METROPOLITAN DEVELOPMENT COM'N OF MARION CTY. v. Pinnacle Media, …

• Decision Date: 30 June 2004
• Docket Number: No. 49A05-0309-CV-465.,49A05-0309-CV-465.
• Citation: 811 N.E.2d 404
• Parties: METROPOLITAN DEVELOPMENT COMMISSION OF MARION COUNTY, et al., Appellants-Defendants, v. PINNACLE MEDIA, LLC, Appellee-Plaintiff.
• Court: Indiana Appellate Court

811 N.E.2d 404

METROPOLITAN DEVELOPMENT COMMISSION OF MARION COUNTY, et al., Appellants-Defendants, v. PINNACLE MEDIA, LLC, Appellee-Plaintiff.

No. 49A05-0309-CV-465.

Court of Appeals of Indiana.

June 30, 2004.

Jeffrey S. McQuary, Office of Corporation Counsel, Indianapolis, IN, Attorney for Appellants.

Alan S. Townsend, George T. Patton, Jr., Paul D. Vink, Bose McKinney & Evans, LLP, Indianapolis, IN, Attorneys for Appellee.

OPINION

FRIEDLANDER, Judge.

The Metropolitan Development Commission of Marion County (the Commission)¹ and the Department of Metropolitan Development of the City of Indianapolis (the DMD)² (referred to collectively as "the City") appeal the grant of summary judgment and the award of attorney fees in favor of Pinnacle Media, LLC (Pinnacle) on Pinnacle's complaint for declaratory judgment. The City presents the following restated and consolidated issues for review:

1. Did the trial court properly grant summary judgment in favor of Pinnacle?

2. Did the trial court abuse its discretion in awarding attorney fees to Pinnacle pursuant to Ind.Code Ann. § 34-52-1-1 (West 1999)?

We affirm in part and reverse in part.³

The parties do not dispute the material facts. Pinnacle's primary business is the erection of outdoor advertising signs (sign(s)). In a typical transaction, Pinnacle leases land from a landowner, obtains the necessary permits from state and/or local authorities, erects a sign, and then leases space on the sign to various entities. Embarking on such a transaction, Pinnacle entered into leases with the Hoosier Heritage Port Authority (HHPA), which authorized Pinnacle to build two signs on HHPA property that consisted of a railroad corridor located near I-465. Pinnacle then sought to obtain any necessary permits.

In July 1999, Pinnacle contacted the DMD to request permits to build two signs on the HHPA property. After careful consideration of the issue by several DMD officials, the agency responded to Pinnacle's request with a letter dated July 26, 1999.⁴ The letter provided in relevant part:

Based on the location of the proposed sign, to be located on the parcel described in the attached legal description, being located within right-of-way owned and controlled by the State of Indiana, and the fact that the I-465 right-of-way is not within a zoning district, this office lacks jurisdiction to issue, or to require an improvement location permit.

Appellant's Appendix at 31. The DMD further recommended that Pinnacle contact the State regarding these issues. Upon receiving this letter, Pinnacle requested clarification from the DMD in light of the fact that the property was owned by HHPA, not the State.⁵ The next day, on July 27, the DMD reiterated that the City lacked jurisdiction over Pinnacle's proposed signs because they were to be located on unzoned property:

This letter clarifies my letter to you dated July 26, 1999. [Pinnacle] has restated that the property, upon which the sign is proposed to be located is owned by [HHPA], an entity established pursuant to IC 8-10-5. Regardless of the ownership of the property, due to the fact that the I-465 right-of-way is not designated as within a zoning district on the zoning maps, this office lacks jurisdiction to issue, or to require an improvement location permit.

Any approvals required by the State of Indiana, however, must be obtained.

Appellant's Appendix at 32 (emphasis supplied). At the time of the letters, the only unzoned areas in Marion County were the interstate rights-of-way.

After receiving the July 1999 letters, Pinnacle requested and obtained permits from the Indiana Department of Transportation (INDOT) and then built the two signs in accordance with its leases with HHPA. The City did not object to the construction of these signs. Soon after the signs were erected, however, the DMD began receiving complaints from neighborhood organizations that were upset about the signs and worried about proliferation of more signs on the unzoned rights-of-way within the I-465 loop.

After building the signs on the HHPA property, Pinnacle pursued more leases on similarly situated unzoned property within Marion County. Pursuant to these leases, the property owners authorized Pinnacle to construct signs at fifteen separate locations. Between February 29 and April 19, 2000, Pinnacle submitted fifteen applications for sign permits to INDOT, one for each of the fifteen leased locations.⁶ Pinnacle did not apply for permits from the DMD, as the land remained unzoned.

