Key Haven Associated Enterprises, Inc. v. Board of Trustees of Internal Imp. Trust Fund

• Decision Date: 01 June 1981
• Docket Number: No. TT-255,TT-255
• Citation: 400 So.2d 66
• Parties: KEY HAVEN ASSOCIATED ENTERPRISES, INC., Appellant, v. BOARD OF TRUSTEES OF the INTERNAL IMPROVEMENT TRUST FUND and Dept. of Environmental Regulation et al., Appellees.
• Court: Florida District Court of Appeals

Page 66

400 So.2d 66

KEY HAVEN ASSOCIATED ENTERPRISES, INC., Appellant, v. BOARD OF TRUSTEES OF the INTERNAL IMPROVEMENT TRUST FUND and Dept. of Environmental Regulation et al., Appellees.

No. TT-255.

District Court of Appeal of Florida, First District.

June 1, 1981.

Rehearing Denied July 13, 1981.

Mallory H. Horton, of Horton, Perse & Ginsberg, and David Paul Horan, of Taylor, Brion, Buker & Greene, Key West, for appellant.

Terry Cole and Kent A. Zaiser, Tallahassee, for appellees.

ROBERT P. SMITH, Jr., Judge.

Appellant Key Haven urges that the circuit court erred by dismissing, for Key Haven's failure to exhaust Chapter 120 remedies in a licensing dispute, its inverse condemnation complaint against the Department of Environmental Regulation. Judge Hartwell's decision to abstain was the preeminently correct response to a litigant who sought extraordinary constitutional remedies after abandoning opportunities for wholly adequate administrative and judicial remedies within the Chapter 120 process. We affirm.

Between 1964 and 1968 the trustees of the Internal Improvement Trust Fund (IIF) sold Key Haven's president and predecessor in title 185 acres of submerged shallow flatlands in the Keys of Monroe County. The trustees reserved only fractional undivided interests in any petroleum and other valuable minerals beneath the bottomlands. The price was $300 per acre. In 1972, four years after the last purchase, Key Haven applied to the trustees for a permit to dredge 679,000 cubic yards of limerock from the bottom and to fill adjoining bottomlands with that material and 300,000 yards more, brought from elsewhere, to create a residential development of canalfront lots. Following a moratorium on all such permits, DER in April 1976 notified Key Haven of its intent to deny this one, and Key Haven sought and received formal Section 120.57(1) proceedings on its applications.

Before the DOAH hearing officer Key Haven contended that its dredge-and-fill proposal met the standards of Chapters 253 and 403, Florida Statutes (1975), ¹ for preserving natural resources and water quality, but that in any event the State, having sold the submerged lands expecting they would be dredged and filled, was estopped to refuse the permit. ² After an appropriate hearing the hearing officer entered a recommended order rejecting Key Haven's argument on both counts and recommending denial of the permit. The hearing officer found Key Haven had not shown that the project would satisfy Chapters 253 and 403 to the contrary, the project would "obliterate all aquatic life in this area" and, though the IIF trustees assumed the bottomlands to be sold would be filled, as was lawful in those days without a State permit, and they were aware of the purchaser's plans, the State was not estopped to deny the permit because the trustees did not promise the purchaser a permit, or mislead him, or induce him to take any injurious action:

When the Petitioner purchased the subject property from the Trustees of the Internal Improvement Trust Fund, the Petitioner was not required to seek further dredge and fill permits from the State. When the Petitioner undertook to commence dredge and fill activities, there was, however, such a requirement. The Petitioner is not in a different position than any other landowner who has been affected by the statutory permitting requirements.

Following DER's adoption of the recommended order with little change, Key Haven had a clearly defined opportunity to appeal the DER order within the administrative process. The Governor and Cabinet, sitting as the IIF trustees, hear appeals from DER permit denials. Section 253.76, Fla.Stat. (1977). Should the trustees' decision have been adverse, Key Haven would then have been entitled to a Section 120.68(1) district court appeal.

Key Haven was untempted by the direct review option. Instead of pursuing a permit or other remedies through those conventional forums, Key Haven filed a circuit court complaint alleging that the IIF trustees sold Key Haven's predecessor the submerged flatlands knowing and intending that he would dredge and fill to create canal front lots, and that DER's denial of the permit unconstitutionally ³ prevented all use of the property and constituted a taking for which compensation was payable as in eminent domain. Before the circuit court Key Haven sought to avoid contesting DER's denial of the permit while asserting, nevertheless, that the denial effected a taking. Key Haven summarized its position by argument in support of its motion for summary judgment:

The Plaintiff corporation and the Defendants deem it to be in the public interest to deny a development permit for the lands previously purchased from the Trustees with the understanding that those lands would be filled. The Plaintiff corporation does not seek to review the denial of the development permit, it, as well as the Defendants agree that such denial was necessary in light of the substantial and over-riding public interest in preserving the state's natural resources; however, the state must, in order to keep from defrauding the landowner be compelled by this Court to institute condemnation proceedings against the land.

