Land Use and Local Government Law and Litigation

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Filtering by Tag: Bert Harris

Expectation of a Future Plan Amendment Does Not Create “Existing Use” or “Vested Rights” that Are Compensable under the Bert Harris Act: A. Town of Ponce Inlet v. Pacetta, LLC et al, 38 Fla. L. Weekly D1481a (Fla. 5th DCA, July 5, 2013).

The Fifth District reversed a non-final order of the circuit court finding the Town of Ponce Inlet liable under the Bert Harris Act.  While it is not discussed in the District Court opinion, the circuit court’s order demonstrated that the trial judge was incensed by the pattern of the facts:  one set of Town officials had encouraged the plaintiff to assemble a set of parcels of waterfront land in order to come in with a comprehensive redevelopment plan and a comprehensive plan amendment to implement it; the project then attracted political opposition, and a later set of Town officials not only refused to amend the comprehensive plan to allow the project, but amended the charter and codes to prohibit future approvals.

The Fifth District, applying the earlier Halls’ River case and Florida law on vested rights, found that there was no basis under which the landowner could claim a “vested right” to the plan amendments necessary to allow the desired development, and therefore no right that was burdened by the Town’s action or inaction.  Therefore, there was no basis for liability under the Bert Harris Act.

Legislation 1 - Bert Harris Act amendments

Some (relatively) minor amendments to the Bert Harris were passed.  Clarifies the definition (structurally) of an "existing use," shortens the time for the government to provide the "ripeness"/settlement alternatives and clarifies language about that provision, clarifies the waiver of soveriegn immunity and - most importantly- mostly undoes the Hall's River case holdings on the "application" of a statute, rule or ordinance. 

Attached is  a link to the bill text that went through the House and Senate and was enrolled by the House.  I believe that the Senate's final version was the House's version and the bill will go to the Governor.

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.

M&H Profit, Inc. v. City of Panama City, 34 Fla. L. Weekly D2554b (Fla.1st DCA Dec. 14, 2009)

M&H Profit, Inc. v. City of Panama City, 28 S.3d 71, 34 Fla. L. Weekly D2554b (Fla.1st DCA Dec. 14, 2009)

In M&H Profit, Inc. v. City of Panama City, the 1st DCA upheld a circuit court decision to dismiss a Bert Harris claim because the City had not applied a new law to the property simply by enacting a change to the zoning code.

Under the facts (at least as stated), the property owner would have a bad time under the Act. The owner bought commercially (C-1) zoned property in the City that, at the time, was not subject to any height restrictions. The owner apparently intended to build a 20 story condominium. The most critical fact in the opinion (if true) is that the comprehensive plan apparently did not allow residential development in that area or district (it’s unclear whether the zoning code and plan were in conflict).

The owner met with the City to discuss plans, and the City then adopted changes (apparently already in the works, but who knows) to the code to limit height to 120 feet with certain setbacks and 150 feet under any circumstance. The owner then met “informally” with the City Manager and got a letter indicating that the proposal would not be permitted under the amended C-1 zoning. The owner did not appeal, but his attorney wrote to ask if there was any way around it.

The owner then filed a Bert Harris claim, asserting that the adoption of the zoning change inordinately burdened its property by preventing the approval of the 20 story condominium project.

The circuit court dismissed, agreeing with the City that the owner could not maintain a claim because no application was ever made and that only “as applied” challenges can be raised under the Act.

The 1st DCA upheld the circuit court decision. Citing the language of the Act, the Court noted that the plain language requires the application of law. Citing commentators who interpreted the Act as only providing an “as applied” challenge, the Court held: “Simply put, until an actual development plan is submitted, a court cannot determine whether the government action has “inordinately burdened” property.”\

Amazingly, the majority opinion makes only the most passing reference to Hall’s River:

Finally, appellant argues this case is controlled by Citrus County v. Halls River Development, Inc., 8 So. 3d 413 (Fla. 5th DCA 2009). It is unnecessary for us to address the correctness of that decision because we find it inapplicable in this case. Citrus County involved an amendment to a comprehensive plan which reclassified the land use category on a particular piece of property. In this case, we are dealing with adoption of a general land development regulation effective throughout an entire zoning district. Citrus County is, therefore, not controlling.

This opinion is in clear and direct conflict with Hall’s River and totally misstates the facts. The plan amendment in the Halls case did NOT apply only to the property in question.

