Opinion
Civil No. 01-1787-AS.
August 6, 2004
OPINION and ORDER
Plaintiff, West Lynn Corporate Park, LLC, alleges nine claims against the City of West Linn ("the City"), arising out of conditions imposed on plaintiff's development, West Linn Corporate Park. Plaintiff's sixth claim for relief — for retaliation — is also alleged against City engineer, Boris Piatski. Before the court are the parties' cross-motions for summary judgment (docket Nos. 79 and 87).
BACKGROUND
Plaintiff is a developer, and this dispute arises out of its development of a corporate office park on plaintiff's property at 1800 and 1830 Blankenship Road in the City of West Linn. The subject property lies east of Summerlinn Drive, which was formerly known as 13th Street, and south of Greene Street, the vacation of which is at issue in this lawsuit. A depiction of the site is attached at the end of this opinion and order.
Plaintiff alleges nine claims. The first and second claims are for inverse condemnation under the Oregon and United States Constitutions. These claims seek redress for conditions plaintiff asserts were unlawfully imposed on its development. The third claim alleges that the City was unjustly enriched by the improvements it required plaintiff to make as conditions of the development. The fourth and fifth claims are for inverse condemnation under the Oregon and United States Constitutions. In contrast to the first and second claims, these claims seek redress for an alleged taking by the City of a portion of the intersection of Greene Street and 13th Street. The sixth and seventh claims allege that the City and Boris Piatski violated the Civil Rights Act by retaliating when plaintiff exercised its rights under the First Amendment. The eighth claim alleges that the City violated the Civil Rights Act by treating plaintiff differently from other similarly situated developers in violation of plaintiff's right to Equal Protection. The ninth claim alleges that conditions the City imposed on the development were in breach of a 1975 Annexation Agreement.
Plaintiff seeks full or partial summary judgment on the fourth, fifth, six and ninth claims for relief. In addition and in the alternative, plaintiff seeks partial summary judgment on those claims, as well as, its seventh claim for relief. Defendants seek summary judgment on all claims.
FACTS
There is a paucity of agreed material facts in this case.
Plaintiff asserts that it is a developer of two office buildings in the City of West Linn. Plaintiff's Concise Statement of Material Facts in Support of Plaintiff's Amended Motion for Summary Judgment ("Plaintiff's Facts"), ¶ 1. Defendants deny that without explanation. Response to Plaintiff's Concise Statement of Material Facts in Support of Plaintiff's Amended Motion for Summary Judgment ("Defendants' Response Facts"), ¶ 1. The denial could be based on an argument by defendants that the developer was not plaintiff, but rather Renaissance Development, which defendant maintains is a distinct entity from plaintiff.
The Annexation Agreement
Before March 31, 1975, Fred and Betty Byron owned property designated as tax lot 300, portions of which were then located outside of, but adjacent to, the City of West Linn. Concise Statement of Material Facts in Support of Motion for Summary Judgment by Defendants ("Defendants' Facts"), ¶ 1; Plaintiff's Response to Defendants' Concise Statement of Facts ("Plaintiff's Response Facts"), ¶ 1. On March 31, 1975, the Byrons entered into an annexation agreement with the City. Defendants' Facts, ¶ 2; Plaintiff's Response Facts, ¶ 2. The Byrons and the City agreed that City would" provide all normal municipal services," the availability of which would be "within the sole discretion of [the] City." Affidavit of Robert E. Franz, Jr. ("Franz Aff."), Ex. 522, p. 2. The Byrons agreed that they, their heirs and assigns, would "pay [the] City a `service extension' fee in the amount of $600 per family dwelling unit" and to "construct and install all streets, sanitary sewers, storm sewers, street lights, water distribution lines and all other utilities necessary and normal with the subdivision." Id. Plaintiff asserts that this annexation agreement is still binding on the parties to this lawsuit. Plaintiff's Facts, ¶ 2. Defendants deny that it is. Defendants' Response Facts, ¶ 2.
Plaintiff asserts that the City changed the zoning of the site from residential to commercial in December 1983. Plaintiff's Facts, ¶ 4. Defendants, without explanation, deny that assertion. Defendants' Response Facts, ¶ 4. There is, however, no issue that the development at issue in this action — West Linn Corporate Park — is commercial, not residential.
The Traffic Study
Defendants assert that Randal Sebastian, Pat Sisul (Engineer), and John McGrew (architect) appeared on behalf of Renaissance Development Corporation at a pre-application conference with the City on December 5, 1996, to discuss the development of an office complex on the site. Defendants assert that, at the meeting, Renaissance Development was told that it would be required to provide a traffic study to the City to determine the impact of the development on off-site intersections, and that the traffic engineer should consider the Dolan test for constitutionality. Defendants assert that Renaissance Development was again notified of these requirements at another pre-application conference on April 3, 1997. Defendants' Facts, ¶¶ 4, 5. Plaintiff asserts that these pre-application conferences concerned other projects that were later abandoned and thatDolan was not discussed at either meeting. Plaintiff's Response Facts, ¶ 2.
See Dolan v. City of Tigard, 512 U.S. 374, 391 (1994).
On August 14, 1997, Randal Sebastian appeared at a meeting of the Willamette Neighborhood Association in West Linn as a speaker regarding the development of West Linn Corporate Park. Defendants' Facts, ¶ 6; Plaintiff's Response Facts, ¶ 3. The minutes of that meeting indicate that he informed those present that the project would add to traffic on 10th Street. Defendants' Facts, ¶ 6; Franz Aff., Ex. 526, p. 1.
Defendants assert that on September 17, 1997, Renaissance Development, Show Timber Company (a developer of adjacent property), and the City agreed to jointly fund a traffic study of the 10th Street/I-205 corridor and retained the firm of Kittelson and Associates to perform that study. Defendants' Facts, ¶ 7. Plaintiff contends that the City forced the developers to contribute funds to the study by threatening to stop their developments. Plaintiff's Response Facts, ¶ 4. Defendants maintain that Renaissance Development, Show Timber and the City intended for the study to determine the off-site impacts the two developments would have on traffic. Defendants' Facts, ¶ 8. Plaintiff contends that the study was unrelated to the impact of the development of West Linn Corporate Park. Plaintiff's Response Facts, ¶ 5.