While Pinnacle was applying for additional permits from INDOT, City officials began, in March 2000, discussing proposals to zone the land under the interstates. Maury Plambeck, then the DMD's Administrator of Current Planning and now the Director of the DMD, drafted a proposed ordinance to zone the interstate rights-of-way. On March 21, 2000, along with a draft of the proposed ordinance, Plambeck circulated an internal memorandum to five individuals that provided in part:

Yesterday, we discussed the problem of advertising signs located within the interstate right-of-way, on railroad right-of-way.

Two advertising signs were located within the Interstate 465 right-of-way, in northeast Marion County, because the interstates are not zoned. Current Planning provided a map which showed that the only unzoned areas in Marion County are the interstate rights-of-way. The map also showed the locations of railroad rights-of-way that intersect interstate rights-of-way. There is the potential for many more advertising signs to be located within interstate rights-of-way, without approval or review by the City staff.

We determined that the best way to solve the problem would be to zone the interstate rights-of-way. Attached is a draft of a proposed ordinance to zone the interstate rights-of-way.... If the draft is acceptable, I would like to take the ordinance to public hearing as soon as possible.

* * *

Appellee's Appendix at 90. Around this time, Plambeck also sought input from INDOT concerning the draft and was informed by INDOT of the additional permit applications filed by Pinnacle.

Thereafter, on April 26, 2000, a week after Pinnacle filed the last of its applications with INDOT, the DMD officially proposed an amendment to the Zoning Ordinance of Marion County. On April 28, Plambeck circulated the proposed ordinance to various interested parties, including sign companies such as Pinnacle, and informed them that a public hearing on the matter had been scheduled before the Commission on May 17, 2000. In early May, a representative of Pinnacle discussed the proposed ordinance with Michael Graham of the DMD and noted an apparent problem with the proposed ordinance.

On July 10, 2000, the City-County Council enacted into law a substantially revised version of the proposed ordinance, assigning zoning classifications to the unzoned land in Marion County generally occupied by freeways.⁷ Around this same time period, between May 15 and July 14, 2000, INDOT denied all fifteen of Pinnacle's permit applications. Pinnacle appealed the denials and eventually settled with INDOT on June 18, 2001. Pursuant to the settlement, INDOT granted permits for ten of the fifteen permit applications filed by Pinnacle.

Following the settlement, Pinnacle began constructing one of the signs authorized by INDOT, which was located at 1425 Harding Street near I-70 (the Harding Street Sign). Shortly after construction began, the DMD posted an Order to Stop Work (Stop Work Order) dated July 24, 2001. The reason cited on the order was Pinnacle's failure to obtain an Improvement Location Permit for the sign from the City. Pinnacle immediately ceased construction of the Harding Street Sign despite its belief that the Stop Work Order was issued erroneously.

After months of discussions between Pinnacle and the City, on January 15, 2002, Pinnacle filed its Complaint for Declaratory Judgment, seeking a declaration that the amendment to the zoning ordinance was inapplicable to the ten permits filed with INDOT before the amendment was enacted, a declaration that the Stop Work Order was void and unenforceable, and an award of attorney fees. The City filed a Motion to Dismiss on March 4, 2002, which the trial court denied on June 24, 2002. Both parties subsequently filed for summary judgment. Following a hearing on the motions for summary judgment, on February 12, 2003, the trial court granted summary judgment in favor of Pinnacle and concluded that Pinnacle was entitled to attorney fees because the City engaged in frivolous, unreasonable, or groundless litigation. The City immediately appealed this order. The City also filed a Motion to Stay, which the trial court denied, on April 3, as to the declaratory judgment but granted as to the award of attorney fees. On motion by Pinnacle, this court dismissed the appeal, on June 30, 2003, as premature because no amount of attorney fees had been awarded and, thus, there was no final judgment. On remand, the parties entered into an agreed stipulation, setting Pinnacle's reasonable attorney fees at $52,978.92. On August 5, 2003, the trial court approved the stipulation and entered a final judgment. The City now appeals. Additional facts will be provided below where necessary.

1.

The City initially challenges the entry of summary judgment in favor of Pinnacle. While not raising any disputed issues of material fact, the City contests the order on several legal fronts and argues that it is entitled to summary judgment. We will address each legal argument in turn.

When reviewing a grant or denial of summary judgment, our standard of review is the same as that used by the trial court: summary judgment is appropriate only where the evidence shows there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Embry v. O'Bannon, 798 N.E.2d 157 (Ind.2003) (citing Ind. Trial Rule 56(C)). Here, there are no factual disputes. "Accordingly, this...