In granting DER's motion to dismiss the complaint for Key Haven's failure to seek Chapter 120 remedies before the IIF trustees and, if necessary, a district court of appeal, Judge Hartwell cited Coulter v. Davin, 373 So.2d 423 (Fla.2d DCA 1979), holding that one's remedy for agency action which is unconstitutional in effect is by direct review in a district court rather than by collateral attack in a circuit court, and he cited Kasser v. Dade County, 344 So.2d 928 (Fla.3d DCA 1977), holding that a property owner cannot be heard to assert simultaneously that a zoning restriction is reasonable and that it is confiscatory by constitutional standards. Judge Hartwell found compelling parallels between those cases and this one:

The only distinction between Coulter and Key Haven is that the plaintiff in Key Haven seeks inverse condemnation whereas Coulter sought an injunction barring agency action against him. However, the actions were based on identical allegations that agency action constituted an unconstitutional taking of land. Therefore, both actions were attempts to collaterally attack the particular agency's denial of a permit.

The analogy between Kasser and Key Haven is clear. Key Haven seeks to circumvent the established review procedure for denial of a dredge and fill permit by DER by alleging agreement with that denial. Key Haven is thus in the same contradictory posture as Kasser collaterally attacking action while asserting agreement with it.

Florida courts consistently have embraced the general principle that a party ordinarily will not be indulged a collateral attack on administrative action in circuit court when direct review by a district court of appeal is or was available under Section 120.68. Carrollwood State Bank v. Lewis, 362 So.2d 110, 113-14 (Fla. 1st DCA 1978), cert. den., 372 So.2d 467 (Fla.1979); Metro Dade County v. Dept. of Commerce, 365 So.2d 432 (Fla.3d DCA 1978); School Board of Leon County v. Mitchell, 346 So.2d 562, 567-68 (Fla. 1st DCA 1977), cert. den., 358 So.2d 132 (Fla.1978); State ex rel. Dept. of General Services v. Willis, 344 So.2d 580, 589-91 (Fla. 1st DCA 1977).

The primacy of direct district court review under Chapter 120 is but an extension of the familiar principle, long antedating the Administrative Procedure Act of 1974, that all review processes afforded by the executive branch must ordinarily be exhausted before the judicial branch will consider intervention. See School Board of Flagler County v. Hauser, 293 So.2d 681 (Fla.1974). The same principle limits the availability of district court review of action by the executive branch under Chapter 120. ⁴ In the APA context the exhaustion requirement assures that the branch constitutionally responsible for implementing the statutory scheme has had a full opportunity to reach a sensitive, mature, and considered decision upon a complete record appropriate to the issue; and that requirement produces an authentic decision by the executive which then may be reviewed comprehensively, on all appropriate issues, in a single judicial forum. See Rice v. Dept. of Health and Rehabilitative Services, 386 So.2d 844, 848 and (dissenting opinion) 854 and n.6 (Fla. 1st DCA 1980); Escambia County Sheriff's Dept. v. Fla. Police Benevolent Ass'n, Inc., 376 So.2d 435, 436 (Fla. 1st DCA 1979), cert. den., 389 So.2d 1109 (Fla.1980). The power of circuit courts to intervene is not dissolved by Chapter 120, but by judicial policy that power is reserved for use in situations irremediable by direct review, Willis, 344 So.2d at 590. Even when the facial constitutionality of a rule or statute is raised, that question is judicially determinable in the direct review process, e. g., Peoples Bank of Indian River County v. Dept. of Banking and Finance, 395 So.2d 521 (Fla.1981); so when a party having Chapter 120 remedies seeks to raise such issues in collateral circuit court litigation, the court "should refrain from entertaining declaratory suits except in the most extraordinary cases ...," as when the constitutional legitimacy of the entire administrative inquiry is questioned. Gulf Pines Memorial Park, Inc. v. Oaklawn Memorial Park, Inc., 361 So.2d 695, 699 (Fla.1978); Rice, 386 So.2d at 849.

Contending it was exempt from normal review processes before the IIF trustees and a district court, Key Haven says it was entitled to circuit court preemption because DER properly denied Key Haven the only remedy DER might have granted, and neither DER nor the trustees could grant the remedy Key Haven seeks in consequence of DER's lawful action, namely, full compensation for the lost "Manhattan" ⁵ Key Haven might have raised from the ocean floor by dredge and fill. Only the circuit court, says Key Haven, can order that proper...