The parties vehemently disagree about the purpose of the Kittelson and Associates study. Defendants assert that the parties intended the study to determine the conditions of approval for West Linn Corporate Park. Defendants' Facts, ¶ 17. Plaintiff asserts that the study addressed a "fairly substantial area and [was] much larger than simply looking at any impacts from the West Linn Corporate Park" and that its purpose was to "forecast build-out traffic volumes," including "an estimation of all the traffic within the City of West Linn that would be generated from undeveloped lands" Plaintiff's Response Facts, ¶ 12; Affidavit of Tom Schwab ("Schwab Aff."), ¶ 4.
Defendant maintains that the City relied on representations of Renaissance Development that it would abide by the results of the Kittelson and Associates study. Defendants' Facts, ¶ 18. Plaintiff denies that and asserts that Renaissance Development only contributed to the study to have its land use application deemed complete and prevent delay. Plaintiff's Response Facts, ¶ 15; Affidavit of Patrick Sisul ("Sisul Aff."), ¶ 13.
The traffic study was completed in February 1998. Defendants' Facts, ¶ 10. The cover letter from Kittelson and Associates to City engineer, Dave Monson, states:
"The purpose of the 10th Street Corridor Conceptual Plan was to recommend the future traffic lanes and traffic control devices predicted to meet a 20-year forecast traffic demand for this corridor. The study also recommends a plan to allow phased construction in the future and a prediction of traffic volumes that trigger the need for each phased improvement. The report also describes the roadway improvements required with the Summerlinn Apartment complex and the West Linn Corporate Park.
"The roadway improvements the study required for these two `inprocess' developments is outlined on pages 30, 31, and 32 of the study in the conclusions on page 36."
Franz Aff., Ex. 513, p. 2. Defendants rely on the following excerpt from the report to support their assertion that the report was intended to determine off-site impacts of the development of West Linn Corporate Park:
"Construction of the West Linn Corporate Park will trigger the need to install a traffic signal at the intersection of 10th Street/Westbound ramp and at the immediately adjacent intersection of 10th Street/Salamo Road. This pair of traffic signals will be required by the completion of either Summer Linn [ sic] Apartments or the West Linn Corporate Park."
Defendants' Facts, ¶ 10; Franz Aff., Ex. 513, p. 37 (emphasis supplied). To support the assertion that defendants' characterization of the traffic study is inaccurate, plaintiff relies on the affidavit of one of the authors of the cover letter to the study, Senior Engineer Tom Schwab, who testifies that:
"The term `trigger' is used to note that along with all other traffic existing, the additional traffic will meet the justification standard or warrants for the traffic improvements. It does not mean that West Linn Corporate Park alone should be responsible for the full cost of the improvements.
8. If I was asked to try to access the appropriate or roughly proportional share of cost for West Linn Corporate Park for the improvements in the report, I would look to the percentages set forth at Table 3, which is based on percentages of 2,018 p.m. peak hour entering vehicles. The phase I understand to be at issue is the Blankenship Road/Willamette Road/10th Street in that Table and the West Linn Corporate Park percentage is 5.4%. . . . Given that the traffic signals equipment themselves have value for future phases that, if anything, would be more than a fair assessment against West Linn Corporate Park."
Schwab Aff., ¶¶ 7, 8 (citing Franz Aff, Ex. 513, p. 23).
The Conditions of Approval
On November 24, 1997, architect Charles Matschek submitted a design review application for a project designated as "West Linn Corporate Park." Defendants' Facts, ¶ 9; Franz Aff., Ex. 529, p. 6. Plaintiff maintains that the submission was for a different project, but offers no evidence in support of that assertion. Plaintiff's Response Facts, ¶ 6. Plaintiff also disputes defendants' assertion that the owner of the property at the time of the design review application was Randall Sebastian, but offers no evidence to controvert defendants' assertion that he was. Plaintiff's Response Facts, ¶ 6; Defendants' Facts, ¶ 9; Franz Aff., Ex. 529, p. 3.
On March 6, 1998, the Planning Director of the City approved the design review application submitted by Renaissance Development, with conditions of approval. Defendants' Facts, ¶ 11; Plaintiff's Response Facts, ¶ 8. Plaintiff did not appeal the decision within fourteen days of receipt, as specified in the approval. Defendants' Facts, ¶ 12; Plaintiff's Response Facts, ¶ 9; Franz Aff., Ex. 500, p. 9. Condition of Approval No. 10 required the applicant, Renaissance Development, to "finance the review of the development's fire and domestic water system demands with the City's new Water Master Plan consultant (Montgomery-Watson) to establish all necessary off-site and onsite water improvement required for the development." Franz Aff., Ex. 500, p. 8. Pursuant to that condition, on March 19, 1998, the engineer for the development submitted a preliminary water improvement plan to Montgomery Watson. Defendants' Facts, ¶ 13; Plaintiff's Response Facts, ¶ 10; Franz Aff., Ex. 530.
On March 19, 1998, neighboring developers, West Linn Associates, LLC, and Albertson's, Inc., appealed the approval of the design review application for West Linn Corporate Park, and the City's Land Use Hearings Officer heard the appeal on April 15 and May 6, 1998. Defendants' Facts, ¶ 14; Plaintiff's Response Facts, ¶ 11. At the May 6, 1998, hearing, William Cox, the attorney for Renaissance Development, argued that the applicant was mitigating traffic impacts of the proposed development by installing two traffic signals and would pay Systems Development Charges ("SDCs") to fund these capital improvement projects. Defendants' Facts, ¶ 15; Franz Aff., Ex. 500, p. 12. The substance of the remainder of the testimony material to the present dispute is disputed. Defendants' Facts, ¶ 16; Plaintiff's Response Facts, ¶ 11.
