Opinion
No. COA09-1080
Filed 15 February 2011 This case not for publication
Appeal by plaintiffs from order entered 23 February 2009 by Judge Michael E. Beale in Cabarrus County Superior Court. Heard in the Court of Appeals 11 February 2010.
The Brough Law Firm, by T.C. Morphis, Jr., for plaintiffs-appellants. Hamilton Moon Stephens Steele Martin, PLLC, by Keith J. Merritt and Rebecca K. Cheney, for defendant-appellee.
Cabarrus County No. 08 CVS 504.
Fred Wally ("Wally"), Lavon Benton, Randall Benton, Don Crowe, and George Martocchio (collectively, "plaintiffs"), as neighboring property owners, challenged The City of Kannapolis' ("defendant") zoning of a newly annexed parcel of land as Campus Development-Conditional Zoning ("CD/CZ"). Plaintiffs appeal the trial court's order granting defendant's motion for summary judgment and dismissing plaintiffs' declaratory judgment action. We affirm.
I. BACKGROUND
The subject property consists of five tracts of land for a total of 75.9 acres ("the property"). The property is located at the intersection of North Carolina Highway 3 and Odell School Road in Cabarrus County ("the County"), North Carolina. Since this location is more than 3.5 miles from the nearest primary corporate limits of defendant, it was formerly subject to the County's zoning ordinances. In 2005, with the exception of one small parcel of the property, the County changed the zoning from Agricultural/Open Space ("A/O") to Office/Institutional ("O/I"). Most of the surrounding rural property remained zoned as A/O. Plaintiffs did not challenge the County's 2005 rezoning.
The property is owned by Coddle Creek, LLC ("Coddle Creek"), and the J.C. and Marie Wallace Charitable Remainder Trust ("the Trust") (collectively, "the Owners"). D. Keith Wayne ("Wayne") is the manager for Coddle Creek, and Dave McCoy ("McCoy") is the trustee for the Trust. Wayne petitioned the County to rezone the property from A/O and O/I to General Commercial Conditional District ("GC-CD") and Medium Density Residential-Conditional District ("MDR-CD") on 5 September 2006. Wayne's request for the rezoning was to relocate the corporate headquarters and operation center for his company, Wayne Brothers Incorporated. The County denied Wayne's rezoning request.
On 24 September 2007, at the request of the Owners, defendant annexed the property into its city limits. Once the property was annexed, it was subject to defendant's Unified Development Ordinance ("UDO") and its 2015 Land Use Plan ("the land use plan"). On that same day, defendant approved a Development Agreement ("Development Agreement") and an Agreement for Construction of Utility Improvements between defendant and Coddle Creek ("Utility Agreement") (collectively, "the Agreements"). According to the Agreements, the Owners intended to develop a neighborhood office and a light industrial and retail business park on the property. The Owners agreed to build and fund the necessary infrastructure to connect the development to defendant's sewer utility. Defendant agreed to extend its water lines to the property. The Agreements were contingent upon the property being zoned as CD/CZ.
By 16 October 2007, Wayne and McCoy submitted an application ("the application") to defendant seeking to zone the property as CD/CZ. The application proposed the following site-specific conditions: (1) a limit on retail space of 175,000 square feet; (2) relaxation of the size limits for retail and commercial service uses; (3) allowance of driveways as permitted by the North Carolina Department of Transportation; (4) a change in setback requirements from 75 feet to 25-50 feet; (5) allowance of in-line restaurants as a conditional use; (6) allowance of sign lettering and painting as a permitted use; and (7) requirement of one parking space per 250 square feet of retail area. On 7 November 2007, following a public hearing, the Kannapolis Planning and Zoning Commission ("the Zoning Commission") approved the zoning request.
