Sunday, October 21, 2007

Sometimes, a Developer Does Have a Collateral Attack on a Quasi-Judicial Denial

In Palazzo Las Olas Group LLC v. City of Ft Lauderdale, the 4th District threw out the circuit court's dismissal of a lawsuit filed by a frustrated developer over the city's denial of a site plan for a project that had been the subject of an RFP issued by the city's Community Revitalization Agency and also to long negotiations with the City.

The circuit court agreed with the city that the developer's only remedy was certiorari review of the denial. The 4th District disagreed, holding that under the facts of the case the developer had collateral estoppel and various other claims that could not have been addressed in the certiorari review process.

The facts may be pretty close to unique (if almost predictable): The City, through the CRA had a parking garage near the beach at the end of Las Olas Blvd. It wanted the property redeveloped, so put out an RFP. It seems that the terms of the RFP looked for a use of the property that would require amendments, variances, or conditions on the ultimate site plan approval from the standard terms of the zoning ordinance. The developer wins the RFP, gets the land under contract and starts negotiating the details of the site plan and conditions.

In the meantime, politics being what they are, opposition arises. Ultimately the elected mayor and some of the council are elected and clearly oppose the project. The developer claims that the mayor drove the staff to take positions that delayed staff completeness and otherwise abused the process until the opposition counsel members took office so they could vote to deny the project.

Project gets denied, cert gets denied, developer files multicount complaint, the essence of which is estoppel, bad faith, etc. Developer claims to have $5M tied up into the project based on City's representations not only that it wanted the project, but that it wanted the project in a form that required the variances/exceptions that later justified the denial.

The circuit court bought the argument that cert is the only remedy and dismissed the complaint with prejudice. The 4th, while suspecting that some of the claims will be resolved on summary judgment or judgment on the pleadings, disagreed with respect to most of the claims. Here's the language that we'll need to know for later:

While we agree that Palazzo could only obtain a reversal of the Commission’s
actual decision denying it site plan approval via a petition for writ of
certiorari, we do not believe that this bars the pursuit of other civil

First, during certiorari proceedings seeking to challenge the denial of the site plan, the issues that can be addressed are extremely limited. In such a proceeding, the circuit court would be limited "to determin[ing] (1) whether the agency afforded procedural due process; (2) whether the agency observed the essential requirements of law; and (3) whether competent, substantial evidence supported the agency’s findings and judgment." See, e.g., Powell v. City of Sarasota, 953 So. 2d 5, 6 (Fla. 2d DCA 2006). Consequently, the circuit court could never reach issues concerning whether the City had contractually agreed to waive certain permitting requirements as alleged by Palazzo or whether, based upon the City’s actions, the City was equitably estopped from denying site plan approval. Cf. Citrus County v. Fla. Rock Indus., Inc., 726 So. 2d 383, 387 (Fla. 5th DCA 1999) (holding "common law issues" concerning whether County was estopped from denying permit because of its acquiescence over the years, the permit applicant’s good faith reliance on actions of County, and the permit applicant’s commitment of resources had no place in administrative permitting process or in certiorari review of decision denying permit).

Second, much of what underlies Palazzo’s civil claims, and particularly counts I and III, is an allegation that as a consequence of the City’s own actions it is now estopped from denying site plan approval. Florida’s courts have long recognized that local government entities must deal fairly with their citizens and that, in the absence of fair dealing, the doctrine of equitable estoppel may be invoked.

. . .

