City of Okoboji v. Parks

• Decision Date: 26 April 2013
• Docket Number: No. 12–0335.,12–0335.
• Citation: 830 N.W.2d 300
• Parties: CITY OF OKOBOJI, Iowa, Appellee, v. Leo PARKS, Jr. and Okoboji Barz, Inc. d/b/a Okoboji Boat Works, Fish House Lounge and Clucker's Broasted Chicken, Appellants.
• Court: Iowa Supreme Court

830 N.W.2d 300

CITY OF OKOBOJI, Iowa, Appellee,

v.Leo PARKS, Jr. and Okoboji Barz, Inc. d/b/a Okoboji Boat Works, Fish House Lounge and Clucker's Broasted Chicken, Appellants.

No. 12–0335.

Supreme Court of Iowa.

April 26, 2013.

Sean J. Barry and Richard J. Barry of Montgomery, Barry, Bovee & Barry, Spencer, for appellants.

Michael J. Chozen, Spirit Lake, for appellee.

APPEL, Justice.

In this case, we again consider issues surrounding the efforts of the City of Okoboji to enforce zoning restrictions on a property located on the shore of West Lake Okoboji. The lakefront property is zoned residential, but has been historically operated as a marina pursuant to special-use permits allowing nonconforming use. We have previously held that while the use of the property as a marina is lawful under the special-use permits, they do not allow an expansion of use that includes on-premises consumption of alcohol with live entertainment, karaoke, hog roasts, and full-moon parties. City of Okoboji v. Okoboji Barz, Inc. (City of Okoboji I), 717 N.W.2d 310, 315–16 (Iowa 2006). After the district court, on remand from our decision in City of Okoboji I, entered a narrow injunction limiting relief to denial of a city liquor license, we held in a certiorari proceeding that the district court erred in not giving the City broader relief and remanded the case again. City of Okoboji v. Iowa Dist. Ct. (City of Okoboji II), 744 N.W.2d 327, 332 (Iowa 2008).

Undeterred, the owner of the property now seeks to operate a bar on a structure called the Fish House Lounge, which, while generally moored to the marina's “seawall,” is capable of getting underway on the lake. The Fish House Lounge has a class “D” liquor license from the state. The City objected to the operation of the Fish House Lounge as contrary to our holdings in City of Okoboji I and City of Okoboji II and sought declaratory and injunctive relief. The district court ruled that the arrangement amounted to a nonconforming use of the property in violation of the City's zoning regulations. The court entered an injunction prohibiting use of the marina property to provide parking, access to or from, and supporting services, including bathroom facilities, to patrons of a boat, vessel, or structure on which alcohol is served or upon which entertainment, music, karaoke, abandon-ship parties, or howl-at-the-moon parties are provided. The injunction further prohibited the selling or serving of alcohol, wine, and beer on any boat or structure moored to or attached to the marina and on or from any boat or structure attached to a dock extending from the premises.

The property owner appeals. We now affirm the district court as modified below.

I. Factual and Procedural Background.

The factual background of this dispute has already been set forth in City of Okoboji I and City of Okoboji II. Historically, two marinas, the Cove and Okoboji Boats, were located on the lakeshore of West Lake Okoboji. In 1972, the City of Okoboji enacted a zoning ordinance. The properties where the marinas were located were zoned lakeshore residential. Section 2(A) of article VII of the ordinance dictates that single-family dwellings are the only permitted principal uses of lakeshore residential property. Okoboji Zoning Ordinance art. VII, § 2(A) (2006) (originally codified in 1972). In addition, section 2(B)(2) of article VII prohibits use of property in a lakeshore residential district as an entry point for commercial access. Id. § 2(B)(2). In 1973, the properties received special-use permits that grandfathered in then-existing operations as nonconforming uses under the ordinance. In 1975, the two marinas merged into a single marina known as Okoboji Boat Works.

Leo Parks, Jr., purchased Okoboji Boat Works in 2001.¹ As part of a remodeling effort, Parks sought to build a bar on the marina property that would serve on-site liquor. The City denied Parks's request for a class “C” commercial liquor license, stating that “operation of a tavern/restaurant on premises represents a substantial change in the nature and character of the use permitted under the special use permit.” City of Okoboji I, 717 N.W.2d at 313. When Parks appealed the City's denial to the alcoholic beverages division of the Iowa Department of Commerce, the City filed an action seeking temporary and permanent injunctive relief against operation of a tavern as a nonconforming use. Id. The district court denied the City relief, and the City appealed. Id.

