Town of Nags Head v. Toloczko

• Decision Date: 28 March 2012
• Docket Number: No. 2:11–CV–1–D.,2:11–CV–1–D.
• Citation: 863 F.Supp.2d 516
• Court: U.S. District Court — Eastern District of North Carolina
• Parties: TOWN OF NAGS HEAD, Plaintiff, v. Matthew A. TOLOCZKO, and Lynn B. Toloczko, Defendants.

863 F.Supp.2d 516

TOWN OF NAGS HEAD, Plaintiff,

v.Matthew A. TOLOCZKO, and Lynn B. Toloczko, Defendants.

No. 2:11–CV–1–D.

United States District Court,

E.D. North Carolina,

Northern Division.

March 28, 2012.

C. Everett Thompson, II, C. Everett Thompson, II, Attorney at Law, Elizabeth City, NC, for Plaintiff.

Jason Charles Pfister, Keith P. Anthony, K & L. Gates LLP, Research Triangle Park, NC, William J. Brian, Jr., K & L Gates, LLP, Morrisville, NC, for Defendants.

ORDER

JAMES C. DEVER III, Chief Judge.

At its core, this case involves whether the Town of Nags Head (“Town” or “plaintiff”) can enforce land-use ordinances against the owners of a private home abutting the ocean beach. The case raises profound and unresolved issues of North Carolina law that transcend this particular case. As the Fourth Circuit has recognized on several occasions, it is not the role of a federal court to intervene in such delicate state-law matters. Accordingly, and as explained in detail below, the court dismisses without prejudice defendants' counterclaims for equitable or declaratory relief, abstains from hearing defendants' other counterclaims and the Town's claim for damages and stays those claims and counterclaims, and dismisses certain claims and counterclaims that are moot or unripe.

I.

Matthew A. Toloczko and Lynn B. Toloczko (collectively “Toloczkos” or “defendants”) own an oceanfront cottage (“Cottage”)located at 199 East Seagull Drive, Nags Head, North Carolina. Countercl. [D.E. 7] ¶¶ 3, 7. Over the years, natural forces have gradually eroded the beach that once separated defendants' Cottage from the Atlantic Ocean. See Pl.'s Resp. Defs.' Mot. Summ. J. [D.E. 30] 2–3. On November 12, 2009, a powerful storm struck the Town. Countercl. ¶¶ 30–32. This storm damaged the Cottage and washed away a significant amount of surrounding sand, including the sand around the Cottage's septic tank. Id. ¶¶ 32–33.

On November 14, 2009, the Town sent the town manager to inspect defendants' Cottage. Am. Compl. [D.E. 1–3] ¶ 5. Based on the damage observed during this inspection, the Town condemned the Cottage. Id. ¶¶ 4–6: Countercl. ¶ 37. On November 30, 2009, the Town issued a declaration of nuisance (“Nuisance Declaration”), an order of abatement, and a warning citation to defendants. Am. Compl. ¶ 8; id. Ex. A; Countercl. ¶ 38; id. Ex. A. The Nuisance Declaration informed defendants that the Cottage created a “likelihood of personal and property injury” and was located in the “public trust,” in violation of Town Ordinance § 16–31(6)(b) and (c) (“Ordinance 16–31(6)”). Am. Compl. Ex. A; Countercl. Ex. A.¹ The Town instructed defendants to demolish the Cottage within eighteen days or face daily $100 fines. Am. Compl. ¶¶ 9, 10; id. Ex. A; Countercl. ¶¶ 40, 42; id. Ex. A. The Town also warned defendants that it would take action to demolish the Cottage if defendants refused to do so themselves. Am. Compl. Ex. A; Countercl. ¶ 40; id. Ex. A. On January 15, 2010, the Town issued defendants a civil citation for failure to comply with the Nuisance Declaration and began assessing daily $100 civil penalties. Am. Compl. ¶ 15; id. Ex. B; Countercl. Ex. B.

On July 7, 2010, the Town adopted Ordinance No. 10–07–021 (“Ordinance 10–07–021”), which amended various sections of the Town's Code of Ordinances. Countercl. ¶ 63; Nags Head, N.C., Ordinance No. 10–07–021 (July 7, 2010). ² In essence, Ordinance 10–07–021 requires owners of properties located within the “public trust beach area” to obtain building permits before undertaking any construction-related work on their properties. See Ordinance No. 10–07–021. It also prohibits the issuance of building permits for structures that have been declared public nuisances pursuant to Ordinance 16–31(6). Id.

On December 6, 2010, the Town filed suit in the Dare County, North Carolina Superior Court (“Dare County Superior Court”), requesting an expedited hearing and seeking an order of abatement for the Cottage and recovery of the civil penalties that it had assessed against defendants [D.E. 1–2]. The Town amended its complaint on January 6, 2011 [D.E. 1–3]. The Town now asserts three claims:

(1) An order of abatement pursuant to N.C. Gen.Stat. § 160A–175. Am. Compl. ¶ B.

(2) In the alternative, an order of abatement pursuant to N.C. Gen.Stat. § 160A–193. Id. ¶ C.

(3) Recovery of civil penalties pursuant to N.C. Gen.Stat. § 160A–175. Id. ¶ D.

On January 7, 2011, defendants removed the case to this court based on diversity of citizenship [D.E. 1]. On January 21, 2011, defendants filed an answer and asserted twenty-one counterclaims against the Town [D.E. 7]:

(1) Declaratory judgment that the Cottage is not in the “[p]ublic [t]rust” area. Countercl. ¶¶ 106–14.

