Maytown Sand & Gravel, LLC v. Thurston Cnty.

Decision Date09 August 2018
Docket NumberNo. 94452-1,94452-1
CourtWashington Supreme Court
Parties MAYTOWN SAND AND GRAVEL, LLC, Respondent, v. THURSTON COUNTY, Petitioner, Black Hills Audubon Society and Friends of Rocky Prairie, Additional Defendants, Port of Tacoma, a Washington special purpose district, Respondent. Port of Tacoma, a Washington special purpose district, Respondent, v. Thurston County, Petitioner, Black Hills Audubon Society and Friends of Rocky Prairie, Additional Defendants, Maytown Sand and Gravel LLC, Respondent.

Mark Robert Johnsen, Steven David Robinson, Karr Tuttle Campbell, 701 5th Avenue, Suite 3300, Seattle, WA 98104-7055, Elizabeth Petrich, Thruston County Prosecutor's Office, 2000 Lakeridge Drive SW, Building 2, Olympia, WA 98502-6001, Michael Barr King, Jason Wayne Anderson, Rory Drew Cosgrove, Carney Badley Spellman PS, 701 5th Avenue, Suite 3600, Seattle, WA 98104-7010, for Petitioner.

John Edward Duke Powell, Jed Powell & Associates PLLC, 7191 Wagner Way NW, Suite 202, Gig Harbor, WA 98335-6909, Patrick John Schneider, Steven James Gillespie, Foster Pepper PLLC, 1111 3rd Avenue, Suite 3000, Seattle, WA 98101-3292, Don C. Bauermeister, James A. Hertz, Friedman Rubin, 1126 Highland Avenue, Bremerton, WA 98337-1828, Eric Christensen, Cairncross & Hempelmann, P.S., 524 2nd Avenue, Suite 500, Seattle, WA 98104-2323, Carolyn A. Lake, Goodstein Law Group PLLC, 501 S. G Street, Tacoma, WA 98405-4715, for Respondents.

GORDON McCLOUD, J.

¶ 1 The Land Use Petition Act (LUPA), chapter 36.70C RCW, bars parties from challenging a local land use decision in state court if the parties fail to exhaust the administrative process. RCW 36.70C.030. The central issue in this case is (1) whether that administrative exhaustion rule applies to all tort claims that arise during the land use decision-making process. The other issues are (2) whether there was sufficient evidence to support the jury's finding of a substantive due process violation under 42 U.S.C. § 1983 ( Section 1983 ); (3) whether an aggrieved party can recover prelitigation, administrative fora attorney fees intentionally caused by the tortfeasor under a tortious interference claim; and, lastly, (4) whether the Court of Appeals erred in awarding a request under RAP 18.1(b) for appellate attorney fees that was not made in a separate section devoted solely to that request.

¶ 2 We affirm the Court of Appeals on all but the third issue. We hold that (1) LUPA's administrative exhaustion requirement does not bar all tort claims, (2) there was sufficient evidence to support the jury's finding that Maytown Sand & Gravel LLC's (Maytown) substantive due process rights were violated under Section 1983, (3) the tortious interference claims pleaded in this case do not authorize recovery of prelitigation, administrative fora attorney fees, and (4) the Court of Appeals did not err in awarding appellate attorney fees under RAP 18.1(b). We therefore affirm in part and reverse in part.

I. FACTS AND PROCEDURAL HISTORY

¶ 3 In late 2009, Maytown purchased real property in Thurston County from the Port of Tacoma (Port) for the express purpose of operating a mine. The property came with an approved 20-year special use permit (permit) from Thurston County (County) for mining gravel.

¶ 4 That permit was originally issued in 2005 to the previous owner, Citifor, after protracted negotiations with numerous community stakeholders and extensive environmental studies. Because the proposed mining site is located adjacent to one of Washington's largest tracts of prairie-oak-wetland habitat, the proposed project stirred significant opposition from nearby residents, Indian tribes, and environmental conservationists. Trial Ex. (Ex.) 303. The lead environmental group opposing the mine back then was the Black Hills Audubon Society (BHAS). Citifor and BHAS eventually reached an agreement balancing Citifor's mining interest with BHAS's environmental concerns. In exchange for BHAS dropping its opposition to the mine, Citifor agreed to significantly reduce the amount of gravel it originally planned to excavate, to reclaim the property as a wetland once the reduced gravel amount was excavated, and to sell over 800 acres of other property it owned to the state for wildlife conservation. Ex. 429.

