Hitch v. Vasarhelyi

• Citation: 691 S.E.2d 286
• Decision Date: 16 February 2010
• Docket Number: No. A08A0065.,A08A0065.
• Parties: HITCH et al. v. VASARHELYI et al.
• Court: United States Court of Appeals (Georgia)

691 S.E.2d 286

HITCH et al. v. VASARHELYI et al.

No. A08A0065.

Court of Appeals of Georgia.

February 16, 2010.

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Bouhan, Williams & Levy, Walter C. Hartridge, Savannah, for appellants.

Thurbert E. Baker, Attorney General, Isaac Byrd, Deputy Attorney General, John E. Hennelly, Per B. Normark, Assistant Attorneys General, H. Lehman Franklin, Jr., Statesboro, for appellees.

DOYLE, Judge.

This appeal arises from William and Lucy Hitch's attempt to challenge a revocable license to build a dock on State property granted by the Georgia Department of Natural Resources ("DNR") to the Hitches' neighboring landowner, Jane Britt Vasarhelyi. This Court originally affirmed the trial court's dismissal of the Hitches' claims based on lack of standing,¹ and the Supreme Court of Georgia reversed that judgment, holding that the Hitches had standing to challenge the license.² The Supreme Court did not address the question of whether the trial court properly dismissed the Hitches' complaint for failure to state claims for (1) declaratory judgment and mandamus, (2) unconstitutional taking, and (3) denial of due process and equal protection.³ Because we agree with the trial court's dismissal, we affirm.

The factual and procedural history is as this Court summarized in its prior opinion:

According to the Hitches, in 2003, Vasarhelyi applied for a permit to build a dock extending from her property over State-owned tidewater beds and marsh lands. Vasarhelyi apparently was required to seek authorization from the Army Corps of Engineers. In November 2003, the Corps issued a "Joint Public Notice" regarding Vasarhelyi's application, which invited interested persons to request a public hearing on the proposed project. The Hitches, who own property that adjoins Vasarhelyi's land, wrote to the Corps, expressing their objections to the construction of the dock and requesting a hearing. The Corps subsequently learned that DNR had not approved the dock, and it denied Vasarhelyi's application without holding a hearing.

Vasarhelyi ultimately obtained a revocable license from the State of Georgia to construct the dock. Although several designs were proposed, the Coast Guard objected to a straight dock, and Vasarhelyi received permission to build a "dog leg" shaped dock. In October 2004, the Hitches filed a "Petition for Hearing," seeking an administrative hearing with the Office of State Administrative Hearings ("OSAH") in which they could challenge the dock permit. The State, however, responded that it would not forward the petition to OSAH since, with respect to the management of State tidelands, DNR acts pursuant to a delegation of authority from the Governor, who is exempt from the Georgia Administrative Procedures Act ("APA").

On January 13, 2005, the Army Corps of Engineers sent the Hitches a letter informing them that the State had approved Vasarhelyi's request for a dock permit and that the Corps was thus re-processing the application. The Hitches were informed that if they still wanted to request a hearing, they would need to do so before January 27, 2005. There is no evidence that the Hitches sought a hearing. Instead, they filed suit in superior court against Vasarhelyi and the State alleging that, if Vasarhelyi constructed the dock, it would interfere with their ownership rights as the dock would "impair and impinge upon their view of the marsh and Skidaway River." The Hitches also alleged that construction of the dock "would ... severely hamper the ability of the Hitches or their successors in interest to build a dock" on their property and would diminish the value of their property. The complaint contained numerous causes of action, including claims for: (1) declaratory judgment; (2) mandamus; (3) "unconstitutional taking"; (4) "regulatory taking and regulatory denial of due process"; (5) denial of due process; (6) "issuance of permit ... contrary to the public interest"; (7) the State's exceeding its "legal and equitable authority, considering improper factors, and failing to act correctly and equitably in issuing the subject permit/license"; and (8) an equal protection violation.⁴

The State moved to dismiss the complaint, which motion was granted by the trial court on the grounds that the Hitches lacked standing, that the claims were barred by sovereign immunity, and that the Hitches had failed to state a claim for which relief could be granted. This Court affirmed the trial court's ruling with respect to standing and the Supreme Court of Georgia reversed, leaving the question of the correctness of the dismissal pending in this Court.

