CBS Outdoor

The recent decision by the Tennessee Court of Appeals in Metro Nashville v Metro Board of Zoning Appeals & CBS Outdoor, 2014 WL 4364852 (Tenn App Sept 3, 2014), presents a considerable difficulty for almost every party who appears before any board of zoning appeals in the state of Tennessee. The holding of the Court of Appeals is that the local government may, presumably without notice in any manner whatsoever to the applicant, appeal any decision of its Board of Zoning Appeals and challenge whether that decision was appropriate. This means that even though there may not be any opposition whatsoever appearing before the Board of Zoning Appeals, the applicant needs to ensure that there is a sufficient evidentiary basis for any decision of the Board which grants the relief sought. Just because no one appears in opposition does not mean that at some point a lawsuit won’t be filed by the local government itself challenging the decision of its own zoning board.

The decision in CBS Outdoor leaves a number of questions unanswered. Does the local government need to present some proof to the trial court concerning standing? Should the local government appear before the zoning board? Who makes the appearance? Assuming that the local government did not make an appearance before the zoning board, there would be no evidence of standing in the record, and assuming that the respondent denied the standing allegations in the petition for writ of certiorari, there would be no clear evidence of any harm to the local government without such proof. On the other hand, perhaps the Court of Appeals is signaling that the local government need not make any other showing than perhaps a reference to a local ordinance which it contends was not followed. Surely the ordinance itself would have to be introduced however before the trial court, and in the absence of a stipulation from respondent’s counsel, it’s not entirely clear how that takes place either. The trial court can take judicial notice of local zoning regulations upon notice (Rule 202 (b) of the Tennessee Rules of Evidence) but in a  certiorari proceeding  all the evidence should have been presented to the zoning board; allowing additional evidence, even the zoning regulations, arguably allows the court to consider factors which were not considered by the zoning board.

On the other hand, it has always seemed to me that local governments should have the ability to appeal under certain circumstances. The most obvious is where the local government owns a parcel property in the immediate vicinity of the proposal. In such a case, the local government is just like any other neighbor, and can appear before the zoning board opposing the application and appeal the decision on to a reviewing court. In a sense, the well-known City of Brentwood v Metro Board of Zoning Appeals, 149 S.W. 3d 49 (Tenn. App. 2004) represents this idea. Although Brentwood itself did not own property in the immediate vicinity, it was in that case an immediately adjacent neighbor, concerned about the construction of the sign which was at issue in that case.

Secondly, there are certainly times when local zoning boards make decisions which are so far beyond their ordinary activities that the decisions may need to be called into question. Two quick examples: first, where the zoning board grants a variance in the building code provisions. The zoning board has no authority over the building code, and should not be considering building code issues in its hearings. Secondly, if the zoning board violates some federally protected right or activity, litigation to protect those citizens whose rights are in issue may be necessary. For example, religious discrimination might be a basis for such an appeal.

But where the zoning board is exercising powers which are normally within its jurisdictional ken, such as considering variances, conditional use permits (special exceptions), or making determinations concerning non-conforming properties, it would seem unnecessary for the local government to have the right to sue its own zoning board and challenge its decision in a trial court. In fact, one wonders why we bother with zoning boards at all if the local government is free to appeal any decision they issue.  In the CBS Outdoor case, there are no special issues. Metro contends that the zoning board decided a non-conforming property case erroneously. The Metro board of zoning appeals probably hears something in the vicinity of 50 to 75 such cases each year. This kind of case is certainly not anything unusual. It does not seem therefore to afford a basis for an appeal by the local government of its own zoning board’s decision.

Which brings us back to the main issue here: how to best protect against such an appeal. Once more, the best protection is to make sure that the record contains sufficient evidence to justify the decision, and that the order or minute entry of the board reflects findings of fact and conclusions of law which are consistent with the board’s decision. Customarily, I file a fairly lengthy letter with the zoning board approximately one week before the hearing date, detailing why my client complies (or in the case of opposition, why the applicant does not comply) with the requirements for the application. Assuming that the zoning board rules in my favor, I usually request permission to draft the minute entry and/or order of the board which will closely follow my letter. Generally speaking, I have found that it is quite difficult for anyone appealing such decisions to reverse because the combination of the letter (with the evidence), and the order (with findings of fact and conclusions of law) is usually very persuasive to the trial court.

One final note. Given the recent decision by the Tennessee Supreme Court concerning the manner required for trial courts to grant summary judgment pursuant to Rule 56.04 of the Tennessee Rules of Civil Procedure, Smith v UHS of Lakeside, 2014 WL 3429204 (Tenn. S Ct July 15, 2014), it may be advisable to have the zoning board discuss the order or minute entry prior to adoption. I have for a long time suggested that the zoning board should not have to include a detailed motion in order to grant a particular application. Most of the requirements for relief before zoning board are quite detailed – take a look at the variance requirements under Tenn. Code Ann. § 13-7-207 (3) for example (and those are not all of the requirements) – and as a result any motion which attempts to cover each and every requirement is doomed to failure. Most lawyers or trial court could not do it. I know that I could not do it off the top of my head.

However, let me suggest that in the case of a variance, the motion made to grant a variance should include a reference to the exceptional physical feature of the property which the moving member of the board thinks is determinative. The exceptional physical feature of the property is the most important component of a variance, and if the moving member gives the staff or the lawyer representing the applicant that basic piece of information, it would seem to me that most courts would not think it is a logical for the board to allow the staff or the prevailing attorney to draft the order based on that information. Certainly, a good deal of additional information would have to be included, but as I say, the most important part of a variance application is the finding of an exceptional physical feature on the property itself.

In a similar manner, with regard to a conditional use permit (otherwise known as a special exception and many other different names), if the moving member clearly indicated that the use of the property in the manner requested was generally consistent with the other uses in the surrounding vicinity, and that any specific requirements for the conditional use had been complied with, once again, I think most reviewing courts would then allow the staff or the prevailing attorney to fill in the other more minor details of the order or minute entry.

Similarly, on a motion to deny the application, in the case of a variance, the motion might say that there is no exceptional physical feature on the property and/or that there is no hardship suffered by the applicant; and in the case of a conditional use permit, that the use of the property as proposed is not consistent with the other uses in the general vicinity and did not meet all of the requirements. In the case of a denial of a conditional use permit, it would behoove the moving member to specifically identify which of the specific requirements was not complied with. If none of them were complied with then simply say that.

The idea, as you can tell, is to limit the amount of information which must be contained in the motion. The complexity of framing a motion to grant a variance or conditional use permit makes doing that successfully on the spur of the moment almost impossible. Alternatively, if the attorney for the prevailing side so desires, language for suggested motion could be included with the letter justifying the appeal. I have not done this myself in the past, but I have seen it done on several occasions. I would suggest that any such suggested language should be fairly simple and straightforward without the complexity that we lawyers often interject. A sample of such language might be as follows:

I’ll make a motion to approve the variance to permit a reduction in the required sideyard, down to [x number of feet]. In this case, the property is exceptionally narrow when compared to other properties and this causes undue hardship because the applicant can’t use his property in a manner similar to other owners in the same area. This condition was not created by the applicant or others after the adoption of the zoning regulations, the variance won’t cause substantial detriment to the public good and will not substantially impair the intent and purpose of the zone plan and zoning ordinance.