On appeal, we reversed the judgment of the district court and remanded the case to the district court for entry of a permanent injunction prohibiting the use of the property as a bar. Id. at 317. We noted that Parks intended to operate his bar for long hours and to host activities such as karaoke, live music, hog roasting, and monthly full-moon parties. Id. at 316. We held that such activity changes the nature and character of the nonconforming use. Id. As a result, we held Parks's proposal to operate a full-fledged bar could not be considered an accessory use to the operation of the marina. Id.

On remand, the City asked the district court to enter an injunction prohibiting both the operation of the bar and use of the marina for live music, karaoke, hog roasts, and full-moon parties. City of Okoboji II, 744 N.W.2d at 329–30. The district court entered an injunction that only prohibited Parks from selling alcoholic beverages for on-premises consumption, thus prohibiting him from obtaining a class “C” liquor license. Id. at 330. The City sought a writ of certiorari, arguing that under the district court's order, Parks could sell packaged beer and wine to patronsand maintain a bar-like atmosphere on the premises. Id.

In City of Okoboji II, we sustained the writ and held the narrow district court order fell short of our mandate in City of Okoboji I.Id. at 333. We emphasized that our opinion in City of Okoboji I was based on the expanded activities associated with the proposed bar and not on the method of licensing. Id. at 332. We stated, “[T]he injunction must prohibit the activity of operating a bar under the circumstances proposed without regard to the manner alcoholic beverages would be sold or consumed.” Id.

Twenty-five days prior to the issuance of our City of Okoboji I opinion, Parks began implementing an alternate legal strategy. Parks obtained a class “D” liquor license from the alcoholic beverages division of the Iowa Department of Commerce for an excursion boat, the Fish House Lounge. The Fish House Lounge is a thirty-by-forty-foot structure on pontoons. Parks obtained the class “D” liquor license for the Fish House Lounge from the state, and not the City, based upon the state's control of the lake bed. Later applications for a state liquor license requested licensing for additional excursion boats.

In February 2010, after the Fish House Lounge had been in operation for a period of time, the City brought a second action seeking declaratory and injunctive relief. The district court granted the City relief. The district court found that the Fish House Lounge cannot cruise the lake during winter months, has no regular cruise schedule, and is rarely seen cruising the lake. It found that though the Fish House Lounge has small restroom facilities, patrons are asked to use the restroom facilities on the marina property. The district court further found that the Fish House Lounge presents live and recorded entertainment to patrons, hosts theme parties, karaoke, and other activities as outlined in City of Okoboji I and City of Okoboji II, and operates as late as midnight. The district court concluded Parks was engaged in the very activities prohibited by this court in City of Okoboji I and City of Okoboji II, but had simply moved the activities a few feet west onto the Fish House Lounge.

As a result of these factual findings, the district court concluded that the use of the Okoboji Boat Works property to provide ingress and egress to and from a bar, to provide motor vehicle parking for patrons of a bar, and to provide restroom facilities to patrons of a bar constituted an unlawful expansion of the preexisting nonconforming use. The district court further held that Iowa Code section 414.20 authorizes the issuance of an injunction and that the failure to enter an injunction would effectively sanction conduct that the City's ordinance prohibits.

In light of its findings of fact and legal conclusions, the district court entered an injunction prohibiting Parks from:

1. Using the premises described in Exhibit 1 ² ... to provide access to or from, provide parking for persons seeking access to or from, or provide supporting services including bathroom facilities to patrons of, any boat, vessel or structure on which alcohol is sold and consumed or on which entertainment, music, karaoke, abandon ship parties, or howl at the moon parties are provided, while such boat, vessel or structure is moored or otherwise attached to a dock extending from or attached to the said premises; and

2. From selling or serving alcohol, wine or beer, from providing entertainment, music, karaoke, abandon ship parties and howl at the moon parties, on or from any boat or other structure which is moored or attached to the premises described in Exhibit 1 ... or on or from any boat or other structure which is moored or attached to a dock extending from said premises.

The district court declined the City's request to enjoin Parks from providing access to or from a boat or vessel on which alcohol is sold and consumed within three hundred feet of the marina.

Parks appeals.

II. Standard of Review.

A request for an injunction invokes the district court's equitable jurisdiction. Iowa R. Civ. P. 1.1501. We review the district court's order issuing a permanent injunction de novo. Opat v. Ludeking, 666 N.W.2d 597, 603 (Iowa 2003). “Although the trial court's factual findings are not binding” in an action seeking an injunction, “we give...