The Land Use Hearings Officer issued a Final Order on May 20, 1998, upholding the Planning Director's decision and the conditions of approval, modifying No. 5 to read:
"The applicant shall construct the 10th Street corridor street improvements required by the traffic study developed by the traffic engineering consultant Kittleson [ sic] Associates, including construction of two traffic signal lights and associated improvements at the westbound I-205 freeway off-ramp 10th Street and the 10th Street/Salamo Road/Blankenship Road intersections, along with a sidewalk on the west side of 10th Street from the River Falls Shopping Center sidewalk and 8th Avenue."
Defendants' Facts, ¶ 17; Franz Aff., Ex. 500, p. 17. There was no appeal of the Final Order of the Land Use Hearings Officer.
On August 11, 1998, Renaissance Development's engineer, Patrick Sisul, submitted a letter with plans for frontage improvement for Blankenship Road and 13th Street. The letter stated, "I want to run through all the Conditions of Approval and state how each one is being or will be met." Defendants' Facts, ¶ 19; Franz Aff., Ex. 506, p. 1. Mr. Sisul testified that his letter should not be construed that he approved of any of the conditions of approval. Sisul Aff., ¶ 15.
On August 13, 1998, a public improvement construction permit was issued to Renaissance Development. Defendants' Facts, ¶ 20; Plaintiff's Response Facts, ¶ 17.
The City informed Randal Sebastian of Renaissance Development by letter of August 25, 1998, that Montgomery Watson had determined that the project's impact to the Willamette Falls Drive water transmission line would require 785 feet of pipe to be upgraded from eight inches to twenty inches in diameter. The letter reflected the City's understanding that adjacent developer, Show Timber, might pursue the upgrade of roughly 1400 feet of pipe jointly with Renaissance Development. Defendants' Facts, ¶ 21; Plaintiff's Facts, ¶ 18; Franz Aff., Ex. 532.
The $264,000 Bond
On November 4, 1996, the Willamette Christian Church of West Linn conveyed part of the property, which currently comprises West Linn Corporate Park to Randal Sebastian for $862, 553. Defendants' Facts, ¶ 3; Plaintiff's Response Facts, ¶ 3. On October 19, 1998, Betty Byron conveyed Tax Lot 300 to Randal and Sandra Sebastian for $655,000. Defendants' Facts, ¶ 23; Plaintiff's Facts, ¶ 20. On October 28, 1998, Randal Sebastian, as the owner of both portions of the property at issue, entered into a Public Improvements Guarantee ("PIG") with the City, which specified:
"The land use approval for the project requires Developer to construct certain public improvements (the `required public improvements') as a condition of the approval. Public improvements are items that the developer is required to construct and dedicate or otherwise transfer to the City. The land use approval also requires Developer to provide adequate assurances that the required public improvements will be satisfactorily completed. This agreement is intended to provide adequate assurances that the required public improvements will be completed."
Franz Aff., Ex. 536, p. 1; Defendants' Facts, ¶ 24; Plaintiff's Response Facts, ¶ 21. Randal Sebastian crossed out "Renaissance Development" on the blank for "Developer" and wrote in "West Linn Corporate Park, LLC." Franz Aff., Ex. 536, p. 1. The PIG described the public improvements as follows:
"The public improvements include those which are to be constructed on the frontage of the subject property. In particular this means the public improvements which are to be constructed within 13th Street and also within Blankenship Road. . . . In addition to these improvements, the Developer shall also construct the off site improvements which have been included in the land use conditions of approval. These improvements include the waterline improvements within Green [ sic] Street, the waterline improvements in Willamette Falls Drive, the 10th Street Corridor improvements which include two traffic signal lights, improvements to the westbound I-205 ramps and the 10th Street intersection, improvements to the 10th Street, Blankenship and Salamo Road intersection, the construction of a sidewalk on the west side of 10th Street from the River Falls Shopping Center to 8th Avenue, and the gravel path within the Greene Street vacation area."
Defendants' Facts, ¶ 25; Franz Aff., Ex. 536, p. 1.; Plaintiff's Response Facts, ¶ 22. Randal Sebastian signed the PIG on October 21, 1998, as a "member" of "W.L. Corporate Park." Franz Aff., Ex. 536, p. 4.
On October 22, 1998, Randal Sebastian submitted performance bonds to the City guaranteeing performance of the following: (1) "10th Street improvements from Salamo Road to WFD"; (2) "Blankenship Road frontage improvement"; (3) "West Linn Corporate Park"; and (4) "Willamette Falls Drive Transmission main, phase 2". Defendants' Facts, ¶ 28; Franz Aff., Ex. 533, pp. 1, 3, 5, 7; Plaintiff's Response Facts, ¶ 25. On November 24, 1998, plans for the various public improvements for the West Linn Corporate Park development were approved for construction by Wally Koch, the City's Public Improvements Manager. Defendants' Facts, ¶ 29; Plaintiff's Response Facts, ¶ 26.
One particular bond, No. 517854S, in the amount of $264,000, states that plaintiff, "as a condition of the filing of the final subdivision map of: West Linn Corporate Park (DR 97-58 and Misc. 98-11) entered into an agreement or agreements with [the City] to complete the improvements specified in said agreement or agreements." Franz Aff., Ex. 533, p. 5; Jones Aff., Ex. 21, p. 5. The agreement to which the bond refers is the PIG. Paragraph 7 of the PIG addresses the requirement that plaintiff provide a performance bond in the amount of $264,000:
"Developer shall arrange a cash escrow, bond or equivalent security to secure the faithful performance of its obligations under this agreement. The amount of the escrow, bond or equivalent security shall be Two Hundred Sixty-four Thousand Dollars ($264,000). . . . The amount of security as required by this paragraph covers the improvements within 13th Street and Blankenship Road and also the portion of the 12'' waterline in Greene Street which fronts upon the north side of this development. Any additional security to cover the offsite improvements, as described in paragraph 2 shall be addressed in an amendment to this Public Improvements Guarantee."
Franz Aff., Ex. 536, p. 2; Jones Aff., Ex. 21, p. 2. The bond, on the other hand, states that the City and plaintiff entered into an agreement or agreements "to complete the improvements specified in said agreement or agreements" and that if the Plaintiff "shall well and truly perform said agreement or agreements," the bond obligation shall be void. Franz Aff., Ex. 533, p. 5; Jones Aff., Ex. 21, p. 5.