Let me add that I’ve never seen a motion that would be as good as this one. Notice that it is fairly lengthy even though I have kept it as short as I think reasonably possible. It might be advisable to add that the hardship is not solely based on pecuniary considerations and that the size of the variance is no more than necessary to cure the hardship. But unless the members of the zoning board are provided with a sample order such as this for every case, it would be very difficult for the members of the board to remember all of this, especially if the board had a docket of 10 to 20 cases, only some of which are variances.

Frankly, my experience is that most trial courts are so overjoyed to see anything remotely resembling an order or minute entry which addresses the specifics of a particular case that it is usually sufficient to persuade the court that the board’s decision, to grant or deny, will be upheld.

Presumptive Standing

Radow v Board of Appeals of Hempstead, 989 NYS 2d 914 (App Div 2, Aug. 6, 214)

In an interesting case involving standing from New York, several neighbors challenged variances issued by the zoning board to a beach club. The very short opinion summarized the law in New York as requiring a direct injury different from that suffered by the public at large, and that the injury asserted falls within a zone of interests sought to be promoted by the regulation. Most interesting, injury in fact may arise from the existence of a presumption established by allegations demonstrating close proximity to the subject property or, in the absence of such presumption, the existence of actual and specific injury.

In this case, the neighbors lived .69 miles away from the project and the court concluded that they were not therefore entitled to a presumption of proximity. Further, the allegations of injury in fact due to overcrowding and congestion were, from the court's perspective purely speculative and not specific to the challengers and were indistinguishable from those suffered by the public at large. As a result, these neighbors lacks standing to file the lawsuit.

In Tennessee, we also have something of a presumption of proximity; for my own purposes, I usually think about a property within a quarter of a mile of the project as having automatic standing. However in Citizens for a Collierville v Collierville, 977 SW 2d 321 (Tenn. App. 1998), the Tennessee Court of Appeals seemed indicate that anything within 2000 linear feet would be appropriate. The court did not speak in terms of a presumption, but once that proximity was established, there is not much more analysis of any injury in fact.

Many members of CFC have standing to bring the action based on their status as adjacent property owners. CFC has alleged sufficient facts to establish standing in its representative capacity to seek prospective relief for its members, many of whom own single family residential property within 2000 feet of the proposed planned development. Based on the foregoing, we conclude that CFC has standing to sue in its representational capacity.

That quote certainly seems to make clear that if a neighbor lives within 2000 feet in Tennessee, there is a presumption of standing based on proximity to the project.

Wright v Shelbyville, Rd 3

There were two interesting land use cases decided by trial courts in Tennessee in the latter part of July. Today I’ll tackle Wright v City of Shelbyville and next week I’ll add a short summary of the second case.

The Shelbyville case has been going on for quite some time. In 2009, the Tennessee Court of Appeals reviewed a zoning change relating to this property and concluded that there had been procedural errors which necessitated invalidation of the zoning change. In 2012, the court overturned a trial court decision concluding that the quarry application for conditional use permit was barred by the doctrine of res judicata.

The case was again heard in trial court this past July, and Judge Ben Cantrell heard the case. Judge Cantrell has heard many of these zoning cases, having spent a number of years on the Davidson County Chancery Court, where there are always a number of zoning cases pending, and then of course during his tenure on the Tennessee Court of Appeals.

As always in these conditional use/special exception cases, the issue is whether or not there was any evidence before the Board of Zoning Appeals to justify the decision. Very often in conditional use/special exception cases, the only evidence offered against the proposal is lay testimony by owners of neighboring property. Ordinarily these kinds of witnesses don’t add much to the proceedings, because there lay opinions are usually not cognizable by the court. There were evidently several expert witnesses retained to testify in favor of the city. The applicant did argue that the performance standard should not be considered by the court, evidently contending that noise, vibration, and blasting regulations were not part of the approval process. From my point of view, I always urge my clients to demonstrate compliance with all such matters. Obviously, this has to be couched in terms of an opinion from an expert, but it seems important to assure the zoning board as well as any reviewing court that the performance standards can be observed in a meaningful way.

This case was complicated by two other factors. The local planning commission also reviewed the application as a site plan, and in addition, there is already an operating quarry not far away from the proposed location.

A number of jurisdictions utilize this two-step process of having a planning commission review ostensibly for site plan compliance, but it has never been very clear to me why that is necessary. From my point of view, a conditional use/special exception basically combines site plan review with consideration of the proposed land use. As a result, the zoning board should be considering the site plan as well as the use and the planning commission consideration seems somewhat superfluous.

In this case, the situation is even a little more interesting in that the members of the zoning board evidently are mostly also members of the planning commission. The planning commission approved the site plan, but then the zoning board turned down the use. It might be better to allow the zoning board under the circumstances to make the final decision with a recommendation from the planning commission, rather than having to go through two separate hearings on issues which appear to be closely related.

In addition, the operation of another quarry located reasonably closely to the proposed location meant that the impact of the new location might not be as significant. I will not take each factor in turn here, but a number of the criteria used by the local zoning board involved trying to ensure that the proposed activity was compatible with other land uses in the general vicinity. The proof shows that the quarry will be located in the back of the industrial park. But “the closest property where daily activities are conducted is the other quarry. Most of the surrounding properties are all zoned for heavy industry.”

Judge Cantrell did note that there were some residential uses within 2000 feet or so. Some of these residential neighbors testified before the zoning board, mainly about violations of the operation standards at the existing quarry. Because of the heavy industrial uses generally in that area, as well as the fact that violations of the regulations by one operator should not be held against another, the court concluded that general compatibility was established.

These types of cases are always difficult and my guess is that the city will appeal this case up to the Tennessee Court of Appeals.

One final interesting note in this matter is the fact that the chairman of the zoning board announced that he had a conflict of interest but that he would conduct the hearing but not participate in any discussion or voting. The trial court does not discuss this issue so I assume that he was not broached by either of the parties. There was another member who announced that his wife owned property in the general vicinity and, again, it’s unclear whether he recused himself or simply participated. My feeling is that board members who have a conflict should simply be excused from the hearing and not participate in any way. I’m not sure that this is legally required, but it certainly seems to me to likely prevent difficulties on down the road with criticisms possibly leveled at the board chair for the manner of conducting the hearing. In this case, as far as I know, there were no such complaints, but why take the risk?

In any event, this is a very interesting case and one which certainly bears some study. A copy of the case is available here.

More on the Takings Clause

The takings clause continues to be of great interest not only practically from the point of view of land use lawyers, but academically as well. Recently, the Turo Law Review held a symposium devoted to the takings issue and the Law Review has recently published papers dealing with the topics discussed during that symposium. You can read and download copies of the academic papers here. The topics include standing issues such as those developed in the Williamson County case, the nuisance and state law exceptions to the Lucas rule, and of course the Nollan, Dolan and Koontz trilogy. I have only had an opportunity to read a couple of the articles, but the ones I have read have been quite interesting and if you have any cases in this area of the law, it certainly would be wise to take a look and see if any of the papers presented have an impact or offer greater insight into your legal cause of action.

Taking: Is the claim ripe?

I happened to stumble across a recent decision of the Second Circuit Court of Appeals addressing the ripeness doctrine in the context of a takings under Hamilton Bank v Williamson County. The case is styled Sherman v Town of Chester, 2014 WL 1978726 (2nd Cir 2014), and involves the 10 year effort of a developer to get approval for a 400 acre development in Chester, New York. The court concluded that the town had erected roadblock after roadblock to prevent the development from being approved, and ruled that for purposes of the developer's takings claim, a final decision by the town was unnecessary.

