Introduction 

What type of land use proceeding is this?  Finding the correct answer to this question is critical to knowing your client’s rights and avoiding legal error.  Like different sports, there are distinct types of land use proceedings - legislative, quasi-judicial or administrative/ministerial.  Like a sport, the type of proceeding dictates the rules of the proceeding, such as the standards for decision-making, the rules of procedure and other substantive rules.

Similar to comparing basketball to baseball, the differences in “the rules of the game” in different land use proceedings are substantial.   For example, in a legislative proceeding, any person can speak at a public hearing, no speaker is sworn, there is no cross-examination of speakers, the decision-maker enjoys broad legislative discretion, makes only one finding and the decision is reversed by a court only when the record of the rezoning proceeding reveals no plausible basis for the decision.  On the other hand, in quasi-judicial or administrative/ministerial proceedings, every aspect of these proceedings differ with the rules of the game applicable to legislative decisions.

Likewise, the rules of the game between administrative/ministerial verses quasi-judicial proceedings are nearly polar opposite.  In a quasi-judicial proceeding every person (the applicant and other property owners) who suffer special damages are entitled to due process rights, including fair trial protections.  In administrative/ministerial proceedings, a public hearing is not required.    

In some circumstances, the answer is simple.  A traditional rezoning proceeding or ordinance text change is a legislative decision.  Most times, the difficulties arise when a proceeding is not legislative. The recent case of Butterworth v. City of Asheville, 2016WL2865128 (May 17, 2016) illustrates that finding the correct answer requires drilling to the essence of the proceeding.

Butterworth v. City of Asheville 

Facts

The procedural process in Butterworth is ordinary.  A developer files an application for approval of a proposed major residential subdivision.  Neighbors oppose approval of the subdivision.  Initially, the City’s planning staff reviews the developer’s application and thereafter the application is reviewed by a committee of City staff known as the City’s Technical Review Committee (TRC).  The TRC recommends approval of the application to the City’s Planning and Zoning Commission (Commission); the Commission makes the final decision regarding approval of a major subdivision and approves the application.  

A portion of the developer’s application requests a modification of the City’s general design standards relating to the width of the streets within the proposed subdivision.  The developer desires building streets narrower than required by general City standards.

The City’s law authorizes the Commission to allow a modification of general design standards when there is topographical or other unusual physical characteristics that would cause strict compliance with the general standards to be an unusual and unnecessary hardship on the proposed subdivision. 

As part of its general review of the application, the TRC determined that the modification requested by the developer satisfied this standard. The TRC recommended that the Commission approve the modification requested by the developer.  While considering the TRC recommendation at its public meeting, the Commission allowed public comment from concerned citizens but did not conduct a public hearing where witnesses are sworn, parties are allowed to offer evidence, cross-examine witnesses and offer rebuttal evidence.  The Commission approved the modification requested by the developer.

The neighbors opposing approval of the major subdivision filed a petition for certiorari in Superior Court.  The City and the developer filed motions to dismiss the petition and the Superior Court dismissed the petition.  

Ruling and Analysis

The North Carolina Court of Appeals unanimously reversed the Superior Court decision and remanded the case to the Commission for further proceedings.

The Court of Appeals acknowledged that the City’s law expressly states that the Commission’s decision whether to approve a preliminary plat “shall be ministerial in nature.”  Nevertheless, the Court of Appeals drilled down to the portion of the developer’s application requesting approval of a major subdivision and focused exclusively on the grounds and standards stated in the City’s law allowing modifications.

The Court of Appeals reasoned that an administrative land use decision requires only “the mere application of specific, neutral, and objective criteria ….”  Butterworth, p. 6.  Approval of the modification in Butterworth would have been administrative had the grounds and standards stated in the City’s law possessed these qualities.

However, the grounds and standards stated in the City’s law authorizing approval modifications failed to satisfy these qualities.  Because City law required the Commission to exercise some discretion in applying generally stated standards when considering the developer’s request for a modification, the Commission’s decision was quasi-judicial.  Accordingly, the Court directed the Commission “to conduct further proceedings which provide the Neighbors with the level of due process required for quasi-judicial proceedings before that Commission.” Butterworth p. 7.

Comments

1. Because the level of due process rights possessed by parties is determined by the type of land use proceeding, courts are not be bound by custom, practice or labels of local law.  Instead, courts will drill down to the essential quality of each land use decision.
2. Butterworth illustrates the complexity of applying the distinction between administrative and quasi-judicial decisions practically.  It appears that the vast majority of the application complied with “specific, neutral and objective criteria.”  Instead of viewing the process as a whole, the Court of Appeals determined that the correct approach is to search for any aspect of a decision that is not administrative in nature.  Is the Court of Appeal’s remand satisfied by a proceeding that only concerns the modification, or does the Commission rehear the entire application?   Should the developer withdraw its request for a modification, is the prior approval final and no further proceeding is required? 
3. Butterworth reveals that the specific wording of local law describing the grounds and standards for approval of a land use request is critically important.  As the Court of Appeals states, “[t]his is not to say that every decision to allow a modification in a subdivision proposal is quasi-judicial in nature.  Butterworth, p. 5 (emphasis by the Court). Perhaps one factor recognized by the Court of Appeals in Butterworth is that the criteria stated in City law for approving a modification was similar to the criteria stated in state law for granting variances, a classic quasi-judicial decision.