Plaintiff claims that: (1) the improvements covered by the bond consist of the 13th Street and Blankenship Road improvements and the twelve-inch waterline in Greene Street; (2) these are complete; and (3) the City has accepted them. The City claims that the bond includes the 10th Street/Salamo improvements, which the City has not accepted.
Plaintiff alleges that when it requested release of the $264,000 bond, defendant Boris Piatski said that the City would not release the bond until plaintiff dedicated to the City the disputed half of the intersection at 13th and Greene Street/Summerlinn Drive (see infra.). Plaintiff's Facts, ¶¶ 23, 24. Defendants dispute that assertion and claim that the bond has not been released because the 10th Street/Salamo improvements have not been properly constructed. Defendants' Response Facts, ¶ 25.
The Vacation of Greene Street
On December 14, 1998, 13th Street from Blankenship Road to the northern boundary of Greene Street was changed to the name of Summerlinn Drive. Defendants' Facts, ¶ 30; Plaintiff's Response Facts, ¶ 27. The parties agree that, on that date, the former intersection of 13th Street and Greene Street was changed to the name of Summerlinn Drive (Defendants' Facts, ¶ 31; Plaintiff's Response Facts, ¶ 28), but disagree as to whether that intersection was included in Greene Street after the name change, or was solely included in Summerlinn Drive (Defendants' Facts, ¶ 32; Plaintiff's Response Facts, ¶ 29). Portions of Greene Street were vacated after December 14, 1998. Defendants' Facts, ¶ 36; Plaintiff's Response Facts, ¶ 33. The extent of the vacation is at issue.
The parties disagree whether the vacation of Greene Street included Summerlinn Drive, i.e., the intersection formerly known as 13th Street and Greene Street. Defendants' Facts, ¶¶ 33, 35; Plaintiff's Response Facts, ¶¶ 30, 32.
Ordinance 1439 was passed on July 12, 1999, providing:
The portion of a public street in the City of West Linn, Clackamas County, Oregon, described on Attachment "A" is hereby vacated excepting the reservation of a 20 foot wide utility and access easement to be conveyed to the City of West Linn for the entire length of the right of way and a 20 foot wide access easement from the north end of 13th Street connecting to the open space area known as Park C in the Summerlinn Apartment application. . . . The specific location of these easements to be determined by the City Engineer.
Attachment A is a legal description of the land dedicated. It contains no landmark identifiers that would enable the court to determine the boundaries of the land dedicated.
Plaintiff's Facts, ¶ 10; Affidavit of Jeffrey R. Jones ("Jones Aff."), Ex. 5, p. 1. Plaintiff asserts that this ordinance resulted in half of the disputed intersection vesting in plaintiff. Plaintiff's Facts, ¶ 10. Defendants dispute that. Defendants' Response Facts, ¶ 10.
Ordinance No. 1439 also adopted the findings contained in the staff report dated June 15, 1999. Plaintiff's Facts, ¶ 13; Jones Aff, Ex. 5, p. 1. Attached to the staff report is a map with the entire length of Greene Street shaded as the "portion to be vacated." Jones Aff. Ex. 6, p. 4. The staff report also states that a 4-foot gravel path is to be constructed along the length of Greene Street east of the 13th Street intersection and that an 8-foot wide gravel path shall be installed in the easement linking 13th Street to Park C (a park north of Greene Street).Id., p. 2.
Plaintiff asserts that a City engineer, Peter Spir, attempted to cause plaintiff to dedicate half of the disputed intersection to the City without compensation. Plaintiff's Facts, ¶ 14. Defendants deny that, but the parties agree that plaintiff would not dedicate the disputed potion of the intersection to the City. Defendants' Response Facts, ¶ 14. Plaintiff asserts that the City recorded the easement, locating the gravel path easement in the disputed intersection, and that the City caused utilities to be installed in the easement and caused the easement to be paved and used as a roadway. Plaintiff's Facts, ¶ 15. Defendants deny this (Defendants' Response Facts, ¶ 15), although there is no issue that the disputed portion of the intersection is currently paved and being used as a public roadway.
Exterior Stairs Violation
During construction of West Linn Corporate Park, Building Official Dave Davies inspected exterior stairs at the site and informed plaintiff on December 29, 1999, that the stairs violated the building code and would need to be repaired. Defendants' Facts, ¶ 37; Plaintiff's Response Facts, ¶ 34; Franz Aff., Ex. 542, pp. 10-11. The parties disagree whether the stairs were in violation of the building code, whether stairs at City Hall existed with similar violations, and whether Dave Davies' actions were in retaliation against plaintiff. Id. The Release
On March 21, 2000, Michael Kelly signed a release agreement on behalf of plaintiff. Defendants' Facts, ¶ 38; Plaintiff's Response Facts, ¶ 35. The release provides:
"West Linn Corporate Park, L.L.C. waives any and all claims, demands, damages, costs, attorney fees, and/or liability, of any type, existing as of the date of this release against the City of West Linn, its officials, employees, agents, successors, and assigns, arising out of or related to Condition of Approval 5 fo the approval of West Linn Corporate Park, MISC-98-11. This waiver includes a waiver of all claims relating to the 10th Street corridor street improvements prior to the date of this release, whether or not those actions were in accord with Condition of Approval 5 or sought to impose additional requirements upon West Linn Corporate Park, L.L.C. This waiver includes but is not limited to all claims asserted in the draft complaint attached hereto as Exhibit 1."
Franz Aff., Ex. 512, p. 1. Defendants have offered into the record a draft complaint, to which the release refers, which alleges that the City imposed additional off-site improvements on plaintiff's project that were not original conditions of approval. Franz Aff. Ex. 512, pp. 4-10. Plaintiff asserts that the draft complaint submitted by defendants was not attached to the Release. Affidavit of Donald Joe Willis, ¶ 4. Plaintiff does not allege that a different draft complaint was attached or offer an explanation as to what the release is referring to by "the draft complaint attached hereto as Exhibit 1."