However, the interesting part of the case is the introduction which begins with a brief discussion of “Catch-22" the famous book by Joseph Heller. It’s worth reading the first couple pages for that alone.

The Writ of Cert and "Something More"

I continue to struggle with the concept of when the 60 days for an appeal from a local government agency decision begins to run under the terms of the common law writ of certiorari here in Tennessee. “The case law . . .  certainly shows that something more than simply a vote taking place is required before a judgment or order will be considered as having been entered pursuant to [the certiorari statute].” Grigsby v City of Plainview, 194 S.W. 3d 408 (Tenn. App. 2005).

But what is that “something more” and what form must it take? Most attorneys would think in terms of some writing, but in these days of Internet connectivity and video on demand, could this “enduring evidence of the judicial act of rendition of judgment” (Carter Nashville Board of Zoning Appeals, 377 S.W.2d 914, 916 (Tenn. 1964)) be something much more substantial?

Many local government agencies now record their proceedings on video and post the video to the Internet for anyone to see. Could the process of posting a video recording of the local agency hearing be the “something more” required by the statute and Tennessee case law? A video recording is certainly not as ephemeral as the oral announcement (rendition) of the decision. Video recordings, whether stored on tape, disk, hard drive (local or in the cloud) are all enduring forms of evidence. Assuming that there is no doubt that the government itself posted the video to the Internet, the video recording is certainly better than many other forms of recordation.

For example, the well-known Advanced Sales v Wilson County Board of Zoning Appeals (1999 WL 336305, Tenn. App. May 28, 1999) case involved a situation where the 60 days was started when the zoning board secretary circled the words “Relief Denied” on a rudimentary form and signed on a line immediately below the circle. The form was not sent to anyone, including the applicant, it did not list who voted for and against the proposal, and it did not include any rationale for the denial of the application. Yet, the Court of Appeals concluded that this rudimentary form was sufficient to begin the 60 day appeals time.

Contrast that with a video recording of the hearing before the that same zoning board. Anyone watching the recording would know who made the motion, who seconded the motion, the reasons for the motion, the votes in favor the motion, the votes against the motion, and the outcome of the case. Certainly, when contrasting these two methods of kickstarting the appeals process, the video recording offers far more information for the party considering an appeal so as to make an informed decision as to whether an appeal is likely to be successful. In addition, it would seem far more difficult to fake or somehow falsify such a video recording; assuming that the viewer is familiar with the particular board or commission involved, he or she would presumably immediately know something was amiss if the wrong people showed up on the video recording.

Consider also that while our hypothetical video recording does not necessarily require any tangible format, neither does the rudimentary form in Advanced Sales. For example, a staff member the morning following the decision, could have arrived at his or her office, fired up the computer, and filled in a similar form electronically stored on the computer. The same information as was placed on the tangible paper form in Advanced Sales could be filled in on the electronic version on the computer, and then uploaded to the local government website without ever printing it out and without it ever taking tangible form. The rudimentary form would simply be a collection of electronic bits of data. Even the signature of the board secretary could be electronically affixed. Indeed, here in Nashville, the Metro Board of Zoning Appeals uses a facsimile stamp to manually affix the signatures of both the board chair and board secretary. This is specifically contemplated by the board’s rules. An electronic version is not much different.

In fact, a number of local government agencies now republish their agenda a day or two after the hearings, indicating briefly the results in the cases which were determined by the board and then upload those to the Internet. I would assume that these agenda revisions with the results of each case would satisfy the “something more” of Advanced Sales/Grigsby, and if that is the case, then it seems odd that a full recording of the proceedings of the local government agency would not fulfill the same function.

All of these ruminations bring us around to the same conclusion as was forced by the result in Advanced Sales: any appeal by way of the common law writ of certiorari from a local government decision should be filed within 60 days of the meeting where the decision was made. Simply put, if you wait beyond the 60 days from the date of the meeting where the decision was made, you run the risk of missing the all-important 60 day window of opportunity for the appeal. Filing the appeal outside of those 60 days, deprives the court of subject matter jurisdiction.  “Failure to file a writ within this period precludes review of such decisions by the courts.” Johnson v. Metropolitan Gov't for Nashville Davidson County, 54S.W.3d 772, 774 (Tenn. Ct. App.2001).

Finally, just to illustrate that this discussion is not purely hypothetical, Metro Nashville makes a video recording of Council meetings, zoning board meetings, historic zoning commission meetings, planning commission meetings, and various other local boards and commissions. Most of these video recordings are posted on YouTube, where Metro Nashville maintains its own channel, usually the following day. To take the case of the Metro Board of Zoning Appeals, the video would be posted on the Friday following the Thursday afternoon hearing; however, the written order from the zoning board is usually prepared within a few days after the hearing, usually the Monday following the Thursday hearing. If the video recording is sufficient to start the 60 day appeals time running, and the petitioner files 60 days after the written order is prepared the following week, the petition may be filed too late.

Again, when filing any appeal under the common law writ of certiorari, file within 60 days from the date of the hearing where the decision was announced. Failure to follow that rule of thumb can result in dismissal of the petition for lack of subject matter jurisdiction.

Board rules that applicant can't return for 6 months

An interesting issue came up in a recent case from North Dakota. That case, Dahm v. Stark County County Bd. Of County Com’rs, 841 NW2d 416 (ND Dec 19,2013), involved an application for a rezoning combined with a subdivision plat. Because the rezoning was denied, the applicant sued the county making a number of allegations, including arbitrary and capricious action, conflict of interest, and an erroneous ruling precluding admission of additional testimony. Similar arguments are seen in many land use cases.

The interesting thing to me about this case was that the County after denying the application, also decided that it did not want to hear from the applicant regarding this particular property for at least another six months, and included language to that effect in denying the application. The North Dakota Supreme Court found nothing untoward about this ruling.

There are a number of local boards and commissions here in middle Tennessee which have rules precluding the submission of the same or a substantially similar application for a period of sometimes 6, sometimes 12 months once the original application has been denied. Many years ago, I wrote in a similar provision for the Metro Board of Zoning Appeals, in an effort to stop serial applications for the same or substantially similar relief. At the time, the board had several applications where the same applicant would attempt to get back on the agenda nearly every month by making some minor change in the proposed application. Obviously, this slows down the ability of the board to handle the cases coming before it, and is a total waste of time from the board’s perspective since having denied it originally, minor changes in the proposal are unlikely to warrant reconsideration.

I have not seen those rules challenged either here in Tennessee, or elsewhere. And of course, this case is somewhat different: the North Dakota ruling did not have to do with a standing rule but was specifically implemented in this particular instance because the applicant had been to the County board for 3 months in a row and the board was simply tired of hearing the application, especially given the fact that several requests for additional information had been made but not complied with by the developer.

In any event, the North Dakota Supreme Court upheld the six-month ban.

The decision to implement a six-month appearance restriction was also not arbitrary, capricious, or unreasonable. In making its decision, the County Board noted that Dahm had presented the Duck Creek Estates project three months in a row without adequately resolving the issues of roads, sewage, water, and population density. As the district court reasoned, "the time and effort expended by the Stark County Zoning Board, the City and County Planner, and by the Stark County Commission persuades the Court that there was no violation of Stark County's authority and obligation to regulate land use . . . by their decision to impose the six month prohibition." Here, given the repeated attempts to re-zone and the failure to make the requisite adjustments, it was not unreasonable for the County Board to implement a six-month wait period.

