Planning and Development Regulation

2015 North Carolinba Land Use Litigation


David W. Owens
School of Government
The University of North Carolina at Chapel Hill
© 2017


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

Town of Midland v. Wayne, 368 N.C. 55, 773 S.E.2d 301 (2015)

Condemnation; Vested rights

Cabarrus County in 1997 approved a development plan for a largely residential development on a 250-acre tract.  By 2009 two phases of the development were substantially developed and sold.  The 90-acre parcel involved in this litigation was in the undeveloped portion of the project.  The defendant owned the undeveloped tract and an LLC controlled by the defendant owned the developed portion of the approved development.  The Town of Midland condemned a three-acre portion of the parcel for a natural gas pipeline and fiber optic line.  During construction the contractor used a portion of the site outside the acquired easement as a construction staging area.  Installation of the pipeline also precluded completion of the development in the same manner originally approved, allegedly rendering the property unsuitable for the approved development.  The plaintiff alleged an inverse condemnation based on:  (1) a temporary taking of the construction staging area; and (2) loss of the vested right to complete the overall project as originally permitted.  The trial court and court of appeals held for the defendant on the staging area taking and that issue was not appealed.

The court affirmed the trial court’s finding of a vested right to develop the 90-acre parcel.  The multiphase residential development plan that was approved for the overall project is consistent with the inherent nature of residential development and the defendant reasonably and in good faith relied on that approval.  The defendant made substantial expenditures of money, time, and labor based on this approval, which never lapsed. In order for the contiguous properties to be considered as a whole for the takings analysis, the factors to be considered are (1) unity of ownership, (2) unity of use, and (3) physical unity.  Here, the parcels were adjacent, satisfying physical unit.  Being subject to a single approved development plan that led to a vested right for the overall project satisfied the unity of use.  Given the joint vested right and the controlling interest in the LLC owned by the defendant, the “modicum of unity of ownership” was also met.  The court held the vested right is not a separate property interest for takings analysis.  However, it provides a unique quality to the land to which it is attached that enhances its value and must be considered in assessing the pre-condemnation value of the property.  To the extent that vested right is frustrated, that is reflected in the reduction in value of the undeveloped tract.


Morningstar Marinas/Eaton Ferry, LLC v. Warren County, 368 N.C. 360, 777 S.E.2d 733 (2015)

Appeals; Standing

The plaintiff operates a commercial marina on Lake Gaston.  The owner of another marina (East Oaks) located approximately 145 feet across a small cove from the plaintiff’s property proposed to build 36 townhouses on a residentially zoned tract and use part of the site as a driveway to an adjacent commercially zoned parcel that included a dry-stack boat storage facility.  East Oaks applied for a conditional use permit for the townhome project, but before their application was heard by board of adjustment (BOA), the zoning administrator ruled townhomes were a permitted use, so the CUP application was withdrawn and permits issued.  The plaintiffs appealed this determination regarding the townhomes and asked for a formal ruling on whether the drive connecting a boat launch on the residential area to the commercial property with the boat storage facility could be located in a residential zoning district.  The zoning administrator refused to issue a determination on the drive issue.  The BOA heard the plaintiff’s appeal on whether a CUP was required for the townhomes and ruled for the plaintiff.  On appeal, the trial court entered a consent order reinstating the permit, ruling the plaintiff was not an aggrieved party with standing to appeal the townhouse determination to the BOA.  The plaintiff then asked for a formal determination of the drive issue.  The zoning administrator determined the drive issue was not regulated by county zoning.  The plaintiff then appealed this determination to the BOA, but the county attorney and zoning administrator determined the plaintiff did not have standing and refused to place the appeal on the BOA agenda.  The plaintiff sought a writ of mandamus to compel the question be heard by the BOA.

The court then held that mandamus was a proper writ in this instance as the zoning administrator has a ministerial duty to place complete appeals on the BOA agenda.  The question of standing to make the appeal is a legal question for the BOA and it is not within the power of the administrator to rule on standing.  Once on the agenda, the BOA can and should rule on whether the plaintiff has standing. 


Byrd v. Franklin County, 368 N.C. 409, 778 S.E.2d 268 (2015)

Unlisted uses; Interpretation; Shooting range

The plaintiffs proposed to locate a shooting range on their property.  The zoning provisions in the county’s unified development ordinance provided that any use not specifically included in the table of permitted uses were prohibited.  The ordinance did not list shooting ranges, so the plaintiffs were advised the use was prohibited and it was suggested they seek a text amendment to include shooting ranges in the table of uses.  The staff later informed plaintiffs that the range could be considered an “open air game,” which was eligible for a special use permit. The plaintiffs applied for a special use permit, which was denied.  The staff then ordered cessation of the shooting range.  The board of adjustment and trial court upheld that order.