Condition of Approval 5, to which the release also refers, provides:
"The applicant shall construct the 10th street corridor street improvements required by the City traffic study currently being developed by the traffic engineering consultant Kittelson Associates. (Minimum improvements for the development shall be the construction of the two traffic signal lights and associated improvements at the west bound I-205 freeway off-ramp and 10th Street and the 10th Street/Salamo Road/Blankenship Road intersections, along with a sidewalk on the west side of 10th St. from the River Falls Shopping Center sidewalk and 8th Avenue."
Franz Aff., Ex. 500, p. 7.
Systems Development Charge ("SDC") Credits
On October 19, 1998, Randal Sebastian submitted an application for deferral of SDCs based upon the value of the public improvements that were being constructed in conjunction with the development of West Linn Corporate Park. That application was approved, and SDCs for the development were deferred in the amounts of $190,928 in Street SDCs and $22, 320 in Water SDCs. Defendants' Facts, ¶ 27; Plaintiff's Response Facts, ¶ 24.
On November 29, 2000, SDC credits were issued to plaintiff. Defendants' Facts, ¶ 39; Plaintiff's Response Facts, ¶ 35. Rather than receiving SDC credits, the parties agree that the adjacent developer, Show Timber, applied for and received cash for the value of improvements it had constructed that exceeded the previously estimated value. Defendants' Facts, ¶ 22; Plaintiff's Facts, ¶ 19; Affidavit of Neil Nedelisky, ¶ 21.
The Development is Complete
Various certificates of occupancy — temporary and final — were issued for West Linn Corporate Park from March 24, 2000, through May 14, 2002. The development is now occupied, and plaintiff is receiving rental income from the tenants. Defendants' Facts, ¶ 40; Plaintiff's Response Facts, ¶ 35.
Plaintiff is planning to construct additional office space on adjacent property to the east of West Linn Corporate Park, including two office buildings. Defendants' Facts, ¶ 41; Plaintiff's Response Facts, ¶ 36. The parties disagree whether plaintiff will be charged SDCs for the new project. Defendants' Facts, ¶ 42; Plaintiff's Response Facts, ¶ 37.
The parties disagree whether the City would have changed the conditions of development or denied the proposal if Renaissance Development or plaintiff had challenged the conditions during the approval or construction process. Defendants' Facts, ¶ 43; Plaintiff's Response Facts, ¶ 38. Plaintiff asserts that a challenge would have imposed greater delays and burdens on plaintiff. Plaintiff's Response Facts, ¶ 38. The parties disagree as to whether plaintiff's failure to challenge the conditions was a manifestation of consent to them. Defendants' Facts, ¶ 44; Plaintiff's Response Facts, ¶ 39. The parties also disagree as to whether the City has a policy, custom or practice of treating plaintiff differently from any other developer. Defendants' Facts, ¶ 45; Plaintiff's Response Facts, ¶ 40.
SUMMARY JUDGMENT STANDARD
A party is entitled to summary judgment as a matter of law if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show there is no genuine issue as to any material fact." Fed.R.Civ.P. 56(c); Bahn v. NME Hosp's, Inc., 929 F.2d 1404, 1409 (9th Cir. 1991).
The moving party carries the initial burden of proof. The party meets this burden by identifying portions of the record on file that demonstrate the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322-24 (1986). Once the initial burden is satisfied, the burden shifts to the opponent to demonstrate through the production of probative evidence that there remains an issue of fact to be tried. Id. The facts on which the opponent relies must be admissible at trial, although they need not be presented in admissible form for the purposes of opposing the summary judgment motion. Id.
The court must view the evidence in the light most favorable to the non-moving party. Bell v. Cameron Meadows Land Co., 669 F.2d 1278, 1284 (9th Cir. 1982). All reasonable doubt as to the existence of a genuine issue of fact should be resolved against the moving party. Hector v. Wiens, 533 F.2d 429, 432 (9th Cir. 1976). The inferences drawn from the underlying facts must be viewed in the light most favorable to the party opposing the motion. Valadingham v. Bojorquez, 866 F.2d 1135, 1137 (9th Cir. 1989). Where different ultimate inferences may be drawn, summary judgment is inappropriate. Sankovich v. Insurance Co. of North America, 638 F.2d 136, 140 (9th Cir. 1981).
Deference to the non-moving party does have some limit. The non-moving party "must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e) (emphasis supplied). The "mere existence of a scintilla of evidence in support of the plaintiff's position would be insufficient." Anderson v. Liberty Lobby Inc., 477 U.S. 242, 252 (1986). Therefore, where "the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Matsushita Electric Industrial Co. v. Zenith Radio Corporation, 475 U.S. 574, 587 (1986).
DISCUSSION
1. Plaintiff's First Claim for Relief: Inverse Condemnation — Oregon Constitution
The City seeks summary judgment in its favor on this claim, which asserts that the conditions imposed by the City on plaintiff's development constituted a taking in violation of Article 1, Section 18, of the Oregon Constitution. Article I, section 18, of the Oregon Constitution provides that "[p]rivate property shall not be taken for public use . . . without just compensation. . . ." Private property is "taken" for public use or benefit through the exercise of eminent domain.GTE Northwest, Inc. v. Public Utility Commission, 321 Or. 458, 466 (1995). To exercises the power of eminent domain, the government institutes condemnation proceedings. Id. A landowner brings an "inverse condemnation" to recover just compensation when a unit of government "takes" private property without first instituting condemnation proceedings. Suess Builders v. City of Beaverton, 294 Or. 254, 258 n. 3 (1982).
The City asserts that it is entitled to summary judgment on the following grounds: (1) only the taking of land, not the imposition of conditions on a development, can constitute a taking; (2) plaintiff did not own the property at the time of the alleged taking; (3) plaintiff lacks standing to challenge the conditions; (4) plaintiff's claim is barred by equitable estoppel; (5) plaintiff waived this claim; (6) plaintiff was compensated for the improvements; (7) plaintiff released the claim; and (8) no action was taken in regard to plaintiff or the development by the City Council and consequently, there was no taking.