Certainly, the North Dakota Court relied on the specific facts in this case, which would not be present given the text of the 6 month rules here in Tennessee. But I tend to think that our courts would react similarly: that the applicant had received a hearing and lost, and could reapply 6 months later and that as a result, the rule precluding submission of the same or a similar request within that timeframe was not arbitrary and capricious or violative of the applicant’s rights in any way. These rules seem to make good sense, and they don’t preclude the applicant from ever coming back, they just delay the return for a rather short period of time.

Update on the Boyd Theater

There appears to be a solution to the Boyd Theater economic hardship question that we discussed here   several weeks ago. An anonymous donor has pledged $4.5 million for the purchase of the theater. While the application of the developer still is pending before the Philadelphia Historic Zoning Commission, since economic hardship regulations usually include the inability to sell the structure for a reasonable price, and since the price offered by the anonymous donor matches the price which the developer was willing to accept, it would seem difficult at this point to contend that there is still an economic hardship.

Of course, there is still a broader issue as to whether or not the theater can be rehabilitated and where the money for such rehabilitation might be coming from. But it was certainly a grand theater and if rehabilitation is at all possible, it would certainly seem as though an attempt is worth the effort.

A couple of new books . . .

I picked up a couple of new land use planning books recently. The first, is a well-known hornbook, Land Use Planning and Development Regulation Law, by Juergensmeyer and Roberts, West Publishing, 3rd Edition, 2012. In the past I have mainly used Dan Mandelker’s excellent single volume Land Use Law (setting aside the excellent multi-volume treatises often necessary for more in-depth research). But that book seems to be out of print, and I have wanted a replacement for basic issues in zoning and land use. J & R serves that function well. It seems very comprehensive, and I may ultimately prefer it in any event. As an example, J & R discusses an often overlooked detail in the scheme of land use planning regulations; what I call intergovernmental immunity. That is, the immunity of local, state, and federal governments from zoning regulations. J & R at §4:22, page 148.

Chapter 8 of J & R deals with building codes, a topic in which I have a great deal of interest, but which is not often discussed in the context of land use planning law. In addition, the book does not stray beyond land use planning all very often. As a result, much of the information is directly related to not just my practice of law, but when I teach, the topics which I teach to students. I find that to be very helpful. In fact, I always like to have some horn book which I can recommend to students so that they can get a quick and simple explanation of some of the cases we discuss in class and get a general overview of the topic. Sometimes in class discussions the minutiae of the case overwhelms the general outline of the subject matter.

One downside of the book is that the index does not seem to be very detailed. For example, with regard to the intergovernmental immunity that I mentioned above, I could not find that subject matter referenced in the index on a quick search. It is there, but it takes a little effort to find.

A second book that I found recently is Zoning and Land Use Law in Georgia, by Seth Weissman, Douglas Dillard, and Jill Skinner. It was published in 2013, and is available to order online.

This is a typical one state overview of land use regulations. There are many of these across the country, and I have always found these books to be quite good. Usually, they are written by a practitioner in the state as a result the information is filtered through the eyes of an attorney with an excellent understanding of the wall of that particular state and the way it fits together. This book is no exception: the authors have done an excellent job of explaining land use in zoning law in Georgia and for anyone wishing to gain an understanding of outlaw, this book is highly recommended. The development of land use planning and zoning in Georgia seems to been a little bit different from that in the various other states, and so this volume is of particular interest in contrasting the development of land use planning in Georgia from estate such as Tennessee. Ultimately, it appears to me that the regulations come out pretty close in the end, but different paths were taken to reach a similar goal.

Zoning for Taxes: Religiously Discriminatory?

In a very interesting RLUIPA case decided by the Eastern District of Michigan, a church which desired to buy property in a highway commercial zoning district for use as its main place of worship lost its argument that the Michigan Township violated its First Amendment protections and/or RLUIPA. Alger Bible Baptist Church v. Township of Moffatt, 2014 WL 462354 (E.D. Michigan Feb 5, 2014). Religious uses are conditionally permitted in four of the six zoning districts within the township, but unfortunately, the church made a deposit on the property located in the highway commercial district (which does not permit such uses) before understanding that the zoning ordinance precluded the use.

For the most part, the church’s argument was that similar secular businesses were permitted in the highway commercial district, and that this violated both the First Amendment and RLUIPA (the equal terms clause primarily). The township defended on the basis that this zoning district was a neutral law of general applicability and designed only for tax paying land uses. The court found the zoning ordinance to be a neutral law of general applicability and further that the church did not allege a single instance where a non-secular institution which was tax-exempt but was nevertheless permitted to operate in the highway commercial district. “It follows that ABBC has not pled sufficient facts to demonstrate that the Zoning Ordinance impermissibly targets religious conduct for distinctive treatment. Indeed, a church has no constitutional right to be free from reasonable zoning regulations nor does a church have a constitutional right to build its house of worship where it pleases.”

The claims under the Michigan Constitution were also dismissed. Inasmuch as there was no reference made to a statutory cause of action under Michigan law, I presume that Michigan does not have a state Religious Freedom Restoration Act.

However, this interesting Michigan case which may well be appealed to the Sixth Circuit, and likely would have a different ending here in Tennessee. Tennessee RFRA puts the burden of proof on the government to demonstrate by clear and convincing evidence that the zoning regulation is essential to a compelling governmental interest and that the  regulation is the least restrictive means of accomplishing that compelling interest if the regulation impinges or curtails religious freedom. As I have said many times on this blog, that is a very high burden of proof to place on the government, and most likely impossible to sustain in most if not all zoning cases. As a result, it seems to me that the result in the Michigan case, if transferred somehow magically to Tennessee, would be reversed because of the Tennessee Religious Freedom Restoration Act.

Legislative Immunities and Zoning Changes

Recently, the Nevada Supreme Court ruled that there was no First Amendment right of association and no unconstitutional vagueness where a city legislator was censured for voting for a zoning change on a project where he had a conflict of interest. Carrigan v Commission on Ethics of the State of Nevada, 313 P.3d 880 (NV Nov. 27, 2013).  The case was on remand from the US Supreme Court, Nevada Commission on Ethics v Carrigan, 131 S Ct 2343, 180 L. Ed. 2d 150 (2011), which found that the censure of council member because of his failure to recuse himself when voting on a matter where his campaign manager was paid $10,000 a month by a developer while seeking permits from the city was not protected by any First Amendment right in casting a vote. Both cases are worth reading. Essentially, the city council member was arguing that any conflict of interest was protected by his First Amendment rights. While the analysis by the US Supreme Court was a bit unusual, relying on a historical perspective of the First Amendment, certainly the conclusion that there was no such protection seems correct.

Cell Towers

An interesting new case was handed down by the District Court for the Middle District of Tennessee early in January of this year, American Towers Inc. v Wilson County, 2014 WL 28953 (MD Tn Jan 2, 2014). This is an interesting application of the Federal Telecommunications Act (FTCA) and is certainly illustrative of the difficulties that a local zoning board can get into if it doesn’t pay attention to the requirements of the federal statute. The decision must be in writing, there must be substantial evidence supporting it, there cannot be any unreasonable delay, and the decision must not amount to a total prohibition of service. The zoning board lost on every issue.

