John C. & Maureen G. Osborne Revocable Family Trust v. Town of Long Beach

• Decision Date: 30 May 2017
• Docket Number: Court of Appeals Case No. 46A03-1607-PL-16982
• Citation: 78 N.E.3d 680
• Parties: JOHN C. & MAUREEN G. OSBORNE REVOCABLE FAMILY TRUST; Timothy J. and Anna Voortman; Christopher Lyons; and Duneland Development, LLC, Appellants/Cross-Appellees-Plaintiffs, v. The TOWN OF LONG BEACH, Indiana; The Long Beach, Indiana Town Council; The Building Commission of the Town of Long Beach, Indiana; The Advisory Plan Commission of the Town of Long Beach; The Board of Zoning Appeals of the The Town of Long Beach, Indiana; Jane Starr Neulieb; Peter Byvoets; Robert Lemay; Larry Wall; John Wall; Joseph Jogmen; Patrick Cannon ; Michael Gorman; and Aaron Tomsheck, all in their official capacities as members of the Long Beach, Indiana Town Council, Advisory Plan Commission, Board of Zoning Appeals, Building Commission, and Building Commissioner, Appellees/Cross-Appellants-Defendants, and The Long Beach Community Alliance, Inc., an Indiana not-for-profit corporation; and James Neulieb, an Individual, Appellees/Cross-Appellants-Defendants.
• Court: Indiana Appellate Court

78 N.E.3d 680

JOHN C. & MAUREEN G. OSBORNE REVOCABLE FAMILY TRUST; Timothy J. and Anna Voortman; Christopher Lyons; and Duneland Development, LLC, Appellants/Cross-Appellees-Plaintiffs,

v. The TOWN OF LONG BEACH, Indiana; The Long Beach, Indiana Town Council; The Building Commission of the Town of Long Beach, Indiana; The Advisory Plan Commission of the Town of Long Beach; The Board of Zoning Appeals of the The Town of Long Beach, Indiana; Jane Starr Neulieb; Peter Byvoets; Robert Lemay; Larry Wall; John Wall; Joseph Jogmen; Patrick Cannon ; Michael Gorman; and Aaron Tomsheck, all in their official capacities as members of the Long Beach, Indiana Town Council, Advisory Plan Commission, Board of Zoning Appeals, Building Commission, and Building Commissioner,¹ Appellees/Cross-Appellants-Defendants,andThe Long Beach Community Alliance, Inc., an Indiana not-for-profit corporation; and James Neulieb, an Individual, Appellees/Cross-Appellants-Defendants.

Court of Appeals Case No. 46A03-1607-PL-16982

Court of Appeals of Indiana.

May 30, 2017

Attorneys for Appellants : Matthew T. Albaugh, Shawn M. Doorhy, Faegre Baker Daniels LLP, Indianapolis, Indiana.

Attorneys for Appellee Town of Long Beach, Indiana ³ : L. Charles Lukmann, III, Charles F.G. Parkinson, Julie A. Paulson, Connor H. Nolan, Harris Welsh & Lukmann, Chesterton, Indiana.

Attorneys for Appellee Long Beach Community Alliance, Inc : Kurt R. Earnst Braje, Nelson & Janes, LLP, Michigan City, Indiana, Patricia F. Sharkey, Environmental Law Counsel, P.C., Chicago, Illinois.

Attorney for Appellee James Neulieb : Gregory S. Colton, Law Office of Gregory S. Colton, Valparaiso, Indiana.

Attorneys for Amicus Curiae, Indiana Association of Cities and Towns and Indiana Municipal Lawyers Association : Brian W. Welch, Melissa J. Buckley, Bingham Greenebaum Doll LLP, Indianapolis, Indiana.

Attorney for Amicus Curiae Conservation Law Center : Jeffrey B. Hyman, Conservation Law Center, Bloomington, Indiana.

Kirsch, Judge.

[1] John C. & Maureen G. Osborne Revocable Family Trust, Timothy J. & Anna Voortman, and Christopher Lyons (together, "Homeowners") each own a residence along the Lake Michigan shoreline in Long Beach, Indiana. Each Homeowner sought to construct a seawall due to concern about a possible breach of their respective septic systems by Lake Michigan waters. After building permits were issued to Homeowners for the seawalls, The Long Beach Community Alliance, Inc. ("LBCA")⁴ and James Neulieb⁵ ("Neulieb") each filed an administrative appeal of the building permits with the Board of Zoning Appeals of the Town of Long Beach ("BZA"), and, thereafter, stop work orders were issued, which prevented construction on the seawalls from proceeding. Homeowners and their contractor, Duneland Development, LLC ("Duneland" and, together with Homeowners, "Plaintiff Owners") filed in the trial court a twelve-count complaint for declaratory and injunctive relief ("the Complaint") against The Town of Long Beach, Indiana, the Town Council, the Building Commission, the Advisory Plan Commission, the BZA, certain individuals in their official capacities as members of the aforementioned municipal entities (collectively, "Town Defendants"), as well as LBCA and Neulieb. Thereafter, the Town Defendants, LBCA, and Neulieb each filed a motion to dismiss, which the trial court denied by orders on April 8 and April 19, 2016 (together, "the April Orders"). On July 5, 2016, the trial court issued an "Order Denying [Plaintiff Owners'] Motions for Injunctive Relief and Declaratory Judgment" ("the July 5 Order").

