Mayor and Council of Rockville v. Brookeville Turnpike Const. Co.

Citation246 Md. 117,228 A.2d 263
Decision Date04 April 1967
Docket NumberNo. 89,89
PartiesThe MAYOR AND COUNCIL OF ROCKVILLE v. BROOKEVILLE TURNPIKE CONSTRUCTION CO., Inc.
CourtCourt of Appeals of Maryland

George W. Shadoan, City Atty., and William C. Staley, Asst. City Atty., Rockville, for appellant.

Alfred H. Carter and Vivian V. Simpson, Rockville (Joseph B. Simpson, Jr., H. Algire McFaul, Thomas A. Lohm and Simpson & Simpson, Rockville, on the brief), for appellee.

Argued Jan. 17, 1967 Before HAMMOND, C. J., and MARBURY, OPPENHEIMER, BARNES and McWILLIAMS, JJ.

Reargued April 3, 1967 Before HAMMOND, C. J., and HORNEY, MARBURY, OPPENHEIMER, BARNES, McWILLIAMS and FINAN, JJ.

HAMMOND, Chief Judge.

This case has spawned some red herrings which the parties and the Chancellor have dropped across an essentially simple trial of fact and controlling law.

The City of Rockville sought below to enforce specifically a written contract dated January 1962 between the City and an owner who was trying to transform raw land mostly within, but partly without, the City limits into over four hundred apartment units. The City agreed 'to act, insofar as it is permitted by law, to annex' that part of the land outside its corporate limits in return for the promises of the landowner (a) to dedicate by December 28, 1962, approximately half an acre of delineated land for a street, (b) to set aside and develop two specified areas within the development for the recreational use of its residents, and (c) to attempt to purchase an additional defined three-acre parcel of land adjacent to that outside Rockville and, if successful, to dedicate the purchased parcel 'permanently to recreational use' or, if unsuccessful by July 1, 1962, to pay the City $10,000 in four annual installments, 'the said sums to be used by the City for the purpose of acquiring and developing additional public recreation area.'

The City proceeded to annex the land but the developer (which will sometime hereinafter be called Gingery as it was a corporate alter ego of its president, D. E. Gingery, who consistently acted and spoke for it) refused to perform its promises except as to the payment under protest of a $3,000 installment; indeed, Gingery testified in the City's suit for specific performance that he had never intended to honor the contract.

In its appeal from the Chancellor's denial of specific performance, the City has tossed us at least one red herring in an effort to picture itself as undeviatingly without hint of reproach. In return, Gingery drew more of the ruddy aquatic vertebrates across the trial in order to paint himself as the helpless and hapless victim of governmental injustice and oppression, compelled by the evil municipal pressure of economic duress and coercion of frustrating delay to fight fire with fire by signing an agreement he did not intend to honor. More of the fishes emerged from the Chancellor's expressed reasons for denying the City relief. He said, entirely accurately in the abstract, that specific performance is an extraordinary remedy which is within the sound discretion of the court to grant or refuse and that a determination to grant this extraordinary remedy must be supported by a contract that is 'fair, just, reasonable, bona fide, mutual, useful, made upon a good and valuable consideration consistent with a well regulated society and * * * in its effect ultimately tend to produce a just end' and held that the contract in question lacked mutuality, was illegal as beyond the power of the City, unconscionable as setting up at auction to the highest bidder the exercise of the City's power to annex land, and extortionate in that the City by delaying action on the request for annexation compelled the developer to accede to its illegal demands.

We do not agree, finding that the City had the power and the right to exact the agreements made by Gingery in return for its promise to annex his land, that the contract was voluntarily entered into and that it did not lack mutuality.

