W.R. Grace & Co. v. Cambridge City Council

Citation779 N.E.2d 141,56 Mass. App. Ct. 559
Decision Date25 November 2002
Docket NumberNo. 00-P-27.,00-P-27.
PartiesW.R. GRACE & CO.-CONN. & another<SMALL><SUP>1</SUP></SMALL> v. CAMBRIDGE CITY COUNCIL & another.<SMALL><SUP>2</SUP></SMALL>
CourtAppeals Court of Massachusetts

John Kenneth Felter, Boston (Michael Murray with him) for the plaintiffs.

Brian C. Levey, Framingham, for the defendants.

Present: BROWN, LENK, & COWIN, JJ.

COWIN, J.

W.R. Grace & Co.-Conn. and Alewife Land Corporation (collectively, Grace) challenge certain zoning amendments adopted by the city of Cambridge (the city) that effectively froze Grace's development plans for a period of twenty-three months. A judge of the Land Court allowed summary judgment in favor of the city, while simultaneously denying Grace's motion for summary judgment. On appeal, Grace asserts (1) the amendments exceeded the city's police powers as expressed in G.L. c. 40A, §§ 1 et seq. (the Zoning Act); (2) the amendments constituted "reverse" spot zoning, and were therefore unlawful; and (3) regardless of the validity of the amendments, the amendments constituted a "regulatory taking" of property for which Grace is constitutionally entitled to compensation. Thus, we enter the dense thicket of court decisions that have sought to establish the boundary between private property rights and permissible governmental action limiting the value of those rights. Complicating the analysis in this particular case is the fact that a summary judgment decided the outcome; accordingly, we must examine not only whether correct principles of law were applied, but also whether summary judgment was appropriate. After consideration of each factor, we affirm the judgment of the Land Court.

1. Undisputed facts and prior proceedings. Grace owns a parcel of land in North Cambridge containing approximately twenty-nine acres (the locus). Grace acquired the property in 1954. Chemical products were manufactured in facilities located there until 1974. Prior to 1977, the zoning district in which the locus was situated was designated "Industry B," wherein industrial uses were permitted as of right.3 In 1977, Cambridge amended its zoning ordinance by, among other things, designating the zoning district "Industry C," which restricted building height to forty-five feet and allowed a maximum floor area ratio of 1.0. This district was the only Industry C zoning district in the city. Most of the property within the district is owned by Grace, the remainder consisting of a two-family house and a small parcel owned by the Metropolitan District Commission.

During and subsequent to 1977, other zoning actions affected the locus. The city first created a Planned Unit Development Overlay district applicable to Industry C districts, and thus applicable to the locus, that imposed certain minimum open space and landscaping requirements but permitted increases in building height to eighty-five feet and in floor area ratios to 2.0. Development within the Planned Unit Development district required the issuance of a special permit by the Cambridge planning board. In 1982, the city placed a portion of the locus in a Flood Plain Overlay district, which also prohibits any construction within the Overlay district without issuance of a special permit by the planning board.

In 1987, Grace, through an agent, applied for and received a special permit to develop a portion of the locus. The development, called Alewife Center, called for a hotel and six office buildings with associated retail uses, with the total contemplated new space exceeding one million square feet. There would also be accessory parking for more than 2,300 automobiles. The special permit authorized construction to proceed in phases between 1987 and 1994. The first building (Alewife Center One) was completed and occupied in 1989. Grace expended other funds in connection with its intention at that time to develop the property further.

In 1989, Grace sought and received an amendment to the special permit that revised commencement dates for various phases of the project and authorized postponement of commencement of the final phase of Alewife Center from June, 1994, to September, 1997. Despite the special permit and the amendment thereto, Grace undertook no further construction at the locus following the completion of Alewife Center One. In 1996, Grace applied for further extensions of the phased commencement dates, but this time the application was denied by the planning board.

The locus is bounded to the north by a Residence B district; to the east by Industry A-1, Residence B and OS (open space) districts; to the south by Industry A-1 and Residence C-2 districts; and to the west by Office 2 and OS districts.

