City of Grantsville v. Redevelopment Agency of Tooele City, 2010 UT 38 (Utah 5/14/2010)

Decision Date14 May 2010
Docket NumberNo. 20080373.,20080373.
PartiesCity of Grantsville and the Town of Stockton, Plaintiffs, Appellants and Cross-appellees, v. Redevelopment Agency of Tooele City; City of Tooele; and the Tooele County Economic Development Corporation, Defendants, Appellees and Cross-appellants.
CourtUtah Supreme Court

Scott M. Lilja, Cassie J. Medura, Lisa B. Bohman, Salt Lake City, for appellants.

Phillip W. Dyer, Gainer M. Waldbillig, Carey A. Seager, Salt Lake City, for appellees.

PARRISH, Justice:

INTRODUCTION

¶ 1 On February 2, 1994, the City of Tooele, the Tooele County Economic Development Corporation ("Corporation"), Tooele County, and the Tooele County Council of Governments ("Council of Governments") entered into an agreement pursuant to the Utah Interlocal Cooperation Act ("Interlocal Agreement" or "Agreement") relating to the redevelopment of property formerly belonging to the Tooele Army Depot ("Base Property" or "Property"). Appellants, the City of Grantsville and the Town of Stockton (collectively, "Grantsville"), filed suit alleging, among other claims, that the City of Tooele, the Redevelopment Agency of Tooele City ("Redevelopment Agency"), and the Corporation breached their contractual and fiduciary obligations to develop the Base Property or to share the profits from the sale of the Base Property as required by the Interlocal Agreement.

¶ 2 The district court granted summary judgment for the defendants on all claims. We reverse in part and affirm in part. We hold that the district court improperly dismissed Grantsville's contractual claims, including its reformation claim, because Grantsville raised a material issue of fact as to whether the Interlocal Agreement is integrated. But we affirm the district court's order dismissing Grantsville's remaining claims.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 3 This case arises from the closure and realignment of the Tooele Army Depot ("Depot"), a federal military installation located in Tooele County. To speed up economic recovery in communities where military bases are slated to close, the Defense Base Closure and Realignment Act of 1990, 10 U.S.C. § 2687 (2006), provides a process whereby former base property can be converted to new uses by public and private entities. To facilitate this process, Tooele City, Tooele County, and Grantsville each passed a resolution designating the Corporation as the sole entity to represent their respective interests to the Army in the base closure process. In turn, the Corporation formed the Base Reuse Commission for the purpose of formulating a base reuse plan. The Corporation also selected the Redevelopment Agency as the entity to acquire title to the Depot's real property.

¶ 4 Before the Base Reuse Plan was drafted and submitted for approval to the Army, Tooele County, Tooele City, the Redevelopment Agency, and the Council of Governments entered into the Interlocal Agreement. The Interlocal Agreement was entered pursuant to the Utah Interlocal Cooperation Act, Utah Code sections 11-13-101 through 11-13-314 (2007).1 The Agreement provided that the Base Property would be annexed into Tooele City and that the Redevelopment Agency would acquire title to the Base Property. The Agreement further provided that the Redevelopment Agency acquire the Base Property "pursuant to the Base Reuse Plan and lease[] [it] and manage[] [it] on an interim basis, all in conformance with the terms and provisions of such agreements therefor as shall be negotiated by and between the Reuse Committee and the Army." Grantsville executed the Interlocal Agreement as a member of the Council of Governments.

¶ 5 After the execution of the Interlocal Agreement, the Corporation submitted the Base Reuse Plan to the Army for approval. The Base Reuse Plan included a scheme for realigning the Base Property to promote economic development and to create jobs. On March 27, 1996, the Redevelopment Agency submitted an application for an Economic Development Conveyance to the Army that, if granted, would allow the Army to transfer the Base Property to the Redevelopment Agency at no cost. On August 27, 1999, the Army deeded the Base Property to the Redevelopment Agency. The Redevelopment Agency then sold a portion of the Property for fifteen million dollars and paid the proceeds to Tooele City. Tooele City used the proceeds to finance a new city hall, an animal control facility, a new library, and to improve the city golf course clubhouse. Additionally, each year Tooele City transferred the interest generated from the proceeds to its general fund as payment for "contract services."

