Sunset Cay, LLC v. City of Folly Beach

• Decision Date: 27 January 2004
• Docket Number: No. 25774.,25774.
• Citation: 593 S.E.2d 462,357 S.C. 414
• Court: South Carolina Supreme Court
• Parties: SUNSET CAY, LLC, Appellant, v. The CITY OF FOLLY BEACH, Respondent.

357 S.C. 414

593 S.E.2d 462

SUNSET CAY, LLC, Appellant, v. The CITY OF FOLLY BEACH, Respondent.

No. 25774.

Supreme Court of South Carolina.

Heard December 4, 2003.

Decided January 27, 2004.

Rehearing Denied March 17, 2004.

John M.S. Hoefer and K. Chad Burgess, both of Willoughby & Hoefer, PA, of Columbia, for appellant.

Sandra J. Senn and Stephanie P. McDonald, both of Charleston, for respondent.

Justice BURNETT:

This case presents the issue of whether a municipality is required by the state Constitution and statutes to provide sewer service to all residents when it provides such service to any resident.

FACTS

In 1983, city council of the City of Folly Beach ("City") enacted an ordinance authorizing the construction of a sewer system following approval of the plan in a voter referendum. City built a system serving the central commercial district, using mostly state and federal grant monies. The system collects untreated wastewater and pumps it across the Folly River to an interconnection with the James Island Public Service District. The wastewater is then transported to the Charleston Commission for Public Works treatment and disposal. In 1984, City adopted Ordinance No. 84-13, which governs the operation and extension of the sewer system. User charges fund the operation and maintenance of the system. Extensions must be funded and constructed by the person requesting them. Detailed plans of proposed extensions prepared by a registered engineer must be submitted to City for approval.

In February 2000, City enacted Ordinance No. 29-99, which stated "[t]here shall be no expansion of the sewer system beyond the commercial, C-1 and C-2, districts within the corporate boundaries of the City of Folly Beach ... without an affirmative vote of the Folly Beach City Council." In July 2000, City enacted Ordinance No. 14-00, which stated "sewer service shall not be extended outside of the existing C-1 and C-2 Districts to serve any additional buildings or residential units except residential units adjacent to the existing taps on the original gravity sewer line at the time of this ordinance." The ordinance preamble notes the original grants were to provide sewer service to the central commercial district; that it is not possible to foresee increased demands within that district; that City depends on two other entities to transport and treat the waste; and that City "is facing significant capital and overhead increases just to service the existing sewer."

In September 2001, Developer acquired about seven acres of land located within City's limits. Developer bought the property from the O'Rourks, who had tried but failed to obtain sewer service from City. Developer has paid city taxes on the property. Developer proposes to build eight residential duplexes on the property, but needs sewer service to do so. Without sewer service, Developer may be limited to building fewer duplexes with septic tanks.

Developer's property is located at the far western end of the island. The extension would require some 4,000 feet of new pipeline—equal to the amount already in place to serve the central commercial district. The extension would serve few residences and likely would require boring through sensitive marshlands. It would require one or more additional pumping stations and additional staff, maintenance, and operating expenses, City asserts. The residents of Folly Beach neither need nor desire an island-wide sewer system "for a myriad of ecological and financial reasons," City contends.

Developer's property is zoned C-3 (marine commercial). Developer asserts the system has been extended at least ten times over the years to serve various commercial and residential properties, including at least one property zoned C-3 that is not located within the central commercial district. City concedes the system has been expanded, but asserts the system still is largely confined to the core commercial district as originally planned. Expansion of the system apparently has been a controversial issue among residents since it was built, with the majority of residents and council members choosing to limit expansion and the development likely to follow.

In March 2002, Developer's attorney wrote City, asking it "to acknowledge that it will accept the extension of sanitary sewer facilities" to Developer's property, with Developer funding the cost of the extension. City responded by letter, saying it "cannot extend the system or accept any extension under the existing ordinance," but Developer was welcome to request an extension from city council.

In April 2002, Developer brought a declaratory judgment action against City, alleging City is required to provide sewer service under the state Constitution and statutes and asking the court to enjoin enforcement of ordinances limiting expansion of the sewer system outside the central commercial district. Developer filed a motion for partial summary judgment, seeking a declaration that the ordinances on their face are contrary to state law and unconstitutional, and an order enjoining enforcement of the ordinances. The City subsequently filed a motion for summary judgment, contending the ordinances are valid under the state Constitution and statutes.