1. The Hitches contend that the trial court erred in dismissing their claims seeking (i) declaratory judgment that they were entitled to a hearing before an administrative law judge ("ALJ") under the APA, and (ii) mandamus compelling DNR to transfer the licensing decision to OSAH for a hearing by an ALJ. However, the Hitches identify no statutory authority for such a hearing, and we discern no reversible error.

The Hitches' claims for declaratory judgment and mandamus arise from DNR's denial of their petition for a formal hearing pursuant to DNR rules authorizing such petitions in "contested cases."⁵ The DNR rules incorporate the APA definition of the term "contested case,"⁶ which is defined by the APA as "a proceeding, including, but not restricted to ... licensing, in which the legal rights, duties, or privileges of a party are required by law to be determined by an agency after an opportunity for hearing."⁷

The Hitches argue that the legal requirement for an opportunity for hearing in this case is contained in the Coastal Marshlands Protection Act, which provides:

Any person who is aggrieved or adversely affected by any order or action of the Coastal Marshlands Protection committee shall, upon petition within 30 days after the issuance of such order or the taking of such action, have a right to a hearing before an ALJ appointed by the board. The hearing before the ALJ shall be conducted in accordance with the APA....⁸

Based on this language, the Hitches assert that because they are adversely affected by the license granted to Vasarhelyi, they are entitled to a hearing before an ALJ. However, as correctly noted by DNR, the Coastal Marshlands Protection Act explicitly states that its provisions do not apply to certain private docks built "exclusively for the noncommercial use of the owner or his or her invitees," as is the dock planned here.⁹ Therefore, the Coastal Marshlands Protection Act provides no authority for review by an ALJ of the decision to grant the revocable license to Vasarhelyi.¹⁰ The license was not granted in accordance with a particular licensing or permitting scheme; rather, it addressed the request by a private property owner to build a dock on State land, and it was granted pursuant to DNR's authority to manage State land. "As the State agency designated to manage the tidelands, DNR may determine the appropriate method by which to apportion use of the State's property. That includes the authority to issue revocable licenses affecting the tidewaters in accordance with applicable law."¹¹

Further, we note that Vasarhelyi pursued a parallel permitting process required by the U.S. Army Corps of Engineers. That process required DNR's concurrence that Vasarhelyi's application was consistent with Georgia's Coastal Management Program.¹² With respect to DNR's statement in its letter issuing the license that DNR concurred with Vasarhelyi's consistency certification in her application to the Army Corps of Engineers,¹³ the Hitches cite no other authority, and we have found none, requiring a formal hearing before an ALJ to appeal such an action by DNR.¹⁴ Accordingly, we discern no basis for a declaratory judgment or the mandamus relief they seek.¹⁵

2. The Hitches also contend that the trial court erred in dismissing their claims for unconstitutional taking of property without just compensation. We disagree.

"The Takings Clause of the Fifth Amendment, made applicable to the States through the Fourteenth, provides that private property shall not `be taken for public use, without just compensation.'"¹⁶ Moreover,

as the United States Supreme Court recognized in Lingle v. Chevron U.S.A., Inc.,¹⁷ government regulation of private property may, in some instances, be so onerous that its effect is tantamount to a direct appropriation or ouster—and that such regulatory takings may be compensable under the Fifth Amendment. Regulations that fall short of eliminating property's beneficial economic use may still effect a taking, depending upon the regulation's economic impact on the landowner, the extent to which it interferes with reasonable investment-backed expectations, and the interests promoted by the government action.¹⁸

The Hitches' takings claims turn on their allegation that their property has been diminished in value by DNR's issuance to their neighbor of a revocable license to build a private dock. However, even assuming a legally cognizable economic impact, the Hitches' complaint has failed to show how the mere issuance of a license to construct a private dock on State land resulted in a taking of their property by the State for public use. The State is neither constructing nor maintaining the private dock. As the Supreme Court of Georgia held in Stanfield v. Glynn County,¹⁹ a county was not liable for inverse condemnation or taking merely by virtue of its approval "of the construction of a waste transfer facility and its issuance of building permits" to a private owner and operator.²⁰ We find that logic to be persuasive in this case because the revocable license was granted to Vasarhelyi, a private party, solely for the lawful construction and use of a private dock by Vasarhelyi.²¹ Therefore, the trial court did not err in dismissing these claims.

3. Finally, the Hitches contend that DNR's issuance of the license violated their constitutional...