Pursuant to S.L. 1993-247, § 1, plaintiffs appealed the Zoning Commission's decision to the Kannapolis City Council for de novo review. On 10 December 2007, defendant held a public hearing. At this hearing, defendant received a staff report ("the staff report") dated 16 October 2007 from the Zoning Commission regarding the proposed zoning. This document was a comprehensive written analysis stating that the proposed zoning was consistent with defendant's Land Use Plan, was reasonable, and was in the public interest. Following public comments from, inter alia, Wayne and Wally, defendant approved the application. On 14 January 2008, defendant adopted a resolution to zone the property to CD/CZ ("the resolution").
On 26 February 2008, plaintiffs filed an action in Cabarrus County Superior Court alleging that defendant failed to comply with procedural and substantive statutory requirements, failed to comply with defendant's UDO, and that defendant's actions were arbitrary and capricious and constituted spot zoning. Plaintiffs asked the trial court to declare the zoning void and of no effect, and to direct defendant to initiate proceedings to rezone the property to its previous classification. Both plaintiffs and defendant filed motions for summary judgment along with supporting affidavits, stipulating that there were no genuine issues of material fact and that the case was ripe for summary judgment. On 23 February 2009, the trial court entered an order granting defendant's motion for summary judgment on all claims, and dismissing plaintiffs' declaratory judgment action. Plaintiffs appeal.
II. SUMMARY JUDGMENT
"The standard of review from an order allowing summary judgment is well-established: We review a trial court's order for summary judgment de novo to determine whether there is a genuine issue of material fact and whether either party is entitled to judgment as a matter of law." McDowell v. Randolph County, 186 N.C. App. 17, 20, 649 S.E.2d 920, 923 (2007) (internal quotations and citations omitted). Here, since the parties stipulated before the trial court that no disputed issues of material fact existed, our determination is limited to whether summary judgment was properly entered in defendant's favor, or conversely should have been entered in favor of plaintiffs. Id.
III. STATUTORY AND UDO REQUIREMENTS
Plaintiffs argue that the zoning of the property violated the UDO and N.C. Gen. Stat. § 160A-383 (2007). We disagree.
A. Application of the UDO
The Kannapolis UDO states that it "shall apply to all . . . private land(s), and use(s) thereon over which the City has jurisdiction . . . including any areas within the jurisdiction of the City pursuant to [N.C. Gen. Stat.] § 160A-360." Kannapolis, N.C., Unified Development Ordinance § 1.1.6.1 (2009). N.C. Gen. Stat. § 160A-360 provides that a city may exercise jurisdiction over areas within its corporate limits. N.C. Gen. Stat. § 160A-360(a) (2009). Thus, the UDO applied to the property once it was annexed into the corporate limits of Kannapolis.
The UDO states that "[t]he Official Zoning Map of the City of Kannapolis, North Carolina . . . [is] hereby incorporated and made a part of this Ordinance." Kannapolis, N.C., Unified Development Ordinance § 1.1.6.2 (2009). Appendix A to the UDO defines "rezoning" as "[a]n amendment to the Official Zoning Map[.]" Id. at App. A. Under this definition, any amendment to the Official Zoning Map, including the adoption of zoning restrictions for newly annexed property not previously included on the Official Zoning Map, qualifies as "rezoning." In accordance with the language in Appendix A, the initial application requesting adoption of CD/CZ submitted in this case is titled "Application for Amendment to the Kannapolis Zoning Map" and is referred to in the conditional zoning application as the "Rezoning Application." [Doc Ex Tab 24] Thus, based on the language of the UDO, defendant's action in the present case qualifies as a rezoning.
1. Site Plan
"[Z]oning decisions are typically afforded great deference by reviewing courts and when the most that can be said against such ordinances is that whether it was an unreasonable, arbitrary or unequal exercise of power is fairly debatable, the courts will not interfere[.]" Childress v. Yadkin Cty., 186 N.C. App. 30, 34, 650 S.E.2d 55, 59 (2007) (citation, quotation marks, and alteration omitted). "Interpretation of the zoning ordinance is a matter of law which we review de novo." Keith v. Town of White Lake, 175 N.C. App. 789, 791, 625 S.E.2d 587, 588 (2006). "This Court may not substitute its judgment for the legislative determination of the Council, but we may inquire whether the Council acted in violation of required procedures." George v. Town of Edenton, 294 N.C. 679, 687, 242 S.E.2d 877, 882 (1978).
