Alliance Inv. Grp. of Ellensburg, LLC v. City of Ellensburg

• Decision Date: 25 August 2015
• Docket Number: No. 32370–6–III.,32370–6–III.
• Citation: 358 P.3d 1227,189 Wash.App. 763
• Court: Washington Court of Appeals
• Parties: ALLIANCE INVESTMENT GROUP OF ELLENSBURG, LLC, Appellant, v. CITY OF ELLENSBURG, Washington, Respondent.

189 Wash.App. 763

358 P.3d 1227

ALLIANCE INVESTMENT GROUP OF ELLENSBURG, LLC, Appellant

v.CITY OF ELLENSBURG, Washington, Respondent.

No. 32370–6–III.

Court of Appeals of Washington, Division 3.

Aug. 25, 2015.

Amended on Denial of Reconsideration Oct. 20, 2015.

Le Anne Marie Bremer, Miller Nash Graham & Dunn LLP, Vancouver, WA, for Appellant.

Terry Michael Weiner, City of Ellensburg, Ellensburg, WA, Michael F. Connelly, Etter McMahon Lamberson Van Wert & Oresk, Spokane, WA, for Respondent.

Roger D. Wynne, Seattle City Attorney's Office, Seattle, WA, for Amicus Curiae on behalf of Washington State Association of Municipal Attorneys.

Tim Trohimovich, Futurewise, Jeffrey M. Eustis, Aramburu & Eustis LLP, Seattle, WA, for Amicus Curiae on behalf of Futurewise.

Opinion

KORSMO, J.

¶ 1 This appeal once again requires us to consider the decision in Noble Manor Co. v. Pierce County, 133 Wash.2d 269, 943 P.2d 1378 (1997), and its application to an amended Critical Area Ordinance (CAO) adopted after a short plat had been approved. We reject appellant's interpretation of Noble Manor, affirm the trial court's ruling, and award respondent City of Ellensburg its attorney fees.

FACTS

¶ 2 Alliance Investment Group (Alliance) owns land in the City of Ellensburg (City) that is the subject of this action. The land is zoned for light-industrial usage. Alliance filed a short plat application with the City on February 16, 2007, to divide the property into nine lots to develop an industrial park. While final plat approval was pending, the City also approved a building permit for a heating company office and shop on one of the lots.

¶ 3 Some of the land in the short plat was within a floodplain region, a fact that caused the plat application to be carefully scrutinized to ensure compliance with the existing CAO. The short plat was approved on May 28, 2008. The following year, the City adopted a new CAO that again addressed floodplain regions.¹

¶ 4 Alliance asked the City for a statement of restrictions confirming that the 2009 CAO would not apply to future building permits for its short plat. Alliance contended that its property was subject to the 2007 CAO in place at the time of the short plat. The City's Planning Director disagreed and Alliance appealed to the City's planning commission. Alliance lost that appeal and then filed a Land Use Petition Act (LUPA) action in superior court.

¶ 5 The superior court agreed with the City's interpretation and concluded that the 2007 CAO would not apply to future building permits. Alliance then timely appealed to this court. We accepted a joint brief from Futurewise and the Washington State Association of Municipal Attorneys as amici curiae.

ANALYSIS

¶ 6 The primary issue presented is which development rights vest upon approval of a short plat application that is not accompanied with a building permit application. We agree with the superior court and the administrative reviewers that short plat approval did not necessarily vest Alliance in the 2007 CAO for future building permits.

¶ 7 Washington's vested rights doctrine developed at common law, with Washington expressly adopting a minority position that generally is more favorable to property owners. Once a complete building permit application is filed, it will be considered under the then-current ordinances and regulations governing the land. Abbey Rd. Grp. LLC v. City of Bonney Lake, 167 Wash.2d 242, 250, 218 P.3d 180 (2009). That allows certainty for the property owner who gets to choose when to vest. Id. at 250–51, 218 P.3d 180. The common law vested rights doctrine ultimately also was applied to “conditional use permit applications, grading permit applications, shoreline substantial development permit applications, and septic permit applications.” Potala Village Kirkland, LLC v. City of Kirkland, 183 Wash.App. 191, 198, 334 P.3d 1143 (2014), review denied, 182 Wash.2d 1004, 342 P.3d 326 (2015) (footnote citations omitted).² However, the vesting doctrine was never extended by the courts to land division actions. Noble Manor, 133 Wash.2d at 280, 943 P.2d 1378.

¶ 8 The legislature in 1987 chose to codify the vested rights doctrine, adopting a statute governing vesting for plats and subdivisions as well as a statute governing vesting for building permits. The latter statute provides:

A valid and fully complete building permit application for a structure, that is permitted under the zoning or other land use control ordinances in effect on the date of the application shall be considered under the building permit ordinance in effect at the time of application, and the zoning or other land use control ordinances in effect on the date of application.