The court of appeals held receipt of the written order from the county to desist constituted an appealable written final order.  The court affirmed that shooting ranges did not constitute “open air games” as defined by the zoning ordinance and ruled that since this was not a listed use, the ordinance unambiguously prohibited it.  The dissent rejected this final point, noting that the court’s Land decision rejected the concept that a zoning ordinance may prohibit uses that are not explicitly allowed.  Given the law favors the uninhibited free use of land, such an automatic disallowal of a use because the ordinance failed to identify it is invalid.  In a per curiam decision, the supreme court adopted the dissenting opinion.



North Carolina Court of Appeals

Fehrenbacher v. City of Durham, 239 N.C. App. 141, 768 S.E.2d 186 (2015)

Interpretation; Record; Telecommunication towers

The city development review board and planning director approved a 120-foot tall telecommunication tower on a leased portion of a five-acre lot owned and occupied by a church.  The staff determined the proposed “monopine” design of the tower complied with ordinance requirements for a “concealed wireless communication facility.”  The ordinance required such facilities to be aesthetically compatible with the site and surroundings and gave examples of permitted concealment incorporation into a church steeple, bell or clock tower, flagpole, or tree.  On appeal to the board of adjustment, neighbors testified the “monopine” tower would be twice as high as surrounding real trees.  The board of adjustment upheld the staff determination and the trial court affirmed that decision.

While minutes of the board of adjustment hearing were available, the first hour of the three hour hearing was not recorded due to a recording malfunction.  The court held this did not result in an inadequate record for judicial review as the plaintiff’s evidentiary submission of affidavits and photographs were included in the hearing record.  Because the plaintiff did not identify any other competent or substantial evidence presented in the verbal testimony that was missing from the record as a result of the recording malfunction, the court held the record to be adequate for review.  The court held it was not error for the trial court to allow the tower applicant to submit photo simulations that were submitted as part of its application but not presented to the board of adjustment, noting G.S. 160A-393(i) gives the trial court discretion to supplement the hearing record.  On the de novo question of interpretation of the ordinance, the court noted that while the pole would be twice the height of existing trees, the camouflaging was such that it was not “readily identifiable” to a casual observer as a cell tower and it was compatible with the wooded rural residential area surrounding it.


China Grove 152, LLC v. Town of China Grove, 242 N.C. App. 1, 773 S.E.2d 566 (2015)

Impact fees

The town charged the plaintiff an “adequate public facilities fee” of $54,284 to ensure funding for increased public needs resulting from their residential subdivision.  The court held this was an unauthorized impact fee.  While G.S. 160A-372(c) includes permissive language that a subdivision ordinance “may provide” for a fee in lieu of recreational facilities, there is no provision in that statute that the city can condition subdivision on payment of funds to subsidize its law enforcement, fire protection, and parks.  Thus under Lanvale, the fee was invalid as a matter of law.  The city had voluntarily returned the fee, but did pay interest of 6% per year, which is required under G.S. 160A-363 if the fee was not specifically authorized by law.  The city contended the common law doctrine of accord and satisfaction barred the claim for interest when the plaintiff accepted the voluntary refund of the fee.  While the letter and its acceptance did satisfy all obligations and liabilities under the adequate public facilities ordinance, it made no mention of the statutorily required interest and thus did not amount to a release of the statutory obligation to pay interest.


Good Neighbors of Oregon Hill Protecting Property Rights v. County of Rockingham, 242 N.C. App. 280, 774 S.E.2d 902, review denied, 368 N.C. 429, 778 S.E.2d 78 (2015)

Spot zoning, Reasonableness, Notice

A father and son purchased a 102 acre parcel near Reidsville. The father then applied to rezone a two acre portion of the property from Residential Agricultural to Highway Commercial Conditional in order to construct a kennel for a bird-dog training facility. The staff and planning board recommended approval and the county rezoned the property with nine conditions, including provisions on grading, landscape buffers, lighting, and parking. Neighbors challenged the rezoning, contending it was illegal spot zoning, was arbitrary and capricious, and that proper notice had not been provided for the rezoning hearing.

The court held a rezoning can only be “spot zoning” if the property is owned by a single person. Since this property was owned jointly by a father and son at the time of the rezoning, it is not spot zoning.  The court noted that any rezoning must be “reasonable, neither arbitrary nor unduly discriminatory, and in the public interest.”  The court conducts a whole record review on this issue and the burden is not the challenger to establish invalidity. The court is not a trier of fact, but reviews the whole record to review the sufficiency of evidence presented to determine if there was an error of law in this summary judgment on a declaratory judgment proceeding.  Since the court found the trial court had mistakenly made new findings of fact, the case was remanded for a new hearing on this issue. On the question of notice of the rezoning heaqring, the court noted the clerk to the board had made a certification of mailing of the notice and that must be deemed conclusive in the absence of fraud. With no allegation of fraud here (and noting the appelllants actually appeared at the hearing), the court dismissed this claim. Finally, the court held that pouring a concrete pad on the site for use as a personal kennel did not violate the local ordinance (even if that pad could be used for a commercial kennel if the rezoning were subsequently approved).