Defendants' first argument in support of summary judgment on this claim — that the Oregon Constitution requires compensation only for the taking of land — is without merit:
"For purposes of takings analysis [there is] little difference between a requirement that a developer convey title to the part of the property that is to serve a public purpose, and a requirement that a developer himself make improvements on the affected and nearby property and make it available for the same purpose."Clark v. City of Albany, 137 Or. App. 293, 300 (1995).
Furthermore, issues of material fact preclude summary judgment for the City based on its assertion that plaintiff did not own the property at the time of the alleged taking. Specifically, the record contains insufficient and conflicting evidence regarding the relationship between Renaissance Development and plaintiff as well as Randal Sebastian and plaintiff. Moreover, there is no evidence of any conveyance of the property from Randal Sebastian to plaintiff. These same issues of fact also preclude summary judgment in the City's favor on the grounds that plaintiff lacks standing, the claim is barred by equitable estoppel and that plaintiff waived the claim.
The equitable estoppel defense is based on the City's assertion that it relied upon the developer's apparent consent to the conditions of approval, and to the use of the Kittelson and Associates report in determining those conditions. There are issues of material fact, however, regarding the purpose and scope of the Kittelson and Associates report, as well as, whether, and the extent to which, plaintiff may have manifested consent.
Regarding the City's assertion that plaintiff has already been compensated for the improvements through the issuance of SDC credits, plaintiff has submitted sufficient evidence to create an issue of material fact that the face value of the SDC credits may be significantly less than their actual value.
The City next argues that plaintiff released all claims relating to the 10th Street corridor improvements. Issues of material fact regarding the intended scope of the release bar summary judgment on this basis. Plaintiff asserts that the release required the City to approve the 10th Street corridor improvements if they were approved by the Oregon Department of Transportation. The release states that it becomes effective upon that event, but it is ambiguous as to the City's obligations on that occurrence.
Moreover, if the City could continue to withhold occupancy permits after the Oregon Department of Transportation approved the improvements, it is difficult to see what the benefit of the bargain would have been for plaintiff.
Defendants cite Clarke v. Port of Portland, 23 Or. App. 730 (1975), for the proposition that a taking may only be accomplished by the City Council, which it alleges, did not impose any conditions upon plaintiff. Clarke, however, is distinguishable. In that case, the appellate court affirmed the ruling that alleged statements by Multnomah County officials that property would not be granted a sought-after change in zoning by the Port of Portland failed to state a claim for inverse condemnation. Because these officials were incapable of approving the change in zoning, the court determined that their statements could not give rise to a takings claim. This case does not stand for the proposition that imposition of developmental conditions by any means other than action of the City Council cannot, as a matter of law, constitute a taking.
For the reasons described above, each of the bases cited by the City is insufficient to grant the City summary judgment on plaintiff's first claim.
2. Plaintiff's Second Claim for Relief: Inverse Condemnation — United States Constitution
The City makes some of the same arguments in opposition to the second claim as were made in opposition to the first: (1) plaintiff did not own the property at the time of the alleged taking; (2) plaintiff lacks standing to challenge the conditions; (3) plaintiff's claim is barred by equitable estoppel; (4) plaintiff waived this claim; and (5) plaintiff released the claim. For the reasons described above, issues of material fact preclude summary judgment on any of these bases on plaintiff's second claim as well.
In addition to these arguments, the City also argues that the second claim is barred by the statute of limitations, which the City asserts is two years. Plaintiff asserts that the applicable limitations period is six years. The Oregon Supreme Court has held that the limitations period applicable to inverse condemnation claims is six years. Suess Builders Co. v. City of Beaverton, 294 Or. 254, 267-68 (1982). In Suess Builders, the plaintiff alleged an inverse condemnation claim under the Fifth and Fourteenth Amendments to the United States Constitution and 42 U.S.C. § 1983, as well as Article 1, Section 18, of the Oregon Constitution. The court did not reach what limitations period applied to the federal claim, but did "hold that the § 1983 claim does not ripen until the claim under the Oregon Constitution, article I, section 18, has been decided. It is therefore not precluded . . . by the statute of limitations." Id.
The parties to the present case agree that the federal takings claim does not arise until the state claim is resolved. Plaintiff's Response Brief, p. 25; Defendants' Reply Brief, pp. 19-20. The parties disagree as to whether the present action is the appropriate forum in which to resolve plaintiff's state law claim, i.e., whether the state law claim is ripe. The City maintains that plaintiff should have challenged the conditions at some point before filing this action and failed to do so. The cases relied upon by the City, however, each concern regulatory takings and there is no support for the assertion that the reasoning therein applies to a case such as this where exactions and conditions of approval are at issue. See Fifth Avenue Corp. v. Washington County, 282 Or. 591, 614-21 (1978); Joyce v. Multnomah Co., 114 Or. App. 244, 247 (1992); Dunn v. City of Redmond, 86 Or. App. 267, 270 (1987). Consequently, the City has failed to meet its burden on this defense.
Furthermore, there are issues of material fact whether, and at what point, plaintiff opposed the conditions. Plaintiff maintains that going forward with the development in the face of objectionable conditions was a business decision to avoid delay, which would arise if the conditions were challenged, and seek damages later. As described above, there are issues of fact regarding at what point plaintiff obtained an ownership interest in the subject property, and thus whether plaintiff would have had standing to challenge the conditions at the time they were imposed. Furthermore, there are issues as to what state law procedures would have been available to plaintiff. Consequently, issues of fact preclude a finding that plaintiff's state law claim is not ripe and thus, a finding cannot be reached that plaintiff's federal takings claim is barred by the statute of limitations.
3. Plaintiff's Third Claim for Relief: Unjust Enrichment
Plaintiff's third claim alleges that the City was unjustly enriched because it received the benefit of off-site improvements constructed by plaintiff for which plaintiff was not fairly compensated. As described above, there is conflicting evidence in the record regarding whether the actual value of SDC credits is significantly less than their face value. This issue of material fact precludes summary judgment on the unjust enrichment claim, because the value of the compensation paid plaintiff cannot be determined on this record.
