BLOGS: North Carolina Land Use Litigator
Friday, April 22, 2016, 11:14 AM
By John Cooke
“You don’t know what you don’t know” is a popular catchphrase. So, do you know what a “betterment” is and how the law of betterments operates?
Land use law has ancient roots. Sometimes, a case requires an appellate court to write a 21st century opinion explaining and summarizing ancient legal concepts and law. These opinions provide an important service to the practicing bar because they remind lawyers of legal principles which they may have heard, but do not fully appreciate. Unless you know these ancient roots, you don’t know what you don’t know.
A Primer on the Law of Betterments
In the case of Harris v. Gilchrist, ___N.C. App. ___, ___ S.E. 2d. __ 2016WL787933 (March 1, 2016), the North Carolina Court of Appeals applies the law of betterments to two classes of defendants. In Harris, the defendants had been non-owner occupants, but later became tenants in common with the plaintiffs. The Court of Appeals’ opinion discusses the law of betterments and explains the reasons for this law applying differently to these two classes of defendants. As such, Harris is a modern primer on the law of betterments.
The defendants were non-owner occupants who believed they owned land, built a house on the land, resided in the house and paid property taxes and insurance. When the true owner died and the deed by which the defendants claimed ownership of the land was declared void, the defendants became tenants in common with the plaintiffs.
Several of the tenants in common filed a petition for partition of the property by sale. After the property was sold, the trial court entered an order allowing a betterment allowance for the house and reimbursement of taxes and insurance in favor of the defendants. The trial court denied the plaintiffs’ request that they recover three (3) years of rent from the defendants. The plaintiffs appealed the trial court’s order to the North Carolina Court of Appeals.
In a clearly written opinion by Judge Dillon, the Court of Appeals affirms in part and reverses in part the trial court’s order. The Court of Appeals explains the law of betterments as it applies to two classes of defendants—non-owner occupiers and tenants in common.
· A betterment is a permanent improvement affixed to land owned by others.
o Under the equitable doctrine of ex aequo et bono (“according to the right and good”), a tenant in common who made a “betterment” to real property owned by other tenants in common was entitled to an allowance.
o By statute adopted in 1871, the General Assembly extended “the right and good” of equity to non-owner occupants holding land under color of title that the non-owner occupant believed to be good title. Under the statute, a betterment is exclusively a defensive right arising in a proceeding where the true owner of the land invokes the court’s powers to secure possession of the land. A betterment allowance is intended to compensate a person who has mistakenly made permanent improvements, in good faith, to the land the occupier did not own.
· Under the statute, the amount of the allowance equals the lesser of either (1) the costs of the betterment or (2) the incremental increase in value of the land caused by the betterment. The incremental increase in value is the difference in the value of the land with the permanent improvement minus the value of the land without the permanent improvement (land value with permanent improvement – land value without the permanent improvement = incremental increase in value).
· Balancing the scales of justice requires consideration of the rent which would have been due to the true owner:
o A tenant in common who occupied the land is not liable for rent so long as the tenant has not prevented the other tenants from accessing the land.
o A non-owner occupant possesses no land rights and owes three (3) years of the fair market rent accruing before the true owner filed a legal action seeking possession of the land. Rent accruing more than three (3) years after the filing of the owner’s action is only an offset to a betterment allowance.
· Balancing the scales of justice requires consideration of contributions made by the person who made the betterment:
o A tenant in common is entitled to reimbursement for paying taxes and insurance assessed against property owned by tenants in common.
o A non-owner occupier is not entitled to reimbursement for paying taxes and insurance assessed against another person’s property.
1. With modern surveying exactitude, it is rare in the 21st century for a person to build an improvement on another person’s property because of a defective survey. But, people do mistakenly assume that they own property. In those situations, betterments may be their only relief for investing hundreds of thousands of dollars on another person’s land.
2. Harris illustrates broader and more important lessons:
a. First, the law is deep and wide. Law, the body of legal rules, principles, and doctrines, has developed to administer justice “according to the right and good.” While the legal system is imperfect, most times injustices arise from the imperfections of people operating in the system – not the system itself.
b. Second, when you encounter a case which seems unfair, then, most likely, you have not thought deeply enough about the facts or researched diligently enough to find the exact law which fits the unique facts of the case. As Harris illustrates legal rules, principles, and doctrines are nuanced and a single factual difference may completely alter the outcome of a case.