Consistent with these principles, there are Florida cases suggesting that a civil suit will lie against a governmental entity where it has engaged in alleged unfair dealing. In Sundstrom v. Collier County, 385 So. 2d 1158 (Fla. 2d DCA 1980), the owner of real property obtained a building permit and spent money to commence work on the project. Thereafter, the zoning board issued a stop-work order. The property owner failed to timely seek certiorari review and, instead, filed a petition for writ of mandamus. The trial court dismissed the petition with prejudice as a consequence of the owner’s failure to timely seek review of the order via the filing of a petition for writ of certiorari. The appellate court agreed that mandamus was not the appropriate remedy, but nonetheless reversed the dismissal with prejudice because the owner should have been afforded the opportunity to "state a cause of action in equity for equitable estoppel, declaratory relief, or an injunction." Id. at 1159. And, Florida Rock Industries, 726 So. 2d at 383, Town of Largo v. Imperial Homes Corp., 309 So. 2d at 571, and Town of Longboat Key v. Mezrah, 467 So. 2d 488 (Fla. 2d DCA 1985), each involved the circumstance where a property owner/applicant brought a civil action for declaratory relief and/or an injunction, asserting that the governmental entities’ prior conduct was such that it was estopped from taking the complained-of action. And, in Florida Rock Industries, the property owner simultaneously filed a petition for writ of certiorari, seeking review of the order on its application for determination of vested rights, and a civil complaint, seeking declaratory relief and alleging equitable estoppel. 726 So. 2d at 386.

Having considered the above authorities and principals and the limitations of certiorari review, we hold that while any direct challenge seeking to overturn the Commission’s decision denying site plan approval had to be sought via the filing of a petition for writ of certiorari, this did not preclude Palazzo from bringing a civil suit, wherein it sought relief on matters beyond those appropriately addressed during the certiorari proceeding. The trial cour

Wow. The Court is holding that if you have a valid legal issue that lies outside the scope of certiorari relief, you get to plead a separate cause of action. This has long been recognized in cases involving notice, and also where the relief is under a different statute than the decision was taken under. (see Omnipoint III - the 3d DCA case on remand, and various takings cases).

The interesting fight here ultimately will be the issue of estoppel versus "you can't contract away the police power." A second issue may become the kind of "inequitable conduct" that may lead to estoppel, as the Court seems to be broadening the potential scope. Historically, good faith reliance could be founded only on a lawfully issued statement or decision. Here, the 4th DCA is permitting a "course of conduct" pleading to establish a legally sufficient basis for pleading estoppel.

It will be interesting to see whether this case settles quickly, or only after the circuit court has another go-round at the issues.

Just What Can You Do After Quashal?

In Hernandez-Canton et al v. Miami City Commission et al, the 3d DCA held that the city commission and circuit court erred in interpreting an earlier decision it had issued in the same matter.

The dispute goes to whether an application was vested against changes in the zoning regulations. The vesting provision in the amending resolution sets a particular date for having a complete application submitted. In the first case, here's the link to the original Morningside opinion, the 3d District found that the application was subject to the new regulations because the approval resolution on its face established that the "completeness" date was after the vesting date. Here's the most relevant part of the opinion:
The City’s zoning resolution states, in the second "whereas" clause, that "on
February 10, 2004, . . . [the developer] submitted a complete Application for
the previously reviewed Major Use Special Permit application . . . ." (Emphasis
added). By the terms of the resolution, the City treated the application as
being complete on February 10, 2004. This was after the effective date of the
new ordinance.
Section 1305.2.1 of the zoning code provides in substance for
grandfathering of "any complete application for development filed prior to
January 1, 2004 . . . ." (Emphasis added). As stated in the zoning resolution,
the application in this case was not complete until February 10, 2004. That
being so, the January 2004 amendments are applicable to this application.

On remand, the City Attorney apparently took the position that the resolution approving the development was not actually quashed and could be fixed by entering new findings. The City Commission apparently reapproved the resolution. Here's how the 3d DCA describes it:

The City Attorney took the view that our court had left the 2004 zoning
resolution intact, and had simply remanded so that the City Commission could
make findings in support of its 2004 resolution. The objectors argued that the
earlier zoning resolution could not stand in view of this court’s determination
that the 2004 resolution was based on the wrong law, i.e., the wrong version of
Section 1305.
The City Commission accepted the proposition that its 2004 zoning resolution had not been overturned. The City Commission enacted a new zoning resolution which made the findings contemplated by the new version of Section 1305. The objectors sought certiorari review in the appellate division of the circuit court, which was denied.
The objectors then sought second-tier certiorari review in this court. The petition for certiorari is well taken.
OK, so what this does NOT tell us is whether the findings that the City Commission entered were new findings that the application was in fact complete prior to the "drop dead date." We also don't know whether new findings were challenged as being supported or supportable by competent substantial evidence, or simply that the City Commission didn't have the legal right to alter its earlier finding on remand.