However, the opinion does not stop there. Judge Wolf (former counsel for the Florida League of Cities) wrote the opinion and apparently could not help but include an otherwise totally unnecessary analysis of local home rule powers as justification for not broadly construing the clearly remedial Act. Judge Wolf creates from whole cloth an entirely new rule of law: “Thus, an interpretation of state statutes which would impede the ability of local government to protect the health and welfare of its citizens should be rejected unless the Legislature has clearly expressed the intent to limit or constrain local government action.” In this language, Judge Wolf takes Florida law regarding preemption (which Judge Wolf has helped expand to the point that the Legislature must use “magic words” to preempt local authority or to create uniform law) and raises it to an entirely new level. One imagines that there is a shrine to Article VIII of the Florida Constitution in his office, one that places the provisions governing home rule above every other provision in the document.

And it makes one wonder whether the Court’s “mis-cite” of Hall’s River – and attempt to avoid defining or certifying conflict – might not be an active attempt to avoid Supreme Court review of the opinon and its new home rule doctrine.

The dissent cites Hall’s River as a reason the landowner should be given the chance to make a case. I actually think that the majority opinion does the landowner a favor. Making a specific application for what he wants and being denied is the best way to demonstrate the effect of the ordinance and the only way to prove that the project could have or would have been approved under the prior ordinance – which (IMHO) would be central to being able to prove up the rest of the case under the Act.

1stDCA Totally Screws Up the Analysis in a Bert Harris Case – [but Probably Reaches the Right Result]

City of Jacksonville v. Coffield, 34 Fla. L. Weekly D704 (Fla. 1st DCA 2009)

Well, the headline’s not totally fair. The Court properly got that a successor landowner could maintain the suit – and they got the right result. But in the process, the Court totally screwed up the analysis.

The case involves the City of Jacksonville abandoning a public street to a private homeowner’s association- a process that is not the same as vacating the street. When the street was abandoned, the private HOA refused to allow and adjoining landowner access to it. The result of the HOA’s refusal to permit access was that the landowner was unable to proceed with an 8 lot subdivision of the adjoining land.

The landowner sued the City under the Bert Harris Act, claiming that the street abandonment inordinately burdened its “existing use” in the subdivision. Under the definitions in the Act, the subdivision would be an existing use if it was a “reasonably foreseeable, non-speculative land use, suitable for the real property, compatible with adjacent uses and that had raised the fair market value” of the land. Under one of the two tests for an inordinate burden under the Act, the land would be inordinately burdened if the owner was permanently unable to attain reasonable investment backed expectations. However, the Act applies only where the “specific action of a governmental entity” results in an in ordinate burden.

The problem here is that the Court totally confused the issues. It did not deal at all with the simple fact that the ultimate action that prevented the subdivision was not the abandonment of the street, but the HOA’s subsequent refusal to permit access. The court then got hung up on the fact that the abandonment was pending when the transaction was finalized , and held that the landowner could not have reasonable investment backed expectations where the action was known. Problem: this violates the US Supreme Court decision in Pallazzolo v. Rhode Island, where the Court held that a property owner’s RIBE are NOT automatically frustrated by the existence of a regulation when the property is acquired. See also the Florida case of Vatalaro v. DEP.

Further, the Court mixed up the impact of the reasonable investment backed expectation analysis, which applies only to one prong of the “inordinate burden” test, with the “reasonably foreseeable” analysis – which applies to whether the landowner could reasonably expect the use without the government action . The whole definition of a “reasonably foreseeable use” goes to the question of whether, immediately before the government act, the value of a particular use would be part of the valuation of the property – that is, whether the use would be included if the property were valued for eminent domain.

Practitioners need to focus on the clear distinguishing characteristic here: that the ultimate action was private, not governmental, and that the uses were not protected against that action.

Bert Harris - Refusal to Extend Permit not Compensible

The Fifth DCA probably got the right result based on the wrong (or incomplete) interpretation of the Bert Harris Act in Holmes v. Marion County.

The Holmes' were denied a "special land use permit" to continue operating a Construction and Debris landfill on their property past the 3 years they already had been operating. Predictably, the denial was based on a bunch of complaints from neighbors.

The Holmes filed under Bert Harris, claiming that the landfill was an existing use, and that the denial inordinately burdened it. The court found that it was not "vested" and that the Holmes "investment backed expectation" was only to run the mine for the 1st three years.

The Court completely botched the analysis.

First, Bert Harris protects either "vested uses" (e.g. one that is already operating) or "existing uses" -- the latter are those uses that are reasonably foreseeable, non-speculative uses that are suitable for the property and compatible with adjacent uses. The Act therefore clearly intended that some "non-vested" uses that a property MIGHT be allowed are protected. By claiming that the Holmes' could not get compensation because their "investment backed expectations" were limited to the rights that had been vested, the Court completely got this issue backward.

Of course, the lower court might have found that the ability to use the land as a landfill was not an existing use because it did not qualify under the definition of an "existing use" and in this case that probably was the case (at least based on the reported facts - god knows what the real facts are).

So, did it come out right? I don't know, but quite possibly. Did the Court get the law right? No.