4. Plaintiff's Fourth Claim for Relief: Taking of Intersection — Oregon Constitution
Plaintiff and the City have moved for summary judgment on this claim. In the alternative, plaintiff seeks a declaration that the disputed access easement is for an eight-foot-wide gravel path.
Plaintiff contends that the City had no right to convert its easement from 13th Street to Park C, which entitled it to build an eight-foot-wide gravel pathway, into a roadway across the disputed easement. By doing so, plaintiff argues, the City exceeded the scope of its easement, taking plaintiff's property without just compensation, in violation of the Oregon Constitution.
To establish a taking by inverse condemnation, the plaintiff is not required to show that the government deprived the plaintiff of all use and enjoyment of the property at issue. See Morrison v. Clackamas County, 141 Or. 564, 568 (1933). A "substantial interference" with the use and enjoyment of property is adequate. Hawkins v. City of La Grande, 315 Or. 57, 68-69, (1992).
"Whether an interference with property rights is `substantial' is a jury question." Id. at 72. Therefore, even if the court were able to find that the scope of the City's easement was unambiguously limited to the eight-foot-wide gravel path described in the staff report adopted by Ordinance No. 1439, whether the City's current use of the easement is a substantial interference with Plaintiff's current use and enjoyment of the servient tenement is a question of fact, precluding summary judgment. See Celotex Corp. v. Catrett, 477 U.S. at 322-24. Consequently, summary judgment in either party's favor on plaintiff's fourth claim is denied.
The City also argues that plaintiff's inverse condemnation claim under the Oregon Constitution is barred by the statute of limitations in the Oregon Tort Claims Act. Without deciding whether a takings claims is a tort within the meaning of the Oregon Tort Claims Act, the court observes that the street was vacated on July 12, 1999, but that the City did not record its easement over the disputed intersection until June 12, 2000. There are insufficient facts for the court to determine when the alleged loss or injury occurred. Defendant's motion for summary judgment on this ground is denied.
The City also asserts that the PIG required plaintiff to dedicate any ownership interest it had in the disputed intersection to the City. The City seeks summary judgment on grounds that plaintiff has violated the PIG and must dedicate any interest plaintiff may have in the disputed intersection to the City. Summary judgment for the City is also inappropriate on this ground. While it is true that the PIG required Plaintiff to dedicate "all necessary rights of way and easements for the required public improvements," it does not state that plaintiff agreed to dedicate any ownership interest it had in the disputed intersection to the City. PIG, ¶ 5. Therefore, the City's motion for summary judgment on grounds that Plaintiff has failed to live up to its agreements under the PIG is denied.
In the alternative to summary judgment, plaintiff seeks a declaration that the disputed easement is limited to an eight-foot-wide gravel path. An easement holder may use its easement only as is reasonably necessary to accomplish the purpose for which the easement is granted. Ericsson v. Braukman, 111 Or. App. 57 (1992) The servient landowner retains the remaining rights to the land upon which the easement lies. State Dept. of Fish and Wildlife v. Kortge, 84 Or. App. 153, 158 (1987) (noting that the servient landowner is entitled to use its land in any way that does not unreasonably interfere with the easement holder's rights to use the land for its stated purposes).
The reasonable necessity of one's use of an easement is a fact-based inquiry determined from the circumstances of each case. Miller v. Georgia-Pacific, 48 Or. App. 1007, 1016 (1980). "The permissible uses or scope of an easement, as distinguished from its location, may vary depending on what land is necessary for the fulfilment of the easement's purpose." Clark v. Kuhn, 171 Or. App. 29, 33-34 (2000). The staff report adopted by Ordinance No. 1439 stated that an eight-foot-wide gravel path would be built on its twenty-foot access easement. The City also planned public improvements along the entire length of 13th Street, however, including the disputed intersection, and to this end, Plaintiff agreed to dedicate all necessary rights of way and easements. PIG, p. 2. Whether the City intended to limit its use to an eight-foot-wide gravel path when the easement was created is a question of fact.
Furthermore, the City has submitted evidence sufficient to create an issue of material fact that vacation of the intersection may not have been valid, and that if the intersection was vacated, it vested in the City as the owner of the adjacent property, i.e., 13th Street/Summerlinn Drive, which lies to the north and south of the disputed intersection. Thus, issues of material fact preclude the declaration sought by plaintiff.
5. Plaintiff's Fifth Claim for Relief: Inverse Condemnation — U.S. Constitution
As with the fourth claim for relief, plaintiff and the City both have moved for summary judgment on this claim. In the alternative, plaintiff seeks a declaration that the disputed access easement is for an eight-foot-wide gravel path.
The bases for denying summary judgment on the fourth claim for relief apply to the fifth claim as well. Furthermore, plaintiff briefs its Fourth and Fifth Claims for Relief together, but fails to distinguish the causes of action. Plaintiff's Memorandum, pp. 29-30. The moving party on a motion for summary judgment carries the initial burden of proof. Id. Plaintiff has failed to meet its burden, and its motion for summary judgment is denied.
The City moves for summary judgment on the issue of ripeness but fails to show how the doctrine developed in Williamson County Planning Commission v. Hamilton Bank, 473 U.S. 172 (1985), in the context of "regulatory takings" would apply to this case. Defendant has failed to meet its burden, and its motion for summary judgment is denied.
6. Plaintiff's Sixth and Seventh Claims for Relief: Violation of Civil Rights
Plaintiff claims that the City's refusal to release the bond it posted pursuant to the Guarantee agreement and the easement it filed over the intersection at 13th and Greene Streets were intended to punish Plaintiff for speech protected by the First Amendment. To prove its claims, Plaintiff must establish: (1) it was subjected to an adverse governmental action, such as being denied a benefit or privilege by the City; (2) it engaged in speech that was constitutionally protected because it touched on a matter of public concern; and (3) the protected expression was a substantial motivating factor for the adverse action. Ulrich v. City and County of San Francisco, 308 F.3d 968, 976 (2002).
