Frankland v. City of Lake Oswego

• Decision Date: 31 December 1973
• Citation: 267 Or. 452,517 P.2d 1042
• Parties: Roger FRANKLAND et al., Respondents, v. CITY OF LAKE OSWEGO, a municipal corporation, et al., Petitioners.
• Court: Oregon Supreme Court

Page 1042

517 P.2d 1042

267 Or. 452

Roger FRANKLAND et al., Respondents, v. CITY OF LAKE OSWEGO, a municipal corporation, et al., Petitioners.

Supreme Court of Oregon.

Argued and Submitted June 6, 1973.

Decided Dec. 31, 1973.

Gerson F. Goldsmith, Portland, argued the cause for petitioners. With him on the briefs for petitioner Mountain Park Corporation were J. Brad Littlefield, and Goldsmith, Siegel & Engel, Portland

Also on the briefs were Garry P. McMurry, Patric J. Doherty, and McMurry, Sherry & Nichols, Portland, for petitioners City of Lake Oswego and John C. MacLean, H. J. Fergusen, William Cook, Robert Dent, Mary Goodall, William Knowles, and Charles Needham; Kenneth W. Baines, and Wheelock, Richardson, Niehaus, Baines & Murphy, Portland, for petitioner Dave Christensen, Inc., and David J. Krieger, and Black, Kendall, Tremaine, Boothe & Higgins, Portland, for petitioner Security Bank of Oregon.

David P. Templeton, Portland, argued the cause for respondents. With him on the briefs were Charles Robinowitz, Robert E. Glasgow, and Dusenbery, Martin, Bischoff & Templeton, Portland.

Whitaker & Whitaker, Portland, filed an amicus curiae brief on behalf of The Homebuilders Assn. of Metropolitan Portland.

Before O'CONNELL, C.J., and McALLISTER, DENECKE, HOLMAN, TONGUE and HOWELL, JJ.

HOWELL, Justice.

Plaintiffs filed this action for a declaratory judgment seeking an injunction or, alternatively, an award of monetary damages as remedies for the construction of an apartment building by the defendant Dave Christensen, Inc. At the close of plaintiffs' case, the trial court allowed defendants' motion to dismiss. On appeal, the Court of Appeals reversed and remanded the case to the trial court, 8 Or.App. 224, 493 P.2d 163 (1972). We granted review.

The plaintiffs, adjoining property owners, challenge the validity of the construction of the apartment building which was erected pursuant to a planned unit development ordinance enacted by the City of Lake Oswego. Plaintiffs contend that the construction was not accomplished according to the planned unit development plan as submitted to the City, and that they are entitled to have the apartment building removed or be awarded damages for the depreciation in value of their property resulting from such construction.

We adopt a portion of the opinion of the Court of Appeals which states the background and the facts leading up to the filing of this suit.

In 1967 various entities in which Carl Halvorson had a dominant interest acquired the right to purchase the property designated (B) and (C) in the accompanying map (hereinafter the Kerr property). The segment of the Kerr property around which this suit revolves is in Multnomah County and lies north of the east-west Clackamas-Multnomah county line and is designated (B) on the map. It is separated by a dotted line from the balance of the Kerr property, marked (C) on the accompanying map. This land was undeveloped. Plaintiffs live or own property on the strip of land immediately west of (B), extending southward from Stephenson Street and

designated (A) (hereinafter called Arrowood). Arrowood was substantially developed with single family residences. Immediately east of (B) is other land, not involved here, which also was developed with single family residences.

NOTE: OPINION CONTAINS TABLE OR OTHER DATA THAT IS NOT VIEWABLE

Prior to the events which led to this litigation, all of the land mentioned above which lay in Multnomah County had been zoned under a comprehensive plan as R--20--single family residential--upon which residences could be built only if the lot occupied an area of 20,000 square feet or more. Arrowood had been annexed to the City of Portland several years earlier and remained zoned by Portland for single family residences. The accompanying map illustrates that Arrowood is surrounded by the Kerr property except for its northerly tip. Conversely, the strip of land in controversy, (B), is surrounded by and a part of land which already had been comprehensively zoned single family residential, except for its southerly tip.

