Morsman v. City of Madras

• Decision Date: 09 December 2003
• Citation: 81 P.3d 711,191 Or. App. 149
• Parties: Phillip MORSMAN and Brigitte Morsman, Petitioners, v. CITY OF MADRAS, Respondent.
• Court: Oregon Court of Appeals

81 P.3d 711

191 Or. App. 149

Phillip MORSMAN and Brigitte Morsman, Petitioners, v. CITY OF MADRAS, Respondent.

2003-040; A122113.

Court of Appeals of Oregon.

Argued and Submitted September 9, 2003.

Decided December 9, 2003.

Michael F. Sheehan, Scappoose, argued the cause and filed the brief for petitioners.

Robert Lovlien, Bend, argued the cause for respondent. With him on the brief was Bryant, Lovlien & Jarvis, P.C.

Before EDMONDS, Presiding Judge, and ARMSTRONG and SCHUMAN, Judges.

SCHUMAN, J.

The City of Madras passed an ordinance annexing some contiguous territory. Petitioners, who own a trailer park in the annexed area, appealed the annexation to the Land Use Board of Appeals (LUBA), alleging, among other things, that the annexation did not meet the "reasonableness" requirement imposed by earlier cases from this court and the Supreme Court. Petitioners also alleged that the annexation was void because the city failed to demonstrate that the annexation complied with state and local land use planning criteria. LUBA rejected petitioners' reasonableness argument but agreed that the city had not demonstrated compliance with land use laws and remanded the city's decision for further proceedings on that question and a variety of others. Petitioners seek judicial review, assigning error only to the part of LUBA's opinion declaring the annexation to be reasonable. We reverse that part of LUBA's opinion and remand.

The basic facts and procedural history are not in dispute. The city effected the annexation by using the "triple-majority" process set out in ORS 222.170(1):

"The legislative body of the city need not call or hold an election in any contiguous territory proposed to be annexed if more than half of the owners of land in the territory, who also own more than half of the land in the contiguous territory and of real property therein representing more than half of the assessed value of all real property in the contiguous territory consent in writing to the annexation of their land in the territory and file a statement of their consent with the legislative body * * *."

The city obtained the necessary consents, held a two-session hearing, and then passed an ordinance approving the annexation.

The annexed territory adds some 759 acres to the existing 1,465-acre city, resulting in a 50 percent increase in the city's corporate territory. The annexation is of the "cherry stem" variety, so called because the bulk of the annexed property (the "cherry") is connected to the city by an annexed, narrow 300-foot section of the Warm Springs Highway (the "stem"). See Dept. of Land Conservation v. City of St. Helens, 138 Or.App. 222, 225, 907 P.2d 259 (1995)

. Much of the annexed area is occupied by an already developed industrial park, the city's sewage treatment plant, its airport, and some residential properties including petitioners' 60-unit low income mobile home park. Some residential developments adjacent to the "stem" portion of Warm Springs Highway are not included in annexed territory and remain outside of the city. The newly added area is within the city's urban growth boundary.

Petitioners' major argument before LUBA, which they again raise on review, was that the city's decision was not reasonable. The facts underlying LUBA's conclusion that the annexation was reasonable are not disputed; the only issue is whether those facts adequately support the conclusion, a question we review for legal error. City of St. Helens, 138 Or.App. at 228, 907 P.2d 259. The terms of the argument are framed by Portland Gen. Elec. Co. v. City of Estacada, 194 Or. 145, 160-65, 241 P.2d 1129 (1952), as explained and amplified in City of St. Helens. In Portland Gen. Elec. Co., 194 Or. at 159, 241 P.2d 1129, the Supreme Court, evaluating the validity of an oddly shaped annexation under the predecessor to the current annexation statute, held:

"From time immemorial, we have consistently held that in the interpretation of state statutes relating to the enactment of legislation or ordinances by a city that the same must be exercised reasonably and not arbitrarily; therefore, in statutes empowering cities to legislate annexation proceedings, there is implied within the legislative grant that such cities must legislate reasonably and not arbitrarily, and such reasonableness is a part of the legislative grant to the same extent as if it were written literally into the statute."

The court went on to describe a number of factors that could be taken into account in determining reasonableness. In dictum, it suggested that

"[i]t would be absurd to think that the legislature intended that a city would have carte blanche authority to reach out its tentacles like an octopus and envelop property which in no wise could be considered as beneficial to the city or to the property annexed. If this were not so, there would be nothing to prevent the cities from attaching to themselves territory far removed from the city environs by a narrow ribbon strip, so long as the property attached was contiguous."

Id. at 159-60, 241 P.2d 1129. Ultimately, the court decided that "[n]o exact yardstick can be laid down as to what is reasonable and what is not," id. at 165, 241 P.2d 1129, and declared that the annexation at issue was unreasonable principally because it "was employed for the sole purpose of enhancing the revenues of the city in an amount practically twice that which the city now enjoys * * *." Id. at 166, 241 P.2d 1129.

In subsequent cases, we have held that Portland Gen. Elec. Co. does not make "irregularly shaped" annexations per se unreasonable. Rivergate Residents Assn. v. Portland Metro. Area, 70 Or.App. 205, 689 P.2d 326 (1984), rev. den., 298 Or. 553, 695 P.2d 49 (1985); Mar. Fire Dist. v. Mar. Polk Bndry, 19 Or.App. 108, 526 P.2d 1031, rev. den. (1974). Most recently, we upheld the reasonableness of a cherry-stem annexation in City of St. Helens, 138 Or.App. 222, 907 P.2d 259. In that case, the state argued that Portland Gen. Elec. Co. should be strictly construed so as to invalidate the city's cherry-stem annexation, while the city, for its part, contended that the judicially created "reasonableness" standard from Portland Gen. Elec. Co. v. Estacada had been superseded by land use laws enacted after that 1952 decision. Id. at 227, 907 P.2d 259. We rejected both contentions. We first reaffirmed the Portland Gen. Elec. Co. v. Estacada court's determination that annexation legislation contains an implied reasonableness requirement and updated the decision by concluding that the requirement inheres in ORS 222.111(1), which provides:

"When a proposal containing the terms of annexation is approved in the manner provided by the charter of the annexing city or [state law], the boundaries of any city may be extended by the annexation of territory that is not within a city and that is contiguous to the city * * *."

City...