The Sixth Circuit has addressed the “in writing” requirement: to satisfy the TCA’s “in writing” requirement, a local government’s denial must “(1) be separate from the written record; (2) describe the reasons for the denial; and (3) contain a sufficient explanation of the reasons for the denial to allow a reviewing court to evaluate the evidence in the record that supports those reasons.” New Par v. City of Saginaw, 301 F.3d 390, 395–96 (6th Cir. 2002). In this case, there were two applications to the board; in the first, the Zoning Board circled “Relief Denied” on the front of [the] Application, explaining in full that its decision was “due to noncompliance of property, multiple uses on site,” and in the second, the Zoning Board denied without prejudice “based on ongoing litigations [sic] and negotiations with an alternate site.” Frankly none of these reasons are explained with any degree of specificity sufficient to allow someone to understand what was really going on. And the second denial, based on “ongoing litigation,” seems specious.

By the way, this observation that the board does not act on pending applications when there is litigation ongoing is referenced throughout the opinion. The trial court notes that there was no documentation presented concerning this “policy” of the board. Probably what was going on here however is a fairly well documented Tennessee procedure relating to the common law writ of certiorari. Once an appeal has been taken from a decision of a lower tribunal, and the writ of certiorari has issued, under Tennessee law, there should be no further proceedings before the administrative tribunal. As Justice Koch explained in Stone Man v Rutherford County Regional Planning Commission, “proceeding simultaneously in both the administrative and judicial forums on the same matter is fraught with the dangers of inconsistency and duplication of effort.” So the zoning board policy of not considering an application once litigation has begun is rooted in a fundamental Tennessee jurisprudential rule. However, that Tennessee rule would seemingly have nothing to do with federal litigation under the FTCA.

In any event, the court concludes that the written decision lacks sufficient specificity under the terms of the FTCA. Furthermore, while the county relied on the meeting minutes and hearing transcripts, neither of those were separate from the record. As the court indicated, “the hearing transcripts and meeting minutes are not sufficiently separate because the Court cannot discern after studying them the arguments the Zoning Board and Planning Commission relied on as opposed to the arguments those bodies found unavailing.”

Furthermore, there is no substantial evidence presented to the board. “The legal problem for Wilson County—and the reason the stated worries about the tower’s impact on the [nearby] school are not substantial evidence that can support the county’s denials — is that health concerns are an impermissible ground of denial under the FTCA. See 47 U.S.C. § 332(c)(7)(B)(iv) (No State or local government or instrumentality thereof may regulate the placement, construction, and modification of personal wireless service facilities on the basis of the environmental effects of radio frequency emissions to the extent that such facilities comply with the Commission’s regulations concerning such emissions.)”

The other reasons to deny the application relied on nothing more than conjecture and speculation. “While the Sixth Circuit has not said that lay opinion evidence may never satisfy the substantial-evidence requirement, it has rejected similar lay-opinion testimony at least twice.” The board did hear evidence regarding the non-conforming nature of the use on the property. This issue seems a bit murky: the court was not very specific about the exact nature of the non-conforming aspect of the property. However, evidently the difficulty could be resolved by a simple subdivision, which is been denied by the planning commission even though technically compliant with the local regulations. The court had little sympathy for the county’s argument that the subdivision was turned down because the cell tower use had not yet been approved by the zoning board. This amounted to a Catch-22 in the court found this again a violation of the act.

Regarding the alleged prohibition of cell coverage, the court found that the applicant had demonstrated that the area in question had four cell coverage and rejected lay opinion tending to prove the opposite. Again, without some expertise, lay testimony about matters of engineering expertise is unavailing in state or federal court.

Finally, with regard to unreasonable delay, the FCC has previously ruled that in an application such as this one hundred and 50 days is a reasonable time frame within which to make a decision. “In addition to the fact that the county’s pending litigation rationale finds no support in the FTCA, it also finds no support in Wilson
County’s own policies or regulations, as discussed above. As a result, the Court grants summary judgment to ATI on its claim that Wilson County’s delays in processing ATI’s applications violate the FTCA.”

The court ordered Wilson County to immediately grant the application and all approvals necessary to allow ATI to construct the proposed tower. The county was also ordered to cease all attempts to prevent ATI from subdividing the proposed site.

Finally, the court considered whether the zoning board’s actions were within its authority under Tennessee state law and concluded that they were not. The issue was whether the zoning board lacked authority under Tennessee law to deny or defer the applications due to pending litigation. The applications seemed clearly to meet the requirements of Wilson County’s zoning ordinance and the county’s practice of not considering matters subject to pending litigation found no support in the zoning ordinance. The court concluded that the Zoning Board and Planning Commission exceeded their authority because they did more than simply determine whether the requested use complied with Wilson County’s zoning laws. However, as I mentioned above, this doctrine concerning pending litigation is not a local matter; it is the policy of the state to ensure judicial economy by not having both administrative and judicial proceedings concerning the same subject matter continuing at the same time. Under the common law writ of certiorari here in Tennessee, most likely a local court would be sympathetic with the zoning board’s position. However, it certainly should be emphatically noted that clearly these applications were denied based on something other than the existing zoning regulations. It would make any difference than that the zoning board did not consider the second application because of the pending litigation doctrine; the fact of the matter is that the applications met the requirements of the local regulations, should been granted, and the District Court here clearly overturned the zoning board decision in a manner which was consistent not only with the FTCA but also with Tennessee state law. To put it another way, the zoning board and the planning commission here both acted arbitrarily and capriciously in denying these applications. Under Tennessee state law, there decisions it should have been reversed regardless of the pending legislation doctrine.

When does a lease amount to a subdivision?

An interesting question that comes up from time to time is whether a cell tower lease or a lease for a billboard creates a new lot, with the attendant issues of whether subdivision approval must be obtained and the local zoning regulations met. In a recent case out of Maine, Horton v Town of Casco, 2013 WL 6685140 (Me. December 19, 2013), the court reviewed this issue in the context of a cell phone tower and concluded that the lease did not create a new lot, did not have to comply with the subdivision regulations, and that the zoning regulations were met based on the larger lot within which the lease was granted. The Maine court indicated that while a lease might create a lot., the legal interest thereby transferred had to be of “sufficient dignity” to create a subdivision. The court held that it is the nature of the transferred interests, not the type of contract or instrument facilitating the transfer that determines whether a new lot is created.

Citing an earlier case where campsites were rented for a limited period of time, and distinguishing it from a another precedent where timeshares for parking recreational vehicles (for an almost indefinite fee interest), the court held that since the cell carrier did not have exclusive rights to the leased property, and that the right it did have was for a finite period, the legal interest was more a license and not sufficient to create a new lot.

The Tennessee courts have not addressed this specific issue related to cell towers, billboards, and other such specific uses of property typically associated with a leasehold interest. However, the Tennessee Court of Appeals has had occasion to review the issue of whether a leasehold interest of whatever nature is sufficient to invoke the requirements of the state subdivision regulations.  In City of Church Hill v Taylor, 1996 WL 605247 (Tenn. App. 1996), the appellate court upheld the decision of the trial court finding that there was a subdivision of land for the purposes of the Tennessee enabling statutes only when property is sold and not when sites are leased. In this case, the leasehold interests were lots for the placement of manufactured housing. “We believe the Trial Judge was correct in employing such a construction. In so finding, we recognize that the problems sought to be alleviated would result as much from leasing trailer sites as from selling them. We conclude, however, that the Planning Commission's remedy lies with the Legislature, and not with the courts.” There has been no change in the definitions since the time of this decision.

Obviously, that still leaves the issue of zoning regulations, but assuming that the use is legal, that is permitted within the zoning district, for the most part bulk regulations should be of little difficulty. At the time of the decision in Taylor, I discussed its impact with a number of my planning colleagues. The most part, they did not seem too concerned about the relative importance of this case; my perspective has been and continues to be that this is a fairly major loophole that someday ought to be closed.

