Dupont v. IDAHO STATE BD. OF LAND COM'RS

• Court: Idaho Supreme Court
• Writing for the Court: TROUT, Chief Justice.
• Citation: Dupont v. IDAHO STATE BD. OF LAND COM'RS, 7 P.3d 1095, 134 Idaho 618 (Idaho 2000)
• Decision Date: 28 July 2000
• Docket Number: No. 25041.,25041.
• Parties: Donald A. DUPONT, Petitioner-Appellant-Cross Respondent-Respondent on Appeal-Cross Respondent. v. IDAHO STATE BOARD OF LAND COMMISSIONERS, and the Department Of Lands, Stanley Hamilton, Director, Respondents-Respondents-Cross Respondents-Respondents on Appeal-Cross Appellants, and City of Coeur D'alene, Intervenor Cross Appellant-Appellant on Appeal-Cross Respondent.

7 P.3d 1095

134 Idaho 618

Donald A. DUPONT, Petitioner-Appellant-Cross Respondent-Respondent on Appeal-Cross Respondent. v. IDAHO STATE BOARD OF LAND COMMISSIONERS, and the Department Of Lands, Stanley Hamilton, Director, Respondents-Respondents-Cross Respondents-Respondents on Appeal-Cross Appellants, and City of Coeur D'alene, Intervenor Cross Appellant-Appellant on Appeal-Cross Respondent.

No. 25041.

Supreme Court of Idaho, Coeur d'Alene, April 2000 Term.

July 28, 2000.

Rehearing Denied September 12, 2000.

Jeffrey A. Jones and Nancy Stricklin, Coeur d'Alene, for appellant City of Coeur d'Alene. Nancy Stricklin argued.

John F. Magnuson, Coeur d'Alene, for respondent Dupont.

Hon. Alan G. Lance, Attorney General, Boise, for respondent Idaho State Board of Land Commissioners and Department of Lands. Stephanie A. Balzarini, Deputy Attorney General, argued.

TROUT, Chief Justice.

This is an appeal from an order of the district judge vacating an order of the State Board of Land Commissioners (Board) revoking a dock permit issued to Donald Dupont (Dupont) by the Idaho Department of Lands (Department). The City of Coeur d'Alene (City) appealed from the order of the district court and the Board has cross-appealed. For the reasons set forth below, we now affirm the decision of the Board revoking Dupont's dock permit.

I. FACTUAL AND PROCEDURAL BACKGROUND

Dupont owns 158 feet of littoral property on the shores of Lake Coeur d'Alene. In March of 1992, Dupont filed an application under I.C. § 58-1305 seeking permission from the Department to construct a private dock in the waters abutting his property. Idaho Code § 58-1305(b) requires an applicant to either get consent from, or give formal notice to, adjacent owners "[i]f the plans of the proposed encroachment indicate such infringement will or may occur...." Dupont gave notice of his application to the owners of the adjoining properties. Additionally, on April 6, 1992, the Department sent letters to the property owners giving them twenty-one days from the date of the letter to file an objection with the Board. Dennis Davis, the owner of a one-quarter interest in an adjoining littoral lot, did file an objection with the Department but not until April 30, 1992, after the deadline imposed by the Department.¹ It is undisputed the City was never given formal notice from either Dupont or the Department. However, the record also reflects the Department communicated with the City several times in March and April regarding the application of city ordinances to the proposed dock.

Under I.C. § 58-1305(c), the Board is required to hold a hearing if an objection is filed by an adjacent landowner, or if the Board deems it advisable because of the existence of unusual circumstances. Because there was no timely objection filed, and notwithstanding the notice of the City ordinance establishing a public swimming zone in the area of the proposed encroachment, the Department administratively determined Dupont's application was neither unusual nor distinguishable from the approximately 2,000 applications the Department receives annually. Accordingly, Dupont's permit was administratively issued pursuant to I.C. § 58-1305 on May 4, 1992.

On May 12, 1992, Davis provided the Department with a "Notice of Appeal" of Dupont's permit. On May 27, 1992, the City also notified the Department of its objection to the permit, and requested the Board reconsider the decision to grant it. In response to the notice of appeal and the public concern generated by the issuance of the permit, the Department scheduled an informal reconsideration hearing. At the informal hearing, after hearing statements from all the parties, the Department concluded the permit was validly issued. On July 7, 1992, the Board held a meeting concerning the Davis appeal. At the conclusion of that meeting, the Board scheduled a contested case hearing pursuant to former I.C. § 67-5214(c) to determine whether to reaffirm or revoke Dupont's permit. On August 26, 1992, the hearing officer issued an order allowing the City to intervene in the contested case administrative proceedings.