Bottom line: When you don’t know what you don’t know, you cannot blame the legal system.
Friday, April 8, 2016, 9:03 AM
The Business of Water Service
If you turn a water faucet handle, you expect that clean water to pour forth. If you flush a toilet, you expect waste to disappear. If these are your expectations, you are likely a business customer of a local government.
There are two significant water service cases pending in the North Carolina Supreme Court. North Carolina Supreme Court decisions are controlling and decisions in these cases may change water service business practices in North Carolina.
We posted an earlier entry about one of these cases. See here In 2013, the General Assembly transferred the assets and obligations of the City of Asheville’s 100 year-old drinking water system to a regional sewer district, which had never operated a drinking water system. However, the General Assembly made no provision for the employees experienced in operating the system to continue operating it.
If the North Carolina Supreme Court decides this transfer law is valid, then a majority vote at the General Assembly can dissolve any local government drinking water or sewage disposal company and transfer its assets and operations to a company chosen by the General Assembly.
In today’s post, we discuss another water service case pending in the North Carolina Supreme Court. This case involves who pays for water services. A homebuilder contends that the Town of Carthage (the “Town”) cannot assess a water service fee against a person selling lots to home buyers because the seller is not consuming the services. If the North Carolina Supreme Court agrees with the homebuilder, water costs will increase for consumers, such as homeowners, and water services may not grow to serve new development.
The North Carolina Supreme Court has scheduled oral argument for both cases on May 17, 2016.
A legendary phrase in jurisprudence is Lord Coke’s “Note the distinction.” When you hear the phrase, you have a queasy feeling. Your analysis is perfectly logical – and perfectly wrong.
A basic distinction in North Carolina local government law is that North Carolina local governments discharge governmental activities and engage in proprietary activities.
A governmental activity is regulating public conduct, such as adopting land development regulations or providing services, such as public schools, jails, and social services. Everybody has the right to use these services.
A propriety activity is operating a business, such as providing water services. Only people who pay for the service have a right to use it.
Quality Built Homes, Inc. v. Town Carthage
A. The Facts
Under the Town’s laws, a “water impact fee” must be paid at the time a customer taps into the system or a development permit is issued within the system’s area, whichever occurs first. Final subdivision plat approval is a development permit under Town law.
Quality Built Homes, Inc. (homebuilder) paid the impact fees, sold all lots in its subdivision and sued the Town for a refund, interest and attorney fees. The homebuilder alleged that the Town “was not specifically authorized by law to charge and collect impact fees for water and sewer”, the Town “has illegally collected water and sewer fees.” and “was using the impact fees …to offset the expense of maintaining its entire water system.” Quality Built Homes v. Town of Carthage, __ N.C. App. __, 776 S.E. 2d 897(2015)(unpublished), p. 1. At that point, the Town was supplying water and sewer services to homebuilder’s former customers, the homeowners residing in the homebuilder’s development.
The Town denied the homebuilder’s allegations and asserted the affirmative defenses of statute of limitations, and waiver or estoppel through acceptance of the benefits. The trial court entered summary judgment in favor of Town and the homebuilder appealed to the North Carolina Court of Appeals.
B. The Court of Appeals’ Decision
After reviewing plaintiff’s contentions, the public enterprise statutes, and North Carolina Supreme Court case law, the North Carolina Court of Appeals affirmed the trial court’s judgment and concluded that the Town was authorized to charge impact fees “that are necessary to ensure the continued quality of water and sewer services in the face of development.” Quality Built, p. 4. As for using these fees for maintenance, the Court of Appeals concluded that the plaintiff had not identified any authority prohibiting the use of revenue generated from these fees for maintenance, and therefore the Court of Appeals overruled the plaintiff’s claim that the Town “has acted ultra vires in collecting its water and sewer impact fees.” Quality Built, p. 5.
