City of Prattville v. Post

• Decision Date: 05 April 2002
• Citation: 831 So.2d 622
• Parties: CITY OF PRATTVILLE and City of Prattville Planning Commission v. Mack POST and Bobby Carter.
• Court: Alabama Court of Civil Appeals

831 So.2d 622

CITY OF PRATTVILLE and City of Prattville Planning Commission v. Mack POST and Bobby Carter.

2000461.

Court of Civil Appeals of Alabama.

April 5, 2002.

Alex L. Holtsford, Jr., and Rick A. Howard of Nix, Holtsford, Gilliland, Lyons & Higgins, P.C., Montgomery; David McDowell of McDowell, Faulk & McDowell, Prattville; and George Howell of Howell, Sarto & Howell, Prattville, for appellant City of Prattville.

Louis C. Colley of Cleveland & Colley, P.C., Prattville, for appellees.

MURDOCK, Judge.

This case arose out of the denial by the City of Prattville Planning Commission ("the Commission") of "preliminary plan approval" for a residential subdivision to be known as Kingston Hills.

Pursuant to § 11-52-1 et seq., Ala.Code 1975, the City of Prattville ("the City") adopted an ordinance setting forth regulations relating to the development of residential subdivisions within the City's jurisdiction.¹ Under the City's regulations, planned subdivisions must go through a three-step approval process before the Commission. The three steps are: a sketch-plan approval, a preliminary plan approval, and final plat acceptance, which are described in more detail below.

Initially, a developer presents a "sketch plan" to the Commission. The sketch plan typically includes general information about the developer's plans for the subdivision. The City department heads review the sketch plan and offer comments, after which the developer appears before the Commission to discuss the sketch plan. The purpose of sketch-plan review is to give the developer an opportunity to confer with the Commission and its technical advisors before drawing detailed plans of the subdivision for preliminary plan approval. The Commission's approval of a sketch plan is based on general information rather than an in-depth review; thus, under the City's regulations, sketch-plan approval is expressly not binding on the Commission in subsequent stages of plan review.²

In the second stage, the developer presents a preliminary plan to the Commission. The preliminary plan is considered to be the formal application for subdivision approval and is to include specific information about the subdivision. Under the City's regulations, the developer is not authorized to perform any grading work or other improvements to the property before preliminary plan approval; it does so at its own risk.³ During this stage, the developer must appear before the Commission to discuss the preliminary plan, and the Commission will conduct a public hearing on the subdivision before granting or denying approval.

Finally, in the third stage, the developer presents a final plat to the Commission for approval. Under Article III, Section D, of the Ordinance, final plat approval is required before the subdivision can be recorded in the county probate office and before the construction of the planned residential structures can begin.

In this case, Mack Post and Bobby Carter ("the developers") submitted a sketch plan for a proposed subdivision, to be called "Kingston Hills," to the Commission in 1994. The sketch plan proposed to divide the land into 110 lots, provided for a pumping station to connect the homes to be built on those lots to the City's sewer system, and projected the installation of curbs and gutters for storm drainage. The Commission approved the sketch plan, but the developers did not proceed with the development of the subdivision at that time. The developers determined that the cost of the pumping station and the use of curbs and gutters made the project too expensive for them to pursue.

On March 4, 1998, the developers submitted a second sketch plan for Kingston Hills to the Commission. The developers revised their 1994 plans and divided the land into 30 large lots with septic tanks and open ditches for storm drainage. After the City department heads had reviewed the sketch plan, the City advised the developers, in a letter dated March 16, 1998, that the planning department had made the following comments on the sketch plans, in pertinent part: "Indicate the nearest sewer main. City regulations require the connection of subdivisions that are within 1200 ft. of an existing main."

The developers' engineer, Greg Gillian,⁴ appeared before the Commission at its March 19, 1998, Commission meeting, to discuss the sketch plan. One of the developers, Mack Post, was also present at the meeting. Gillian requested three times that the sketch plan not be approved unless it was approved with open ditches and septic tanks. Joel Duke, the city planner, advised the Commission not to approve the subdivision as proposed with septic tanks because the subdivision was located within 1200 feet of a sewer connection. The Commission unanimously approved the sketch plan; however, Gillian admitted that the city planner advised him at the meeting that sketch-plan approval was not binding toward preliminary plan approval.