The 3d goes on to make this out to be a big misunderstanding of its earlier opinion and to provide very precise instructions on the scope of its decision:
We must respectfully say that our prior opinion was misinterpreted in the
proceedings on remand. In order for the developer’s application to be approved,
it was necessary for the developer to demonstrate compliance with the new
version of Section 1305. Since the City Commission in 2004 applied the old
version of Section 1305, it follows that the 2004 zoning resolution was
defective and had to be set aside. It was necessary for the City Commission to
conduct a new hearing and make a determination whether the developer’s proposed
project does, or does not, comply with the new version of Section 1305.
We therefore grant certiorari and quash the decision of the circuit court appellate
division. We vacate the 2006 and 2004 zoning resolutions. We remand this matter
to the circuit court appellate division, with directions to remand the matter to
the City Commission for a new hearing and determination by the City Commission
whether the proposed project does, or does not, comply with Section 1305 as
amended in 2004. At the new hearing, the developer has the burden of
demonstrating compliance with the new version of Section 1305.

OK, it's obvious that if the project could meet the amended versions there would be no dispute here. BTW, it's also very unclear whether the court's instructions violate the Florida Supreme Court's determination in G.B.V. regarding what "quashal" and "remand" mean, and the limits on judicial authority in cert cases.

What's interesting is that the Court, without ever saying so, is holding that the City was not free to make new findings regarding the "completeness date" and whether the application therefore could be processed under the earlier regulations.

I find this case very troublesome all around. On one hand, it is hard to avoid the conclusion that the developer and the City were playing hard and fast with the rules, in both hearings. On the other hand, the facts we have are those in the 3d DCA opinions, and (sorry to say) the Court clearly has a bias on how it makes these cases come out.

Moreover, the Court does not help us at all understand what it thinks are the rules on remands. It is saying that, as a matter of law, on remand the City Commission can treat the application as still open, open a new evidentiary hearing, and approve the application if the developer proves that it meets the later ordinance. On the other hand, the Court is foreclosing - without discussion- the question of whether evidence could show that the project is vested.

What's going on? does the Court think that the issue of whether the application was vested is a factual "law of the case" matter that was completely disposed of in the first opinion? If so, why doesn't the Court say so? Is the Court saying that, where a local government makes a finding of fact (even in a whereas clause, rather than in some kind of formal finding), it cannot, on remand, accept evidence on that point and make a different finding ? Does the Court believe that to be the meaning of the "law of the case'? If so, is there an exception where cert was granted because the original finding wasn't supported by CSE? Those kinds of holdings would actually be useful to practitioners because these areas of cert law are still very uncertain. Some kind of legal reasoning would at least give us some reference point as to why the Court is adamant that the case can be opened but only to enter findings as to the later regulations.

The failure of the Court to establish the legal basis for its conclusion that its earlier decision was misunderstood and misapplied leads to two alternative conclusions: First, the Court thinks that the situation was sleazy and is trying to kill the development because it thinks that the City made or will make unjustifiable findings in order to vest project, all for some improper purpose. Second, the Court has no clear idea of the legal principles it is invoking or creating and is simply muddying the waters in total confusion. Well, maybe both could be true.

Getting clear legal bases for opinions is not a "pro development" or "anti-development" issue. Everyone in the process should be able to understand what the rules are and how they will be applied, at all stages from staff reviews to hearings to judicial review.

3d DCA: Plain Meaning Trumps Administrative Interpretation

In another interesting opinion from the 3d DCA (who has replaced the 5th as the district court most likely to issue an interesting statement of land use law), we have City of Coral Gables Code Enforcement Board et al v. Tien.

