Snyder v. City of Minneapolis

• Decision Date: 09 June 1989
• Docket Number: No. C7-87-1394,C7-87-1394
• Citation: 441 N.W.2d 781
• Court: Minnesota Supreme Court
• Parties: James L. SNYDER, petitioner, Respondent, v. CITY OF MINNEAPOLIS, petitioner, Appellant.

Page 781

441 N.W.2d 781

James L. SNYDER, petitioner, Respondent, v. CITY OF MINNEAPOLIS, petitioner, Appellant.

No. C7-87-1394.

Supreme Court of Minnesota.

June 9, 1989.

Rehearing Denied July 13, 1989.

Syllabus by the Court

1. Under the facts and circumstances of this case, plaintiff cannot be charged with knowledge of the illegal nature of his land use and may recover in negligence against the City.

2. The cap on municipal tort liability provided by Minn.Stat. § 466.04 is not an affirmative defense but a statutory rule of law trial courts are obliged to impose whenever damages exceed the statutory limit.

3. Minnesota Statutes § 466.04, the cap on municipal tort liability, survives plaintiffs constitutional challenges based on equal protection and due process and does not violate art. 1, Sec. 8 of the Minnesota Constitution.

4. Damages are modified in accordance with this opinion.

5. Plaintiff's estoppel claim does not entitle him to money damages.

6. Plaintiff failed to prove a claim under 42 U.S.C. § 1983.

Clay R. Moore, Mackall, Crounse & Moore, Minneapolis, for petitioner, appellant.

Robert J. Alfton, Jerome F. Fitzgerald, Office of City Atty., Minneapolis, for petitioner, respondent.

League of Minnesota Cities, Thomas J. Crundhoefer, Ass'n of Minnesota Counties, Margaret J. Flicker, St. Paul, for amicus curiae.

Heard, considered, and decided by the court en banc.

WAHL, Justice.

This case arose out of a land use dispute between plaintiff, James Snyder, and the City of Minneapolis. Snyder brought suit against the city on April 10, 1986 in Hennepin County District Court for damages caused when the city issued him a building permit to build a new building and a permit to demolish his existing building then revoked the building permit after the existing building was demolished. Snyder alleged negligence, estoppel and a deprivation of his constitutional rights in violation of 42 U.S.C. § 1983. He also sought an injunction to compel the City to grant him a variance. ¹ Rejecting the City's defense of discretionary immunity, the trial court entered judgment for Snyder on the negligence and estoppel claims, but found no basis for the § 1983 claim. Both parties appealed. The court of appeals agreed that the city was not immune from liability for its negligent issuance of the building permit, held the award of damages for negligence not to be clearly erroneous but imposed a $200,000 cap on the city's liability under Minn.Stat. § 466.04 (1986) and affirmed denial of the § 1983 claim. Snyder v. City of Minneapolis, 422 N.W.2d 747 (Minn.App.1988). We affirm in part, modify in part, and remand.

I

James Snyder has owned property at 1409 West Lake Street in Minneapolis since 1977. Until the summer of 1985 the lot was occupied by a two story brick building, with a basement. The building measured 30' by 46', including a four foot exterior deck and stairway. The building was located adjacent to Calhoun Square and within 300 feet of the Calhoun Square Parking Ramp. In 1983 an adjacent alley was abandoned, adding 6 feet to Snyder's lot which then measured 36' by 46'.

Snyder's lot was located in the B3S-3 Zoning District which, under Minneapolis Zoning Code § 540.1460, required that structures provide a minimum of four offstreet parking places. Snyder's building did not have to meet the offstreet parking requirement because it was grandfathered in as a pre-existing structure. In February of 1985 the building, then worth $155,000, suffered fire damage. The cost of repair was placed at $45,000. Instead of repairing the existing building, Snyder decided to build a new building, which he believed could be built to full dimensions of the now larger lot.

In June of 1985 through his contractor, Willard Weikle, plaintiff submitted a proposal for a new 36' X 46' building to the Zoning Office. Edward Virnig, a Zoning Office employee, told Weikle the proposal did not show the four off-street parking places which were required. Virnig also told Weikle to contact the city coordinator's office regarding the possible use of parking spaces in the recently opened Calhoun Square Parking Ramp (ramp) to satisfy the parking requirement. Virnig said spaces in the ramp might satisfy the parking requirement because the ramp was financed in part by an Urban Development Action Grant (UDAG).

