Adams v. Village of Wesley Chapel , 259 F. App'x 545 ( 2007 )


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  •                              UNPUBLISHED
    UNITED STATES COURT OF APPEALS
    FOR THE FOURTH CIRCUIT
    No. 06-2115
    ROBERT D. ADAMS, JR.; AILEEN S. ADAMS,
    Plaintiffs - Appellants,
    versus
    VILLAGE OF WESLEY CHAPEL, a North Carolina
    Municipal   Corporation; ALBERT W.  BLACK,
    Individually,
    Defendants - Appellees.
    --------------------------------------------
    NORTH CAROLINA PROPERTY RIGHTS COALITION,
    INCORPORATED; JOHN LOCKE FOUNDATION,
    Amici Supporting Appellants.
    Appeal from the United States District Court for the Western
    District of North Carolina, at Charlotte. Robert J. Conrad, Jr.,
    Chief District Judge. (3:03-cv-00411)
    Argued:   October 31, 2007               Decided:    December 11, 2007
    Before TRAXLER and GREGORY, Circuit Judges, and Jerome B. FRIEDMAN,
    United States District Judge for the Eastern District of Virginia,
    sitting by designation.
    Affirmed by unpublished per curiam opinion.
    ARGUED: William J. Brian, Jr., KENNEDY, COVINGTON, LOBDELL &
    HICKMAN, L.L.P., Research Triangle Park, North Carolina, for
    Appellants.    Steven Kepner McCallister, SHANAHAN LAW GROUP,
    Raleigh, North Carolina, for North Carolina Property Rights
    Coalition, Incorporated, and John Locke Foundation, Amici
    Supporting Appellants.    Ann Cox Rowe, DAVIS & HAMRICK, L.L.P.,
    Winston-Salem, North Carolina; Torin L. Fury, FRAZIER, FRANKLIN,
    HILL & FURY, R.L.L.P., Greensboro, North Carolina, for Appellees.
    ON BRIEF: Patrick L. Byker, KENNEDY, COVINGTON, LOBDELL & HICKMAN,
    L.L.P., Research Triangle Park, North Carolina, for Appellants. H.
    Lee Davis, Jr., DAVIS & HAMRICK, L.L.P., Winston-Salem, North
    Carolina; William L. Hill, FRAZIER, FRANKLIN, HILL & FURY,
    R.L.L.P., Greensboro, North Carolina, for Appellees.
    Unpublished opinions are not binding precedent in this circuit.
    2
    PER CURIAM:
    Robert D. Adams and Aileen S. Adams appeal a district court
    order granting summary judgment against them on various claims
    arising out of the annexation of a tract of land that they owned
    and declining to exercise supplemental jurisdiction over their
    remaining claims.      We affirm.
    I.
    Because this is an appeal from the grant of summary judgment,
    we view the facts in the light most favorable to the Adamses, the
    non-movants.      See Saucier v. Katz, 
    533 U.S. 194
    , 201 (2001).
    In July 1999, Albert Black, the mayor of the Village of Wesley
    Chapel,   North    Carolina   (“the   Village”),   spoke   to    Mr.   Adams
    regarding the possible voluntary annexation of a 184-acre tract of
    land that the Adamses owned.        Both men testified that they could
    not remember the particulars of the conversation.               Afterwards,
    however, Black sent Adams a letter stating in pertinent part:
    It was a pleasure to talk with you on Saturday about the
    Village of Wesley Chapel.        I have enclosed some
    information about Wesley Chapel along with a “Petition
    for Voluntary Annexation.”
    Because some of your neighboring property owners have
    expressed interest in being voluntarily annexed into
    Wesley Chapel within the next thirty or so days, I wanted
    to make sure you were made aware of this in case you
    would also like to become part of Wesley Chapel at this
    time.
    The Village of Wesley Chapel offers you protection from
    another municipality attempting to take you into its
    boundaries through involuntary annexation as well as
    3
    offering a low tax rate ($.02 per $100.00 of property
    valuation).
    If you wish to be a part of this voluntary annexation,
    please complete the enclosed form and mail it to us as
    soon as possible. If you have questions, please do not
    hesitate to contact me . . . .
    J.A. 3030.    Adams also had a conversation with Black in which Black
    told    him   that    his    zoning   would      not    change      if   the    Adamses
    voluntarily annexed their property.                    The Adamses subsequently
    completed the form and sent it in, and in September 1999, their
    petition was approved.
