Onyx Props. LLC v. Bd. of Cnty. Comm'rs of Elbert Cnty.

• Decision Date: 03 October 2016
• Docket Number: No. 15-1197,No. 15-1141,15-1141
• Citation: 838 F.3d 1039
• Parties: Onyx Properties LLC, a Colorado limited liability company; Emerald Properties, LLC, a Colorado limited liability company; Paul Naftel; Shauna Naftel, Plaintiffs–Appellants, and Local Service Corporation, the Estate of Chapter 11 Bankruptcy in re: Simon E. Rodriquez, Trustee; Kenneth G. Rohrbach; Karen L. Rohrbach; Paul K. Rohrbach; Compost Express, Inc., a Colorado corporation, Plaintiffs, v. Board of County Commissioners of Elbert County, in its official capacity, Defendant–Appellee. National Association of Home Builders, Amicus Curiae. Robert Quinn, an individual; Karen Quinn, an individual; Patricia Rodenz, an individual; Michael McClendon, an individual; David Aksland, an individual; Sean Mulvihill, an individual; Stephen Mulvihill, an individual; Edwin Baker, an individual; Virginia Baker, an individual; Stan Lynn, an individual; Edward Lovelace, an individual; Donna Lovelace, an individual; EJL Enterprises, Inc., a Colorado corporation; Prairie Land, LLC, a Colorado limited liability company; Craig Clausen, an individual; Kenlou, LLC, a dissolved Colorado corporation; Gary Levin, an individual; Fiddleback Ranch, LLC, a Colorado limited liability company; William Paul Summers, an individual; Eugene Erickson, an individual; Anne Erickson, an individual; Lora Krista, an individual; Rebecca Arnold, an individual; Dennis Leonard, an individual; Thomas Maroney, an individual; Station Gulch Ranch, LLC, a Colorado limited liability company; Richard O'Leary, an individual; Linda O'Leary, an individual; Morningstar Development, LLC, a Colorado limited liability company; Amanda Pines, LLC, a Colorado limited liability company; Amanda Pines North, LLC, a Colorado limited liability company; Ladero Land Development, Inc., a Colorado corporation, Plaintiffs–Appellants, v. Board of County Commissioners of Elbert County, Defendant–Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

838 F.3d 1039

Onyx Properties LLC, a Colorado limited liability company; Emerald Properties, LLC, a Colorado limited liability company; Paul Naftel; Shauna Naftel, Plaintiffs–Appellants,
and
Local Service Corporation, the Estate of Chapter 11 Bankruptcy in re: Simon E. Rodriquez, Trustee; Kenneth G. Rohrbach; Karen L. Rohrbach; Paul K. Rohrbach; Compost Express, Inc., a Colorado corporation, Plaintiffs,
v.
Board of County Commissioners of Elbert County, in its official capacity, Defendant–Appellee.

National Association of Home Builders, Amicus Curiae.

Robert Quinn, an individual; Karen Quinn, an individual; Patricia Rodenz, an individual; Michael McClendon, an individual; David Aksland, an individual; Sean Mulvihill, an individual; Stephen Mulvihill, an individual; Edwin Baker, an individual; Virginia Baker, an individual; Stan Lynn, an individual; Edward Lovelace, an individual; Donna Lovelace, an individual; EJL Enterprises, Inc., a Colorado corporation; Prairie Land, LLC, a Colorado limited liability company; Craig Clausen, an individual; Kenlou, LLC, a dissolved Colorado corporation; Gary Levin, an individual; Fiddleback Ranch, LLC, a Colorado limited liability company; William Paul Summers, an individual; Eugene Erickson, an individual; Anne Erickson, an individual; Lora Krista, an individual; Rebecca Arnold, an individual; Dennis Leonard, an individual; Thomas Maroney, an individual; Station Gulch Ranch, LLC, a Colorado limited liability company; Richard O'Leary, an individual; Linda O'Leary, an individual; Morningstar Development, LLC, a Colorado limited liability company; Amanda Pines, LLC, a Colorado limited liability company; Amanda Pines North, LLC, a Colorado limited liability company; Ladero Land Development, Inc., a Colorado corporation, Plaintiffs–Appellants,
v.
Board of County Commissioners of Elbert County, Defendant–Appellee.

No. 15-1141
No. 15-1197

United States Court of Appeals, Tenth Circuit.

FILED October 3, 2016

James D. Thorburn, The Law Office of James D. Thorburn, LLC, Greenwood Village, Colorado, for Plaintiffs–Appellants.

Josh A. Marks (Melanie B. Lewis with him on the briefs), Berg Hill Greenleaf & Ruscitti, LLC, Boulder, Colorado; for Defendant–Appellee.

Troy R. Rackham, Fennemore Craig, P.C., filed an Amicus Curiae brief for National Association of Home Builders, Denver, Colorado, in support of Appellants.

Before HARTZ, EBEL, and MORITZ, Circuit Judges.

HARTZ, Circuit Judge.

The plaintiffs in the two cases before us on appeal complain that they were denied due process when the Board of County Commissioners of Elbert County (the Board) required them to rezone their properties before they could subdivide them. They allege that after the Board lost the documents reflecting the prior comprehensive zoning ordinance, it created new

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documents without following proper procedures for enacting an ordinance and covered up their misconduct. Perhaps these allegations state a claim under Colorado law. We hold, however, that the plaintiffs were not deprived of their right to due process under the United States Constitution.