¶ 6 Grantsville opposed Tooele City's and the Redevelopment Agency's use of the Base Property and filed suit, asserting claims for breach of contract, breach of the covenant of good faith and fair dealing, reformation, breach of fiduciary duty, negligent misrepresentation, promissory estoppel, unjust enrichment, and constructive trust. Additionally, Grantsville requested an accounting for the proceeds received from the sale of the Base Property. Grantsville argued that Tooele City and the Redevelopment Agency had used the proceeds from the sale of the Base Property for Tooele City's sole benefit and thereby breached their duty to develop the Base Property for the benefit of the entire Tooele County community. Grantsville also argued that the Base Property remained largely unchanged from the time it had been listed on the closure list and that Tooele City's and the Redevelopment Agency's failure to develop it pursuant to the Base Reuse Plan was a breach of the Interlocal Agreement. The other governmental entities that were parties to the Interlocal Agreement—Tooele County and the Council of Governments—did not file suit.

¶ 7 The district court granted summary judgment to Tooele City and the Redevelopment Agency on all issues. Specifically, the district court held that the plain language of the Interlocal Agreement did not require the defendants to "share the proceeds" from the sale of the Base Property with Grantsville. Grantsville appealed. We affirm in part and reverse in part the district court's grant of summary judgment. We have jurisdiction pursuant to Utah Code section 78A-4-103(3)(2008).

STANDARD OF REVIEW

¶ 8 "We review a district court's decision to grant summary judgment for correctness, granting no deference to the district court's conclusions, and we view the facts and all reasonable inferences in the light most favorable to the nonmoving party." Bodell Constr. Co. v. Robbins, 2009 UT 52, ¶ 16, 215 P.3d 933. Additionally, "it is well established that an appellate court may affirm the judgment appealed from if it is sustainable on any legal ground or theory apparent on the record, even though such ground or theory differs from that stated by the trial court." First Equity Fed., Inc. v. Phillips Dev., LC, 2002 UT 56, ¶ 11, 52 P.3d 1137.

¶ 9 Standing is a question of law that we review for correctness, "affording deference for factual determinations that bear upon the question of standing, but minimal deference to the district court's application of the facts to the law." Cedar Mountain Envtl., Inc. v. Tooele County, 2009 UT 48, ¶ 7, 214 P.3d 95 (internal quotation marks omitted).

DISCUSSION

¶ 10 The issues to be resolved in this appeal are: (I) whether Grantsville has standing to bring suit for claims arising under the Interlocal Agreement, (II) whether the district court erred in granting summary judgment on Grantsville's claim that the Redevelopment Agency and Tooele City breached the Interlocal Agreement, (III) whether the district court erred in dismissing Grantsville's fiduciary duty and equitable claims, (IV) whether the district court erred in denying Tooele City and the Redevelopment Agency's motion to amend their complaint, and (V) whether the district court erred in denying Grantsville's motion for a change of venue. We address each issue in turn.

I. GRANTSVILLE LACKS TRADITIONAL STANDING BUT HAS ALTERNATIVE STANDING TO RAISE CLAIMS UNDER THE AGREEMENT

¶ 11 Initially, we must determine whether Grantsville has standing to bring suit against the Redevelopment Agency and Tooele City for allegedly failing to develop the Base Property. See Ball v. Pub. Serv. Comm'n, 2007 UT 79, ¶ 45, 175 P.3d 545 ("Prior to deciding the substantive questions presented by the parties, this Court must ascertain whether it has subject matter jurisdiction. . . ." (internal quotation marks omitted)); Jones v. Barlow, 2007 UT 20, ¶ 12, 154 P.3d 808 ("[S]tanding is a jurisdictional requirement that must be satisfied before a court may entertain a controversy between two parties." (alteration in original) (internal quotation marks omitted)).

¶ 12 A party can establish traditional or alternative standing. See Cedar Mountain. Envtl., Inc. v. Tooele County, 2009 UT 48, ¶ 9, 214 P.3d 95. We hold Grantsville lacks traditional standing but has alternative standing in this dispute.

A. Grantsville Does Not Satisfy Traditional Standing Requirements Because It Has No Legal Interest in the Interlocal Agreement

¶ 13 Grantsville argues that it has a legal interest in the dispute and thus has traditional standing because it "consented to being represented in the base closure process, passed resolutions authorizing such representation and signed the Interlocal Agreement for the purpose of implementing the process." We disagree.

¶ 14 Utah's traditional standing test requires a showing of injury, causation, and redressability. See Utah Chapter of the Sierra Club v. Utah Air Quality Bd., 2006 UT 74, ¶ 21, 148 P.3d 960. Under the first prong of the traditional test, "the petitioning party must allege that it has suffered or will `suffer[] some distinct and palpable injury that gives [it] a personal stake in the...

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