    At the time the tract was annexed, it was zoned “R-40” by
    Union County, where the tract was located, and the Village had not
    enacted a zoning ordinance.           On July 7, 2000, however, the Village
    sent the Adamses a notice of a public hearing on a proposed new
    zoning ordinance. The letter stated “that the Village Council does
    not    plan   to   change    the    current      zoning      designations       of    any
    property.” J.A. 3085, 5769. Indeed, when the zoning ordinance was
    subsequently       enacted   on    August      21,   2000,    the    Adamses’       tract
    continued     to     be   zoned    R-40;    however,      the    meaning       of    that
    designation changed under the new ordinance.                 Under Union County’s
    zoning, R-40 was a density standard, while under the Village’s, it
    was a minimum lot size.           The new designation excluded flood plain
    and power line rights of way from a parcel’s usable area and
    allowed no deviations from a minimum-40,000-square-foot lot.                         That
    excluded approximately 40 acres of usable area from the Adamses’
    4
    tract, resulting in 35 fewer house lots that could be developed,
    and reducing the property value by $1,590,000.            The Adamses later
    petitioned unsuccessfully to rezone their property.
    Dissatisfied with this result, the Adamses filed suits in
    state and federal court against the Village and Black in his
    individual capacity (“Appellees”).            The state court action was
    subsequently removed to federal court and consolidated with the
    other federal action.           The Adamses then sold the property in
    question for $3,700,000 on March 1, 2004, while this action was
    pending.      The Adamses had paid $56,500 for the land in 1964.
    As is relevant here, the Adamses’ complaint alleges violations
    of federal and state constitutional provisions protecting against
    takings    without      just   compensation    and    violations   of   equal
    protection and substantive due process rights.             It also includes
    state   law    claims   for    fraud,   negligent    misrepresentation,   and
    violation of North Carolina’s unfair and deceptive trade practices
    statute, see N.C.G.S. § 75-1.1. The district court granted summary
    judgment against the Adamses on the constitutional claims, finding
    that their sale of the land rendered the claims moot and that the
    claims failed as a matter of law in any event.                 Declining to
    exercise supplemental jurisdiction over the remaining state law
    claims, the district court remanded them to state court.                  See
    28 U.S.C.A. § 1367(c)(3) (West 2006).
    5
    II.
    The Adamses first contend that the district court erred in
    concluding that their constitutional claims were moot.                 We agree.
    In order to have standing, a plaintiff must allege and prove
    an actual or imminent injury caused by the defendant’s challenged
    conduct that can be redressable by the relief sought.                  See Steel
    Co. v. Citizens for a Better Env’t, 
    523 U.S. 83
    , 103 (1998).
    Generally      speaking,    these   elements       must   continue     to   exist
    throughout the lawsuit; otherwise, the action becomes moot.                   See
    United States Parole Comm’n v. Geraghty, 
    445 U.S. 388
    , 397 (1980).
    But cf. Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC),
    Inc., 
    528 U.S. 167
    , 190-92 (2000) (explaining that standing need
    not always be present through time to prevent a case from becoming
    moot).
    The Adamses’ constitutional claims allege that Appellees’
    actions proximately caused a reduction in the value of their
    property, entitling them to damages. That they have since sold the
    property is irrelevant to the redressability of their claim since
    a damages award could redress the injury they allege.                 See Memphis
    Light,   Gas    &   Water   Div.    v.    Craft,    
    436 U.S. 1
    ,    8    (1978)
    (“Respondents’ claim for actual and punitive damages . . . saves
    this cause from the bar of mootness.”).            Thus, the Adamses’ sale of
    their property did not moot their constitutional claims.
    6
    III.
    The Adamses next argue that the district court erred in ruling
    that they failed to create a genuine issue of material fact
    regarding their regulatory takings claims.      We disagree.
    The Takings Clause of the Fifth Amendment to the United States
    Constitution provides, “[N]or shall private property be taken for
    public use, without just compensation.”1         This constitutional
    protection “is not restricted to physical invasions, occupations,
    or removals of property.”   Houlton Citizens’ Coalition v. Town of
    Houlton, 
    175 F.3d 178
    , 190 (1st Cir. 1999).     Rather, in some cases,
    overly   burdensome   government   regulation    can   constitute   an
    unconstitutional taking.     See 
    id. “A regulatory taking
    occurs
    when the value or usefulness of private property is diminished by
    a regulatory action that does not involve a physical occupation of
    the property.”   Levald, Inc. v. City of Palm Desert, 
    998 F.2d 680
    ,
    684 (9th Cir. 1993).     It may occur as a result of “a radical
    curtailment of a landowner’s freedom to make use of or ability to
    derive income from his land,” even if the government does not
    physically intrude upon, or acquire a legal interest in, the
    property.   Kirby Forest Indus., Inc. v. United States, 
    467 U.S. 1
    ,
    14 (1984). However, a regulatory action only becomes a compensable
    1
    The Adamses advance the same arguments with regard to their
    state constitutional claims as they do for their federal ones. We
    therefore do not distinguish between the two for the purposes of
    our discussion.
    7
    taking under the Fifth Amendment if the government interference has
    gone “too far,” Pennsylvania Coal Co. v. Mahon, 
    260 U.S. 393
    , 415
    (1922), which it does when “some people alone” are forced “to bear
    public burdens which, in all fairness and justice, should be borne
    by the public as a whole,” Armstrong v. United States, 
    364 U.S. 40
    ,
    49 (1960).