It is undisputed that, at the time of sketch-plan approval, one of the developers, Bobby Carter, and Gillian, acting as the developers' agent, knew that under the City's regulations, sketch-plan approval was not binding on the Commission at the preliminary plan stage of review. The other developer, Mack Post, testified that he relied on Gillian, as his agent, to review the City's regulations. After the meeting, Gillian advised both developers that sketch-plan approval was not binding toward preliminary plan approval. The developers proceeded with the engineering work necessary to prepare the subdivision for preliminary plan approval, incurring $20,262.25 in engineering fees.

On August 4, 1998, the Autauga County Health Department inspected the property and issued a letter to "proceed with caution" with the use of septic tanks because of the soil types.

The developers submitted the subdivision for preliminary plan approval at the August 20, 1998, Commission meeting. Gillian and at least one of the developers appeared before the Commission to discuss the preliminary plan.⁵ After much discussion of the August 4 letter dealing with soil types, erosion issues relating to the design of the open ditches, and concerns that future development might be cut off from the City's sewer system if Kingston Hills were to be developed with septic tanks, the Commission voted not to approve the preliminary plan with septic tanks and open ditches.

The developers resubmitted Kingston Hills for preliminary plan approval at the December 1998 Commission meeting. Gillian and one of the developers, Mack Post, appeared before the Commission to discuss the preliminary plan. The developers and the Commission felt that they would be able to alleviate the Commission's concerns about the open ditches; however, the issue of the septic tanks created an impasse. The Commission again voted not to approve the preliminary plan with septic tanks.

The developers then sued the City and the Commission. The developers asserted a fraud claim and also alleged that the Commission had acted negligently, recklessly, or wantonly in having represented to the developers at the sketch-plan stage that the Commission specifically approved of the use of septic tanks and then disapproving the use of septic tanks at the preliminary plan stage.⁶ Alleging substantive immunity, the City filed a motion to dismiss all of the developers' claims. The City also moved, on other grounds, to dismiss the wantonness and recklessness claims. The trial court denied the City's motion to dismiss based on substantive immunity, but granted the City's motion to dismiss the wantonness and recklessness claims. The developers amended their complaint to name as additional defendants those individual Commission members who had voted against preliminary plan approval, alleging that the Commission had acted in bad faith.

On December 18, 2000, a bench trial was held. At the close of the developers' case, the City and the individual Commission defendants moved for the entry of a judgment in their favor, contending that the individual Commission members were entitled to immunity; that the developers had failed to demonstrate an intent to deceive, which the defendants contended was essential to the developers' fraud claim based on a promissory-fraud theory; and that the developers' negligent-misrepresentation theory also failed in that the developers could not have reasonably relied on the Commission's mere sketch-plan approval. The trial court granted the defendants' motion in part and denied it in part, and entered a judgment in favor of the City to the extent the developers sought relief on a promissory-fraud theory; the court also accorded immunity to the individual Commission members. However, the trial court denied the City's motion as to "monetary damages," which we infer to be a reference to the possibility of relief based on negligent misrepresentation.⁷ At the conclusion of a bench trial, the trial court entered a judgment in favor of the developers as to negligent misrepresentation in the amount of $20,262.25, i.e., the amount of the engineering fees incurred by the developers after the sketch-plan approval stage. The City appeals.

The City seeks the reversal of the trial court's judgment on three grounds. It contends that substantive immunity should have applied to the City, that the remaining fraud claim was actually a claim of promissory fraud and that that claim was adjudicated in its favor when the trial court granted the City's motion for a judgment; and that substantial evidence did not support the trial court's judgment in favor of the developers as to the negligent-misrepresentation claim.

The developers argue that substantive immunity should not apply and that the developers reasonably relied on representations by the City approving septic tanks and open ditches during the sketch-plan review.

Standard of Review

At the close of the developers' case, the City and the individual Commission defendants moved for...