[2] On July 29, 2016, Plaintiff Owners filed, pursuant to Indiana Appellate Rule 14(A) or 14(D), an appeal as of right of the July 5 Order, which Plaintiff Owners view as an interlocutory order. On or near the same time, LBCA and Neulieb, who view the July 5 Order as a final order that disposed of all claims, filed an appeal of the April 19 Order that denied their respective motions to dismiss. This court consolidated LBCA's and Neulieb's appeal with Plaintiff Owners' appeal.⁶

[3] Numerous issues are raised by the consolidated appeal. We first address the following preliminary issue:

I. Whether this court has subject matter jurisdiction to hear the cross-appeal issues raised by appellees LBCA, Neulieb, and Town of Long Beach concerning the trial court's denial of their respective motions to dismiss in the April Orders.

We next address the following dispositive cross-appeal issue:

II. Whether the trial court erred when it denied the motions to dismiss filed, separately, by Town Defendants, LBCA, and Neulieb, each of which asserted that the trial court lacked subject matter jurisdiction because Plaintiff Owners failed to exhaust their administrative remedies.

[4] We reverse the trial court's April 8 Order that denied the motions to dismiss filed by Town Defendants, LBCA, and Neulieb.

Facts and Procedural History

[5] This litigation stems from Homeowners' desire to build a seawall on each of their respective lakefront residential lots, which are located on Lake Shore Drive in the Town of Long Beach, at the southern shore of Lake Michigan.⁷ Homeowners maintain that storms and waves have damaged their properties and have put their septic systems in imminent peril of being breached; they assert that construction of the seawalls is necessary to avoid discharge of septic contents onto the beach and into Lake Michigan and to protect their properties. Homeowners also claim that, without the seawalls, their homes could be damaged to the point of being uninhabitable, and no new septic field could be constructed given the size of their lots. Before applying for building permits, the Homeowners filed applications in May and July, 2015 with the BZA, asking for a variance from the view protection ordinance found in the Town Code at 154.060.⁸ The BZA held public hearings on the proposed development standards variances on August 13, October 13, November 10, November 24, and December 8, 2015.

[6] During the public hearings, Homeowners presented testimony from a contractor, a surveyor, an engineer, and an appraiser regarding Homeowners' claim that there was an urgent need for the seawalls. Neulieb and LBCA, among others, posed oral and written objections to the seawalls asserting, among other things, that the seawalls would be located in fragile dune and floodplain locations and could accelerate or cause beach erosion of Lake Michigan beaches and dunes that, according to LBCA, "are held in trust for Long Beach residents as members of the public by the State of Indiana and as Long Beach homeowners by the Town of Long Beach," as well as those beaches and dunes "which are owned by neighboring private property owners, including LBCA members." LBCA Br . at 22-23; LBCA Addendum at 30. In November 2015, Homeowners' engineer, in response to the erosion concerns, wrote a letter to the BZA stating that "[t]he seawalls as proposed will not adversely affect the surrounding areas" and "do not present [ ] erosion risks[.]" Appellants' App . Vol. II at 89-90. At the conclusion of the December 8, 2015 hearing, the BZA granted Homeowners' requested variance from the view protection ordinance, Long Beach Ordinance 154.060.⁹ Id. at 56. The BZA's December 8, 2015 decision included findings that "construction of the proposed seawall[s] is an absolute necessity to avoid discharge of septic contents ... as well as to protect the [Homeowners'] propert[ies]" and that "[t]he proposed design of the seawall[s] is the minimum design (size, location, height, etc.) necessary to prevent a septic discharge and other property damage." Id . at 97-98, 104-05, 111-12. No party appealed that decision.

[7] On December 14, 2015, each of the three Homeowners filed an application with the Building Commission for a building permit for a proposed seawall. On December 30, 2016, the then-Building Commissioner, Aaron Tomsheck, approved the applications and issued a building permit to each of the three Homeowners ("Building Permits"). The next day, Homeowners commenced construction efforts, which continued for the next month and included bringing in equipment, purchasing steel sheet piling, excavating, and driving sheet piles into the ground.

[8] On January 25, 2016, LBCA filed administrative appeals to the BZA, pursuant to Indiana Code section 36-7-4-918.1¹⁰ and Long Beach Ordinance 154.153¹¹ challenging the legality of the three Building Permits issued on December 30, 2015. LBCA challenged the legality of the issuance of the three Building Permits on the basis that not all Long Beach ordinances had been complied with and Homeowners had not obtained all needed variances including those to comply with the following Long Beach Ordinances: 154.072 regarding accessory uses and structures; 154.112 regarding changes in dune topography; 154.091 regarding special BZA approval of construction within a regulated floodplain; Chapter 155 governing construction in floodplains, including specifically the requirements to obtain a floodplain permit and comply with the General Standards in 155.50; and Chapter 156 governing storm water management planning to avoid diversion of floodwater onto neighboring properties, acceleration of erosion, and sediment transport and disposition. Appellants' App . Vol. II at 174-215.

[9] The same day, Neulieb also filed an administrative appeal challenging the three building permits, asserting that the permits were issued in violation of the side-yard setback requirement of Long Beach Ordinance 154.077, which requires that structures be placed no closer than six feet from the side property lines; the Homeowners' building plans indicated that their proposed seawalls would be built within one foot of the side property lines, contrary to the ordinance. Id . at 217-18.

[10] On January 26, 2016, the then-Building Commissioner Aaron Tomsheck ("Tomsheck") issued a stop work order for each of the building permits pursuant to automatic stay provisions of ...