C. The North Carolina Supreme Court and the Homebuilder’s Theory
The homebuilder asked the North Carolina Supreme Court to review the Court of Appeal’s decision and the North Carolina Supreme Court accepted the case for review.
The homebuilder’s legal theory is: (1) local governments only possess those powers granted by the North Carolina General Assembly, (2) the public enterprise statutes do not use the term “impact fees” and only enable fees “for the use of or the services furnished by” a public enterprise, (3) this language is clear, unambiguous and cannot be broadly construed to include or imply authority to charge impact fees, (4) homebuilder was charged for services to be furnished and (5) this fee is not unauthorized by the General Assembly, illegal and ultra vires.
The homebuilder finds support for its theory in two North Carolina Supreme Court decisions where homebuilders have won making similar arguments. In Smith Chapel Baptist Church v. City of Durham, 350 N.C. 805 (1999), the North Carolina Supreme Court held that charging stormwater fees for purposes other than stormwater drainage systems was unauthorized. In Lanvale Properties v. County of Cabarrus, 366 N.C. 142 (2012), the North Carolina Supreme Court held that charging zoning fees to subsidize new school construction was not authorized by the General Assembly.
1. Note the distinction: zoning and subdivision enabling statutes do not authorize charging fees; public enterprise enabling statutes authorize a broad array of fees (“rents, rates, fees, charges and penalties”) assessed in the business discretion of local governments operating public enterprises. Setting rates for a public enterprise is a “propriety function… limited only by statute or contractual agreement.” Smith Chapel Baptist Church, 350 NC 805, 815. Public enterprise statutes do not forbid charging “impact fees.”
a. It is unsurprising that the term “impact fee” does not appear in the first sentence of N.C.G.S. 160A-314(a). This 45 year-old sentence has not been modified since it was adopted in 1971. The term “impact fee” did not appear in a recorded case arising in North Carolina until 1988, 17 years later. In fact, neither a North Carolina appellate court decision nor the General Assembly has defined the term “impact fee.” So, the real question “is what did the General Assembly mean by ‘use of … any public enterprise?’”
b. The General Assembly did not limit "use" by adopting a definition. Customers buying new homes in residential subdivisions expect water and sewer services. To satisfy these expectations, homebuilders must either build water service systems or represent that there is a third party provider. Drilling wells and building septic systems consumes land, reducing the number and/or size of homes a homebuilder can sell and raising the homebuilder's construction costs. Moreover, some land, because of poor soils, cannot support wells and septic systems. Because the Town could serve the new subdivision, the homebuilder avoided these costs and risks and satisfied its customers' expectations. The homebuilder used the availability of the Town's water services to sell homes. The General Assembly understood this fact in 1971, and this fact continues today.
c. Of course, in some circumstances water service fees are unreasonable. See e.g. Point South Properties v. Cape Fear Public Utility Authority, __ N.C. App. __, 778 S.E.2d 284 (2015) (refunds due to developer where property is served by another provider and defendant had no plans to serve the property). See here
Here, Quality Homes paid the fees and sold all of its product and wants fees refunded – a double benefit.
2. Justice Huskins, a former Justice of the North Carolina Supreme Court, was fond of saying that he wanted to know the “the meat in the coconut” – not the hard shell of abstract legal analysis.
a. Homebuilding is an important business. Fees are passed along to homebuyers and advocating forhousing affordability is a laudable cause. Unfortunately, in some circles, when a fee is labeled “impact fee”, the attitude is “game on.”
b. If the North Carolina Supreme Court adopts the homebuilder’s position, only current consumers of water services will pay for water service businesses.
i. While housing prices might decrease, the cost of home ownership is likely to increase.
ii. Why should current consumers pay for extensions or enlargement of water service systems? In fact, how could local governments charge fees to current customers for extensions or enlargements of water systems to serve new development? Existing customers are not consuming these water services.
3. When you note the distinction between governmental and proprietary activities, the General Assembly’s plan is self-evident: Local governments possess discretion to manage their businesses. If a company uses a water service to its economic advantage, the local government may assess a reasonable and non-discriminatory fee. How a business spends its revenue to support its business is a discretionary business decision.
After all, water service is a propriety activity.