5th Flip Flops on Rehearing - Best Diversified does NOT get an Inverse Condemnation Judgment (or File that Bert Harris Claim Right)

In an opinion on rehearing that seems to have taken over a year (here's the link), the 5th DCA reversed its decision (well, to be clear, Judge Sharp changed sides), and found that the circuit court erred in finding that a construction and debris landfill suffered a taking when a) both the County and the DEP clearly and almost admittedly changed their rules just to deny permits to that particular landfill, and b) there was massive issues in what needed to be done to close it.

The facts seem all over the place if you compare the opinions, at least insofar as they apply to whether the landfill could accept fill to be closed. Judge Sharp seems to have switched sides based on a view that the county would have allowed the owner to pay to have clean fill brought in to close the landfill -- even thought that isn't a "use" and wouldn't leave the property with other uses. The landowner appears to have wanted to have a permit to bring in clean C&D fill to cover the other fill.

OK, so the taking goes down. One thing that I find a serious issue in both opinions is that they find no taking in the denial of permits to continue operating the landfill under the "nuisance" exception of Lucas. The problem is that no-one ever tried to shut down the operation as a nuisance. They simply claimed "issues" that were "nuisance like" in the permitting process. The problem is that actual nuiscance doctrine always involves balancing -- an activity isn't always a nuisance just because it has some objectionable characteristics.

Let's be clear: the 5th found the DEP found that the activity was a public nuisance. But such a determination is an action in tort. DEP has never been given any authority to try nuisance torts. AS A MATTER OF THE SEPERATION OF POWERS, DEP DOES NOT HAVE THE AUHTORITY TO DETERMINE AND DECLARE A LANDFILL TO BE A PUBLIC NUISANCE. Those powers are set forth in section 403.704, Fla. Stat. and permit standards are set forth in sectin 403.707. While the Dep't has LOTS of ennumerated powers, the power to declare a public nuisance is not one of them. But, hey, when did a little thing like not having the power to abrogate the common law stop a zealous agency attorney (what, his/her oath as an attorney? respect for the constitution? ) ?

The court's approach here seems to indicate that if there is anything objectionable, the local government or a state agency can declare a nuisance without having to litigate the nuisance under the common law, and evade takings responsibility at the same time.

BUT THE BIG issue is that the landowner might have succeeded in a Bert Harris claim (which he won below) except that the 5th found (in a footnote) that he had not complied with the statutory requirement of filing a claim. It also found that Bert Harris liability doesn't attach to the abatement of a public nuisance. But if the landowner HAD filed the appraisal, at least there would be a reasonable fight over damages under that Act. Moreover, even if the denial of the landfill were not compensable, if there were no other uses left to the property, there may have been Bert Harris liability anyway.

Bert Harris Case - Determination of Inordinate Burden Requires Findings

In Brevard County v. Stack, here's the opinion, the 5th upheld the Bert Harris Act against some really silly constitutional claims, but remanded a trial court's inordinate burden decision for a written finding.

The case involved new wetlands regulations that did not allow mitigation. A commercial property had an area of wetlands in the middle, and the no mitigation and buffer rules prevented an otherwise viable development plan from going forward. This resulted in the loss of a viable contract for the property.

The appraisal filed with the required notice indicated a loss in value of the property of $1M, from 1.7M to $700,000 due to the inability to construct the development plan.

Here's where it gets interesting. The County came back with a ripeness decision that included a site plan prepared by the County that would have allowed the owners to develop, but with a bunch of limits, including a reduction in parking from 170 to 100 spaces.

The appraiser found that the County's plan did not cure the problems created by
the Ordinance, and that the diminution of value remained the same, because
the plan required that the Property be bisected, it did not provide for
sufficient parking, and it made no provision for a traffic signal. All of
these factors made the Property less attractive to a developer.

Now it appears that the County did not contest this opinion, because the matter was tried to partial summary judgment on the issue of inordinate burden, and the trial court found for the Plaintiffs.

On appeal, the County attacked the constitutionality of the Act on numerous grounds, mostly specious and sometimes frightening.

First, they claimed that it violated the County's substantive due process rights by forcing them to contract away their police powers, first in requiring (functionally) a "ripeness" action or an offer of settlement under threat of suit, and then by "requiring" the entity to "buy back" rights.

First, a "contracting away" claim is NOT based on due process; it's based on organic limits to the power of the government and the notion of the separation of powers. Moreover, while it might be possible to have a Bert Harris settlement that is void for this reason (believe me, I know, I just drafted a settlement around this issue) due to the doctrines laid out in Sarasota County v Chung and Morgan Co. v. Orange County, the fact that a government entity can settle (under threat of litigation) does not create a contracting problem.

