Butterworth v. The City of Asheville

IN THE COURT OF APPEALS OF NORTH CAROLINA

No. COA15-919

Filed: 17 May 2016

Buncombe County, No. 14 CVS 05202

HOPE C. BUTTERWORTH and husband, LUKE T. BUTTERWORTH; MICHAEL D.

SKRZYNSKI; SUZANNE A. FULLAR; KERRY BRIGHT and wife, STEPHANIE

LeGRAND; LAURENCE H. VICKERS and wife, KAREN T. VICKERS; H. PETER

LOEWER and wife, JEAN LOEWER, Petitioners,

v.

THE CITY OF ASHEVILLE and FARMBOUND HOLDINGS, LLC, Respondents.

Appeal by Petitioners from order entered 24 April 2015 by Judge Mark E.

Powell in Buncombe County Superior Court. Heard in the Court of Appeals 9

February 2016.

Roberts & Stevens, P.A., by F. Lachicotte Zemp, Jr., and Eric P. Edgerton, for

Petitioners.

City of Asheville City Attorney’s Office, by City Attorney Robin T. Currin and

Assistant City Attorney Catherine A. Hofmann, and McGuire Wood & Bissette,

P.A., by Joseph P. McGuire, for Respondents.

DILLON, Judge.

The subject matter of this appeal is a proposed residential subdivision being

developed by Farmbound Holdings, LLC (the “Developer”), which was approved by

the City of Asheville’s Planning and Zoning Commission (the “Commission”).

Petitioners are individuals who reside near the proposed development. Petitioners

(the “Neighbors”) appeal from the trial court’s order dismissing their action against

BUTTERWORTH V. CITY OF ASHEVILLE

Opinion of the Court

the City of Asheville (“the City”) and the Developer. For the following reasons, we

reverse the order of the trial court and remand the matter to the trial court for

remand to the Commission for further proceedings.

I. Background

In May of 2014, the Developer submitted an application to the City to develop

a major residential subdivision known as the Brynn Subdivision. In its application,

the Developer requested that the subdivision be approved with a modification which

would allow for the city streets within the proposed subdivision to be narrower in

width than otherwise required by City regulations.

In October of 2014, the Commission convened a public meeting and heard a

presentation by the City urban planner explaining the proposed project as well as the

report of the City’s Technical Review Committee recommending that the subdivision

be approved with the modification. The Commission also allowed for public comment

from concerned citizens who opposed approval, including the Neighbors. Ultimately,

though, the Commission voted to approve the Brynn Subdivision preliminary plat,

five to one (5-1), with the requested street-width modification.

In December of 2014, the Neighbors filed a petition for certiorari in Buncombe

County Superior Court, seeking review of the Commission’s decision. Respondents

each filed an answer and moved for dismissal.

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On 24 April 2015, after a hearing on the matter, the trial court entered its

written order granting Respondents’ motions to dismiss. The Neighbors timely filed

written notice of appeal to our Court from the trial court’s dismissal.

II. Analysis

In their sole argument on appeal, the Neighbors contend that the trial court

erred in concluding that the City was not required to afford them all fair trial rights

before approving the Developer’s subdivision preliminary plat. Specifically, the

Neighbors contend that the approval of the street-width modification required the

Commission to exercise discretion and, therefore, rendered the Commission’s

approval process quasi-judicial in nature, and not ministerial/administrative in

nature. We hold that the Commission’s approval of the plat in this case was, in fact,

quasi-judicial in nature and that, therefore, the Neighbors1 were deprived of certain

due process rights in the approval process. Accordingly, we reverse the order of the

trial court for remand to the Commission for further proceedings consistent with this

opinion.

A. The Commission is Authorized to Approve Subdivision Applications.

Our General Assembly has empowered municipalities to regulate the

subdivisions within their territorial jurisdiction. River Birch Assocs. v. City of

Raleigh, 326 N.C. 100, 107, 388 S.E.2d 538, 542 (1990). Specifically, N.C. Gen. Stat.