Facts: One landowner has a yacht that is longer than his canal-front lot in Coral Gables is wide, and ties it up there. Obvious result: the bow or stern overhangs neighboring property. City has an ordinance that requires a person to own a lot to which they tie a boat (language is provided below). Neighbor complains, and a code enforcement officer cites the boatowner.

Then boatowner appeals the citation to the Code Enforcement Board. The Code Enforcement Board, advised by the City Attorney, reads the literal language of the ordinance to require only ownership of the property to which the yacht is affixed, not to require ownership of all lands that the yacht might then front, cover, or block, and dismisses the violation.

The neighbor then files for first tier certiorari. FIRST PRACTICE NOTE: This was wrong, procedurally. Review of the actions of a Code Enforcement Board that is acting pursuant to Chapter 162 is by appeal to the circuit court, not by certiorari. The circuit court on certiorari, decides for the neighbor, and the boat owner and Code Enforcement Board file for second tier certiorari to the District Court (this was procedurally correct, because there is no statute granting discretionary review authority of circuit court decisions to the district court).

Before getting to the opinion, here's the operative language:
It shall be unlawful for any person to anchor, moor or tie up any boat or craft
of any and every nature whatsoever to any waterfront property abutting the
waterways and canals within the city, unless he is the owner of the property to
which the craft is anchored, moored or tied up or is the lessee of improved
property having a dwelling structure thereon, under a written lease from the
owner of the fee simple title to such property or is the guest in the house of
the owner of improved property having a dwelling structure thereon.

The District Court grants cert and quashes the circuit court decision, with the following language:

We recognize at the outset that the scope of our review at this stage of the
proceeding is quite limited. Where, as here, “full review of administrative
action is given in the circuit court as a matter of right,” a litigant “is not
entitled to a second full review in the district court.” City of Deerfield Beach
v. Vaillant
, 419 So. 2d 624, 626 (Fla. 1982). However, where “there has been a
violation of a clearly established principle of law resulting in a miscarriage
of justice,” then we are authorized to reach down and supply relief. Allstate
Ins. Co. v. Kaklamanos
, 843 So. 2d 885, 888 (Fla. 2003) (citing Ivey v. Allstate
Ins. Co.
, 774 So. 2d 679, 682 (Fla. 2000)). As the court noted in Kaklamanos,
“‛clearly established law’ can derive from a variety of legal sources, including
recent controlling case law, rules of court, statutes, and constitutional law.”
Kaklamanos, 843 So. 2d at 890. To that list, we today add municipal ordinances.
Applying Kaklamanos, we conclude it would be a violation of “clearly established
law” and a substantial “miscarriage of justice” if this mega-yacht was banned
from the City of Coral Gables based upon this ordinance.
We are compelled to this conclusion based upon a plain reading of the ordinance.

SECOND PRACTICE NOTE: The court has given practitioners some very strong language to use here.. First, the 3d DCA is providing a supporting corollary to its opinions last year that the courts must stand ready to ensure that the laws are properly interpreted, and that the district courts are not potted plants that have to accept improper decisions under the "miscarriage" standard or based on their limited review. Auerbach v. City of Miami, 929 So.2d 623 (Fla. 3d DCA 2006), here's the link to the 3d DCA opinion; see also Osborn v. Board of County Comm'rs (Monroe). Compare the Fifth DCA opinion and dissent in Board of County Commissioners v. City ov Cocoa, where the court turned a blind eye to a clearly illegal annexation based on the "miscarriage" label.

