of the action that they were committed to completing the improvements without the need of the bonds.
MYC Klepper/Brandon Knolls LLC v. Board of Adjustment for City of Asheville, 238 N.C. App. 432, 767 S.E.2d 668 (2014)
Billboards; Nonconformities; Estoppel
Plaintiff was cited for installing a billboard without a permit. A billboard had previously been located on the site. The original billboard was erected in 1992 pursuant to a variance that required its removal in 1997, the expiration of an amortization period then in effect. The billboard remained on site until 2007, when the sign was removed with only the poles remaining. In 2010 a new billboard was installed.
The court first addressed the issue that the complaint named the Board of Adjustment rather than the city as a party. The court held that while G.S. 160A-393(e) requires the city be named as respondent, this failure did not deprive the court of subject matter jurisdiction and the city’s participation in the proceedings cured the defect in the petition for review. The court held that since the ordinance allows reestablishment of nonconformities within 60 days and this sign had been removed for over a year, it could not be reestablished without a permit even if it were deemed a lawful nonconformity.
The court also dismissed an estoppel argument based on contention that a former city attorney had advised the plaintiff at the time the sign replacement was being considered for replacement that they were proceeding properly. Even if that advice was given, a mistake by a city officer would not immunize the plaintiff from liability for a zoning violation.
Six at 109, LLC v. Town of Holden Beach, 238 N.C. App. 469, 767 S.E.2d 400 (2014)
Unsafe structure; Condemnation; Public trust area
Plaintiff owned a dilapidated four-unit oceanfront motel. In 2008 the plaintiff made non-structural interior improvements pursuant to a valid building permit. In 2010 the town issued a stop work order for unpermitted work on the site. In early 2011 the plaintiff applied for a permit for additional exterior work. In August 2011 the town inspector condemned the building as an unsafe structure under G.S. 160A-426 and denied the building permit. After a hearing at which the plaintiff presented evidence and testimony, in March 2012 the inspector issued an order that the structure was unsafe, a hazard to surrounding properties, had attracted criminal activity constituting a nuisance, was a threat of disease, and a danger to children. The structure was ordered demolished pursuant to G.S. 160A-429. That order was appealed to the town council, which after notice and hearing issued an order in September 2012 making similar findings and upholding the order to demolish if sufficient repairs were not made by April 2013. The town council order was affirmed by the trial court.
The plaintiff contended the town lacked subject matter jurisdiction under Cherry as the structure was in the public trust area. The court noted the property was condemned as unsafe under G.S. 160A-426, a conclusion not based on interference with public trust rights. The court also concluded the town council conducted a de novo review, including its own two-day hearing and site visit. The court found there was ample evidence in the record to support the town council’s conclusion that the structure was unsafe and met the statutory standards for mandated demolition. The court found the certificate of compliance issued for the interior work in 2009 did not preclude a determination in 2010 that the structure was unsafe. As there was substantial evidence in the record to support the town’s conclusions that the structure was indeed unsafe, the plaintiff had been given full opportunities to present evidence and to make repairs, the order of demolition was affirmed.
Federal Cases
Mt. Airy Business Center, Inc. v City of Kannapolis, 2014 WL 229564, order adopted 2014 WL 975516 (M.D. N.C. Jan. 21, 2014)
Federal jurisdiction
The plaintiff operated an internet sweepstakes business in the city beginning in 2008. The city in 2010 adopted zoning restrictions on these business that limited their location to certain districts and imposed separation requirements, parking, and operational restrictions. The city also imposed business regulations that imposed operational restrictions and adopted a $500 per terminal per year privilege license fee. The city cited the plaintiff for violation of the zoning provisions. The plaintiff challenged the city regulations and fees, alleging various federal constitutional and statutory claims, as well as a lack of state authority for the regulations. The city asked the court to abstain.