Pursuant to the Board's order, a hearing officer was appointed and a contested case hearing was held on December 7 and 8, 1992. Following the hearing, the hearing officer made findings of fact and conclusions of law and recommended the permit be revoked. It is undisputed the hearing officer conducted a de novo hearing and made a de novo decision regarding the appropriateness of issuing the permit. The Board adopted the findings of the hearing officer, and adopted all but two of the conclusions of law. The Board did not adopt the hearing officer's conclusion that the hearing was a reconsideration of the decision to issue a permit, rather than a hearing on the revocation of the permit, and the Board did not adopt the conclusion of law that the City was an adjacent landowner and therefore entitled to notice of the proposed encroachment under the Lake Protection Act. On August 3, 1993, the Board issued a decision revoking Dupont's permit. Dupont then appealed to the district court. The City filed a cross-appeal claiming the Board incorrectly determined the hearing officer had erred in classifying the contested hearing as a reconsideration of the decision to issue the permit, and the Board incorrectly held the hearing officer had erred in concluding Dupont had failed to provide adequate notice to the City.

After briefing and argument, the district judge issued his opinion on August 20, 1998. In his opinion, the district judge concluded the Board's order revoking Dupont's permit was in error and vacated the order, remanding the case back to the Board for further proceedings. The court determined there was no procedure by which the Board could order a de novo reconsideration of the decision to grant Dupont's permit. Rather, the contested case must have been a revocation hearing. At a revocation hearing, the petitioners would have had the burden of proof to show Dupont's permit should be revoked and the only issue properly before the hearing officer would have been whether the requirements of the law were met at the time the permit was granted. The district judge held the hearing officer had applied an incorrect standard of review to the case and the Board's adoption of the officer's findings and conclusions was erroneous. The City then appealed from this decision and the Board cross-appealed.

II. STANDARD OF REVIEW

On appeal, this Court will review an agency's decision independent of the district court's determination. McCoy v. State, Dept. of Health & Welfare, 127 Idaho 792, 793, 907 P.2d 110, 111 (1995). Under the Idaho Administrative Procedure Act, the agency's decision must be affirmed unless the agency's findings and conclusions are:

(a) in violation of constitutional or statutory provisions;

(b) in excess of the statutory authority of the agency;

(c) made upon unlawful procedure;

(d) not supported by substantial and competent evidence on the record as a whole; or

(e) arbitrary, capricious, or an abuse of discretion.

McCoy, 127 Idaho at 794, 907 P.2d at 112 (citing I.C. § 67-5279(3)).

III. DISCUSSION

On appeal, the parties present five issues to this Court. First, the City argues the Board incorrectly determined the hearing was a revocation proceeding rather than a reconsideration of the original decision to issue Dupont's dock permit. Second, Dupont argues the Board incorrectly applied a de novo standard of review to the revocation hearing. Third, Dupont argues even if the Board applied the correct standard of review, I.C. § 58-1305(a) is unconstitutionally vague. Fourth, Dupont argues the Board's decision to revoke the permit is not supported by substantial and competent evidence. Fifth, both the City and the Board argue the public trust doctrine provides an independent basis for the Board's decision. We will address each argument in turn.

A. The City lacks standing to appeal the issue regarding the characterization of the contested case hearing.

On appeal, the City argues the Board erred in rejecting the hearing officer's conclusion that the contested case hearing was a reconsideration of the original administrative decision to issue the permit, not a hearing on the revocation of Dupont's permit. Despite the Board's rejection of the hearing officer's conclusion regarding the nature of the proceedings, the Board nevertheless revoked Dupont's permit; the outcome the City desired. Thus, because the City has suffered no injury as a result of the Board's action in this regard, the City lacks standing to now raise this issue on appeal. Therefore, we decline to address the merits of this issue.

B. The Board applied the correct standard of review to the revocation proceeding.

Dupont argues the Board applied an incorrect standard of review to the revocation hearing. According to Dupont, in reviewing the Department's initial administrative determination to issue the permit, the Board was required to apply "well-accepted principles of appellate review." That is, the Board could only review the record and determine whether the Department's findings of facts supported its conclusions of law. The Board could not reweigh the evidence and substitute its opinion for that of the Department. Because there is no dispute the Board applied a de novo standard to the hearing, Dupont argues the Board's findings and conclusions were made upon unlawful procedure and must be overturned.

In contrast to Dupont, both the City and the Board argue a de novo standard is appropriate for revocation hearings. Under the administrative rules governing lake encroachments in effect at the time the Board conducted the hearing, revocations or withdrawals of permits were required to comply with the procedures set forth in I.C. § 67-5214(c) (now amended and renumbered as I.C. § 67-5254). IDAPA 20.11.4(u) (1990). Idaho Code § 67-5214(c) provided, in relevant part:

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