(2) Declaratory judgment that the Town's enactment of Ordinance 16–31(6)(c) exceeded the Town's state statutory authority. Id. ¶¶ 115–22.

(3) Declaratory judgment that the Town's ordering defendants to demolish the Cottage violated N.C. Gen. Stat. §§ 160A–441 to –540. Id. ¶¶ 123–30.

(4) Declaratory judgment that the Cottage is “not likely to cause personal or property injury.” Id. ¶¶ 131–37.

(5) Declaratory judgment that the Town lacks the authority to declare structures on the “dry sand beach” nuisances. Id. ¶¶ 138–53.

(6) Declaratory judgment that Ordinance 16–31(6)(c) does not authorize the Town to declare as nuisances structures located on the “dry sand beach.” Id. ¶¶ 154–62.

(7) Declaratory judgment that N.C. Gen.Stat. § 143–138 preempts Ordinance 10–07–021. Id. ¶¶ 163–78.

(8) Declaratory judgment that the Town's enactment of Ordinance 10–07–021 exceeded the Town's zoning authority. Id. ¶¶ 179–91.

(9) Declaratory judgment that the Town's enactment of Ordinance 10–07–021 exceeded the Town's nuisance authority. Id. ¶¶ 192–209.

(10) Declaratory judgment that Ordinance 10–07–021 unlawfully delegates the Town's zoning power to the town manager. Id. ¶¶ 210–21.

(11) Declaratory judgment that the Cottage is not subject to Ordinance 10–07–021. Id. ¶¶ 222–31.

(12) Declaratory judgment that the Town's enactment of Ordinance 10–07–021 violated defendants' vested rights to the application of the Town's unamended ordinances. Id. ¶¶ 232–52.

(13) Declaratory judgment that the Town's actions deprived defendants of their substantive due process rights as provided by the United States and North Carolina Constitutions. Id. ¶¶ 253–56.

(14) Declaratory judgment that the Town's actions deprived defendants of their procedural due process rights as provided by the United States and North Carolina Constitutions. Id. ¶¶ 257–60.

(15) Declaratory judgment that the Town's actions deprived defendants of equal protection under the law as provided by the United States and North Carolina Constitutions. Id. ¶¶ 261–68.

(16) The Town acted under color of state law to deprive defendants of their rights secured by the Fifth and Fourteenth Amendments of the United States Constitution, in violation of 42 U.S.C. § 1983. Id. ¶¶ 269–73.

(17) Preliminary and permanent injunctions against the Town's demolishing the Cottage. Id. ¶¶ 274–82.

(18) The Town's actions were a regulatory taking under the United States and North Carolina Constitutions. Id. ¶¶ 283–92.

(19) Initiation of an inverse condemnation proceeding against the Town. Id. ¶¶ 293–306.

(20) The Town slandered defendants' property title. Id. ¶¶ 307–15.

(21) The Town was negligent in determining that the Cottage violated Ordinance 16–31(6). Id. ¶¶ 316–21.

On February 25, 2011, the Town filed an answer to defendants' counterclaims [D.E. 12, 15]. On March 8, 2011, the Town moved to dismiss two of defendants' counterclaims (counterclaims three and twenty-one) and filed a supporting memorandum [D.E. 17, 19]. On March 22, 2011, defendants responded [D.E. 20].

On June 14, 2011, defendants moved for partial summary judgment, arguing that they were entitled to judgment as a matter of law as to all of the Town's claims and five of defendants' counterclaims (counterclaims one through five) [D.E. 25, 26]. The Town responded in opposition on July 25, 2011 [D.E. 30], and defendants replied on July 27, 2011 [D.E. 31].

On September 19, 2011, defendants asked the court to hold a status hearing [D.E. 32], to which the Town did not object [D.E. 34]. The Town and defendants informed the court that a beach nourishment project had restored the beach sand in front of the Cottage and, as a result, the Town had withdrawn the Nuisance Declaration on September 14, 2011. See Defs.' Mot. Status Conf. [D.E. 32] Ex. A; Pl.'s Resp. Defs.' Mot. Status Conf. [D.E. 34] 1–2. Specifically, the Town notified defendants that the Cottage “no longer constitutes a violation of Town Code Sec. 16–31(6)(b) & (c),” and the Town invited defendants to apply for permits to repair any damage to the Cottage. Defs.' Mot. Status Conf. Ex. A. The Town explained that even though the Cottage was “clearly still” in the public trust area, the Town had lifted the Nuisance Declaration because the Cottage no longer impeded “use of and access to the ocean beach.” Id.

On November 7, 2011, defendants moved for partial summary judgment as to fourteen of their counterclaims (counterclaims six through sixteen and eighteen through twenty) [D.E. 37, 38–43]. On December 9, 2011, the Town responded in opposition [D.E. 46]. On December 23, 2011, defendants replied [D.E. 47].

On February 23, 2012, defendants supplemented their summary judgment motions by notifying the court of Town of Nags Head v. Cherry, Inc., –––N.C.App. ––––, 723 S.E.2d 156 (2012) [D.E. 48]. Relying on Cherry, defendants also requested leave to file a motion to dismiss the Town's claims [D.E. 49]. The Town responded in opposition [D.E. 50], and defendants replied [D.E. 51]. On March 23, 2012, the Town filed a motion for leave to file a motion for summary judgment [D.E. 53].

II.

Because this case involves diverse parties, the court has subject-matter jurisdiction over the claims and counterclaims. 28 U.S.C. § 1332. Initially,...