Tolman v. Logan City

• Decision Date: 27 July 2007
• Docket Number: No. 20060713-CA.,20060713-CA.
• Citation: 167 P.3d 489,2007 UT App 260
• Parties: Thomas W. TOLMAN and Verla F. Tolman, Plaintiffs and Appellants, v. LOGAN CITY, and John and Jane Does 1-20, Defendants and Appellees.
• Court: Utah Court of Appeals

167 P.3d 489

2007 UT App 260

Thomas W. TOLMAN and Verla F. Tolman, Plaintiffs and Appellants, v. LOGAN CITY, and John and Jane Does 1-20, Defendants and Appellees.

No. 20060713-CA.

Court of Appeals of Utah.

July 27, 2007.

Christopher L. Daines and David R. Daines, Logan, for Appellants.

Jody K. Burnett, Salt Lake City, for Appellees.

Before BENCH, P.J., McHUGH, and THORNE, JJ.

OPINION

BENCH, Presiding Judge:

¶ 1 Plaintiffs Thomas W. and Verla F. Tolman (the Tolmans) appeal from a grant of summary judgment in favor of Defendant Logan City (the City), which resulted in the dismissal of the Tolmans' complaint. The trial court did not err in dismissing either of the Tolmans' takings claims, as their claim based on the 1989 enactment of a zoning ordinance was barred by the statute of limitations and their claim based on the 2004 denial of their rezoning application failed as a matter of law. The trial court also correctly determined that the City's denial of the Tolmans' rezoning application did not result in arbitrary and capricious "reverse spot zoning" or a violation of their substantive due process rights because the denial was based on the requirements contained in the City's general plan. Accordingly, we affirm.

BACKGROUND

¶ 2 In 1983, the Tolmans purchased a home at 525 East Fourth North Street in Logan, Utah. At the time of their purchase, the home was a single-family residence situated within a multi-family zone. In 1989, at the request of some of the Tolmans' neighbors, the City downzoned the neighborhood, thereby changing the zone from multi-family residential to single-family residential. In 1995, the City's municipal council adopted a revised general plan for the City, and in 1996 it adopted a zoning map and land development ordinance consistent with the revised general plan. According to the revised general plan, zoning map, and land development ordinance, the Tolmans' neighborhood continued to be zoned as single-family residential.

¶ 3 In 2002, the Tolmans purchased another home and attempted to sell their first home. Their first home had a mortgage of $115,000 and had an appraised value of $130,000. The Tolmans received at least two offers on their home in the summer of 2002: one for $70,000 and another for $100,000. The Tolmans did not accept either offer. They attempted to rent their home, but were unsatisfied with the results. The Tolmans claim that they cannot receive adequate rent due to the zoning restriction limiting the number of unrelated people that may live in a single-family residence to three.

¶ 4 In 2004, the Tolmans submitted an application to rezone their property and numerous surrounding properties from single-family residential to multi-family residential. The City's planning commission recommended that the application be denied because the rezoning request was contrary to the general plan. Ultimately, the City's municipal council denied the Tolmans' application based on the planning commission's recommendation.

¶ 5 The Tolmans then brought suit in district court challenging the City's decision and alleging that the denial of their 2004 rezoning application was arbitrary and capricious, a denial of due process, and a regulatory taking. They also alleged that the enactment of the 1989 ordinance that downzoned their property constituted a regulatory taking.

¶ 6 In response, the City brought a motion for summary judgment, arguing that the Tolmans' claims were either barred by the statute of limitations or failed as a matter of law. The trial court granted the City's motion, concluding that: (1) the Tolmans' takings claim based on the enactment of the downzoning ordinance in 1989 was barred by the applicable statute of limitation; (2) the takings claim based on the 2004 denial of the rezoning application failed as a matter of law because the Tolmans had not demonstrated that they had been deprived of all economically viable use of their property; (3) the Tolmans' due process claim failed as they had not demonstrated the denial of any procedural rights and had not established that the City's decision resulted in arbitrary reverse spot zoning in violation of their substantive due process rights; and (4) the City's denial of the Tolmans' rezoning application was not arbitrary or capricious because it was based on the requirements of the City's general plan. In light of these conclusions, the trial court granted the City's motion for summary judgment and dismissed the Tolmans' complaint.

ISSUE AND STANDARD OF REVIEW

¶ 7 Summary judgment is proper where "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Utah R. Civ. P. 56(c). "When reviewing whether the trial court properly granted summary judgment, we accord the trial court's legal conclusions no deference and review those conclusions for correctness." Blackner v. State, 2002 UT 44, ¶ 8, 48 P.3d 949. Under this correctness standard, we "view the facts and all reasonable inferences drawn therefrom in the light most favorable to the non-moving party." R.A. McKell Excavating, Inc. v. Wells Fargo Bank, N.A., 2004 UT 48, ¶ 7, 100 P.3d 1159 (quotations and citations omitted).

