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5th DCA Mangles the "As Applied" Requirement of the Bert J. Harris Act and Confuses Reasonably Foreseeable, Reasonable Investment Backed Expectations

Citrus County v. Hall's River Development, 8 So. 3d 413 (Fla. 5th DCA 2009)

In 2002 the Citrus County Commission approved a rezoning and development plan, which neighbors then challenged as inconsistent with the comprehensive plan. A plan designation adopted in 1997 limited development density around lakes to 1 unit per 20 acres, but (and the 5th DCA ignores this critical component of the trial court's analysis) also had a provision allowing the County Commission to approve higher densities and uses consistent with the existing zoning/land use designation. This property had a "generic" zone district and an existing RV/camp park. Based on this combination of existing uses and density, the planning staff and eventually the county commissioners thought the property was vested for density and qualified for the exception in the comprehensive plan.

The rezoning was challenged under § 163.3215 as contrary to the low density land use designation, and the circuit court in that case sided with the neighbors, holding that the plan didn't allow the rezoning or use. Based on this new 2002 court interpretation of the effect of the 1997 comprehensive plan amendment, the developer sued under the Bert Harris Act and won at the trial court level. However, the 5th DCA, not liking the outcome, went searching for reasons to overturn the circuit court decision. In the process, the 5th DCA avoided key facts and misinterpreted the Act.

Under the Act, a landowner may seek compensation when a specific action of a governmental entity inordinately burdens either a vested right or an “existing use” of property. One of the definitions of an "existing use" is a "reasonably foreseeable, non-speculative land use that is suitable for the real property, compatible with adjacent land uses, and that has raised the fair market value of the property . . . " (a "reasonably foreseeable use"). One of the definitions of an inordinate burden is that a property owner is permanently unable to realize "reasonable investment backed expectations" in the vested right or existing use.

Here, the 5th DCA determined that the suit was filed too late under the Act, which requires the property owner to provide a notice of claim to the government entity involved within 1 year of the application of a new statute, regulation or ordinance that inordinately burdens real property. A "specific action of a government entity" is a defined term that specifically includes action on a permit or application, i.e., the application of a statute, regulation or ordinance to the particular property at issue. Within the Act there are various internal references to the application - rather than adoption - of statutes, regulations or ordinances, which clearly establish that a property owner must make some kind of application and have it acted upon or suffer some form of enforcement action, before filing a claim. This was also the interpretation of all of the commentators who wrote about the Act. So, if the prior property owner had made a claim in 1998 against the adoption of the plan amendment, the County's correct defense would have been that it was premature until an actual application had been made and denied, giving the County a chance to determine whether other provisions of the plan allowed relief from the objective density limits in the designation.

The 5th DCA paid no attention to all of this evidence that specific action on an application or permit was the trigger for a government action that creates liability, and determined that the mere adoption of some ordinances - or plan policies - can be the “specific action of a government entity” that triggers the 1 year requirement. The 5th DCA opined that where a comprehensive plan or other regulation includes a clear and objective standard (like height or density), the mere adoption of the ordinance "applies" that ordinance to property and triggers the one year challenge period. The 5th DCA found that the plan designation had that kind of objective limit - completely ignoring the plan provision that authorized the County Commission to allow additional uses and densities - a provision whose effect could not be determined until an actual application was made.

The 5th DCA then used its interpretation of the plan provision to hold that the use permitted by the overturned rezoning could not have been a "reasonably foreseeable, non-speculative land use." Even though the planning department thought the rezoning and use/density were permitted under the plan (and existing zoning), even though the County Commission thought it was consistent with the plan, and even though it took a "consistency challenge" by neighbors to determine that the development was not consistent with the comprehensive plan, the 5th DCA determined that the developer had no right or ability to rely on the interpretations of those professionals before proceeding, and that a development that is (later determined to be) inconsistent with the plan cannot be "reasonably foreseeable."

The 5th DCA also applied this distorted view of the facts to the Circuit Court's determination that the property had been inordinately burdened, holding that the owner could not have had "reasonable investment backed expectations" because he closed on the property after the adoption of the plan amendment that (the Court reasoned) prohibited the development. This interpretation ignores U.S. Supreme Court and Florida appeals court precedent (Pallazzolo v. Rhode Island and Vatalaro v. DEP) that hold that the purchase of property subject to a regulation does not prevent one from having "reasonable investment backed expectations" in a regulated use where the application of the statute or regulation would affect a taking.

The Court found that the developer could not have relied on the County staff representations of the comprehensive plan because they were (later found to be) legally incorrect, and that this precluded the landowner from having either an "existing use" (in the form of a reasonably foreseeable use) or an "inordinate burden" (because there was no reasonable expectation). This is a misinterpretation of the Act. While under Florida law "vested rights" against the application of a regulation are not created by a legally incorrect statement by a government official ("yeah, I think you can fill that wetland"), the District Court mistakenly ties this doctrine to whether a landowner has a "reasonably foreseeable use" or "reasonable investment backed expectations."

The 5th DCA’s holdings fly in the face of the legislative intent that the Act provide a remedy for property owners harmed by the application of statutes, regulations and ordinances adopted after 1995. However, if, as occurred here, the adoption of a new, post-1995 law precludes a landowner from having a "reasonable investment backed expectation" then the only people with a cause of action are those who had already had established vested rights at the time the new law was adopted. The District Court's analysis incorrectly makes "reasonable investment backed expectations" and "reasonably foreseeable uses" under the Act dependant on the landowner's ability to establish the existence of a vested right. This is demonstrably wrong: the first part of the cause of action separately protects BOTH vested rights and "existing uses," but the 5th DCA’s formulation requires a property owner to have a "vested right" in order to have both a right that would be inordinately burdened and a reasonably foreseeable use. The District Court's combination of incomplete treatment of the relevant plan provisions and errors in analysis have the effect of writing protection for "reasonably foreseeable uses" out of the Act, a result that is inconsistent with both the intent and the language of the Act.

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