Relay Imp. Ass'n v. Sycamore Realty Co., Inc.

• Decision Date: 01 September 1994
• Docket Number: No. 1801,1801
• Citation: 105 Md.App. 701,661 A.2d 182
• Parties: RELAY IMPROVEMENT ASSOCIATION, et al. v. SYCAMORE REALTY CO., INC. ,
• Court: Court of Special Appeals of Maryland

Page 701

105 Md.App. 701

661 A.2d 182

RELAY IMPROVEMENT ASSOCIATION, et al. v.SYCAMORE REALTY CO., INC.

No. 1801, Sept. Term, 1994.

Court of Special Appeals of Maryland.

July 5, 1995.

Peter Max Zimmerman(Carole S. DeMilio, on the brief for appellant, People's Counsel for Baltimore County, of Towson, J. Carroll Holzer and Holzer and Lee on the brief for appellant, Relay, Towson), for appellants.

Thomas M. Wood, IV (Neuberger, Quinn, Gielen, Rubin & Gibber, P.A., Baltimore, and Edward C. Covahey, Jr.(Anthony J. DiPaula and Covahey and Boozer, P.A. on the brief, Towson), for appellee.

Argued before WILNER, C.J., and WENNER and DAVIS, JJ.

DAVIS, Judge.

This is an appeal from a judgment in the Circuit Court for Baltimore County affirming a decision by the Baltimore County Board of Appeals(CBA) in favor of appelleeSycamore Realty Co., Inc.(Sycamore).In 1993, Sycamore sought permission to construct 198 townhouse units on a 24-acre site in Baltimore County.The plan did not comply with the density requirements of the property's then-existing zoning classification.Nonetheless, the County Review Group(CRG) approved the plan.Sycamore's development plan was opposed by the Relay Improvement Association(Relay)(a neighborhood association), the People's Counsel for Baltimore County, and several neighboring residents--all of whom are parties to the instant appeal.The CBA approved the plan, and the circuit court affirmed.Both the CBA and the circuit court relied on the theory of zoning estoppel.

Appellants present four issues for our consideration.We renumber those issues, and restate items three and four as follows:

I.Maryland should not adopt the doctrine of zoning estoppel, or should exercise extreme caution.

II.A County Review Group proceeding for review of development is not the proper forum to consider zoning estoppel, nor is the County Board of Appeals.

III.The CBA and the circuit court erred, as a matter of law, in setting forth the elements of zoning estoppel.

IV.The CBA and the circuit court erred in applying the doctrine of zoning estoppel to the facts of this case.

FACTS

Hilltop Place is a 24.37-acre parcel of land located in southwest Baltimore County.The land is adjacent to the Relay neighborhood, an older, historic community that coalesced around a railroad facility dating from the mid-nineteenth century.The community includes both newer sections and older Victorian homes.According to an evaluation performed by County planning officials, there is a shortage of park land and recreational sites in the area.Hilltop Place is possibly the last undeveloped parcel of land near Relay that might be used for such purposes.The property is currently owned by appelleeSycamore Realty Co., Inc.When Sycamore first acquired Hilltop Place in 1974, the land was zoned for residential use.The majority of the site (18.21 acres) was zoned at a density of 10.5 residential units per acre (DR 10.5).The remaining 6.16 acres was zoned at a density of 5.5 units per acre (DR 5.5).

In the process of preparing the County's 1990 master plan, the Office of Planning and Zoning reviewed the zoning classifications for Hilltop Place.William Hughey, a community planner, concluded that the property was a "zoning anomaly," and that the DR 10.5 zoning was inconsistent with the density in nearby residential neighborhoods, which ranged from 3.5 to 5.5 units per acre.Hughey discussed the matter with a County Council member whose district included Hilltop Place.Under a February 1990 amendment to the master plan, the Council designated the property as a potential park and recreation site.Nonetheless, no change was made to the zoning.An appraisal of the site, completed at the County's request in June 1990, noted that the "highest and best use" of the parcel would be development in accord with the existing zoning.

On December 4, 1990, Sycamore filed a plan for the development of Hilltop Place.The plan took advantage of the DR 10.5 zoning and provided for construction of a 220-unit townhouse complex.While reviewing Sycamore's proposed development, planning officials noticed that it conflicted with the master plan.The matter was referred to the Department of Recreation and Parks, and the Department recommended that the County acquire the property.