The 5th clearly stated that local governments don't have "due process" rights against the Legislature, but more on the arrogant and frightening nature of the claim later.

Furthermore, as the 5th recognized, the fact that the Legislature created a new cause of action that both recognized the right of the government to exercise the police power but then creates a legislative notion of an action that "goes too far" and requires compensation for that regulation, does not "force" the government to "contract" with private parties in exercising their police powers.

Likewise, the fact that if a landowner is granted compensation for lost rights, the Act recognizes that these rights are permanently transferred to the government entity (as in a property interest/covenant/easement/sale of development rights) doesn't create a contracting problem - it simply again recognizes that the Legislature has created a cause of action and that someone using that cause forfeits other rights. So the 5th also properly rejected the notion that the Act creates a "contracting away" problem through its provision for the transfer of the rights to the government if damages were paid.

NOTE - the big right involved here would be the right to use the property for the "burdened" use should the regulatory regime change. While Bert Harris claims aren't available for "temporary" burdens, this means a regulation or effect that's temporally limited on its face. The imposition of a zoning category, or a wetlands rule, can be presumed permanent because the entity isn't obliged to change it.

The County also tried to argue that the Act improperly delegates legislative authority to the courts, based first on "vagueness" and then on the really bizarre notion that it somehow illegally and improperly enlarged judicial interpretations of takings law.

The 5th rejected the vagueness claim based on the Act's provision of a number of definitions. And while I think this claim reaches pretty far, I do have to admit that the Act is less than clear, and requires a lot of interpretation to determine whether an impacted "right" to use property is an "existing use" as that's defined in the Act.

It also rejected the "legislative imposition on the judiciary" for the clear and obvious reason that the Act explicitly states that it is creating a new cause of action, and that the cause of action is supposed to be more liberal than constitutional takings doctrine.

Note what the County is really trying to do with these combined constitutional claims: establish a doctrine that the Legislature can't create a statutorily imposed financial constraint on a local government's use of police powers that otherwise pass due process and takings tests based on some new kind of claim of constitutional stature for their "right" to exercise police powers. Their underlying but unstated position seems to be that if local governments have home rule police powers, the legislature can take away local power to legislate in areas, or can tell the local government procedurally what must be done in order to exercise those police powers, but can't make them liable for the substantive results of the use of those powers. It's nothing less than an attempt to establish an entirely new, judicially created doctrine that local governments have "constitutional" rights against legislative limits on their powers.

The fact that the county would argue this kind of claim reflects the frightening arrogance that local governments have internalized -- they believe that they have the constitutional right to screw around with anyone they want, limited only by the (emasculated and now meaningless) constitutional constraints of due process and inverse condemnation, and that the Legislature is (or should be) powerless to constrain their authority.

Let's be clear: even with home rule provided by the constitution, local governments are NOT co-equal branches of government. They are political subdivisions (counties) and municipal corporations, whose authority and right to exist are subject to legislative control.

After all of that, the 5th did throw the judgment back to the trial court for findings, based on language in the Act that provides that the court "shall" "determine whether a vested right or an existing use of the real property existed, and if so, whether . . . ." the property was inordinately burdened. The 5th interprets this as requiring an explicit finding, presumably in writing.

PRACTICE NOTE: if you're a Plaintiff in one of these cases, be sure to note this in your memorandum of law, and be sure to provide a draft order that guides the court in getting this right.

Bert Harris Settlement - Maybe More Complicated than You Think

A couple of years ago, I blogged Vetter v. Charlotte County - which dealt with preliminary injunctions and vested rights. Now it's back as Charlotte County Park of Commerce v. Charlotte County. Here's the opinion - which anyone interested in Bert Harris actions MUST read.

It appears that a settlement agreement to deal with the case has blown up. One of the elements is that the landowner filed a notice of a Bert Harris claim during the pendancy of the other litigation. The "claim" was subject to the settlement - before the actual Bert Harris lawsuit was filed.

While gets to the issue. The Act provide for the presuit notice of the "claim" (including the requirement to file appraisals), a 180 day settlement period, then the ability to file a suit. The Act also requires court approval of the settlement "under this section" if it would contravene a statute (the most likely candidate in most circumstances is 163.3194 - the consistency requirement- if a settlment arguable includes a variance from or interpretation of a comprehensive plan provision).

So, is a settlement "under this section" a settlement only of a filed lawsuit, or of a noticed claim?

The 2d District took the position that once the notice of claim was filed, the operative provision for approval of the settlement agreement took effect. That is, once there is notice of a Bert Harris claim, the parties are bound by sections 70.001(4)(d) 1 and 2 regarding the settlement. In this case, that meant sending the issue back to the trial court, because if the Bert Harris claim was settled, then the Plaintiff might be entitled to the relief sought (judicial approval and enforcement of the settlement).

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