¶ 5 But in 2006, the year after the permit was issued and before mining activities began, Citifor sold the property with the permit to the Port. The issues in this case arose four years later when Maytown and the Port sought to use the permit. Even though BHAS had signed off on the permit, other conservation groups and local residents remained opposed to the mine. Maytown and the Port claim that the County's board of commissioners (Board) succumbed to political pressure from these mine opponents and directed the County's Resource Stewardship Department (Department) to impose unnecessary procedural hurdles meant to obstruct and stall the mining operation.

¶ 6 Although Maytown already had a permit to mine the property, the Department remained involved because four key issues needed to be addressed. First, the Friends of Rocky Prairie (FORP), an environmental conservation group, was challenging the validity of the permit. Second, two missed water quality testing deadlines listed in the permit needed to be addressed. Third, there was a discrepancy between the water quality monitoring requirements listed in the permit and the corresponding groundwater monitoring plan that needed to be clarified. Fourth, the permit was due for its five-year review before the hearing examiner.

¶ 7 Because the property had been designated by the County as "mineral land of long term commercial significance," the County was obligated to balance the protection of the mineral land with the protection of critical areas. Ex. 429, at 46. As discussed below, the Department's decisions as to each of the four key issues were generally favorable to Maytown and the Port but came after significant delay and expense.

A. FORP's Claim That the Permit Had Lapsed Due to Inactivity or Noncompliance with the Permit's Water Quality Monitoring Conditions

¶ 8 Sometime in early 2009, local environmental conservationists learned that the Port was planning to sell the property that it had purchased from Citifor as a permitted gravel mine. These individuals formed a group, FORP, to stop the mine. FORP informed the Department that it believed the permit was no longer valid due to three years of nonuse and missed water testing deadlines. Ex. 140, at 1-2 (citing THURSTON COUNTY CODE (TCC) 20.54.040(4)(A); TCC 17.20.150(C) ). FORP acknowledged that the Port had engaged in some activities during those three years but argued that none of those activities counted as use. According to FORP, those activities did not count because the Port was operating outside of its geographical region and outside the scope of its interlocal agreement with the Port of Olympia, the governmental body that had geographical jurisdiction over the property. Id.

¶ 9 The Department dismissed FORP's claim as untimely. The Department explained that it had already ruled the year before, in 2008, that the permit was valid despite the missed testing deadlines and the long period of inactivity. Exs. 141, 143. Because FORP failed to challenge that decision within the time frame for such appeals, the Department determined that FORP was time barred from doing so now.

¶ 10 After this legal challenge failed, FORP decided to put political pressure on the mine instead. FORP informed the Port of Olympia Commission of its belief that the Port was acting outside the scope of the interlocal agreement between the two ports. Olympia Port Commissioner George Barner Jr. agreed with FORP that the Port was acting outside the scope of the interlocal agreement and shared his assessment with the Board. Clerk's Papers (CP) at 255-56. FORP also met privately with the Board's three commissioners to discuss the gravel mine. Exs. 98A, 98B; CP at 2213.

¶ 11 Around the same time as these private meetings, one of the Board's commissioners, Karen Valenzuela, indicated interest in evaluating whether the permit could be revoked either because of the reasons raised by FORP or for some other yet-to-be-identified reason. Ex. 114A. Valenzuela also advised Sharron Coontz (FORP's president) about the evidence that she believed was needed to persuade the Board's two other commissioners to agree to reexamine the validity of the permit. Ex. 74.

¶ 12 As discussed in more detail in the five-year review section infra Section I.C, the Board ultimately agreed with the Department that the issue of permit validity was closed and could not be reopened by FORP. CP at 106-10.

B. Maytown's Journey To Extend the Permit's Water Testing Deadlines and To Clarify the Scope of the Water Quality Monitoring Requirements

¶ 13 Even though the Department had already ruled in 2008 that the gravel mining permit had not lapsed entirely due to inactivity or missed water testing deadlines, there was still the issue of how to address those missed deadlines.

¶ 14 When the permit was originally issued in 2005 to Citifor, that company had planned to start mining immediately. As a result, the permit contained deadlines that assumed an immediate start date. Specifically, condition 6A required field testing of 4 off-site supply wells "[p]rior to any mining activity and within one-year of final issuance of the [permit]," and condition 6C required the mine operator to collect "water levels, temperature, and water quality, including measurement of background conditions" data from 17 wells "within 60 days of the final issuance by the County of the [permit]." Ex. 302 (emphasis added). Because Citifor changed its mind and decided not to pursue the mine soon after it received the permit, Citifor never conducted that field testing and never collected that water quality data.

¶ 15 Significant debate arose in 2009 about whether those two deadlines needed to...

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