ANALYSIS

I. Takings Claims

¶ 8 In their Second Amended Complaint, the Tolmans allege that two land use decisions by the City resulted in a regulatory taking: (1) the enactment of the 1989 zoning ordinance that downzoned their property from multi-family to single-family residential; and (2) the denial of their 2004 application to rezone their property to multi-family residential. "`[A] regulatory taking transpires when some significant restriction is placed upon an owner's use of his property for which "justice and fairness" require that compensation be given.'" View Condo. Owners Ass'n v. MSICO L.L.C., 2005 UT 91, ¶ 31, 127 P.3d 697 (quoting Philip Morris, Inc. v. Reilly, 312 F.3d 24, 33 (1st Cir.2002)). Stated more simply, a regulatory taking occurs when a zoning regulation goes "`too far.'" Arnell v. Salt Lake County Bd. of Adjustment, 2005 UT App 165, ¶ 17, 112 P.3d 1214 (quoting Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 415, 43 S.Ct. 158, 67 L.Ed. 322 (1922)).

¶ 9 A party can challenge a land use decision as a taking through either a facial challenge or an "as applied" challenge. Id. at ¶ 18 n. 9. A facial challenge to a land use regulation becomes ripe upon enactment of the regulation itself. See Smith Inv. Co. v. Sandy City, 958 P.2d 245, 251 (Utah Ct. App.1998) (noting that the only question involved in a facial challenge to a land use regulation is "`whether the mere enactment of the [ordinance] constitutes [a substantive due process violation or] a taking'" (alterations in original) (quoting Keystone Bituminous Coal Ass'n v. DeBenedictis, 480 U.S. 470, 493, 107 S.Ct. 1232, 94 L.Ed.2d 472 (1987))). However, an as applied challenge does not become ripe until the challenging party has exhausted its administrative remedies and received a final decision from the relevant administrative agency. See Arnell, 2005 UT App 165 at ¶ ¶ 18 n. 9, 19, 112 P.3d 1214.

A. Taking Due to Enactment of 1989 Ordinance

¶ 10 The Tolmans' takings claim based on the City's 1989 ordinance is a facial challenge that became ripe upon the enactment of the ordinance and is now barred by the statute of limitations. "[W]hether the statute of limitations has run is a legal conclusion to be reviewed for correctness." State v. Lusk, 2001 UT 102, ¶ 11, 37 P.3d 1103. The catch-all four-year statute of limitations contained in Utah Code section 78-12-25(3) applies to actions not governed by other statutes of limitation. See Utah Code Ann. § 78-12-25(3) (2002). This four-year statute of limitations has been specifically applied to a takings claim. See Johnson v. Utah-Idaho Cent. Ry. Co., 68 Utah 309, 249 P. 1036, 1041 (1926). In recent years, a new statute, which likely has retroactive application,¹ would reduce the statute of limitations period for bringing a facial challenge to a zoning ordinance to just thirty days following the enactment. See Utah Code Ann. § 10-9a-801(5) (Supp.2006). As the Tolmans' challenge to the 1989 ordinance came fifteen years after the ordinance's enactment, it is barred as a matter of law.

B. Taking Due to 2004 Denial of Rezoning Application

¶ 11 The Tolmans' takings claim based on the denial of their rezoning application in 2004 is an as applied challenge that is not time barred, but nonetheless fails as a matter of law. In order "for there to be a taking under a zoning ordinance, the landowner must show that he has been deprived of all reasonable [or economically viable] uses of his land." Cornish Town v. Koller, 817 P.2d 305, 312 (Utah 1991); see also National Parks & Conservation Ass'n v. Board of State Lands, 869 P.2d 909, 925 (Utah 1993) ("The state ... need compensate a landowner only if the regulation deprives him or her of all economically viable use of the land ...."); Arnell, 2005 UT App 165 at ¶ 17, 112 P.3d 1214 (explaining that a total regulatory taking "`denies all economically beneficial or productive use of land'" (quoting Palazzolo v. Rhode Island, 533 U.S. 606, 617, 121 S.Ct. 2448, 150 L.Ed.2d 592 (2001))). This court has previously clarified that the term "economically viable use" does not mean "highest and best use." Smith Inv. Co., 958 P.2d at 258 n. 19. Furthermore, a "mere diminution in property value is insufficient to meet the burden of demonstrating a taking by regulation." Koller, 817 P.2d at 312. In fact, this court has previously held that no taking occurred where a parcel's value diminished by forty-three percent due to a downzoning regulation imposed after a landowners' purchase of the parcel. See Smith Inv. Co., 958 P.2d at 258-59.

¶ 12 The Tolmans have not lost any value in their property as a result of the City's denial of their rezoning application. Given that their property was a single-family residence both before and after the denial,...