In 1958 Gingery bought some nineteen acres of land, somewhat more than fifteen acres of which were within the City of Rockville and 3.55 acres of which were not, being under the zoning and other controls of Montgomery County. The tract was all zoned C-2. In October 1959 application was made to the City to rezone that part of the land within the City to R-20 (medium density residential). In November the application came before the Mayor and Council. A member of a firm of architects and engineers presented a site plan which showed the entire nineteen acres as developed for garden apartments. The plan showed the dedication of a street along one boundary of the property designated as Edmonston Road and several small play areas and a large recreation area within the project. Gingery testified that he intended later to apply to have the 3.55 acres in Montgomery County annexed to Rockville. In reply to a question from Mayor Greene, Gingery said that the large recreation area on the plat would not be dedicated but would remain in private ownership as part of the tract. He also said, in explaining the site plan, that provision was made for 'the location of parking, the location of Edmonston Drive, so that this could be dedicated, and the location of the recreational areas.'

On January 19, 1960, the request for rezoning of the land within the City was granted without condition or reservation. Soon thereafter the Rockville Planning Commission approved a use permit for the apartment house project in accordance with a plat submitted. This plat also showed Edmonston Drive with the notation 'to be dedicated' to a width of seventy feet.

Gingery, as sole owner of the property, later filed a petition for annexation of the 3.55 acre parcel and, simultaneously, requested its rezoning to R-20. After review the Planning Commission in writing recommended annexation and at the same time recommended placing the acreage in an R-S (Suburban Residential) zoning classification until the City 'has had an opportunity to investigate whether there is a need to locate a playground on a portion of the subject tract which would serve the immediate area.' The Commission went on to say:

'The Planning Commission notes with concern that no provision has been made by the developers of the adjoining properties of the subject tract or by the City of Rockville to provide a playground for the occupants of the existing and proposed apartments within the immediate area. Approximately four hundred ten (410) apartment dwellings are being built within the area bounded by Rockville Pike on the east, commercial development on the south, Woodmont Country Club on the west and West Edmonston Drive on the north. It is the view of the Commission that consideration should be given by the Mayor & Council regarding the need for, and the acquisition of, a playground of approximately two (2) acres in size to serve this area, prior to giving the subject tract a permanent zone classification.'

Mayor Greene testified before the Chancellor that the general policy of the City was to require a community being annexed to provide interior and access streets, utilities, and 'to provide recreational areas to serve that particular community' on the theory that it would be an unfair burden on those citizens already living in the City to 'support the heavy capital investment which a new section of the community brings with it.' If the developer is required to provide the basic initial capital improvements, 'you start at even points on capital investment and everybody's taxes are applied to the operations of this new community-everybody starts on an equal basis. * * * Otherwise the problem of obtaining any growth would be so burdensome to the existing community there would be a total rejection of growth. Your taxes would be infinitely increased.' This, he concluded, makes it equitable to require that one who brings in a new community bring it up to the standard of the existing community at his expense, if he desires it to become part of the City.

Mayor Greene also testified that the standard of size the City used for neighborhood parks or recreational areas was one acre per hundred dwelling units, a downgrading of the standard 'established by the National Association of Recreation which uses one acre per hundred people.'

On January 16, 1961, a public hearing on the applications for annexation and rezoning was held before the Mayor and Council. Gingery and his lawyer attended. The lawyer pointed out that the 3.55 acres 'could very easily (and will) become an integral part of the apartment project in the event it is zoned and annexed.' In connection with the rezoning, he referred to the recommendation of the Planning Commission for recreational areas and said: 'We have planned for a recreational area; we are going to install one in there to serve the residents of the apartments being constructed and to be constructed' and then suggested that the 3.55 acre plot would be unsuitable because it would require considerable grading and 'it is very expensive ground. By using that for a recreation area, we would, of course, have to absorb that cost into that of the apartments, which would mean higher rents * * *. I do not feel that this would be a justifiable proposition.'

The architect then spoke, suggesting that a six-acre parcel, which was a part of a twenty-four acre tract Gingery owned, formed by the extension of Jefferson Street and Julian Place, be used for an undedicated recreational site for the over four hundred apartments and some five hundred homes Gingery intended to build on the twenty-four acres.

Gingery said: 'This came about all to the credit of Mayor Greene. * * * If must have been at least a year ago, he asked me about recreation for apartments. I said 'Alex, we are going to provide recreation for that area.' * * * I made that promise. * * * There has never been any question of our living up to what we said.'

Mayor Greene replied...

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