I. BACKGROUND

The essential facts are undisputed. The Board enacted comprehensive zoning regulations on July 5, 1983. The regulations referred to an official county zoning map. By 1997, however, the Board had discovered that its files contained only six pages of the regulations and no zoning map. It therefore authorized Planning Director Kenneth Wolf to research historical zoning information and report his findings in a series of replacement maps and zoning regulations (the Wolf Documents). Although no public proceedings were conducted to approve the Wolf Documents, county officials treated them as authoritative.

Between 1997 and 2008 a number of landowners in the county sought to subdivide their properties into parcels of 35.00 to 59.99 acres. They were informed by county officials that their properties were zoned A–Agriculture and that county regulations required such land to be rezoned as A–1 to be subdivided. The landowners therefore applied to the Board for rezoning, paid the required fees, and obtained approval of their applications. Only after incurring substantial expenses did they become aware that the Board had not formally adopted the regulations and maps in the Wolf Documents that required the rezoning.

The first landowners to file suit were Onyx Properties, LLC and its coplaintiffs, who brought a putative class action in the United States District Court for the District of Colorado (the Onyx Litigation). They sought injunctive relief and damages under 42 U.S.C. § 1983, on the grounds that the Board's actions violated their rights to substantive and procedural due process. The district court denied class certification, and this court declined to grant a petition for permission to appeal that decision. Robert Quinn and 31 other landowners who had been members of the putative class then jointly filed suit against the Board in the same court (the Quinn Litigation) raising the same claims.

The district court in Onyx dismissed the substantive-due-process claim on the pleadings and granted summary judgment in the Board's favor on the procedural-due-process claim. See Onyx Properties v. Bd. of Cty. Comm'rs , No. 10–cv–01482–LTB–KLM (Consolidated w/ 11–cv–02321–RPM–MJW), 2015 WL 1361393, at *7 (D. Colo. Apr. 20, 2015). In Quinn another judge of the district court initially dismissed the first amended complaint without prejudice for failure to state a claim upon which relief could be granted. See Quinn v. Bd. of Cty. Comm'rs , No. 13–cv-02818–CMA–BNB, 2015 WL 3457732, at *1 (D. Colo. June 11, 2015). The plaintiffs responded with a motion to permit them to submit a second amended complaint, but the court concluded that the amendment would be futile and dismissed both the procedural- and substantive-due-process claims with prejudice. See id. at *1, *3 ; Jefferson Cty. Sch. Dist. No. R–1 v. Moody's Inv'rs Servs., Inc. , 175 F.3d 848, 859 (10th Cir. 1999) (leave to amend may be denied as futile if the complaint as amended would be subject to dismissal).

The Quinn plaintiffs appeal the district court's dismissal of both their procedural- and substantive-due-process claims. The Onyx plaintiffs do not pursue their substantive-due-process claim on appeal, but argue that summary judgment was improperly

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granted on their procedural-due-process claim.

We have jurisdiction under 28 U.S.C. § 1291. We have consolidated the two cases for disposition on appeal and affirm both judgments. We hold that the Board's adoption of the Wolf Documents as the official zoning regulations and maps was a legislative act, so the Due Process Clause required no hearing. And the conclusory allegations of cover-up and misrepresentation in the Quinn Litigation do not present a plausible substantive-due-process claim.¹

II. DISCUSSION

We review de novo a district court's order granting summary judgment, “applying the same standards that the district court should have applied.” Schanzenbach v. Town of Opal, Wyo. , 706 F.3d 1269, 1272 (10th Cir. 2013) (internal quotation marks omitted). “Summary judgment is appropriate if the pleadings and the record establish that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law.” Id. “We [likewise] review the district court's order of dismissal de novo, accepting the complaint['s] well-pleaded factual allegations as true.” Hyde Park Co. v. Santa Fe City Council , 226 F.3d 1207, 1209 (10th Cir. 2000). To survive a motion to dismiss under Fed. R. Civ. P. 12(b)(6), a claim for relief must plead sufficient facts to support a reasonable inference that the defendant is liable as alleged. See Jordan – Arapahoe, LLP v. Bd. of Cty. Comm'rs , 633 F.3d 1022, 1025 (10th Cir. 2011).

The Due Process Clause of the Fourteenth Amendment prohibits the state from depriving any person “of life, liberty, or property, without due process of law.” U.S. Const. amend. XIV, § 1. “Procedural due process ensures the state will not deprive a party of property without engaging fair procedures to reach a decision, while substantive due process ensures the state will not deprive a party of property for an arbitrary reason regardless of the procedures used to reach that decision.” Hyde Park , 226 F.3d at 1210. The Board argues that plaintiffs have no constitutional claim because their interest in how their land is zoned is not a “property” interest protected by the Due Process Clause. But it is unnecessary for us to decide this issue because even assuming all plaintiffs possessed a constitutionally protected property interest, they must still be denied relief.²

838 F.3d 1044

A. Procedural Due Process

“The essence of procedural due process is the provision to the affected party of some kind of notice and ... some kind of hearing.” Moore v. Bd. of Cty. Comm'rs , 507 F.3d 1257, 1259 (10th Cir. 2007) (internal quotation marks omitted). The plaintiffs do not clearly articulate what notice or what hearing they should have received, but we understand their arguments as focusing on the failure of the Board to follow required state procedures...