The third factor makes a grant of summary judgment inappropriate. "As with proof of motive in other contexts, this element of a First Amendment retaliation suit may be met with either direct or circumstantial evidence, and involves questions of fact that normally should be left for trial." Id. at 979 (citations omitted).
Whether defendant Piatski told Plaintiff that the City would not release the bond until plaintiff deeded the disputed intersection back to the City and whether such statements would show a retaliatory motive is a question of fact the court leaves for trial. Therefore, summary judgment on plaintiff's Sixth and Seventh Claims for Relief is denied.
In the alternative, Plaintiff moves for partial summary judgment on its Sixth and Seventh claims for Relief. As stated above, to recover on its First Amendment claims, plaintiff must first prove that it was subjected to adverse government action.Id. at 976. Plaintiff claims that it was entitled to the release of the $264,000 bond when it completed the public improvements listed in the PIG and that the City's failure to release the bond subjected Plaintiff to adverse governmental action.
Therefore, Plaintiff moves for partial summary judgment, seeking a declaration that the $264,000 bond does not include the 10th Street/Salamo off-site improvements. Defendant seeks summary judgement that the bond does include the off-site improvements.
The record is in dispute as to whether the $264,000 covers the 10th Street/Salamo improvements. Plaintiff argues that both the bond and the contract are to be construed and considered together and that a bond may be limited in its coverage to less than the entire construction contract. See Biomass One, L.P. v. S-P Constr., 103 Or. App. 521, 529 (1990). Biomass does not address the situation present in this case, however, where the bond and the agreement incorporated into the bond are at odds. The PIG allows for additional security to cover the off-site improvements to be addressed by an amendment to the PIG, while the bond itself indicates that plaintiff must "well and truly perform said agreement" for the bond to be released. The court finds that the language of the contract is ambiguous — the trier of fact must decide the intent of the parties with extrinsic evidence. Oregon School Employees Ass'n, Chapter 89 v. Rainier School Dist., 311 Or. 188, 194 (1991).
Regardless, to meet its burden on the first element of a First Amendment retaliation claim, Plaintiff must merely demonstrate that it suffered the loss of a governmental benefit or privilege in retaliation for protected speech activity. It need not prove that it had a legal right to the benefit denied. Ulrich, 308 F.3d at 977 (citing Hyland v. Wonder, 972 F.2d 1129, 1134-35 (9th Cir. 1992). As the Ninth Circuit stated, "The denial of even a trivial benefit may form the basis for a First Amendment claim where the aim is to punish protected speech." Id.
Accordingly, a declaration that plaintiff is legally entitled to have the $264,000 bond released is unnecessary. There is no dispute that the release of a the bond is a privilege, the denial of which as retaliation for plaintiff's speech would satisfy plaintiff's burden. The parties' cross-motions for summary judgment are denied.
7. Plaintiff's Eighth Claim for Relief — Violation of the Equal Protection Clause
Plaintiff alleges that the City treated it differently that other similarly situated developers because: 1) it was given SDC credits for its overpayment of SDCs to the City on the 10th Street improvements while Show Timber Company was given cash for its overpayment on the same improvements; and 2) the City caused plaintiff to modify steps when steps to City Hall were subject to the same complaint. Plaintiff does not assert that it is a member of any suspect class, and consequently, the City's actions pass muster if there is any rational basis for them, even a hypothetical one. Silveira v. Lockyer, 312 F.3d 1052, 1090 (9th Cir. 2003).
In regard to the cash reimbursement received by Show Timber, there is no issue that plaintiff did not follow the procedures Show Timber did to request a cash reimbursement. Plaintiff argues that it failed to apply for a cash refund because an attorney for the City told an attorney for plaintiff that filing an application would be a waste of time. Regardless of whether that is true, there existed a rational basis for the different treatment of plaintiff and Show Timber: plaintiff did not file an application to the City Council and Show Timber did.
Plaintiff argues that the City Counsel held an executive session in which it decided it would not approve an application by plaintiff for cash reimbursement. However, plaintiff offers no admissible evidence in support of this assertion. See Affidavit of Mike Kelley, ¶ 11.
Plaintiff also bases this claim on the allegation that it was forced to correct a defect in exterior stairs that was allowed to exist in stairs at City Hall. Defendant has offered evidence that there was a defect in the stairs constructed by plaintiff and that was the only basis upon which plaintiff was required to repair them. Defendant has also submitted evidence that there is no violation in the stairs constructed at City Hall. Plaintiff offers no evidence in rebuttal. See Plaintiff's Response Facts, ¶ 34. Consequently, there is no issue of fact that there was a rational basis for the City's finding a violation and requiring its repair.
Plaintiff offers no other specific allegations in support of this claim. Because there is no issue of material fact that there was a rational basis for the City's challenged actions, summary judgment in the City's favor is appropriate.
8. Plaintiffs' Ninth Claim for Relief — Violation of the 1975 Annexation Agreement
Plaintiff's Ninth Claim alleges that the City violated an annexation agreement that it entered into with the Byrons in 1975, by requiring plaintiff to pay money and construct improvements that were obligations of the City. The annexation agreement governed the respective obligations of the parties if the land had been developed as a residential subdivision. That intent is established by the annexation agreement's reference to the requirement that the developer pay "$600 per family dwelling unit" and to "construct and install all streets, sanitary sewers, street lights, water distribution lines and all other utilities necessary and normal within the subdivision." The property was re-zoned from residential to commercial in 1983. Plaintiff and/or Renaissance Development did not seek to have the site re-zoned, seek to construct any family dwelling units on the site, or tender any money on the basis of the number of family dwelling units it would propose to construct. In the absence of those conditions, the City's obligations under the Annexation Agreement do not arise. Consequently, summary judgment in favor of the City is appropriate and plaintiff's crossmotion is denied.
CONCLUSION
Plaintiff's Amended Motion for Summary Judgment (docket No. 79) is denied. Defendants' Motion for Summary Judgment (docket No. 87) is granted in part and denied in part. Plaintiff's eighth and ninth claims for relief — for violation of its civil rights under the Equal Protection Clause and breach of the annexation agreement — are dismissed with prejudice.
IT IS SO ORDERED.