A brief legislative history of variances in Tennessee

Several months ago, I mentioned that I would like to start a series of notes relating to the Tennessee Municipal Zoning Enabling Statutes,  Tenn. Code Ann. §13-7-201 et seq., and compared those provisions to the Standard State Zoning Enabling Act, drafted by a Blue Ribbon Committee under the auspices of the US Department of Commerce in the mid-20s. I haven’t gotten back to that until now but I thought we might begin with the difference between the two zoning enabling provisions which has always fascinated me (and I might add, almost no one else), the language relating to variances as a power of the Board of Zoning Appeals.

The Standard State Zoning Enabling Act has a specific provision relating to variances which provides in §7, that the zoning board has the power “to authorize upon appeal in specific cases such variance from the terms of the ordinance as will not be contrary to the public interest, where, owing to special conditions, a literal enforcement of the provisions of the ordinance will result in unnecessary hardship, and so that the spirit of the ordinance shall be observed and substantial justice done.” The Standard State Zoning Enabling Act was adopted in some form or another by a majority of the states across the country, and Tennessee adopted a modified version in 1935. As a result, many of the states across the country have a variance provision that reads similarly to the one quoted above.

However, the Tennessee version is quite different. It is much more particular about the special conditions which must be demonstrated in order to get a variance. Part of the reason for the greater specificity I submit has to do with the experience in New York City, where in the late 20s, zoning variances were being sold by the zoning board to overzealous developers. Part of the reason for greater specificity was to make it harder for the zoning board to grant a variance for what amounted to no good reason whatsoever. I discussed this difficulty in my book, Tennessee Zoning Boards: Practice and Procedure, third Addition 2012, GadsHill Press, at 247-252.

But the concern regarding overreaching by zoning boards still begs the question: why did Alfred Bettman draft the Tennessee version with the much more specific details? What prompted a more specific provision in this particular case (Tennessee)? The Tennessee version ( Tenn. Code Ann. §13-7-207 (3)) reads as follows:

The board of appeals has the power to: 

(3) Where, by reason of exceptional narrowness, shallowness or shape of a specific piece of property at the time of the enactment of the zoning regulation, or by reason of exceptional topographic conditions or other extraordinary and exceptional situation or condition of such piece of property, the strict application of any regulation enacted under this part and part 3 of this chapter would result in peculiar and exceptional practical difficulties to or exception or undue hardship upon the owner of such property, authorize, upon an appeal relating to the property, a variance from such strict application so as to relieve such difficulties or hardship; provided, that such relief may be granted without substantial detriment to the public good and without substantially impairing the intent and purpose of the zone plan and zoning ordinance.

Well, as it turns out, there is a specific reason for the inclusion of this language. Alfred Bettman submitted his original drafts of the legislation by letter on November 6, 1934 to Mr. Gerald Gimre, who was at the time, a consultant for the State Planning Board of Tennessee, with offices in the Nashville Trust Building here in town. Bettman enclosed with that letter six different pieces of legislation including municipal planning, zoning, and subdivision regulations, regional zoning and subdivision regulations, and state and regional planning legislation.

I have copies of much of his correspondence and draft legislation relating to Tennessee during this time period. And while I can’t be certain, I have in these materials a proposed legislative enactment entitled “Municipal Zoning Act” which has a very short caption (the caption was significantly strengthened later as the time for filing with the Tennessee General Assembly approached), and I believe this to be the first draft of what was to become the Tennessee zoning enabling legislation for municipalities. Section 5 deals with the zoning board and reads as follows:

The chief legislative body may create a zoning Board of appeals, specifying the number and terms of members, mode of appointment and other details relating to the organization and procedure of such board and may authorize such board to administer the details of the application of the zoning ordinance and regulations in accordance with the general rules set forth in the zoning ordinance, including the power to hear and determine appeals from the grant or refusal of building permits and to permit exceptions to or variances from the zoning regulations in the classes of cases or situations and in accordance with the principles, conditions and procedures specified in the zoning ordinance.

As you can see, this leaves the details up to the local legislative body. And while I don’t know that this would have created any difficulties here in Tennessee, there was an attorney in Memphis who felt that the language should be stronger. The attorney was Edward B. Klewer, evidently practicing on his own at this point, but he was certainly an attorney who had a fine career. He appeared in front of the Tennessee Supreme Court on a number of occasions, including Forrester v City of Memphis, 159 Tenn. 16, 15 S.W. 2d 739 (Tenn. 1929), a case involving the jurisdiction and taxing abilities of the city of Memphis. He evidently worked with and represented the City of Memphis on a number of occasions. I have seen some references indicating that he was a Judge at some point although I have not been able to confirm that.

In any event, Mr. Klewer wrote to the State Planning Commission on December 20, 1934, making several suggestions. Of particular interest to us, are the suggestions relating to the municipal zoning board. He says:

Section 5 provides for the creation of a Board of Appeals. Under our Constitution and rulings of our Supreme Court I believe it would be advisable to have the delegation of the power of the board come directly from the legislature rather than from the chief legislative body. In this connection I rather favor an adaptation of the applicable provisions of the enabling act suggested by Messrs. Bassett & Williams of New York. The Memphis enabling act, Private Act of 1925, Chapter 428, authorizing the creation of a Board of Adjustment, follows to some extent the New York form, but, of course, since it was written improvements in text and phraseology have been made in like enabling acts and the wording of the Memphis act can be improved. However, the principal point is that, in my opinion, the jurisdiction and powers of the board should come directly from the legislature rather than from the legislative body of the city through a delegation of powers from the legislature to create a board and to define its powers and jurisdiction.

It is clear that Mr. Klewer believed that the powers of the board should come directly from the state legislature, and that they should be more specific in nature. In fact, as he mentions in the letter, the Memphis Private Act of 1925 does both these things. The specific language used in the Memphis Private Act

The Board of Adjustment shall have the following powers: 

3.   In passing upon appeals, where there are practical difficulties or unnecessary hardship in the way of carrying out the strict letter of such ordinance, to vary or modify the application of any of the regulations or provisions of such ordinance relating to the use, construction or alteration of buildings or structures or the use of land so that the spirit of the ordinance shall be observed, public safety and welfare secured and substantial justice done.

As you can see, this language is closer to the variance provision of the Standard State Zoning Enabling Act, although the use of the terms “practical difficulties” in addition to “unnecessary hardship” is actually a newer phraseology.  Notice also the last phrase, “… so that the spirit of the ordinance shall be observed, public safety and welfare secured and substantial justice done.” In the Bettman version which we will look at in one moment, instead of being affirmative guidelines, these become negative criteria for gauging the application of a variance.

It is also interesting to note that Mr. Klewer mentions in his letter that he is working on a proposed private act for zoning in Shelby County. Interestingly, that private act was adopted in 1935 as Chapter 625 of the Tennessee Private Acts of 1935. Section 6 of that Shelby County zoning enabling statute provides for variances, and it is nearly identical to the 1925 private act adopted to govern zoning in Memphis. That is to say, the Shelby County legislation passed by private act in 1935 is much less specific with regard to the factors which must be demonstrated in order to obtain a variance than the legislation written by Alfred Bettman and passed into law by the Tennessee General Assembly in that same year, 1935. Most likely, the sponsors of the Shelby County legislation felt that the variance language should be the same in Shelby County as in the City of Memphis. It was not until 1955, pursuant to Chapter 142 of the Tennessee Private Act of 1955 that the variance language was changed to bring it into conformity with the Tennessee Public Zoning Enabling Statutes. Notwithstanding the change in 1955, cases such as Reddoch v Smith, 214 Tenn. 213, 379 S.W. 2d 641 (1964), in which a zoning variance basically granting a change in the use regulations of the zoning district in which the property was located was upheld by the Tennessee Supreme Court, illustrate the dangers of the less specific language adopted in Memphis and Shelby County. In Reddoch, the 1955 amendment changing the variance standards in Memphis and Shelby County was not mentioned even though the change took place almost 10 years before the decision was handed down.