1 Neither party argues the Neighbors’ standing in this matter.

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§ 160A-373 allows a municipality to exercise its power to approve subdivisions

through either “(1) [t]he city council, (2) [t]he city council on recommendation of a

designated body, or (3) [a] designated planning board, technical review committee, or

other designated body or staff person.” N.C. Gen. Stat. § 160A-373 (2014).

With regard to a proposed subdivision requiring the extension of public and

private streets, Asheville has elected the third option provided under our General

Statutes. Specifically, Asheville’s City Code of Ordinances delegates the power to

approve a proposed subdivision which requires the extension of a public or private

street to the Commission.2 Asheville City Code of Ordinances § 7-5-8(a)(3)(d)(1)

(2014).

B. The Due Process Required in the Commission’s Decision Process Depends upon

Whether its Decision was Quasi-judicial or Administrative in Nature.

Our Supreme Court has observed that the decision by a local government to

approve or deny a particular land use is typically characterized as being one of four

types – legislative, advisory, quasi-judicial, or administrative. See County of

Lancaster v. Mecklenburg, 334 N.C. 496, 507, 434 S.E.2d 604, 612 (1993). As in

County of Lancaster, the question in the present case is whether the Commission’s

2 A proposed subdivision which involves the extension of public or private streets is deemed a

“major” subdivision under Asheville’s Code. Asheville City Code of Ordinances § 7-5-8(a)(1) (2014).

“Minor” subdivisions are dealt with separately in the Code and need only be approved by City staff,

see id. § 7-5-8(b)(4), as they “do not require the extension of public streets or private streets built to

City of Asheville standards,” see id. § 7-5-8(b)(1).

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approval of the subdivision plat is “properly characterized as a quasi-judicial decision

or as an administrative [] decision.” Id.

The level of due process required to be afforded by the Commission in deciding

a land use request depends upon whether its decision process is quasi-judicial or

administrative in nature. See, e.g., Sanco of Wilmington Serv. Corp. v. New Hanover

County, 166 N.C. App. 471, 475, 601 S.E.2d 889, 892-93 (2004) (comparing

administrative and quasi-judicial land use decisions). Specifically, our Supreme

Court has recognized, “[d]ue process requirements mandate that certain quasi-

judicial [land use] decisions comply with all fair trial standards when they are made.”

County of Lancaster, 334 N.C. at 506, 434 S.E.2d at 611 (emphasis added). The

Supreme Court has described these “fair trial standards” as embracing “an

evidentiary hearing with the right of the parties to offer evidence; cross-examine

adverse witnesses; inspect documents; have sworn testimony; and have written

findings of fact supported by competent, substantial, and material evidence.” Id. at

507-08, 434 S.E.2d at 612. In contrast, an administrative land use decision does not

require this level of due process and may be made “without a hearing at all[.]” Id. at

508, 434 S.E.2d at 612.

Our Supreme Court has differentiated between quasi-judicial decisions and

administrative decisions as follows: In making quasi-judicial decisions, the decision-

maker must “exercise discretion of a judicial nature”; and in the land use context,

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“these quasi-judicial decisions involve the application of zoning policies to individual

situations, such as variances, special and conditional use permits, and appeals of

administrative determinations.” Id. at 507, 434 S.E.2d at 612. In sum, the Court has

stated that such quasi-judicial decisions “involve two key elements: the finding of

facts regarding the specific proposal and the exercise of some discretion in applying

the standards of the ordinance.” Id. Further, as explained by the Court, such quasi-

judicial decisions may not be delegated to an individual administrator, see id. at 509,

434 S.E.2d at 613, but rather must be made by the municipality’s governing council,

board of adjustment or – as in the case of Asheville – a designated planning board,

see N.C. Gen. Stat. § 160A-373.

By contrast, administrative decisions are “routine” and “nondiscretionary,” and

may be delegated to a single individual. County of Lancaster, 334 N.C. at 507, 434

S.E.2d at 612. Moreover, while the decision-maker “may well engage in some fact

finding [in making an administrative decision] . . . this involves determining objective

facts that do not involve an element of discretion.” Id. (internal marks and citation

omitted).