Thursday, March 24, 2016, 5:46 PM
The Ready-Made Suit of Standing
Chief Superior Court Judge James H. Pou Bailey informed lawyers - “Justice under the law is like buying a suit off the rack. It doesn’t fit anybody perfectly, but it fits a lot of people fairly well.”
Sometimes, an unpublished opinion contains informative illustrations. Although it is not controlling legal authority and citation to it is disfavored, an unpublished opinion provides typical examples – how the already-made suit of justice under the law fits a situation.
In our last blog post, we discussed Cherry v. Wiesner, a published North Carolina C ourt of Appeal’s opinion. In Cherry, the North Carolina Court of Appeals affirmed dismissal of an appeal brought by a neighbor living across the street from the alleged misapplication of historic district rules because she failed to allege standing. In that blog post, we suggested that a newly-made limited suit for standing might be appropriate for property located in historic districts because historic district zoning laws regulate the appearances of building exteriors. Specifically, we suggested that consideration of the arguments for and against the court crafting a newly-made limited suit for standing in historic districts was worthy of consideration because the answer affected all properties in historic districts, and would provide the definitive rule applicable to these special districts.
Two weeks after publishing Cherry, the North Carolina Court of Appeals decided another standing case involving a challenge by an adjacent property owner where none of the property was located in a historic property district. In Sugar Mountain Ski Resort v. Village of Sugar Mountain (2016 WL 791132)(March 1, 2016)(Unpublished) the North Carolina Court of Appeals affirmed the Superior Court’s denial of a motion to dismiss the appeal for lack of standing. The Court of Appeals concluded that the adjacent property owner had alleged standing and showed special damages.
In other words, the adjacent property owner’s pleading and evidence in Sugar Mountain fit the ready-made suit of standing.
Sugar Mountain Resort v. Village of Sugar Mountain and Round Boys, LLC
Round Boys LLC (RB) purchased a house located on a slope adjacent to Sugar Mountain Resort’s (SMR) ski slopes. The house’s deck was less than 2½ feet from SMR’s property line and violated the existing setback requirement of the Village of Sugar Mountain (VSM). However, the deck had been allowed to remain because it had been built prior to VSM’s adoption of its zoning ordinance.
RB demolished a portion of the non-conforming deck and simultaneously applied for a variance to expand further into the setback by building new construction. At the hearings held by the Board of Adjustment (Board) considering RB’s variance request, RB agreed to restrict its new construction to remain within the footprint of the original encroachment. Based upon this agreement, the Board concluded that no variance was required and approved issuance of a Zoning Compliance Permit.
SMR appealed the Board’s decision to Superior Court, and filed a motion in Superior Court requesting a temporary restraining order and preliminary injunction (Injunctive relief) to halt construction in the setback until SMR’s appeal was decided. In its petition for writ of certiorari, SMR alleged:
Petitioner has standing…in that it is the owner of property that is adjacent to property which is the subject of the Board’s Order being appealed by this Petition and will suffer special damages as a result of the Board’s Order in that the Board’s Order allows additional construction and improvements to real property adjacent to a ski slope and within the prohibited [setback] area of the Village and the additional construction and improvements have the potential to affect safety and to create a damage to the general health, safety and welfare of the Village. Sugar Mountain, p.4 (Emphasis by the Court).
Two surveys showing the location of pre-existing and new construction in the setback were in the record. In support of its motion for injunctive relief, SMR proffered an affidavit signed by its manager stating in more detail the facts supporting SMR’s allegation of special damages. SMR’s manager stated that the construction of the new improvements “would potentially interfere with skiing operations,” and the new structure added in the setback area “itself could pose an increased risk to the general safety and welfare of the public.”
Asserting that SMR lacked standing, RB filed a motion to dismiss SMR’s appeal. The Superior Court denied RB’s motion and remanded the case to the Board because the Board had “failed to make findings of fact or conclusions of law in the [Board’s] order so that [the superior court could] properly perform its function.” RB appealed the Superior Court’s denial of its motion to dismiss for lack of standing to the North Carolina Court of Appeals.