It took very little time to get a response from Bettman concerning Klewer’s suggestions. On December 27, 1934, Bettman sent a revised version of the Municipal Zoning Act to Mr. Gimre. In the letter, he quibbles with Klewer’s suggestion: “I do not quite see why a grant of power to the municipal council to define the powers of the board should be less constitutional [then having the powers of the board derived directly from the legislature]; but in order not to delay matters … I have accepted Mr. Klewer’s suggestion in this respect, and have revised this bill accordingly.

This time , we can be sure about what draft of the bill he was referring to, because it is immediately behind the letter and has a hand written entry on the upper right which says “Dec 27 encl.” This new draft has a much longer caption but more importantly for our purposes, §5 has been significantly expanded and now contains the Bettman variance language as follows:

The board of appeals shall have the following powers:

3. Where, by reason of exceptional narrowness, shallowness or shape of a specific piece of property at the time of the enactment of the zoning regulation, or by reason of exceptional topographic conditions or other extraordinary and exceptional situation or condition of such piece of property, the strict application of any regulation enacted under this act would result in peculiar and exceptional practical difficulties to or exceptional or undue hardship upon the owner of such property, to authorize, upon an appeal relating to said property, a variance from such strict application so as to relieve such difficulties or hardship, provided such relief may be granted without substantial detriment to the public good and without substantially impairing the intent and purpose of the zoning plan and zoning ordinance.

As I have said many times, this language is most specific, and it makes it difficult to obtain a variance because the language is so specific and requires some exceptional physical feature of the property to justify granting relief. In my experience, it is quite difficult to find some exceptional physical feature of the property which can serve to justify issuance of a variance by the zoning board. In fact, in cases here in Tennessee where this language applies, it is very difficult for a zoning board which grants a variance to be upheld. Perhaps the leading case in Tennessee is McClurkan v Metro BZA, 565 SW 2d 495 (Tenn. App. 1977). The Tennessee Court of Appeals emphasizes in that case the language quoted above which requires some physical feature of the property to be of paramount concern in determining whether a variance should issue.

This specificity in the enabling legislation may not be a bad thing; unbridled discretion to grant variances certainly can have the impact of creating in effect spot zones and undermining the efficacy of the goals of the ordinance itself. In effect, that was the problem in New York City in the mid to late 1920s.

In any event, Mr. Klewer’s suggestion certainly caused the inclusion of the much more specific language for variances drafted by Alfred Bettman. The language was included in the legislation is adopted by the Tennessee General Assembly, Chapter 44 of the Tennessee Public Acts of 1935 and  remains in the Tennessee Municipal Zoning Enabling Statutes to this day. See Tenn. Code Ann. §13-7-207 (3).

I thought perhaps I could find out some additional information about Edward Klewer, but unfortunately he passed away shortly after his correspondence with the State Planning Department. He died on May 18, 1936 at age 49. In running a quick Internet search, I saw that his wife created a scholarship in his name at Rhodes College in Memphis but I have very little other information relating to him. I did find a photograph at this location on the net.  Take a look at page 7, lower left; the caption Indicates that Mr. Klewer is standing at the far right on the first row.

The Boyd Theater in Philadelphia

It’s always interesting to check out land use controversies from other cities across the United States. There’s an interesting controversy in Philadelphia going on right now concerning the Boyd Theater, located on Chestnut Street in Center City, Philadelphia. The theater opened on Christmas Day 1928 and is the last of the old art deco movie houses constructed in the early days of American moviemaking.

Currently it is closed. The Friends of the Boyd have a website with photographs which show the theater’s beauty in its heyday; currently the exterior is in pretty bad shape and I’m sure the interior is not much better. However, the photos of the theater from its gold days are well worth a look.

The current owner has suggested retention of the façade of the building while demolition of most of the rest of the structure to be replaced by an eight screen movie house. The Boyd is on the Philadelphia Register of Historic Places (since 2008) so that the owner needs to convince the Philadelphia Historical Commission that there is an economic hardship sufficient to allow the demolition of the interior.

Take a look at the Plan Philly blog page for additional information, including the applicant’s documentation concerning the economic hardship. To put it simply, rehabilitation of the structure would cost over $40 million, and the various uses that might be available simply will not generate enough income to cover the kind of debt load.

There was a hearing before the Historic Commission’s Committee on Economic Hardship last Tuesday, January 28, but no decision was reached. It certainly is a difficult proposition: the building was and could “beautiful, but finding a new use for the old building is quite challenging.

Koontz and Land Use Law: What's the Impact?

I attended an interesting seminar yesterday sponsored by the Tennessee Bar Association and its Environmental Section, concerning the impact of Koontz v St. Johns River Water Management District, 133 S Ct 2586 (US 2013), a case which we discussed on these pages several months ago. The seminar was extremely interesting; all of the speakers did an excellent job in their particular areas.

Of special interest was the presentation by Prof. J. B. Ruhl, Professor of Environmental and Land Use Law at Vanderbilt University, suggesting that the impact of Koontz may not be very pronounced in the environmental law area because environmental mitigation programs are already designed in a way which follows the Nollan/Dolan/Koontz paradigm. However, in the wild and woolly local land use arena, Koontz may encourage local governments and their agencies and officials to more carefully weigh the impact of mandated exactions and dedications so as to avoid an adverse constitutional determination. It is certainly true that local land use officials have not paid a great deal of attention to this area of the law in the past. I have given numerous seminars over the years, and any time I mention subdivision control, I always discuss the Supreme Court predecessors of Koontz: namely, Nollan v California Coastal Commission and Dolan v City of Tigard (I’ll be adding Koontz to my comments this year).

Notwithstanding this emphasis, I still believe that in any major planning commission across the state of Tennessee at any given public hearing, you can find examples of mandatory dedications and exactions which do not comply with the Nollan/Dolan/Koontz paradigm. For whatever reason, local officials are just not very cognizant of the constitutional issue.

I’m hopeful that Koontz will alert at least some of the more attentive and perceptive officials of the potential dangers that often remain obscured by the minutia of subdivision regulations.

A Cautionary Tale . . .

Back in December of last year, the Eastern District Court of New York issued a ruling in Qing Dong v Town of North Hempstead, 2013 WL 6407724 (ED NY Dec 9, 2013) dismissing with prejudice a takings claim against the defendant. The suit arose out of a zoning regulation that prohibited the use of vacant corner lots which were more than 100 feet in width (there's no explanation as to the rationale behind the regulation). The plaintiff bought a vacant corner property and applied for a permit which was of course denied. Plaintiff appealed for a variance to the board but was denied and then appealed to the state courts (concerning the denial of the variance, not the possible taking), which affirmed the zoning board decision.