In 1996, a petition by certain Cambridge residents led to adoption by the city council of a zoning amendment that rezoned as open space a 400-foot buffer area consisting of approximately thirteen acres that bordered on the adjacent Residence B districts. The new zone included all of the existing buildings and improvements on the locus, all of which became nonconforming uses. The planning board did not recommend adoption of the petition as filed, stating that "[d]ue to general planning concerns relating to the entire [d]istrict, the [p]lanning [b]oard will initiate a study leading to a comprehensive revision of the zoning regulations affecting all of the [Industry C] district and the coterminous [Planned Unit Development] ... district for submission to the [c]ity [c]ouncil as expeditiously as possible."4 Whether because of the planning board's position or otherwise, the version of the petition ultimately adopted by the city council provided for expiration six months after the date of enactment (thus remaining in effect from October 28, 1996, through April 28, 1997).

On January 6, 1997, Grace commenced the present action seeking a declaration that the 1996 amendment that created the temporary (six-month) open-space buffer zone was unlawful as spot zoning; constituted a taking under the United States and Massachusetts Constitutions; and violated the Zoning Act in that it bore no reasonable relationship to legitimate zoning purposes. On March 17, 1997, with the Grace lawsuit already pending, the city council adopted another amendment to the zoning ordinance, this time creating a temporary building moratorium applicable to the Industry C and Planned Unit Development districts that prohibited the issuance of all building permits therein until February 1, 1998. Following adoption of the temporary building moratorium, which affected all twenty-nine acres of the locus, Grace filed a motion to amend its complaint to allege that the moratorium (as well as the earlier six-month rezoning of the thirteen-acre buffer strip) violated substantive due process and constituted both unlawful spot zoning and a regulatory taking. The motion to amend was allowed on June 19, 1997. On May 4, 1998, the city council extended the temporary building moratorium to September 30, 1998. Consequently, any intentions Grace might have had to develop the locus further were effectively held up from October 28, 1996, to September 30, 1998, a period of approximately twenty-three months.5

While these subsequent zoning changes were taking place, the city embarked on a rezoning study with respect to the Industry C district (and therefore the locus). On October 10, 1996, a proposed work program for the study was completed. Additional memoranda were prepared in November and December, 1996. In January, 1997, the city published a request for proposals for a professional facilitation team to work on the study. Early in 1997, a facilitation team was selected. In June, 1997, the planning board accepted a recommendation of the facilitation team that a working group be formed for the purpose of discussing major issues pertaining to the study. The working group consisted of approximately forty members, including representatives of Grace, neighborhood residents, planning board members and members of the Cambridge community development department. Between September, 1997, and January, 1998, the working group developed an issues agenda, retained consultants and negotiated procedures and approaches. The working group then met about every two weeks from January 27, 1998, to June 30, 1998.

On July 10, 1998, the facilitation team submitted to the planning board a report on the working group process. The working group did not reach consensus on what the rezoning should be; rather, it offered differing recommendations of competing participating groups. On December 15, 1998, two and one-half months after expiration of the extended temporary building moratorium, the planning board recommended to the city council the creation of a new Special District 3 to replace the existing Industry C district containing the locus. The new district, an amended version of a proposal filed previously by the planning board, significantly reduced, but did not eliminate, the amount of development previously permitted at the locus. On January 5, 1999, by letter to the city clerk, Grace informed the city council that it did not protest adoption of the planning board petition to create the Special District 3 on the condition that the planning board's amended version was accepted. The planning board petition as amended was adopted on January 7, 1999, and became Ordinance # 1212. Grace has not challenged the permanent zoning of the locus as part of Special District 3, confining this litigation to the merits of the zoning amendments applicable to the twenty-three month period that preceded adoption of Ordinance # 1212.

2. Mootness. The city argues that, with respect to Grace's assertions that the contested zoning amendments exceeded the police power and constituted reverse spot zoning, the claims are moot because those amendments expired not later than September 30, 1998. This proposition...

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