After reviewing SMR’s pleading, the surveys and SMR’s manager’s affidavit, the Court of Appeals concluded that SMR had “sufficiently alleged (1) that the improvements that the Board allowed were unlawful… in that they were located ‘within the prohibited [setback] area’ and (2) that the resort would suffer ‘special damages’ in the form of interfering with skiing operations and reducing the safety of the resort’s ski slopes for members of the public who are guests and patrons of the resort.” Sugar Mountain p.5.
In reaching this conclusion, the Court rejected two legal arguments proffered by RB. First, RB contended that the proposed improvements would not alter the existing setback or increase or alter the pre-existing nonconformity. Therefore, SMR could not suffer special damages. As for this argument, the Court reviewed the record and noted that RB’s variance application proposed an expansion of the home and construction within 2 1/2 feet of the property line. In other words, while the record was unclear, there was evidence prepared by RB that seemed to contradict RB’s first legal argument.
In its second argument, RB contended that the Board’s determination that the proposed improvements would not increase the footprint of the structure conclusively established that the proposed improvements were lawful uses. The Court of Appeals rejected this argument emphatically. The Court observed that “were we to accept the owner’s reasoning, no zoning board decision finding a requested use to be ‘permitted’ could ever be questioned, no matter how erroneous the board’s determination might actually be.” Sugar Mountain p.4.
1. Sugar Mountain illustrates the importance of standing. When a party considers appealing a governmental land use decision that which entitles a use on another owner’s property, an essential first step is identifying the (1) illegal use permitted by the decision and (2) the special damages arising from this illegal use.
2. The concept of standing is quite simple. At the point a party invokes the jurisdiction of a court by filing a case, the party must show to the court at that time and continuously thereafter during the entire proceeding that the dispute practically matters.
In Sugar Mountain, the record showed that determining whether the Board’s decision was erroneous mattered practically. An erroneous decision would allow an illegal use on adjacent property and “special damages in the form of interfering with skiing operations and reducing the safety of the resort’s ski slopes for members of the public who were guests and patrons of the resort” could flow from the illegal use. The case fit the already-made suit of standing.
Thursday, March 10, 2016, 3:38 PM
Aesthetics and Land Use Regulations
Perhaps disappointing to those who enjoy debating architecture, the North Carolina Court of Appeals affirmed dismissal of a challenge to a historic district commission’s approval of a house located across the street from the contesting property owner’s home. Cherry v. Wiesner __ N.C. App. __, __ S.E. 2d ___(WL 611074)(February 16, 2016). The Court of Appeals held that the property owner failed to prove her standing to appeal the commission’s decision.
A fair reading of the Court of Appeals’ opinion is that the property owner failed to produce sufficient evidence to prove standing at the right time, but a broader understanding of the case shows that the relationship between land use regulations and aesthetics is complex, uncertain and evolving.
Background: Planned Communities and Governmental Land Use Regulations
Planned communities maintain their appearance by enforcing extensive land use restrictions contained in private covenants. In this context, the North Carolina Supreme Court evidences significant sensitivity to the risk that amendments might change the nature and character of a planned community. See e.g., Armstrong v. Ledges Homeowners Ass’n, Inc., 360 N.C 547(2006)(reasonableness of an amendment to restrictive covenants should be judged by, among other things, the “nature and character of the community.”)
On the other hand, governmental regulation of aesthetics is uncertain and controversial:
- 1959 - The North Carolina Supreme Court refuses to enforce a regulation based purely upon aesthetics
- 1972 - The North Carolina Supreme Court notes a growing authority in other jurisdictions that police power includes regulation of property for aesthetic reasons alone.
- 1979 - The North Carolina Supreme Court upholds a regulation in a historic district "to control the exterior appearance of private property when the object of such control is the preservation of the State's legacy of historically significant structures." These regulations are "not primarily concerned with whether the subject... is beautiful or tasteful, but rather with preserving it as it is, representative of what it was." 298 N.C. 207, 216 (quoting Rathkopf's, The Law of Zoning and Planning).
- 1982 - The North Carolina Supreme Court overrules its 1959 case, and holds that zoning regulations may be based solely upon aesthetics depending upon facts and circumstances.
- 2015 - The North Carolina General Assemble withdraws power to regulate the exterior appearance of one or two dwellings except in historic districts and a few other situations.