RCW 19.27.095(1). The land division vesting statute states:

A proposed division of land, as defined in RCW 58.17.020, shall be considered under the subdivision or short subdivision ordinance, and zoning or other land use control ordinances, in effect on the land at the time a fully completed application for preliminary plat approval of the subdivision, or short plat approval of the short subdivision, has been submitted to the appropriate county, city, or town official.

RCW 58.17.033.

¶ 9 After the legislature acted, one question was whether the common law vesting doctrine continued to have any force. The Washington Supreme Court first had to address that issue in Erickson & Assocs., Inc. v. McLerran, 123 Wash.2d 864, 872 P.2d 1090 (1994). There the question was whether the vesting doctrine should be applied to a master use permit application, a mandatory part of the development process in Seattle.

Id. at 866, 872 P.2d 1090. Seattle adopted a CAO after appellant filed a master use permit, but before a building permit was sought. Id. The developer was told to comply with the new CAO; instead, suit was filed to challenge the application of the CAO to the project. Id. at 866–67, 872 P.2d 1090. After a series of adverse administrative and court rulings, the developer obtained review by the Washington Supreme Court. The court declined to extend the vesting doctrine to the master use permit, reasoning that the significant legislative efforts in the field of land use regulation militated against judicial involvement absent a need to protect constitutional interests. Id. at 875–76, 872 P.2d 1090.

¶ 10 Erickson was applied in Abbey Road to reject an argument that a site plan vested the applicant's development rights. There the developer filed a site plan application expressing an interest in developing the land into a 575–unit condominium project, but no building permits were sought at the time the plan was filed. 167 Wash.2d at 246–47, 218 P.3d 180. Bonney Lake then changed its zoning laws to exclude condominiums on the Abbey Road land. Id. at 248, 218 P.3d 180. The court declined to find a vesting of rights, reasoning that Erickson controlled and there was no basis for ignoring the vesting requirements of RCW 19.27.095(1). Id. at 252–53, 218 P.3d 180.

¶ 11 The issue was addressed again in Town of Woodway v. Snohomish County, 180 Wash.2d 165, 322 P.3d 1219 (2014). There the court flatly declared: “While it originated at common law, the vested rights doctrine is now statutory.” Id. at 173, 322 P.3d 1219. Reviewing the Erickson/Abbey Road/Woodway line of cases, along with the legislative history behind the 1987 statutes, the court in Potala Village rejected a contention that the filing of a complete shoreline substantial development permit vested development rights. 183 Wash.App. at 196–206, 334 P.3d 1143. Noting that the legislature was quite aware of the various permits that had been subject to common law vesting, the court found it significant that only building permits were made subject to statutory vesting and concluded that the legislature did not intend for shoreline substantial development permits to vest. Id. at 205, 334 P.3d 1143.³ Effectively, Potala Village decided that the legislature had pre-empted the vesting doctrine in a manner that foreclosed expansion of vesting to other permit types.⁴

¶ 12 In light of this authority, the question presented by Alliance would appear to be easily answered—development rights do not vest under the building permit statute until the completed building permit application is filed. RCW 19.27.095(1). Because the legislature has comprehensively addressed land use issues, courts are not to expand the vesting doctrine. Erickson, 123 Wash.2d at 875–76, 872 P.2d 1090. However, the noted cases involve the building permit vesting statute rather than the land division vesting statute, RCW 58.17.033, which also can be a source of vested development rights. The interpretation of that statute was at issue in Noble Manor, the decision on which Alliance bases its arguments here.

¶ 13 In Noble Manor, a developer initially sought to rezone land to build four duplexes on a lot sized for three duplexes. 133 Wash.2d at 272, 943 P.2d 1378. The county denied the request and the developer then filed an application for a short plat to divide the land into three plots to accommodate the three duplexes it sought to build. Id. Nearly two weeks later, the developer filed three building permit applications, but the county accepted only one of them because the short plat had not yet been approved. Two months later, before approving the short plat application, the county adopted an interim zoning ordinance that increased the lot size required for a duplex, an action that prevented Noble Manor from building three duplexes on its lot. Id. The county subsequently approved the short plat nearly nine months after enacting its interim zoning ordinance; the approved plat recognized three duplexes on the site. Id. at 273, 943 P.2d 1378. The developer re-submitted building permit applications for the two previously rejected duplexes. The county again rejected the applications, this time citing the interim ordinance. Id. Two weeks later the developer again submitted the building permits; this time the counter clerk accepted them...