In general municipal ordinances are to be construed according to the same rules as statutes enacted by the legislature. The basic rule is to ascertain and effectuate the intention of the municipal legislative body. [] We must therefore consider this section of the ordinance as a whole, [] and the provisions in pari materia must be construed together [].
Id. at 684, 242 S.E.2d at 880 (internal citations omitted). Kannapolis, N.C., Unified Development Ordinance § 3.4.2.1 states:
A petition for conditional zoning must include a site plan drawn to scale, and supporting information and text that specifies the actual use or uses intended for the property and any rules, regulations and conditions that, in addition to all predetermined requirements, will govern the development and use of the property.
Kannapolis, N.C., Unified Development Ordinance § 3.4.2.1. The UDO defines "site plan" as:
A development plan of one or more lots on which is shown (1) the existing and proposed conditions of the lot, including but not limited to topography, vegetation, drainage, flood plains, wetlands and waterways; (2) the location of all existing and proposed buildings, drives, parking spaces, walkways, means o[f] ingress and egress, drainage facilities, utility services, landscaping, structures and signs, lighting, screening devices; (3) the location of building pads for all residential and non-residential buildings; and (4) [the] location and extent of all external buffers from surrounding areas.
Id. at § A-50.
In the instant case, when Wayne and McCoy applied for conditional zoning of the property, they submitted several materials to defendant. Specifically, they submitted: a "Preliminary Phased Campus Development Plan," the Development Agreements, the site-specific conditions in the application for the conditional zoning district, and preliminary drawings of buildings and proposed land uses for the property. Viewing these materials together, the trial court properly concluded that defendant complied with the UDO's requirements.
2. Proposed Standards for the Property
Plaintiffs argue that Wayne and McCoy failed to clearly show how their proposed standards were greater than that which was typically allowed by the general district. We disagree.
"If any standards are proposed [for the conditional zoning district] that are different from the underlying zoning district, the applicant must clearly demonstrate that the overall resultant project is greater than that which is typically allowed in the general district." Kannapolis, N.C., Unified Development Ordinance § 3.4.4.1.
In the instant case, defendant interpreted this provision to mean that the project will have higher architectural standards than those required for a typical development in the underlying district. Wayne and McCoy submitted conceptual drawings showing the building elevations for the office portion of the property complex. At the meeting of the Planning and Zoning Commission on 7 November 2007, Wayne and McCoy submitted photographs of architectural features they proposed for the development. From this information, defendant evidently concluded that the project would exceed the design standards of a typical development in the underlying development district.
3. Statement of Reasonableness
Plaintiffs argue that the zoning is void because defendant did not require Wayne and McCoy to submit a statement of reasonableness as required by the UDO. We disagree.
Conditional zoning districts like the one requested in the instant case must be adopted in accordance with section 3.4 of the UDO, which states, "[t]he review process established in this section provides for the accommodation of [specific] uses by a reclassification of property into a Conditional Zoning (CZ) District[.]" Kannapolis, N.C., Unified Development Ordinance § 3.4.1. Section 3.4.4 of the UDO provides criteria for approval of "Conditional Zoning District decisions[,]" including a list of considerations an applicant for conditional zoning must take into account when proposing site-specific use standards. Id. at § 3.4.4.1. The list includes the following requirements:
• When implemented the proposed and/or imposed use limitations and conditions will mitigate specific land development issues that would likely result if the subject property were zoned to accommodate all the uses and the minimum standards of the corresponding general zoning district. If any standards are proposed that are different from the underlying zoning district, the applicant must clearly demonstrate that the overall resultant project is greater than that which is typically allowed by the general district.
• The applicant shall submit a "statement of reasonableness" of the proposed rezoning.
Id.