What happens next in the opinion is equally interesting and powerful: a declaration for judicial autonomy in interpreting codes:
We note the City of Coral Gables has filed its own petition for certiorari
aligning itself with Bared. The City suggests, based upon earlier authority of
this Court, we must defer to its “superior technical expertise and special
vantage point” in interpreting this ordinance. See City of Hialeah Gardens v.
Miami-Dade Charter Found., Inc.,
857 So. 2d 202, 206 (Fla. 3d DCA 2003). The
City reads too much into our City of Hialeah decision. We are not required to
and do not defer to an agency’s construction or application of a law or
ordinance where we are equally capable of reading the ordinance
. Fla. Hosp. v. Agency for Health Care Admin., 823 So. 2d 844, 848 (Fla. 1st DCA 2002) (“[A] court need not defer to an agency's construction or application of a statute if
special agency expertise is not required, or if the agency's interpretation
conflicts with the plain and ordinary meaning of the statute.”). A plain reading
of the ordinance in this case requires that we quash the decision below. Holly
v. Auld
, 450 So. 2d 217, 219 (Fla. 1984) (“When the language of the statute is
clear and unambiguous and conveys a clear and definite meaning, there is no
occasion for resorting to the rules of statutory interpretation and
construction; the statute must be given its plain and obvious meaning.”)
(quoting A.R. Douglass, Inc. v. McRainey, 137 So. 157, 159 (Fla. 1931)). We feel
confident the City knows how to properly craft an ordinance to protect its
citizens from unwanted intrusions by mega-yachts if it so desires.(emphasis added).

THIRD PRACTICE NOTE: Believe it or not, this is pretty hot stuff. Whenever you challenge a local decision, the local government attorney's are constantly throwing Hialeah, Palumbus, and a handful of other "deference to local agency" cases on the table for the proposition that a local agency or administrator's action can only be overturned if it involves a "clearly erroneous" interpretation of the law, regardless of how clear the law is. While this decision doesn't quite reach that issue directly, it does provide ammunition for the proposition that a reviewing court can apply its own interpretation of clear and unambiguous ordinances.

Sunday, October 07, 2007

How Do You Challenge Unpermitted Activity?

In Johnson et al v. Gulf County, the 1st District overturned a circuit court's dismissal with prejudice of a neighbor suit claiming improper activities in wetlands.

In one count, the neighbors had claimed under section 163.3215 that the activities violated various provisions of the comprehensive plan. The problem (like in Das v Osceola County) was that the county never issued a development permit for the activities because the county apparently either views the areas as "not wetlands" or views the activities as not needing permits, even if they are wetlands.

Question 1: is altering wetlands "development" ? Probably, if it is in anticipation of any construction activity - look at 380.04.

Question 2: if a local government fails to issue a "development order" to control an activity that constitutes "development," what is the remedy? Under Das v. Osceola County, the right under the statute to get temporary relief or relief to "prevent action" on a development order led the court to conclude that there was an obligation to issue some kind of public document that constituted an authorization to develop so that it could be challenged. In that case (which involved a pipeline), the County then issued a letter authorizing the activity (which the complaining neighbors then did not timely challenge b/c they thought they had the right to something more - oops, they didn't).

Here, it would seem that at the least the neighbors could write the county demanding that some authorization to proceed be granted, so that the same could be challenged.

Alternatively, the 1st DCA seemed to be leaving the door open to the Johnson's to try to re-pled nuisance. Here's an interesting question: is there a cause of action for "per se" nuisance where an activity (a) constitutes development; (b) does not have or does not require a "development order" under local land development regulations. and (c) is claimed to be inconsistent with the plan? There is a very good argument that there is a such a claim, so long as the plaintiff can establish common-law standing to bring the claim. The "exclusive" jurisdiction provision of 163.3215 applies only to claims that development orders are inconsistent with the plan, and it is clear from various provisions, including 163.3194, that developing inconsistent with the plan is unlawful.

It will be very interesting to see how this one proceeds on remand.

The National Perspective - Prof. Patricia Salkin's Land Use Blog

Professor Patricia Salkin of the Albany Law School has started a new blog on land use law that highlights decisions from all over the county. It can be found at the Law of the Land Blog and is a very good resource.

Professor Salkin's name should be familiar to land use practitioners who also are members of the American Planning Association, as she is a frequent contributor to various journals and co-edits the Planning and Zoning Law Report, as well as authoring a number of other publications on land use and zoning law.