Dodd v. Hood River County

• Decision Date: 13 February 1998
• Docket Number: No. 97-35124,97-35124
• Citation: 136 F.3d 1219
• Parties: 28 Envtl. L. Rep. 20,534, 98 Cal. Daily Op. Serv. 1108, 98 Daily Journal D.A.R. 1559 Thomas DODD; Doris Dodd, Plaintiffs-Appellants, v. HOOD RIVER COUNTY, Defendant-Appellee, and State of Oregon, Defendant-Intervenor-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1219

136 F.3d 1219

28 Envtl. L. Rep. 20,534, 98 Cal. Daily Op.

Serv. 1108,

98 Daily Journal D.A.R. 1559

Thomas DODD; Doris Dodd, Plaintiffs-Appellants, v. HOOD RIVER COUNTY, Defendant-Appellee, and State of Oregon, Defendant-Intervenor-Appellee.

No. 97-35124.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Jan. 7, 1998.

Decided Feb. 13, 1998.

John M. Groen, Pacific Legal Foundation, Bellevue, Washington, for plaintiffs-appellants.

Lisa E. Lear, Bullivant, Houser, Bailey, Pendergrass & Hoffman, P.C., Portland, Oregon, for defendant-appellee.

Stephanie L. Striffler, Special Counsel to the Attorney General of Oregon, Salem, Oregon, for defendant-intervenor-appellee.

On Appeal from the United States District Court for the District of Oregon; Robert E. Jones, District Judge, Presiding. D.C. No. CV-91-1157-JO.

Before: ALDISERT, ^* PREGERSON and TROTT, Circuit Judges.

ALDISERT, Circuit Judge:

This latest chapter of the long-running state and federal judicial saga in the zoning controversy between Thomas and Doris Dodd on one side and Hood River County and the State of Oregon on the other requires us to decide whether the Dodds are entitled to compensation under the Fifth Amendment's Takings Clause that was denied them in previous state court and agency proceedings involving takings under Article I, section 18 of the Oregon Constitution. The district court denied them relief. We affirm the judgment of the district court, albeit for different reasons.

In reaching this decision we hold that the district court did not err in applying the doctrine of issue preclusion against the Dodds in the federal proceeding because they had not been totally deprived of some substantial beneficial use of their property, as adjudicated in the state administrative and judicial proceedings.

This case has a long history, the facts of which are set out in our previous opinion in Dodd v. Hood River County, 59 F.3d 852, 855-857 (9th Cir.1995) (Dodd IV ). We will summarize them here.

I.

In November 1983, the Dodds purchased a 40-acre parcel in a Forest Use Zone in Hood River County, intending to build their retirement home. Dodd v. Hood River County, 22 Or. LUBA 711, 714-715 (1992) (Dodd I ) (the Oregon Land Use Board of Appeals, or "LUBA," proceeding). At the time of the purchase, Oregon state law permitted dwellings to be built in Forest Use Zones only if "necessary and accessory" to forest use. See State Land Conservation & Dev. Comm'n Goal 4, Or. Admin. R. 660-15-000(4); Lamb v. Lane County, 7 Or. LUBA 137, 143 (1983) (interpreting and setting standard for compliance with Goal 4). State law also required county zoning ordinances to comply with Goal 4. Or.Rev.Stat. §§ 197.175, 197.250; see also Alexanderson v. Board of Comm'rs, 289 Or. 427, 434-435, 616 P.2d 459 (1980). Hood River County's zoning ordinances, however, were not yet compatible with Goal 4 at the time of the Dodds' purchase. But for the prohibitions set forth in the Oregon statute, the Dodds may have been able to build a residence under the County's zoning scheme, as it was worded.

At about the time of the purchase, the Dodds received several notices from the County which they interpreted as authorization for them to build a residence. Months before the purchase, the County Sanitarian prepared a report for the previous owner stating that the parcel was suitable for a septic system. In January 1984, an employee of the County Planning Department signed a "Land Use Compatibility Statement" stating that a residence on the parcel would be compatible with statewide planning goals. In February 1984, the Sanitarian sent the Dodds a letter stating that their plans to build a residence "would appear to leave opportunity for the water supply system to be developed." However, none of these notices stated that the permits necessary for the Dodds to build their residence would be issued; the Sanitarian's first letter expressly stated that it was not to be considered such a representation.

During the same time period, the County sent notice to the Dodds' predecessor-in-interest, and published other notices, stating that its zoning ordinances were in the process of being amended to comply with Goal 4. In February 1984, the County passed an ordinance changing the zoning of forest land, but fearing that this still did not comply with Goal 4, passed another ordinance in December 1984 which adopted the "necessary and accessory" test for the building of residences in Forest Use Zones.