The circuit court dismissed the case without prejudice, ruling Developer's statutory and constitutional challenges to the ordinances were not ripe for review under the Uniform Declaratory Judgments Act. Developer timely filed a Rule 59(e), SCRCP, motion, arguing the issues were ripe for review and asking the Court to address them. The circuit court denied the Rule 59 motion. This appeal follows.

ISSUES

I. Did the circuit court err in ruling that Developer's statutory and constitutional challenges to the City's ordinance were not ripe for review under the Uniform Declaratory Judgments Act?

II. Does the City have the power, pursuant to the state Constitution and statutes, to enact an ordinance that on its face limits expansion of the sewer system unless city council affirmatively votes to approve an expansion?

III. Does an ordinance limiting expansion of the City's sewer system unless city council affirmatively votes to approve an expansion violate Developer's constitutional right to equal protection under the law?

IV. Does an ordinance limiting expansion of City's sewer system unless city council affirmatively votes to approve an expansion violate Developer's constitutional right to substantive due process of law?

DISCUSSION

I. Declaratory Judgment Act

City contends Developer was required to submit an application, including a detailed construction proposal prepared by a registered engineer, and follow the extension process outlined in the ordinance. Developer's one letter asking City to acknowledge it would grant an extension and City's one letter in response did not constitute an application, City asserts. The circuit court declined to rule on the merits of Developer's arguments, and agreed with City the case was not ripe for review because Developer had not applied for a sewer extension.

Developer argues the circuit court erred in ruling its statutory and constitutional challenges to City's ordinance were not ripe for review under the Uniform Declaratory Judgments Act. See S.C.Code Ann. §§ 15-53-10 to -140 (1976 & Supp. 2002). Developer asserts its challenges to the ordinance were ripe for review because the record was sufficiently developed and "there would be no point in [Developer] exhausting a remedy that does not exist." We agree. The Declaratory Judgments Act provides that "[c]ourts of record within their respective jurisdictions shall have power to declare rights, status, and other legal relations whether or not further relief is or could be claimed." S.C.Code Ann. § 15-53-20 (1976). "Any person ... whose rights, status, or other legal relations are affected by a statute [or] municipal ordinance... may have determined any question of construction or validity arising under the ... statute [or] ordinance ... and obtain a declaration of rights, status or other legal relations thereunder." S.C.Code Ann. § 15-53-30(1976); see also Rule 57, SCRCP.

Despite the Act's broad language, it has its limits. An adjudication that would not settle the legal rights of the parties would only be advisory in nature and, therefore, would be beyond the intended purpose and scope of the Uniform Declaratory Judgments Act. Power v. McNair, 255 S.C. 150, 154, 177 S.E.2d 551, 553 (1970); City of Columbia v. Sanders, 231 S.C. 61, 68, 97 S.E.2d 210, 213 (1957). A declaratory judgment should not address moot or abstract matters. Waller v. Waller, 220 S.C. 212, 223, 66 S.E.2d 876, 882 (1951).

To state a cause of action under the Declaratory Judgment Act, a party must demonstrate a justiciable controversy. Power v. McNair, 255 S.C. at 154, 177 S.E.2d at 553. "A justiciable controversy is a real and substantial controversy which is appropriate for judicial determination, as distinguished from a dispute or difference of a contingent, hypothetical or abstract character." Power v. McNair, 255 S.C. at 154, 177 S.E.2d at 553; Graham v. State Farm Mutual Automobile Ins. Co., 319 S.C. 69, 71, 459 S.E.2d 844, 845 (1995) (same); Holden v. Cribb, 349 S.C. 132, 137, 561 S.E.2d 634, 637 (Ct.App.2002) (same).

The Declaratory Judgments Act is a proper vehicle in which to bring a controversy before the court when there is an existing controversy or at least the ripening seeds of a controversy. Waller, 220 S.C. at 223,66 S.E.2d at 882. The basic purpose of the Act is to provide for declaratory judgments without awaiting a breach of existing rights. The Act should be liberally construed to accomplish its intended purpose of affording a speedy and inexpensive method of deciding legal disputes and of settling legal rights and relationships, without awaiting a violation of the rights or a disturbance of the relationship. Graham, 319 S.C. at 71,459 S.E.2d at 845; Power, 255...