Point South Properties, LLC v. Cape Fear Public Utility Authority, 243 N.C. App. 508, 778 S.E.2d 284 (2015)

Impact fees; Statutes of limitations; Laches

        The plaintiff developer proposed a subdivision in the unincorporated area of New Hanover County.  Between 2003 and 2006 the plaintiff paid required impact fees related to water and sewer services, which were required prior to securing building permits. However, the plaintiff’s properties were in an area that the defendant did not provide water and sewer, but had identified as a potential long-term service area. Plaintiffs objected to the required payment, but made them in order to secure building permits.  In 2012 the plaintiff sought a refund of the impact fees as it was undisputed that at that time the defendant provided no services in this area, had made no official decision to extend services there, and had taken no steps to provide services to these developments. When no refunds were made, this suit was initiated. Defendant contended the claim was barred by the statute of limitations and laches.

The court held the plaintiff’s claim was that the authority lacked authority to impose an impact fee. G.S. 162A-88 allows imposition of fees for “services furnished or to be furnished.”  As the defendant provided no services to the area involved and had made no commitment to provide services, the defendant had no authority to impose the fee. The action challenged was thus ultra vires.  This is not a liability based on a statute (a three year statute of limitations) or a claim based on a contract (a two year statute of limitations). Rather, the ten year statute of limitations for actions not otherwise addressed by statutes of limitations is applicable. The court held that as an equitable defense, laches is not available for a claim that is legal rather than equitable in nature. Further, defendant showed no harm resulting from the plaintiff’s delay in bringing this action.

Note: G.S. 1-52(15) was subsequently adopted to provide for a three-year statute of limitations for claims arising from an unlawful fee charged for water or sewer services. Also, this holding that the ten year rather than three year statute of limitations applied was reversed by Quality Built Homes Inc. v. Town of Carthage II, ___ N.C. ___, 813 S.E.2d 218 (2018).


Nies v. Town of Emerald Isle, 244 N.C. App. 81, 780 S.E.2d 187 (2015), appeal dismissed, 369 N.C. 484, 793 S.E.2d 699 (2016), cert. denied, 138 S.Ct. 75 (2017)

Public trust doctrine; Beaches; Takings

Plaintiffs acquired an oceanfront cottage in Emerald Isle in 2001. Town ordinances allowed and regulated driving of vehicles on the beach during specified periods of the year and prohibited placement of beach equipment within twenty feet of the oceanward base of frontal dunes in order to maintain an unimpeded travel lane for emergency services and other town personnel providing essential services on the beach.  The plaintiff contended that the vehicles driving on their property above the mean high water line as sanctioned by the town ordinance, as well as restrictions on beach equipment, constituted an unlawful taking of private property without compensation.

The parties agreed that the property boundary between state-owned and privately-owned property is the mean high water line.  So the portion of the beach that is flooded on a daily basis, the “wet sand beach” between the mean high and mean low tide lines, is publicly owned. The court held that the public also has rights to use of the occasionally flooded portion of the beach – the “dry sand beach,” between the mean high tide line and the vegetation line (also demarcated by the seaward base of the frontal dune or storm debris line. The court took notice that the public right of access to and use of the dry sand beach is firmly rooted in the custom and history of North Carolina. The court held as a matter of state property law – both in common law and recognized by statute – that public trust rights extend to the dry sand beach as well as the wet sand beach.  As the plaintiff had no right to exclude the public from the dry sand beach, the town regulation of beach driving in this area, even if construed as “allowing” rather than “regulating” public use, cannot be a taking. The court further held that regulation of where on the beach equipment can be placed was a legitimate use of the police power and the means used to regulate placement of large beach equipment in order to facilitate free movement of emergency and service vehicles as a reasonable exercise of the police power.


Federal Cases

 Tommy Davis Construction, Inc. v. Cape Fear Public Utility Authority, 807 F.3d 62 (4th Cir. 2015)

Impact fees; Statutes of limitation; Attorney fees

The plaintiff was required to pay $34,269 in water and sewer impact fees when it obtained building permits for 23 lots.  However, the subdivision in question was not in an area for which the utility authority provided services and a private company provided the water and sewer. As the Authority had no plan for extension of service to this area, it discontinued requiring impact fees there, but refused to refund the fees previously paid. 

The court held the defendant had no authority to impose a water and sewer impact fee for lots in a subdivision that was not served by public water and sewer and where there were no concrete plans to extend services to that area. While the federal claims under Section 1983 were barred by a three year statute of limitations, the state law claim was subject to ten year period as determined by the court in Point South Properties.  The court upheld the award of attorney fees as the ultra vires act here was by the county in collecting the fees as building permits were issued.



Topics - Local and State Government