Prince George's County v. Blumberg, No. 152

CourtCourt of Special Appeals of Maryland
Writing for the CourtArgued before GILBERT; WILNER
Citation407 A.2d 1151,44 Md.App. 79
Docket NumberNo. 152
Decision Date07 November 1979
PartiesPRINCE GEORGE'S COUNTY, Maryland et al. v. Herschel BLUMBERG et al.

Page 79

44 Md.App. 79
407 A.2d 1151
Herschel BLUMBERG et al.
No. 152.
Court of Special Appeals of Maryland.
Nov. 7, 1979.

[407 A.2d 1155]

Page 81

Alan E. D'Appolito, Associate County Atty., Robert B. Ostrom, County Atty. and Michael O. Connaughton, Deputy County Atty., on brief, for appellant, Prince George's County.

Paul T. Sisson, Hyattsville, for appellant, Washington Suburban Sanitary Commission.

Joseph P. Blocher and Barbara A. Sears, Silver Spring, with whom were Linowes & Blocher, Silver Spring, on brief, for appellees.

Argued before GILBERT, C. J., and MORTON and WILNER, JJ.

WILNER, Judge.

This is a case of government running amok. The facts are long and complicated (the printed record extract is nearly 1,500 pages); but what happened, in a nutshell, is that Prince George's County and the Washington Suburban Sanitary Commission (WSSC), after careful study and review, each issued appropriate permits allowing Herschel and Marvin Blumberg to construct a twenty-million dollar high-rise apartment complex, and, after the Blumbergs had commenced construction pursuant to and in reliance on those permits, those agencies revoked the permits and have refused to reissue them.

In an action by the Blumbergs against the county, WSSC, and two former County Executives, the Circuit Court for Prince George's County (1) directed the county and WSSC to reissue the permits, (2) awarded a judgment for substantial damages against the county, (3) dismissed the action for damages against WSSC on the ground of its sovereign immunity, and (4) sustained demurrers filed by the two former County Executives (Gullett and Kelley), dismissing them from the case. No one, except Gullett and Kelley, was entirely satisfied with this result. The county has appealed both the directive to reissue the building permit and the judgment for damages; WSSC has appealed the order requiring the reissuance of its water and sewer permits; and the Blumbergs have cross-appealed the court's refusal to grant monetary relief against WSSC and the dismissal of their action against Gullett and Kelley. We shall here affirm all actions of the circuit court save two; we believe that the court erred (1) in its calculation of damages against the county and (2) in determining that WSSC is entitled to sovereign immunity. We shall therefore remand those aspects of the case for further proceedings in accordance with this Opinion.

The land in question consists of about 40 acres located on Belcrest Road in the Hyattsville area of Prince George's County. The Blumbergs had planned to develop the property since at least 1961, but because of [407 A.2d 1156] one thing or another

Page 83

interest rates, tight money the project did not begin to move forward in earnest until 1971. On July 16, 1971, through counsel, they wrote to WSSC, recounting some of the history of the project, advising of their intention to start construction of a 600-unit high-rise apartment building, and requesting a determination that "the present situation will permit sewer service" for the project. As was pointed out in the letter, the project would not have required any new or extended sewer lines. There was a line already running across the property, and what the Blumbergs needed was permission to connect into it.

This request was referred to the Commissions' Legal Department. On October 6, 1971, Paul J. Hefferon, Staff Counsel to WSSC, responded that, in the Commission's opinion, because the connection would be into an existing line, "a connection of the proposed apartment building would be permitted under the existing letter order of the State Department of Health dated May 20, 1970." 1 Upon receipt of this letter, Marvin Blumberg went to see Mr. Hefferon. He "asked him exactly what it (the letter) meant, whether I would get sewer and water, does it mean what I think it says it means, and he said, yes, it means you are going to get sewer and water."

With this assurance, the Blumbergs engaged an architect and began preparing final plans for their building. On April 6, 1972, they formally applied to WSSC for sewer and water service, paying, at that time, the fees set by WSSC of $8,925.