Cherry v. Wiesner
In 2013, Cherry and Gordon (CG) sought issuance of a certificate of appropriateness from the Raleigh Historic Commission (Commission) to build a new house on a vacant lot. After several hearings, the Commission granted CG’s request and Wiesner (W), a neighbor living across the street from CG’s future home, appealed the decision to the Raleigh Board of Adjustment (Board).
At the Board, the City of Raleigh (City) requested dismissal of W’s appeal because of her lack of standing to appeal the Commission’s decision. The Board made no specific ruling on the City’s request, exercised jurisdiction and reversed the Commission’s decision.
CG and the City appealed the Board’s decision to Superior Court. They continued to maintain that W lacked standing. As the issue of standing sharpened, W offered more specific and detailed information to show standing, including evidence stating the property value of W’s home would diminish should CG build their home. In response, CG requested the court to strike the new evidence and offered their evidence stating that W’s property value would not diminish should CG build their home.
The Superior Court did not admit any new evidence, agreed that W failed to show standing, reversed the Board and restored the Commission’s original decision.
Relying upon established standing requirements applicable to challenging governmental land use decisions, the Court of Appeals reasoned that standing “most often turns on whether the party has alleged ‘injury in fact’ in light of the applicable statutes or caselaw.” p. 5. To challenge a governmental land use decision, the challenger “must claim special damages, distinct from the rest of the community.” p. 6.
Five years before Cherry, the North Carolina Court of Appeals had applied these same requirements to an appeal arising from a historic commission decision concerning demolition of an existing structure and construction of a new structure in its place. Sanchez v. Town of Beaufort, 211 N.C. App. 574 (2011), dis. rev. den., 365 N.C. 349 (2011). Sanchez alleged that the new structure would damage her property because she would lose her private waterfront view and this loss would reduce the value of her property by at least $100,000.00. The Court of Appeals concluded that Sanchez had standing.
After reviewing the Cherry record, the North Carolina Court of Appeals described W’s allegations of standing as “purely aesthetic or are not distinct to her property” and concluded that the allegations did “not demonstrate special damages distinct to respondent other than the view from her front porch.” pp. 8-9. (emphasis by the Court). Accordingly, the Court of Appeals affirmed the Superior Court’s dismissal of W’s challenge, reversal of the Board and restoration of the decision allowing CG to build their home.
- A person residing in a historic district might reasonably believe that he or she possessed a right to challenge approval of a home across the street solely because the structure was not representative of the structures in the district. But, unlike property owners in planned communities, owners in historic districts lack contractual rights to enforce restrictions.
- In Cherry, W’s special damages arise from an alleged “incongruous, oddball two-story modernist home in a largely intact 19th Century historic neighborhood located directly across the street from Mrs. Wiesner.” W’s Motion to Supplement the Record. In other words, W’s special damages arise from the exterior appearance of a home in close proximity of W’s home – and nothing else. The alleged consequences of the exterior appearance is “loss of view and vista, increased gawker traffic, loss of privacy, impairment of ingress to and egress from her property, anxiety, harassment, diminished quiet enjoyment of [her] home, and diminution in property value and marketability.” Id.The distinction between Sanchez and Cherry is that the source of Sanchez’ special damages is not the appearance of the new structure but its height, depriving Sanchez’ property of a waterfront view. It is common knowledge that having a waterfront view at the coast is valued in the marketplace. Sanchez’s damages occur irrespective of the structure’s exterior appearance.W’s hurdle is twofold: showing (1) North Carolina caselaw finding standing solely because of the exterior appearance of a home and (2) the particular exterior appearance of a future home on a currently vacant lot across the street from W’s property causes an injury in fact.
- In 2015, the General Assembly withdrew police powers to regulate exterior appearances of one or two dwellings, but reaffirmed an exception for historic districts.Should North Carolina courts design a special standing rule for appeals arising in historic districts? A secondary source states, “an allegation that the development of property threatens the aesthetic or cultural value of a historic district is sufficient to confer standing.” Rathkopf’s The Law of Zoning and Planning § 63.22.In Sanchez, the Court of Appeals did not address this issue and in Cherry the Court may have been bound to follow Sanchez. The North Carolina Supreme Court may be the only court that can address this question.Respectfully, the answer to this question is more significant than architectural debates between CG, W – or anybody else. There are good arguments pro and con for a special standing rule for historic districts. The answer is a policy decision made by the North Carolina Judiciary and answering it provides the “rules of the community” for every person living in a historic district in North Carolina.