The zoning application submitted in the instant case and the evidence presented at the hearings on the matter satisfied the UDO section 3.4.4.1 requirement that an applicant for conditional zoning submit a "statement of reasonableness," a term that is not defined in the UDO. Because it does not appear unreasonable in light of the sparse guidance provided by the UDO, we agree with defendant's contention that this requirement was met in the instant case. Plaintiffs' assignment of error is overruled.
B. N.C. Gen. Stat. § 160A-383
Plaintiffs allege that defendant violated N.C. Gen. Stat. § 160A-383 by failing to adopt a statement explaining whether approving the zoning was consistent with an adopted comprehensive plan or why defendant considered the zoning to be reasonable and in the public interest. We disagree.
N.C. Gen. Stat. § 160A-383 states, in pertinent part:
When adopting or rejecting any zoning amendment, the governing board shall also approve a statement describing whether its action is consistent with an adopted comprehensive plan and any other officially adopted plan that is applicable, and briefly explaining why the board considers the action taken to be reasonable and in the public interest.
Id. (citation omitted). "[A] municipal zoning ordinance will be presumed to be valid, and the burden is on the complaining party to show it to be [in]valid." Heaton v. City of Charlotte, 277 N.C. 506, 513, 178 S.E.2d 352, 356 (1971) (citations omitted).
Defendant's compliance with N.C. Gen. Stat. § 160A-383 is entitled to similar deference as its compliance with UDO section 3.4.4.1. The language of the statute provides that the statement regarding consistency with a comprehensive plan "is not subject to judicial review." N.C. Gen. Stat. § 160A-383. Because section 160A-383 does not contemplate judicial review of the sufficiency of the statement adopted by the zoning authority, we accept defendant's contention that it met this statutory requirement by approving the staff report containing the findings required by section 160A-383.
IV. ARBITRARY AND CAPRICIOUS
Plaintiffs argue that defendant acted arbitrarily and capriciously when it zoned the property. We disagree.
The Constitution imposes limits on the legislative power to zone by forbidding arbitrary, capricious, and unduly discriminatory interference with the rights of property owners. This standard is a very difficult standard to meet. A decision is arbitrary and capricious if it was patently in bad faith, whimsical, or if it lacked fair and careful consideration. In deciding whether a decision is arbitrary and capricious, courts must apply the whole record test.
Summers v. City of Charlotte, 149 N.C. App. 509, 518, 562 S.E.2d 18, 25 (2002) (internal quotations and citations omitted). "A reviewing court is not free to substitute [its] opinion for that of the legislative body so long as there is some plausible basis for the conclusion reached by that body." Ashby v. Town of Cary, 161 N.C. App. 499, 503, 588 S.E.2d 572, 574 (2003) (internal quotations and citation omitted).
"The whole record test requires the reviewing court to examine all the competent evidence . . . which comprises the whole record to determine if there is substantial evidence in the record to support the [city council's] findings and conclusions." Northwest Prop. Group, LLC v. Town of Carrboro, ___ N.C. App. ___, ___, 687 S.E.2d 1, 6 (2009) (internal quotations and citations omitted). "The `whole record' test does not allow the reviewing court to replace the [city council's] judgment as between two reasonably conflicting views, even though the court could justifiably have reached a different result had the matter been before it de novo." Id. (quoting Thompson v. Board of Education, 292 N.C. 406, 410, 233 S.E.2d 538, 541 (1977)).
Defendant reached its decision to zone the property CD/CZ based on the staff report, the Preliminary Phased Campus Development Plan, the application for zoning with site-specific conditions and details, the Agreements, photographs of the proposed architectural standards, and a number of conceptual drawings. After reviewing the whole record, we hold that this evidence supports the conclusion that defendant engaged in fair and careful consideration in making its decision to zone the property CD/CZ. Defendant's conduct was not patently in bad faith or whimsical. Plaintiffs' assignments of error are overruled.
V. SPOT ZONING
Plaintiffs argue that the zoning of the property was illegal spot zoning. We disagree.