The court held Pullman abstention was not applicable because the only unsettled issue of state law involved the criminal statutes regarding sweepstakes cafes, which are not at issue in this case. The court held Buford abstention was also inapplicable. Zoning cases often present difficult questions of substantial public import where federal review would be disruptive of state efforts to establish a coherent policy, thus triggering Buford abstention. Here, however, there is no state review pending and the plaintiff is challenging the regulatory scheme on constitutional and statutory grounds, so given the specific facts presented, abstention is not appropriate.
Town of Nags Head v. Toloczko, 2014 WL 4219516, No. 2:11-CV-1-D, (E.D. N.C. 2014)
Takings, Public trust area
The defendant owned an oceanfront beach cottage that was severely damaged in a November 2009 storm. The town cited the defendants for violation of an ordinance requiring permits prior to any development on the beach public trust area. The defendants contended the nuisance ordinance was invalid and alleged due process, equal protection, and takings violations. The federal district court initially abstained, but in 2013 the Fourth Circuit held that the North Carolina courts had conclusively determined the town did not have jurisdiction to protect public trust rights in the ocean beach area and remanded the case.
On remand the court concluded the plaintiff’s cottage was not located on the wet sand beach, the town did not have a right to enforce the public trust doctrine on the wet sand beach pursuant to the state court decision in the Cherry case, given the subsequent beach nourishment the property is not a likely to cause personal injury, and that the question of whether the public trust area extended to the dry sand beach was moot. As for the takings claims, the court held that the town’s assertion that state law allowed public use of the dry sand beach did not amount to a physical invasion taking. The court noted that the town’s good faith in use of the police power was irrelevant in a takings inquiry. The court noted that several of the Penn Central balancing factors weighed in favor of the plaintiffs, particularly that they had been allowed to repair the structure after past storm damage, they lost all rental income during the period of the dispute with the town, and removal of the structure would not provide them with a reciprocity of advantage. Still, the town raised genuine issues of material fact on both the Penn Central factors and whether the town’s actions were the proximate cause of the plaintiff’s losses. Thus summary judgment was not appropriate.
CarSpa Automotive, LLC v. City of Raleigh, 57 F.Supp.3d 505 (E.D. N.C. 2014)
Ripeness, Takings
Plaintiff contended the city forced donation of a public access right of way in order to get a building permit and that this was a takings, due process, and equal protection violation. The court held the plaintiff’s failure to apply for a variance meant no final administrative decision had been made so the case was not ripe for judicial review. Further, as the plaintiff had not brought an inverse condemnation claim in state court, that failure to seek an available and adequate procedure for just compensation also rendered the takings claim unripe.
Sansotta v. Town of Nags Head, 97 F.Supp.3d 713 (E.D. N.C. 2014)
Nuisance; Takings; Public trust doctrine
Plaintiff managed and was part owner of six oceanfront beach cottages that were severely damaged in a November 2009 storm. Several weeks after the storm the town declared the structures a nuisance and ordered them demolished. In 2013 the Fourth Circuit held the town did not violate the procedural due process rights of the plaintiff nor did the town’s decision to declare some but not all cottages on the beach after the storm violate equal protection, but that the plaintiff’s takings claim should not have been dismissed on ripeness grounds. During the pendency of the litigation, the town completed a beach nourishment project and eventually issued permits for repair of the cottages.
On remand the court found none of the damaged cottages were located on the wet-sand beach. The court also found that at the time of this action under state law the state (rather than local government) had exclusive authority to enforce public trust rights, so the town had no authority to declare a structure on the dry sand beach to be a nuisance. As the town had no authority to protect public trust rights on the dry sand beach, the court held the plaintiff’s claim that the dry sand beach was not subject to public trust rights to be moot. The court held the public duty doctrine precludes a claim of negligence against the town for its action preventing access to the structures during the storm.
The court address three regulatory takings claims. First , the court held blocking access to the property for repairs during the storm was based on preventing grave threats to life and property and was not a taking. The court held that the town’s assertion of public trust use rights in the dry sand beach was not a physical-occupation takings. The court found there were genuine issues of material fact as to the Penn Central factors for a temporary regulatory taking and accordingly remanded for a jury trial on those issues.
[Note: The parties subsequently settled with the town purchasing the property.]