This is not to say that every decision to allow a modification in a subdivision

proposal is quasi-judicial in nature. That is, the decision to allow a modification may

be administrative in nature if the decision process does not involve the exercise of

discretion but rather involves the application of specific, neutral, and objective

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criteria as set out in the municipality’s governing code. See id. at 510, 434 S.E.2d at

614 (explaining that a decision which requires the application of objective standards

is administrative). However, where the decision requires the exercise of discretion in

applying generally stated standards, the decision is of a quasi-judicial nature. As our

General Assembly has provided,

an ordinance shall be deemed to authorize a quasi-

judicial decision if the city council or planning board is

authorized to decide whether to approve or deny the plat

based not only upon whether the application complies with

the specific requirements set forth in the ordinance, but

also on whether the application complies with one or

more generally stated standards requiring a

discretionary decision to be made by the city council or

planning board.

N.C. Gen. Stat. § 160A-377(c) (2014) (emphasis added).

C. The Commission Viewed its Decision as Ministerial/Administrative in Nature

and Not Quasi-judicial in Nature.

Asheville’s Code grants the Commission the authority to allow modifications

to the minimum subdivision standards required under the Code. Asheville City Code

of Ordinances § 7-5-8(c)(1) (2014). Specifically, the Code states that such

modifications may be allowed in cases of “physical hardship,” defining cases of

physical hardship as

those cases where because of the topography of the tract to

be subdivided, the condition or nature of adjoining areas,

or the existence of other unusual physical characteristics,

strict compliance with the provisions of [the] chapter would

cause unusual and unnecessary hardship on the

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subdivision of the property by [the] property owner or

developer.

Id. § 7-5-8(c)(2). In the event of a case of substantial hardship and the grant of a

modification, the Code empowers the Commission to impose such conditions on the

property owner or developer “as will ensure the purposes of the standards or

requirements waived.” Id. § 7-5-8(c)(3).

Asheville’s Code, however, also provides that the Commission’s process in

deciding whether to approve a preliminary plat “shall be ministerial in nature,”

without making any separate provision for those cases which involve approving a

modification due to a physical hardship. Id. § 7-5-8(a)(3)(d)(1). Instead, the Code

simply states that the Commission must schedule a public hearing to receive

comments regarding a proposed project upon receipt of a major subdivision

preliminary plat from the Technical Review Committee,3 and that, in the event the

preliminary plat as submitted is denied, the Commission must “set forth in writing

the reasons for denying approval of the plat.” Id.

In the present case, the record of the proceedings before the Commission

reveals that the Commission acted in a ministerial/administrative capacity, believing

that it did not have the authority to reject the plat with the modification where City

staff had already recommended approval. That is, it appears that the Commission

3 The Technical Review Committee is tasked with the initial stage of review of new major

subdivision applications and their compliance with applicable regulations. Asheville City Code of

Ordinances § 7-5-8(a)(3)(d) (2014).

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was under the impression that modifications pursuant to § 7-5-8(c) of the City Code

were administrative rather than quasi-judicial in nature, as the text of § 7-5-

8(a)(3)(d)(1) of the City Code would seem to dictate. Specifically, the record of the

Commission’s hearing demonstrates as follows: Existing City standards required a

minimum forty-five (45) foot right-of-way for certain new streets, but the proposed

subdivision’s streets had only a twenty-five (25) foot right-of-way. Nevertheless, the

Commission was under the impression that the requested modification was part of

the Technical Review Committee’s initial review; that there had been compliance

with the process in place for an applicant to request such a modification; that City

staff had recommended approval of the modification or alternately had already

approved the modification; and that the matter had, therefore, already been resolved

prior to the Commission’s approval of the plat, which was merely ministerial, as

required by the Code.

D. The Commission’s Decision to Approve the Developer’s Proposed Subdivision

with the Modification was, in fact, Quasi-judicial in Nature.