A zoning ordinance, or amendment, which singles out and reclassifies a relatively small tract owned by a single person and surrounded by a much larger area uniformly zoned, so as to impose upon the small tract greater restrictions than those imposed upon the larger area, or so as to relieve the small tract from restrictions to which the rest of the area is subjected, is called "spot zoning." It is beyond the authority of the municipality, in the absence of a clear showing of a reasonable basis for such distinction.
Blades v. City of Raleigh, 280 N.C. 531, 549, 187 S.E.2d 35, 45 (1972) (emphasis added). "If a zoning decision is not considered spot zoning then it is presumed valid." Childress, 186 N.C. App. at 35, 650 S.E.2d at 59.
"An essential element of spot zoning is a small tract of land owned by a single person and surrounded by a much larger area uniformly zoned." Covington v. Town of Apex, 108 N.C. App. 231, 237, 423 S.E.2d 537, 540 (1992) (emphasis added). "A plaintiff need not present all the evidence in his favor but only that necessary to rebut the defendant's showing that an essential element of his claim is non-existent or that he cannot surmount an affirmative defense." Id. at 234, 423 S.E.2d at 539 (emphasis added).
[I]n any spot zoning case in North Carolina courts, two questions must be addressed by the finder of fact: (1) did the zoning activity in the case constitute spot zoning as our courts have defined that term; and (2) if so, did the zoning authority make a clear showing of a reasonable basis for the zoning.
Chrismon v. Guilford Co., 322 N.C. 611, 627, 370 S.E.2d 579, 589 (1988). Therefore, "[b]efore reaching the issue of whether the [city council] was reasonable, however, we must first determine whether spot zoning occurred in the instant case." Childress, 186 N.C. App. at 35, 650 S.E.2d at 59.
In the instant case, the property consisted of five tracts of land owned by two different entities — the Trust and Coddle Creek. Since spot zoning has been held to occur when a tract of land is owned by a common owner, defendant's action of zoning the property cannot be considered spot zoning. See Musi v. Town of Shallotte, ___ N.C. App. ___, ___, 684 S.E.2d 892, 895 (2009) (holding that a town's rezoning of a tract of land was not spot zoning because, inter alia, "[t]he subject property does not have a common owner, but is comprised of fifteen (15) parcels, with six (6) owners"); A-S-P Associates v. Raleigh, 298 N.C. 207, 225, 258 S.E.2d 444, 455-56 (1979) (no spot zoning where city created a "102 acre overlay, zoning district . . ., the restrictions of which apply to numerous individual property owners"). Cf. Covington, 108 N.C. App. at 237, 423 S.E.2d at 540 (The defendant town engaged in spot zoning because the plaintiff's evidence showed, inter alia, that "the parcel of land was . . . owned by a single owner[.]"); Blades, 280 N.C. 531, 187 S.E.2d 35 (city engaged in spot zoning when it rezoned a parcel owned by a single entity, a corporation); Good Neighbors of S. Davidson v. Town of Denton, 355 N.C. 254, 259, 559 S.E.2d 768, 772 (2002) (town engaged in spot zoning when it rezoned a parcel that was "wholly company-owned"); Chrismon, 322 N.C. 611, 370 S.E.2d 579 (county engaged in spot zoning when it rezoned land owned by a single person); Alderman v. Chatham County, 89 N.C. App. 610, 616-17, 366 S.E.2d 885, 889-90 (1988) (county engaged in spot zoning when it rezoned a parcel owned by a husband and wife together).
Since plaintiffs have not presented evidence necessary to rebut defendant's showing that an essential element of plaintiffs' claim of spot zoning is non-existent, we hold that defendant's actions did not constitute spot zoning. Because we view this element as dispositive, we need not address the remaining elements of spot zoning. See, e.g., Harvey Fertilizer Gas Co. v. Pitt County, 153 N.C. App. 81, 91, 568 S.E.2d 923, 929 (2002). Plaintiffs' assignments of error are overruled.
VI. CONCLUSION
The trial court's order granting defendant's motion to dismiss and dismissing plaintiffs' declaratory judgment action is affirmed.
Affirmed.
Judges GEER and STEPHENS concur.
Report per Rule 30(e).