At about this time, WSSC became concerned whether, in light of delays in the expansion of the Blue Plains Treatment Plant, the State-imposed moratorium was sufficient to protect water quality in the metropolitan Washington area. On June 21, 1972, the Commission, by Resolution No. 72-053, decided to impose certain additional restrictions of its own on sewer hookups in a number of the basins in the area, including the Anacostia basin in which the Blumberg project was located. One effect of this Resolution was to subject the Blumberg

Page 84

application to approval by the Commission itself, rather than by the staff. Perhaps in furtherance of this action, on July 27, 1972, John F. Stabely, the head of the WSSC Permits and Records Section, advised the Blumbergs that Mr. Hefferon's letter of October 6, 1971, "should not be construed as a commitment by the Commission to provide service. Because of limitation in system capacity no commitment for service can be made."

Faced with this apparent retrenchment on the part of the Commission, the Blumbergs pressed their case for hook-up approval. On August 24, they wrote to James A. Stapp, WSSC Director of Engineering and Construction, complaining about the implications of the July letter and pointing out their reliance on previous assurances given by various Commission personnel. They also enlisted the aid of then-County Executive William W. Gullett (a cross-appellee here) and then-County Councilwoman Gladys N. Spellman, both of whom wrote to the Commission endorsing the project.

On August 23, 1972, the Commission adopted Resolution No. 73-066, the second in a series of four dealing with sewer connections. This Resolution, made effective as of August 2, 1972, suspended all applications for sewer connections of the type represented by the Blumberg project (more than 10 dwelling units). There were several exceptions to this suspension, of which two are, or will soon become, relevant here. The first of these was contained in P 2(b) of the Resolution: "situations where, on a premise of availability of water and sewer service, a . . . building permit . . . has been issued on or before August 2, 1972 by the (county) or where a WSSC connection application . . . has been approved or issued by the WSSC on or before [407 A.2d 1157] August 2, 1972." The second relevant exception was set forth in P 3(c). This allowed the Commission to suspend or waive the provisions of the Resolution for good cause shown, provided that it first determine the existence of good cause before considering the merits of the application.

Notwithstanding this Resolution, the Blumberg application was placed on the Commission's agenda for its October 4 and October 11 meetings as Item No. 465. In connection therewith,

Page 85

Mr. Stapp, the Director of Engineering, submitted to each Commissioner a packet of material concerning the project, with a covering memorandum dated September 21, 1972. Among other things, this memorandum points out that the plumbing applications "are pending" and that "Mr. Blumberg wants assurance that his permits Will be processed to completion." (Emphasis supplied.) Testimony from Mr. Stapp and then-Commission Chairman David Elliott established that packets of this type were normally sent to the Commissioners a week or so in advance of the meeting and were brought by them to the meeting.

The Blumberg application was not acted upon at either the October 4 or October 11 meeting, but was deferred until October 25, in order to allow the staff to consider the effect of other pending applications as well on the overall capacity of the water and sewer system. The Commission did, however, at its October 4 meeting, adopt a third Resolution (No. 73-075), amending and making more restrictive the P 2(b) exception contained in the August Resolution. Under the new Resolution, this exemption would be applicable only where (1) a building permit was issued prior to August 2 premised on a statement of water and sewer service availability supplied by WSSC prior to that date, or (2) approval of a connection application by WSSC on or before August 2. By WSSC approval, the Resolution meant "the acceptance and notation on the pertinent application of payment of the requisite fees", this definition intending to differentiate "between the mere tendering of an application and the WSSC staff action of acceptance and approval thereof, since the fees paid notation is not placed on the application until after such approving review occurs. . . ."

While waiting for WSSC to act upon its connection application, the Blumbergs, on October 6, 1972, applied to Prince George's County for a building permit. The application listed the Blumbergs as both owners and contractors, and described the project as phase 2 of a 36-story condominium apartment building.

October 25 was the magic day for the Blumbergs, for on that day, WSSC approved their connection application and

Page 86

directed the staff to process and issue the necessary water and sewer permits. The circumstances under which that decision was made will be discussed later. Suffice it at this point to note only that the Commission's action was confirmed by letter of its Chairman dated October 27, informing the Blumbergs that their request "has been reviewed and approved for water and sewer service to 600 units apartment project. . . ." The letter continued that the authorization was subject to the installation of appropriate water saving devices, that the Commission's Plumbing Division and Permits and Records Section would be advised of the Commission's action "and authorized to process pending application and/or permits to completion", and that the "connection application and/or hookup plumbing permit"...

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