Notwithstanding the provisions of the Asheville Code suggesting otherwise,

the decision regarding the Developer’s proposed modification required a

determination of whether the Developer would suffer “physical hardship” if the

modification was not allowed. See id. § 7-5-8(c)(2). We hold that this determination

required an exercise of discretion in the application of this generally stated standard,

rendering the Commission’s decision quasi-judicial in nature. See N.C. Gen. Stat.

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Opinion of the Court

§ 160A-377(c) (2014). Our conclusion is in spite of the language in Asheville’s Code

stating that review before the Commission “shall be ministerial.” See Asheville City

Code of Ordinances § 7-5-8(a)(3)(d)(1) (2014). Indeed, our General Assembly has

provided that “an ordinance shall be deemed to authorize a quasi-judicial decision if

the . . . planning board is authorized to decide whether to approve or deny the plat

based . . . on whether the application complies with one or more generally stated

standards.” N.C. Gen. Stat. § 160A-377(c) (2014).

Here, determining the presence of “physical hardship” as defined in § 7-5-

8(c)(2) of Asheville’s Code required the exercise of judgment and discretion in

applying the relevant “generally stated standard[][.]” See id. That is, the decision

did not require the mere application of specific, neutral, and objective criteria, which

would render the decision administrative in nature. Therefore, we hold that the

Commission’s approval of the Developer’s plat with the street-width modification was

a quasi-judicial decision. In approving the plat, the Commission was required to

determine whether the Developer would suffer “physical hardship” without the

modification, a decision which required the exercise of judgment and discretion in

applying this general standard.4

4 Generally speaking, the weighing by a local government board of various burdens of a

proposed use of land not strictly complying with local regulations to determine whether certain of the

associated burdens constitute an undue hardship on a particular party requires application of a

general standard – undue hardship – to a set of individualized circumstances, and the exercise of

judgment and discretion. See Harrison v. City of Batesville, 73 So.3d 1145, 1152-56 (2011) (Mississippi

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Opinion of the Court

E. The Trial Court Erred in Dismissing the Petition for Certiorari, and Remand to

the Commission is Necessary.

Having found that the Commission’s decision to approve the proposed

subdivision was quasi-judicial in nature, we hold that the trial court erred in

dismissing the Neighbor’s petition for certiorari, and remand the matter to the trial

court for further remand to the Commission so that a hearing with “fair trial

standards” can be had.

While review of quasi-judicial decisions by local land use authorities is first to

superior court and in the nature of certiorari, see id. § 153A-336(a); id. § 160A-377(a);

id. § 153A-349(a); id. §§ 160A-393(a), (b)(3), our Court reviews the decisions of trial

courts in such cases to determine whether (1) the trial court’s review was within the

appropriate scope of review and (2) whether the review was correct, see Fehrenbacher

v. City of Durham, ___ N.C. App. ___, ___, 768 S.E.2d 186, 191 (2015). Moreover, the

nature of the decision by the local authority, not the label assigned to it, controls.

Guilford Fin. Servs., LLC v. City of Brevard, 150 N.C. App. 1, 6, 563 S.E.2d 27, 31

(2002), rev’d on other grounds, 356 N.C. 655, 576 S.E.2d 325 (2003) (per curiam).

Our Supreme Court has held that the appropriate scope of review on a petition

for certiorari from a decision by a local governmental authority regarding otherwise

Supreme Court reviewing quasi-judicial application of such a standard); Matthew v. Smith, 707 S.W.2d

411, 414-18 (1986) (Missouri Supreme Court: same); Oklahoma City v. Harris, 126 P.2d 988, 991-92

(1941) (Oklahoma Supreme Court: same); Brandon v. Bd. of Comm’rs of Town of Montclair, 124 N.J.L.

135, 139-41 (1940) (New Jersey Supreme Court: same).

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non-compliant land use includes the following issues where the local authority is

acting in a quasi-judicial capacity:

(1) Reviewing the record for errors in law,

(2) Insuring that procedures specified by law in both

statute and ordinance are followed,

(3) Insuring that appropriate due process rights of a

petitioner are protected including the right to offer

evidence, cross-examine witnesses, and inspect documents,

(4) Insuring that decisions of town boards are supported by

competent, material and substantial evidence in the whole

record, and

(5) Insuring that decisions are not arbitrary and capricious.