Thursday, February 25, 2016, 4:31 PM
A Practical Primer on Zoning Law
When the North Carolina Court of Appeals decides not to publish an opinion, the opinion is not controlling precedent and citations to it in briefs, and arguments are disfavored. Nevertheless, unpublished opinions can be quite instructive.
The North Carolina Court of Appeals’ unpublished opinion in the case of Whitehurst v. Sipes, __ N.C. App. ___, ___ S.E. 2d ____(2016 WL 4009638)(Unpublished)(February 2, 2016) is a good example of an instructive opinion. In Whitehurst, the Court of Appeals confronted an “incomplete” trial court order. But, through diligent examination of the local zoning ordinance and record of the quasi-judicial zoning proceeding, the Court was able to resolve the issues presented on appeal. In other words, Whitehurst is an example of the North Carolina Court of Appeals, independently searching a local zoning ordinance and quasi-judicial proceeding record for answers.
Here are a few of the practical points Whitehurst illustrates:
1. Appeals to Superior Court from quasi-judicial zoning proceedings can involve two very different standards of review. For issues of law, such as interpretation of zoning ordinance, the review standard is de novo. However, when the appeal relates to an erroneous evidentiary finding, the standard is the sufficiency of the evidence in the whole record made at the quasi-judicial proceeding.
a. Attorneys representing parties on appeal to Superior Court should clearly articulate the correct standard for each issue presented in their briefs and arguments.
b. A complete Superior Court order sets out separately each issue, the applicable standard for review, and the support for the Superior Court’s conclusion.
2. When interpreting a zoning ordinance, a decisive rule of construction is that zoning ordinances are strictly construed in favor of the free use of real property. Like in baseball, where a tie is called always in favor of the runner, an ambiguity is interpreted in favor of the free use of land. Hand in hand with this decisive rule, a court will neither add nor subtract from the literal language of the local ordinance to solve an ambiguity.
a. In Whitehurst, the Court of Appeals carefully examines the applicable local zoning ordinance – only the applicable zoning ordinance - and provides idiosyncratic interpretations of the law of Alexander County regarding enlargement of non-conforming buildings, enlargement or extension of nonconforming use, and forfeiture of nonconforming use. The distinct interpretations contained in the opinion are separate case studies of the currently prevailing methodology used by North Carolina Appellate Courts when interpreting a local zoning ordinance.
b. While it is valuable to know general zoning law concepts, most interpretation issues are resolved by examination of the zoning ordinance of the local jurisdiction involved.
3. When examining whether there is sufficient evidence in the record of the quasi-judicial proceeding to support the written findings made by the local board, the entire record is reviewed to discover relevant evidence as a reasonable mind might accept as adequate to support the challenged finding.
a. The Court of Appeals’ opinion demonstrates a detailed examination of a record. If the record is lengthy, imagine the laborious nature undertaken by an appellate court slogging through a cold record. Advocates should have identified specific evidence in the record supporting their position and explain the reason that other evidence does not support a contrary conclusion or is weaker.
b. Developing evidence in advance of a quasi-judicial proceeding can determine the outcome.
An important function of law is to provide a forum to resolve differences with finality.
Many times, appellate courts have no choice other than to remand without deciding an appeal when the trial court’s order or judgment is incomplete. Advocates need to understand the distinct standards applicable to quasi-judicial appeals and be sure to tender to Superior Court judges accurate briefs and complete orders. If you fail to do so, then the parties and the courts are likely to expend unnecessary time, cost and delay resolving their disputes.
The parties in Whitehurst are fortunate. Because the North Carolina Court of Appeals “rolled up its sleeves”, we have a case study of how the Court of Appeals thinks about de novo and evidentiary issues in a quasi-judicial appeal. We can learn from it.