In 1990, the Dodds applied to the County Planning Department for a land use permit, a conditional use permit and a comprehensive plan and zone change that would allow them to build a residence on the parcel. All were denied. In an appeal to the County Planning Commission in April 1991, two public hearings were held before the Commission upheld the Department's decision. The Dodds appealed to the Board of County Commissioners, which also held a public hearing before upholding the decision.

The Dodds then appealed to LUBA, arguing that the denial was a taking under Article I, section 18 of the Oregon Constitution. LUBA also affirmed. LUBA considered a written appraisal of the parcel submitted by the Dodds, which estimated the value of the parcel without the benefit of the Dodds' proposed residence, adding the value of the timber currently available on the land to the value of the land suitable for future timber growing, to be $691.81. The County also submitted a letter from its Forester, who declared that the Dodds, after subtracting expenses, could yield at least $10,000 from harvesting the timber. LUBA found that the Dodds' proposed residence was not "necessary and accessory" to forest use. It also found that there was no taking under the Oregon Constitution because the land could "produce a net profit if properly managed for timber production", and thus the Dodds were not denied a "substantial beneficial use of the property." Dodd I, 22 Or. LUBA at 732.

The Oregon Court of Appeals, Dodd v. Hood River County, 115 Or.App. 139, 836 P.2d 1373 (1992) (Dodd II ), and Oregon Supreme Court, Dodd v. Hood River County, 317 Or. 172, 855 P.2d 608 (1993) (Dodd III ), each affirmed the decision. The Oregon Supreme Court determined that the record supported the Dodds' potential profit from forest use of the land and denied relief under the Oregon Constitution. Dodd III, 317 Or. at 180, 185, 855 P.2d 608. Because the Dodds expressly reserved their takings claim under the Fifth Amendment, the federal issue was not presented in the Oregon administrative and judicial proceedings.

Before the Oregon Supreme Court had decided the case, the Dodds filed suit under 42 U.S.C. § 1983 in federal district court, before which the Dodds made their taking argument under the Fifth and Fourteenth Amendments of the United States Constitution. The district court dismissed the claim as unripe. The Dodds appealed and, because the Oregon Supreme Court decided the case during the pendency of the appeal, we decided that the federal issue was ripe and remanded. Dodd IV, 59 F.3d at 865.

On remand, the district court had to determine, inter alia, whether the Dodds' claim under the Takings Clause of the Fifth Amendment to the United States Constitution, as applied to the states through the Fourteenth Amendment, requires a broader inquiry than a claim under the Takings Clause of the Oregon Constitution. This was to be a threshold decision by the district court before it could determine whether the Oregon state agency determination under the Oregon Constitution precluded the Dodds from proceeding under the Fifth Amendment to the United States Constitution. The district court determined that there was no fundamental distinction between the takings analysis under the two constitutions and, therefore, that the Dodds were precluded from obtaining federal court relief.

II.

We review the district court's grant of summary judgment de novo. Covey v. Hollydale Mobilehome Estates, 116 F.3d 830, 834 (9th Cir.1997). We must determine, viewing the evidence in the light most favorable to the Dodds, whether there are any genuine issues of material fact and whether the district court correctly applied the relevant substantive law. See id.

III.

At issue here is a concept that is traditionally known as and is still most frequently called "collateral estoppel" by the courts. See 18 Charles Alan Wright, Arthur R. Miller, Edward H. Cooper, Federal Practice and Procedure § 4402 (1981). The terms "issue preclusion" and "collateral estoppel" have been used interchangeably by both the parties and the courts in this case. However, we have previously expressed our preference for the term "issue preclusion" and will here refer to the concept by this term. See Robi v. Five Platters, Inc., 838 F.2d 318, 322 n. 2 (9th Cir.1988).

Under the doctrine of issue preclusion, a valid and final determination in one proceeding of a necessary factual or legal issue-here the value of the Dodds' land-may not be relitigated in a subsequent proceeding involving a party to the prior action. See Fisher Broad. v. Department of Revenue, 321 Or. 341, 347, 898 P.2d 1333 (1995). This judicially-created doctrine, as with res judicata, serves to promote judicial efficiency by preventing multiple lawsuits and to enable the parties to rely on the finality of adjudications. Allen v. McCurry, 449 U.S. 90, 94, 101 S.Ct. 411, 414-15, 66 L.Ed.2d 308 (1980). Federal courts must give state court judgments the same preclusive effect as they would be given by courts of that state. Full Faith and Credit Act, 28 U.S.C. § 1738; Parsons Steel v. First Ala. Bank, 474 U.S. 518, 525, 106 S.Ct. 768, 772-73, 88 L.Ed.2d 877 (1986). Therefore, Oregon law dictates our analysis of issue preclusion. See Allen, 449 U.S. at 96, 101 S.Ct. at 415-16.

Under Oregon law, LUBA's determination that the Dodds were not "denied a 'substantial beneficial use of [their] property' ", Dodd I, 22 Or....