Kole v. City of Chesapeake

• Decision Date: 07 January 1994
• Docket Number: No. 930517,930517
• Citation: 439 S.E.2d 405,247 Va. 51
• Parties: Andrew D. KOLE, et al. v. CITY OF CHESAPEAKE, et al. Record
• Court: Virginia Supreme Court

Page 405

439 S.E.2d 405

247 Va. 51

Andrew D. KOLE, et al. v. CITY OF CHESAPEAKE, et al.

Record No. 930517.

Supreme Court of Virginia.

Jan. 7, 1994.

John F. Cahill, Falls Church (Grayson P. Hanes, Falls Church, John Holland Foote, Hazel & Thomas, Manassas, on briefs), for appellants.

William F. Devine, Norfolk (Robert C. Nusbaum, Patrick C. Devine, Jr., Ronald S. Hallman, City Atty., Kathleen A. Dooley, Asst. City Atty., Hofheimer, Nusbaum, McPhaul & Samuels, on brief), for appellees.

Present: CARRICO, C.J., COMPTON, STEPHENSON, WHITING, HASSELL and KEENAN, JJ., and COCHRAN, Retired Justice.

STEPHENSON, Justice.

In this declaratory judgment proceeding, landowners challenge the validity of a city's rezoning ordinance. On appeal, we determine whether the trial court erred in dismissing with prejudice the landowners' bill of complaint on the ground that it was not filed within 30 days of the enactment of the rezoning ordinance, as required by Code § 15.1-493(G).

On September 13, 1991, Seven Springs, Inc. (Seven Springs), a Virginia corporation, and Andrew D. Kole, Seven Springs' sole shareholder (collectively, the Landowners), filed a bill of complaint against the City of Chesapeake (the City) and the City Council, seeking a declaratory judgment, injunctive relief, and damages. The Landowners alleged that the City Council violated Virginia law and federal law in its attempt to rezone the Landowners' property. More specifically, the Landowners claimed that (1) the City Council's action constituted unlawful "piecemeal downzoning" and "spot zoning;" (2) the City Council did not initiate the rezoning as required by law; (3) the rezoning ordinance was void ab initio because the City Council failed to provide notice, advertisement, and public hearing as required by statute; and (4) even if the ordinance were valid, the City Council (a) violated the Landowners' vested rights under existing law, (b) violated their rights to statutory and constitutional due process and their constitutional right to equal protection, and (c) in effect, took their property without just compensation, in violation of the Federal and Virginia Constitutions.

In response to the bill of complaint, the City filed a "Demurrer and Special Plea in Bar and Plea of Statute of Limitations." By this pleading, the City asserted, inter alia, that the Landowners failed to challenge the rezoning ordinance within 30 days of its enactment and, therefore, that "all aspects of [the] suit constituting such a challenge or being derivative of such a challenge are time-barred and must be dismissed."

Thereafter, the Landowners filed a "Statement in Opposition to the City's Plea in Bar" disputing the City's factual allegations and requesting an evidentiary hearing on the plea. The Landowners also requested leave to file an amended bill of complaint and lodged a proposed amended bill with the motion to amend.

The trial court refused the Landowners' motion to file an amended bill of complaint and declined to conduct an evidentiary hearing on the City's plea. Relying solely upon the allegations in the Landowners' bill of complaint, the trial court, by order entered January 15, 1993, granted the City's "Plea of the Statute of Limitations," concluding that all of the Landowners' claims were time-barred because their bill of complaint was not filed within 30 days of the enactment of the rezoning ordinance, as required by Code § 15.1-493(G). We awarded the Landowners an appeal from the trial court's judgment.

We consider those facts that are alleged in the bill of complaint and in the proffered amended bill of complaint. Seven Springs owns approximately 52.425 acres of land in the City, consisting of one tract containing approximately 44.9 acres and another tract containing approximately 7.5 acres. Prior to the challenged rezoning ordinance, the 44.9-acre tract was zoned in the R-10s zoning district (the R-10s tract), and the seven-acre tract was zoned in the Office and Industrial (O & I) zoning district (the O & I tract). The R-10s zoning classification gave Seven Springs the right to develop at least 117 single-family dwellings on the R-10s tract. The O & I zoning classification permitted a variety of uses, including a multi-unit retirement village, on the O & I tract.

Kole is also the sole shareholder of Bedford Golf, Inc. (Bedford), a Virginia corporation. Bedford owns a tract in the City containing approximately 4.9 acres that, prior to the contested rezoning, was zoned in the R-10s district.

The Seven Springs and Bedford properties were originally part of a tract of approximately 480 acres known as the "Trust property." About 1978, the Trust property was zoned for a combination of residential and commercial uses. In 1984, the zoning was modified to allow a combination of residential, institutional, and commercial uses.

Thereafter, Vidco, Inc. (Vidco) acquired portions of the Trust property and proceeded to develop the land by constructing roads and other improvements. One of its developments was a residential subdivision known as "Las Gaviotas." The Seven Springs and Bedford properties are part of and adjacent to the Las Gaviotas development; consequently, Vidco's improvements necessarily also serve Seven Springs and Bedford. During the course of developing its property, however, Vidco experienced financial difficulties and, as a result, was unable to acquire the rest of the Trust property as it had planned to do.

In 1988, the remaining portions of the Trust property, consisting of the R-10s tract and the O & I tract, were acquired by other investors. Among the improvements that Vidco had made on its property were a golf course and a clubhouse. The investors had allowed Vidco to use a portion of their R-10s tract for eight holes of an 18-hole golf course.

Kole first became involved in the development of the Trust property in 1988 when he provided Vidco with additional funds to finance its on-going improvements to its property. In January 1989, however, Vidco declared bankruptcy, and, shortly thereafter, its property was sold at foreclosure.

In April 1989, Seven Springs acquired the R-10s tract and the O & I tract. Previously, City officials had assured Seven Springs that the properties could be developed, without restrictions, under the then-existing R-10s and O & I zoning classifications.

Following Vidco's financial demise, continued operation of the golf course was not economically feasible. Therefore, Seven Springs decided to create a residential development on its R-10s tract. Consequently, on November 28, 1990, Seven Springs submitted to the City a plan to develop 117 single-family residences on the R-10s tract. The City Council, however, refused to process or approve the plan. According to Seven Springs, the Council refused to act on the plan because it was "engaged in a concerted course of action to preclude any use of the property that was inconsistent with [the City's] desire that the property remain as undeveloped open space for public use."

Instead of acting on Seven Springs' plan, the City Council asked the City planning commission to "review the zoning classification for the Las Gaviotas Golf Course and provide a recommendation as to its current appropriateness." On February 13, 1991, the planning commission recommended that Council down zone all of Seven Springs' and Bedford's properties to the C-1 (conservation) zoning district.

On February 19, 1991, the City Council voted to rezone a portion of the R-10s tract to the C-1 district but postponed action on the O & I tract and Bedford's property. On July 16, 1991, the Council voted to rezone Seven Springs' remaining property from the R-10s and O & I districts to the C-1 district and to rezone Bedford's property to the C-1 district. According to Seven Springs, "[t]he uses permitted in the C-1 district are so extremely limited, that all viable economic uses are effectively prohibited."

The City's Charter, in section 3.07, provides that no ordinance shall be effective for at least 30 days after the...