Coastal Ready-Mix Concrete Co., Inc. v. Bd. of Comm’rs of Town of Nags Head, 299

N.C. 620, 626, 265 S.E.2d 379, 383 (1980).

Under the whole record test, which our Court has held is one of the standards

of review applicable to these decisions, if the petitioner is alleging that the decision

by the local authority was arbitrary and capricious, its findings of fact are binding on

appeal if they are supported by substantial, competent evidence, provided such

evidence was presented to the local authority before the decision was made. Blue

Ridge Co., L.L.C. v. Town of Pineville, 188 N.C. App. 466, 469, 655 S.E.2d 843, 846

(2008). However, where the petitioner is alleging that the decision was based on legal

error, de novo review, the other relevant standard, is applicable. Id. at 469, 655

S.E.2d at 845-46. Our Court has held that “[t]he superior court may apply both

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Opinion of the Court

standards of review if required, but the standards should be applied separately to

discrete issues.” Id. at 469-70, 655 S.E.2d at 846.

In the present case, the Neighbors alleged in their petition for certiorari, which

they labeled in the alternative as a complaint seeking a declaratory judgment and

injunctive relief, that the Commission failed to comply with the due process

requirements for quasi-judicial proceedings, alleging additionally that in doing so the

Commission acted arbitrarily and capriciously. Therefore, under Blue Ridge Co., the

allegations in the Neighbors’ petition required the trial court to review the

Commission’s decision under both the de novo and whole record standards. Id. at

469-70, 655 S.E.2d at 845-46. The trial court, however, did neither, apparently

simply agreeing with the Respondents’ position in their answers and motions to

dismiss, ordering that the Neighbors’ petition be dismissed without addressing any

of the relevant issues set out by our Supreme Court in Coastal Ready-Mix Concrete,

or making any findings or conclusions indicating its rationale for so ruling.

In any event, we hold that the trial court on remand shall remand the case to

the Commission to conduct further proceedings which provide the Neighbors with the

level of due process required for quasi-judicial proceedings before that Commission.5

5 Our holding is not to be construed to deem all allowances of modifications, variances, or

special uses, whether under Asheville’s Code or any other local land use regulation, as quasi-judicial

decisions. Instead, our holding here is confined to the modification authorized by § 7-5-8(c) of the

Asheville City Code, where a modification is required for approval of an otherwise non-compliant

preliminary plat. For example, although § 7-7-8(c)(6) of the City Code, applicable to conditional use

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Opinion of the Court

See Humble Oil & Ref. Co. v. Bd. of Aldermen of Town of Chapel Hill, 248 N.C. 458,

470, 202 S.E.2d 129, 137 (1974).

III. Conclusion

For the reasons stated herein, we reverse the order of the trial court and

remand the matter for further proceedings.

REVERSED AND REMANDED.

Judges BRYANT and ZACHARY concur.

zoning, authorizes the City planning and development director to allow “minor modifications” to

approved conditional use zoning ordinances, such modifications are prescribed by specific, neutral, and

objective criteria, such as the limitation of a deviation not in excess of “up to ten percent or 24 inches

. . . from the approved setback,” or a reduction of no more than “25 percent in the number of parking

spaces required[.]” See Asheville City Code of Ordinances § 7-7-8(c)(6) (2014). Whereas § 7-5-8(c) of

the City Code authorizes a modification requiring application of the physical hardship standard

without any other guiding standards, minor modifications under § 7-7-8(c)(6) are guided by clear

standards. See id. Therefore, our review of a minor modification under § 7-7-8(c)(6), unlike a more

general modification under § 7-5-8(c), would, like the legislative action empowering the planning and

development director to authorize it, be deferential, presuming its validity. See County of Lancaster

v. Mecklenburg, 334 N.C. 496, 510 n. 7, 434 S.E.2d 604, 614 n. 7 (1993).

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