In January of 1991, the Division of Real Estate in the County's Office of Law was asked to begin negotiations with Sycamore.On March 22, 1991, the County offered Sycamore $560,000, the amount identified by the County's appraiser as the fair market value of the property.Sycamore rejected that offer and asserted that the County's appraisal was flawed.¹At various points in time, Sycamore asserted that the property was worth at least three to four million dollars, or as much as eight million dollars.

As part of the acquisition effort, the County Council placed the property under public reservation on July 1, 1991.Section 26-66 of the Baltimore County Code provides, in part, that property may be reserved for public use for a period not to exceed eighteen months.Baltimore County Code (B.C.C.)§ 26-66(b) & (c)(1988).During the reservation period, "no building or other structure shall be erected on the land so reserved," and the property is exempt from all county and local taxes and other public assessments.B.C.C. § 26-66(e) & (f).

The code requires that the County acquire the property or initiate condemnation proceedings during the reservation period.In the event that the County fails to do so, the planning board "shall record" a release of the reservation in the County land records within fifteen days after the reservation period ends.B.C.C. § 26-66(g)(emphasis added).When a property is released without either acquisition or condemnation, the County is liable for any actual damages sustained by the property owner as a result of the reservation.B.C.C. § 26-66(h).

In the present case, the County made only a token effort to acquire Hilltop Place during the reservation period.No formal offers were extended, and the County did not initiate condemnation proceedings.In November of 1991, the County informally suggested a partial acquisition, but Sycamore did not respond.Despite the fact that the reservation period ended on September 14, 1992, the County did not release the property until November 19, 1992--nearly two months after it was required to do so.

While County officials in the Office of Law and the Department of Recreation were attempting to acquire Hilltop Place, the wheels of County government were slowly turning elsewhere.In August of 1991, the County began preparation of a comprehensive rezoning map.At that time, both planning officials and Relay recommended that Hilltop Place be downzoned to DR 5.5.On October 15, 1992, the County Council adopted the comprehensive rezoning.The new zoning classification for Hilltop Place took effect in December of 1992--less than one month after the property was released from reservation.²Under the DR 5.5 zoning, only 132 townhouse units could be constructed on the site.

Despite the downzoning of Hilltop Place, Sycamore persisted in efforts to gain approval for its original proposal.Following a public meeting on July 8, 1993, the County Review Group(CRG)³ approved Sycamore's plan for a 198-unit townhouse development.The number of units was reduced from 220 to 198 because of newly-enacted forest conservation restrictions.SeeMD.CODE ANN., NAT. RES. § 5-1601 et seq.(Supp.1994).In approving the plan, the CRG relied on a letter from Arnold Jablon, Director of Zoning Administration, to appellantLouisa Vanderbeek, a neighboring resident.The letter stated, in part:

It is obvious that the change in zoning ... in concert with the county's decision that it did not have the money to purchase the property, makes the county vulnerable to extensive damages.

The county believes that if the reservation prevents the property owner from recording a plat, the length of time to do so is extended by the period of time that the reservation was in place.

Clearly, the law does not permit the utilization of Section 26-66, BCC, by the county to stay potential development in order that the zoning can be decreased without the need to buy [the property].

Appellants argued, to no avail, that Sycamore had no vested rights, and that the CRG was required to apply the current DR 5.5 zoning.Appellants thereafter noted an appeal from the CRG's decision to the County Board of Appeals(CBA).Sycamore filed a cross-appeal, in which it argued that its right to proceed with the development was not restricted by the time limitations stated in Jablon's letter.The CBA conducted two days of evidentiary hearings in August and November of 1993.

The witnesses offered by Sycamore included Frederick Chadsey, IV, an expert in site planning and engineering, who supervised the preparation of Sycamore's development plan.Based on his experience with numerous projects in Baltimore County, Chadsey estimated that it takes three months or less to take a typical project from filing through CRG approval.With regard to the proposed Hilltop Place development, Chadsey estimated that approximately twelve months would have been required to take the project "from the original submittal of the plan to the time of construction."Chadsey also stated that Sycamore directed him to cease working on the plans for development of Hilltop Place in April 1991, and that he did not resume work until May of 1992.In his words, Sycamore "didn't want us to spend money on it if the county was going to purchase it."

Shirley Murphy, head of the Real Estate Division in the County's Office of Law, testified that her office began working on the proposed acquisition of Hilltop Place in early or late 1989.Murphy acknowledged that the County made no further offers after the County's initial offer was rejected.On December 11, 1991, Murphy received a memorandum directing...