tag: North Carolina Land Use Litigator: July 2012

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Tuesday, July 17, 2012, 6:14 PM

Local Governments Take Heed: Conditional Use Permit Processes Are to Be Closely Guarded

The North Carolina Court of Appeals issued an interesting decision this morning governing the issuance of conditional use permits.

The Facts
The petitioner, an individual, was denied a request for a conditional use permit to construct and operate a "Level IV Group Home" in Robeson County.  Specifically, petitioner's proposed facility "will be designed to serve a consumer base for the 'female' mentally ill and mentally retarded population" and "will provide intensive residential programs such as on-site educational curricula, job training, counseling, and a substance abuse program." 

The Procedural Past 
As background, in November 2007, the Robeson County Planning Board initially recommended denial of the conditional use permit application.  In June 2008, the Planning Board held a hearing to consider the conditional use application, the reason for which is unclear in light of the original recommendation.  In any event, in the wake of the second "consideration", the Planning Board eventually issued two resolutions: one recommending denial of the application and one recommending that the Robeson County Board of Commissioners--who would hear and render the decision as to the application--grant the conditional use permit application. 

In October 2008, the Board of Commissioners held a quasi-judicial proceeding to determine the fate of petitioner's application.  In February 2009, after the conclusion of the hearing, the Board of Commissioners denied petitioner's conditional use permit application for the "Level IV Group Home". 

Petitioner petitioned the Superior Court for a writ of certiorari and seeking judicial review.  The Superior Court affirmed the Commissioners' decision to deny the conditional use permit application.

On appeal, the Court of Appeals reversed and remanded with instructions, directing the Commissioners to grant the conditional use permit.  Ok, so what?  Well, the analysis is interesting.

If You Don't Argue It, People Won't Come
Essentially, the Court of Appeals determines that it cannot address petitioner's strongest legal arguments.  The Court appears to regret that it cannot review whether the "Level IV Group Home" use is allowed "as a matter of right" and not dependent upon the issuance of a conditional use permit, as Robeson County (and, apparently, petitioner) believed.  In waxing its lament, the Court states:

"However, petitioner failed to make this argument before the Board. Petitioner’s application was for a conditional use permit. Our thorough review of the transcript from the Board hearing and the Board’s written decision reveals that petitioner never made any of the arguments described above before the Board; petitioner’s arguments before the Board were confined to the issue of whether the standards under Section 30 of the ordinance for issuance of a conditional use permit had been satisfied. “The superior court’s scope of review on certiorari is limited to errors alleged to have occurred before the local board.”"

But the party doesn't end there. 

"In the alternative", as the Court puts it, the petitioner argued that the Board of Commissioners' decision to deny the permit "was not based on substantial, material, and competent evidence in the record and was therefore arbitrary and capricious."

This is where the Court finds its chance to reverse the Board and the trial court. 

Prima Facie Entitlement and the Local Government's Response -- Fire With Fire
The Court notes the standard of review applicable to a quasi-judicial proceeding, and determines that satisfactory evidence entitles the applicant to a prima facie entitlement:  "If ‘an applicant has produced competent, material, and substantial evidence tending to establish the existence of the facts and conditions which the ordinance requires for the issuance of a special use permit, prima facie he is entitled to it.’"  Quoting  Mann Media, Inc. v. Randolph Cty. Planning Bd., 356 N.C. 1, 12, 565 S.E.2d 9, 16 (2002).

For its part, then, the local government bears a return burden:  "If a prima facie case is established, [a] denial of the permit [then] should be based upon findings contra which are supported by competent, material, and substantial evidence appearing in the record.’" Also quoting Mann Media, Inc. v. Randolph Cty. Planning Bd., 356 N.C. 1, 12, 565 S.E.2d 9, 16 (2002).

Yes, that's right.  If (1) the petitioner can produce "competent, material, and substantial evidence" to support the issuance of a conditional or special use permit, then (2) to deny the permit, the local government must present its own "competent, material, and substantial evidence". 

The Outcome
To the Court, Robeson County was unable to overcome petitioner's prima facie entitlement to the conditional use permit.  The rub, it turns out, is that the Robeson County Board of Commissioners rested its decision "entirely of the generalized fears of neighbors".  That, of course, is not competent, material or substantial.  If it were so, and generalized fears were enough, the Bobcats wouldn't be able to play in Charlotte.  See what I did there?

Accordingly, the Court, in an unpublished opinion, reversed and remanded with instructions. 

Mike Thelen is a lawyer in Womble, Carlyle's Real Estate Litigation practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.
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