When Carl Halvorson acquired the right to purchase the Kerr property in 1967, he embarked upon a plan for developing approximately 600 acres into what is termed a 'Planned Unit Development' (hereinafter called PUD). This development includes a town center, commercial area, park, equestrian and other recreational facilities, and areas for garden apartments, town houses, duplexes, single family dwellings, etc. Defendant Mountain Park Corporation, of which Mr. Halvorson was the dominant owner, took title to the land and began the development. In order to obtain a water supply and sewer system, as well as other city services, negotiations were carried on with various municipal corporations. Mountain Park concluded that the best opportunity for development conforming to its own plans lay with the City of Lake Oswego (hereinafter called City). City, which was comprehensively zoned under a zoning code, passed an enabling ordinance permitting planned unit development in new areas. Negotiations ripened into a contract between City, Mountain Park, and Sylvania Properties, another of the entities dominated by Mr. Halvorson. The contract contemplated City would annex the PUD in phases. A section of the contract As contemplated by the contract, Mountain Park proposed annexation of Phases I, II and III of the PUD, and City annexed these areas; later, it annexed Phase IV consisting of 55 acres which included the controversial strip (B). Thereafter, it changed the zoning of Phase IV to allow, among other things, the building of apartments in the southerly part of strip (B) in accordance with the PUD plan submitted by Mountain Park.

dealt with annexation and development. Its tenor is that City agreed to accept the PUD submitted by Mountain Park under its planned unit development ordinance (except for changes or amendments agreed upon by the City of Lake Oswego Planning Commission and Mountain Park) in return for annexation.

Shortly after the rezoning, Mountain Park deeded 3.5 acres in the southerly part of Phase IV, (B), to defendant Dave Christensen, Inc. (hereinafter called Christensen). The latter obtained a commitment for financing from defendant Security Bank of Oregon and submitted to Mountain Park (pursuant to a contract) suggested sketches of an apartment building or buildings which Christensen proposed to construct thereon. After Mountain Park rejected several proposals, it approved the plan effected for the construction of the apartment building, which is the subject of this litigation.

Plaintiffs, adjoining landowners, testified that they learned for the first time about the real bulk, size, and nature of the proposed apartment when Christensen's bulldozers arrived and stripped the area of trees and other vegetation and put in a fill 27 feet high toward the south end of strip (B). They protested by submitting a petition to the City Council on October 21, 1969. The Council referred the matter to the Planning Commission to determine whether the proposed structure was in conformance with the final plan. On November 4, 1969, the Planning Commission ruled against the plaintiffs. City issued a temporary building permit. Thereafter, on November 20, after having previously warned the defendants in writing of such intention, plaintiffs brought this suit. On November 21, City issued a final building permit. ¹

The Court of Appeals held that the portion of the PUD ordinance annexing Phase IV which included the 3.5 acres adjacent to plaintiffs' property was invalid because insufficient or no consideration was given to plaintiffs' property and its single family use. The court quoted Roseta v. County of Washington, 254 Or. 161, 458 P.2d 405, 40 A.L.R.3d 364 (1969), and Smith v. County of Washington, 241 Or. 380, 406 P.2d 545 (1965), to the effect that a change of zoning must first consider whether any changes have occurred in the neighborhood and whether the changes are consistent with the original comprehensive plan. The trial court, on the other hand, used the test of whether the City acted arbitrarily in enacting the PUD ordinance.

Subsequent to the trial of the instant case, and the decisions in Roseta and Smith, this court decided Fasano v. Washington Co. Comm., 264 Or. 574, 507 P.2d 23 (1973). There, we stated that the burden of proof is upon the one seeking the change and that it is necessary that a record be made before the local governing body when a change is under consideration.

Because the case at bar was tried before our decision in Fasano, we do not have the benefit of any record before the City Council It is not necessary, however, that we attempt to decide whether sufficient consideration was given to plaintiffs' properties in annexing Phase IV because we find that the final plan was violated by the construction of the apartment house in question.

and do not know what factors were considered by the Council in enacting the PUD ordinance annexing Phase IV.

Because this case involves a planned unit development concept as a zoning device, we shall first generally describe its characteristics and differentiate it from other more traditional concepts of zoning.

THE PLANNED UNIT DEVELOPMENT CONCEPT

The concept of a planned unit development was initiated by planners and public officials to remedy the defects in traditional zoning theory and practice. ² While not a new concept, ³ it has been only in recent years that zoning authorities have made this option practicable to planners and developers by providing enabling ordinances allowing such development. ⁴

The objectives of planned unit developments are: (1) to achieve flexibility; (2) to provide a more desirable living environment than would be possible through the strict application of zoning ordinance requirements; (3) to encourage developers to use a more creative approach in their development of land; (4) to encourage...