The federal lawsuit was filed alleging a taking, but the difficulty was that although the plaintiff had apparently exhausted his administrative remedies, no condemnation action had been filed in state court. The famous case which arose out of Tennessee, Williamson County v Hamilton Bank, 473 US 172 (1985), requires that any administrative remedy must be pursued, as well as state judicial condemnation remedies before filing in federal court.

The plaintiff argued that under NY state law, a pre-ownership regulation (plaintiff bought the land after the regulation had been passed presumably with knowledge of the regulation) barred a suit for a taking. The district court held that the underlying state law did not matter; in order to be ripe for federal litigation, the state action had to be filed first; without that predicate the case had to be dismissed.

Finally, the federal court dismissed the case with prejudice. The statute of limitations in state court had run: there was no use in dismissing without prejudice because the plaintiff had no right to file the condemnation proceeding in state court any longer.

It is worthwhile to apply this cautionary tale to the law here in Tennessee. First, we don’t know whether a takings claim based on overbroad zoning or other regulation is recognized here in Tennessee. As Justice Koch said, “However, this Court has not yet held that a regulatory takings claim can be asserted under Article I, Section 21 of the Tennessee Constitution. Currently, we have recognized only two types of takings claims – physical occupation takings claims and nuisance-type takings claims . . . Regulatory takings do not fall into either of these categories.” B & B Enterprises v Wilson County, 318 S.W. 3d 839 (Tenn. 2010). It is however worth noting that in 2013, the Tennessee Court of Appeals quoted B & B:

A regulatory taking results when a governmental regulation places such a burdensome restriction on a landowner's use of its property that the government has for all intents and purposes “taken” the property. In 1922, a near unanimous United States Supreme Court noted that a regulation that goes “too far” is a taking of property, presumably as much as a physical taking or invasion of property is a taking.

Durrett Inv. Co., LP v. City of Clarksville, M2012-00807-COA-R3CV, 2013 WL 614411 (Tenn. Ct. App. Feb. 15, 2013).

The Court of Appeals then reversed the trial court decision dismissing the case of a city imposed moratorium on development. Presumably, our Tennessee courts would ultimately find that an overbroad regulation may amount to a taking under the proper circumstances.

Assuming that to be true, the question we are interested in here is how to preserve the right to sue in federal court if a local government has enacted an overbroad regulation. As noted above, the US Supreme Court decision in Williamson County requires that the plaintiff must exhaust their administrative remedies, and in addition must also exhaust any judicial remedies in state court before moving on to federal litigation.

Let’s take a sample case. Suppose a local government refuses to allow a property owner who owns a property which is somewhat smaller than the minimum required lot size in the applicable zoning district. Suppose for example the local government requires a 1 acre residential lot size, but the property owner has only three quarters of an acre. However, the lot was created in 1975, and the zoning regulations adopting the 1 acre minimum lot size were passed in 1980. Therefore, the creation of the lot predates the zoning regulations. Ordinarily, most zoning regulations have provisions for this type of difficulty and usually allow the use of such smaller lots when they were created prior to the adoption of the zoning regulations.

In our case however the city or County refuses to allow the use of the property for anything. The local government refuses to issue a permit. What’s to be done?

First, obviously, under the doctrine of Williamson County, the applicant must file an appeal to the zoning board requesting a variance or any other kind of relief which might be available to him. Ordinarily, the board will deny this application. A substandard lot size is ordinarily not a grounds for a variance here in Tennessee. You must have some exceptional physical feature of the property (not the size of the lot itself) to justify a variance.

What’s next? Certainly the property owner could appeal the decision of the zoning board by way of a common law writ of certiorari, but that is almost certainly doomed to failure. Again, if the variance was properly denied by the zoning board, and in most of these kinds of cases that certainly would be the case because the size of the lot itself is not an exceptional physical feature, the writ of certiorari is not likely to be helpful. Furthermore, unlike the case from New York we have been discussing above, under the Tennessee common law writ of certiorari, an original action may not be joined with the petition for writ of certiorari itself. Since a claim for damages because of a takings is an original action, it cannot be joined with the petition for writ of certiorari.

Therefore, once the board of zoning appeals has denied the application for a variance, and independent lawsuit (not an appeal from the zoning board) should be brought alleging damages. It is important to recognize that this lawsuit must be filed within one year after the date on which the owner is put on notice of the alleged taking. This is the ultimate holding in the Supreme Court decision involving B & B Enterprises. In that case, a subdivision application was denied and it took several years to appeal the decision and ultimately reverse it. After the decision was reversed, the property owner attempted to sue for a temporary taking. However, the Supreme Court found that since the lawsuit for the taking was filed well over a year after the denial by the planning commission of the subdivision application, the one-year statute of limitations had been exceeded.

B & B Enterprises of course argued that the takings claim was not complete or ripe until after the decision of the Tennessee Court of Appeals reversing the decision of the planning commission was entered. The Supreme Court disagreed.

The Planning Commission's action on February 26, 2002, put B & B Enterprises on notice that its reasonable investment-backed expectations for the use of its property had been frustrated. Regardless of the eventual outcome of the judicial proceedings, the Planning Commission began interfering with B & B Enterprises's economically beneficial use of its property by no later than February 26, 2002. While the duration of the judicial proceedings might later be relevant to determining the length of time that B & B Enterprises was denied the use of its property, it is not relevant to determining when B & B Enterprises was put on notice that a taking had occurred. Therefore, we hold that Tenn.Code Ann. § 29–16–124's one-year statute of limitations on B & B Enterprises's claim began to run on February 26, 2002.

B & B Enterprises of Wilson Cnty., LLC v. City of Lebanon, 318 S.W.3d 839, 847 (Tenn. 2010).

Thus, the result in B & B Enterprises is somewhat similar to the decision in Qing Dong from New York. In both cases, the developer’s claim for damages was ultimately frustrated by failing to properly pursue a takings claim in state court within the proper time frame. Although I think the New York case could have been easily predicted and prevented, the same probably cannot be true about B & B Enterprises. The Tennessee Supreme Court’s application of the one-year statute of limitations is likely different from the way most land use practitioners might have expected. It is important to understand this difference, and to recognize that any time there might be a takings claim involved, suit must be filed within a year of that date or the risk of losing it forever is probable.

Let me make this suggestion to attorneys working in this field of endeavor. First, it is often appropriate when filing a common law writ of certiorari, to consider whether there are other claims which should be pursued but which cannot be included in the petition for common law writ. Often, there are claims that might be most appropriate in a declaratory judgment action but which arguably may not be appropriate within the common law writ of certiorari. In the takings context, an action for damages may also be appropriate.

For that reason, whenever filing a petition for common law writ of certiorari, it is certainly appropriate to consider whether a companion case seeking damages and/or declaratory and injunctive relief might be appropriate. Certainly, other than the additional filing fees, if there is reasonable concern about the necessity of filing a separate action, it is well worth filing to avoid this difficulty. Certainly, several times in my career, having filed the companion declaratory judgment action has saved me from an embarrassing dismissal of the certiorari case. It is always worth at least consideration.

Finally, if for some reason a separate companion case is not advisable, it might also be worthwhile to include allegations of a takings claim and or declaratory judgment in the petition for writ of certiorari itself. The local government may move to dismiss those claims as being beyond the scope of a certiorari lawsuit, but presumably the claims would be dismissed without prejudice, and given the Tennessee savings statute, those claims could be reinserted within a year. To be on the safe side, I suggest filing separate actions is most appropriate however.

It is certainly easy to miss the statute on these kinds of takings claims. The attorney must be alert to the various possibilities and make sure to file within a year after the local governmental action.