Weikle contacted the city coordinator's office, which forwarded to Virnig a copy of § 4.3 of the UDAG agreement which provided,

[D]eveloper shall maintain equal access to at least 140 parking spaces of the 450 total spaces in the ramp for the general public use by the merchants and customers of the immediate and existing Hennepin-Lake (non-shopping mall center clientele) retail area.

There is no indication in the record that any doubts were ever expressed to Weikle or Snyder at any time prior to the granting of the building permit by any city employee questioning the use of the publicly dedicated parking spaces in the ramp to satisfy the zoning requirement.

In June of 1985 Virnig gave unrestricted zoning approval to Snyder's proposal by putting the zoning stamp on the plan. Virnig gave this approval based upon parking spaces in the ramp satisfying the zoning requirements. According to William Nordrum, the city's zoning supervisor, Virnig only assumed parking in the ramp could be used to satisfy the zoning requirements. Nordrum also said several property owners in the area had previously been told they could not use parking in the ramp to satisfy zoning requirements.

Snyder obtained a wrecking permit dated July 31, 1985. On August 8, 1985, Weikle picked up and paid $958.58 for a building permit for Snyder's proposed 36' X 46' structure. On that date Snyder commenced demolition of the existing structure. The trial court found Snyder commenced demolition of the existing building in reasonable reliance on the issued building permit. The demolition was completed August 14, 1985, and construction of the new building began.

On August 8, 1985, Ray Harris, the developer of Calhoun Square, called Nordrum and, after inquiry as to what was being done on Snyder's property, claimed Snyder was not entitled to use the ramp to satisfy his parking requirements. Nordrum was aware that Snyder and Harris had long been at odds. In mid-August, Donald Olson, deputy director of the Department of Inspections, called Weikle, telling him the building permit was revoked and to stop work. Footings for the new building had already been poured. The revocation was prompted by advice to Olson, from Nordrum, who accepted Ray Harris' claim regarding parking in the ramp.

Shortly thereafter Olson sent a letter to Weikle confirming the revocation. Although the letter was dated August 20, 1985, it was apparently written on August 8, 1985, the same date the building permit was issued, because that date was crossed out on the City's file copy and August 20, 1985, was written in its place. The letter received by Weikle had been erased with liquid paper and redated. The trial court said it appeared the decision to revoke the permit was made on or before August 8, 1985. The trial court found the City had "knowledge" of the demolition of Snyder's existing building because the City had been involved in scheduling the demolition and had approved a demolition date of August 8, 1985. The trial court found that the existing building could have been saved because of this knowledge yet the City had not promptly notified Snyder that his building permit was in the process of being revoked.

The City did not give Snyder notice or an opportunity to be heard before revoking his building permit, nor does the City have any procedures for doing so. Had Snyder been given a hearing, he could have shown that neither he nor Weikle supplied erroneous information as the revocation letter from Olson alleged. Snyder was told by City Council member Joan Niemiec the City Council would consider his plight but he was told he could not attend that meeting. Snyder was told the building permit had been a mistake and he was invited to apply for a variance for the original 36' X 46' building.

Nevertheless, when Snyder applied for such a variance the Board of Adjustment (Board) denied it on October 23, 1985. The City Council denied the same variance on November 15, 1985. Robert Fine, a business associate of Ray Harris, sat in on the Board's meeting as a "volunteer" sixth member, to the five person board. Fine made a motion in opposition to Snyder's variance application.

Joan Niemiec told Snyder on several occasions that she would support putting him back in the position he was in before demolition. The Board granted a variance for a 30' X 42' building on November 27, 1985. The trial court found that such a building would be smaller than his old building because construction of an exterior staircase, as was on the old building, would require a variance. No finding was made whether Snyder actually applied for such a variance. The purported reason for denying Snyder's variance for a 36' X 46' structure was his failure to meet the offstreet parking requirements. The trial court found this reason not based in fact because the offstreet parking requirements for a 36' X 46' structure are the same as those for a 30' X 42' structure, for which a variance had been granted. The Board did grant a variance for a 36' X 46' structure on January 29, 1986, conditioned on Snyder leasing parking from McDonalds. Snyder was unable to secure the lease.

Snyder made further variance applications as follows:

a. variance of off-street parking requirement for 36' X 46' foot building with partial second floor;

denied by Board of Adjustment on November 27, 1985; denied by Zoning and Planning Committee on November 5, 1985; denied by City Council on November 15, 1985;

b. variance of off-street parking requirement for a 36 X 46 foot one story building (1,656 square feet);

denied by Board of Adjustment on February 26, 1986; denied by City...