    The Adamses agree that the district court was correct to apply
    the three-factor regulatory takings test provided in Penn Central
    Transportation Co. v. City of New York, 
    438 U.S. 104
    , 124 (1978),
    to their claim.       Under that test, when a regulation such as a
    zoning ordinance causes substantial economic harm but does not
    deprive the landowner’s property of all economic value, whether a
    taking occurred depends on “the regulation’s economic effect on the
    landowner, the extent to which the regulation interferes with
    reasonable investment-backed expectations, and the character of the
    government action.”         Palazzollo v. Rhode Island, 
    533 U.S. 606
    , 617
    (2001). Importantly, diminution in the property value alone cannot
    establish a taking.         See Penn 
    Central, 438 U.S. at 131
    .
    Here,     the   only    injury   that        the   Adamses    can     show   is   a
    diminution in the value of their property. They certainly were not
    denied   the   ability      to   obtain       a   reasonable      return    on    their
    investment.     They purchased the property for $56,500 and sold it
    for $3.7 million.        The property was worth that much because it
    could still be developed, just not quite to the extent that it
    8
    could have been before the Village adopted its zoning ordinance.
    With regard to the test’s final factor, the character of the
    government action, the regulation at issue is garden-variety zoning
    based    on   the    need    to     control       growth,   preserve   a   small-town
    atmosphere, and maintain a low tax rate.2                    The Supreme Court has
    previously recognized the legitimacy of similar regulations.                     See,
    e.g., City of Edmonds v. Oxford House, Inc., 
    514 U.S. 725
    , 732-33
    (1995).
    The Adamses confuse matters by trying to include Black’s
    actions       in    inducing        them--fraudulently,         they       contend--to
    voluntarily        annex    their    property       as   part   of   the   challenged
    government action. But the annexation did not impose any burden on
    the Adamses’ property rights.             See Lingle v. Chevron U.S.A. Inc.,
    
    544 U.S. 528
    , 539 (2005) (noting that the regulatory takings test
    “focuses directly upon the severity of the burden that government
    imposes upon private property rights”).                     “Government action” in
    this context refers to the action that imposed the burden--the
    Village’s adoption of its zoning ordinance.                  Appellees’ actions in
    2
    The Adamses contend that they received no “reciprocity of
    advantage” by the annexation and the Village’s adoption of the
    zoning ordinance.    Tahoe-Sierra Pres. Council, Inc. v. Tahoe
    Regional Planning Agency, 
    535 U.S. 302
    , 341 (2002) (internal
    quotation marks omitted). But the Adamses, in fact, received the
    very benefits that the zoning ordinance was adopted to provide.
    See Keystone Bituminous Coal Ass’n v. DeBenedictis, 
    480 U.S. 470
    ,
    491 (1987) (“While each of us is burdened somewhat by such
    restrictions, we, in turn, benefit greatly from the restrictions
    placed on others.”).
    9
    inducing the Adamses to annex their property thus are not relevant
    to the regulatory takings claim.              The district court therefore
    correctly granted summary judgment against the Adamses on these
    claims.
    IV.
    The Adamses also maintain that the district court erred in
    granting summary judgment against them on their substantive due
    process claims.    We disagree.
    In   order   to   recover   for    a    violation   of   substantive   due
    process, plaintiffs must prove that they had a property interest,
    that the defendants deprived them of that interest, and that the
    deprivation “falls so far beyond the outer limits of legitimate
    governmental action that no process could cure the deficiency.”
    Tri-County Paving, Inc. v. Ashe County, 
    281 F.3d 430
    , 440 (4th Cir.
    2002) (internal quotation marks omitted).                To prove this third
    element, plaintiffs must show that the challenged actions had “no
    foundation in reason and [were] a mere arbitrary or irrational
    exercise of power having no substantial relation to the public
    health, the public morals, the public safety or the public welfare
    in its proper sense.”     Sylvia Dev. Corp. v. Calvert County, Md., 
    48 F.3d 810
    , 827 (4th Cir. 1995) (internal quotation marks omitted).
    Here, the Adamses maintain that Black misled them by falsely
    stating that their land was in danger of being involuntarily
    annexed by another town with a higher tax rate if they did not
    10
    voluntarily annex their property to the Village.                     The Adamses
    maintain that Black knew from his involvement in two lawsuits to
    prevent previous attempts by the town of Indian Trail to annex
    property   in    the   Wesley   Chapel    area   that   North    Carolina    law
    prohibits involuntary annexation of large tracts of undeveloped
    land such as theirs.
    The Adamses, however, have failed to forecast any evidence
    that Black told them that such an involuntary annex attempt could
    succeed.     Black’s letter states only that voluntary annexation to
    Wesley Chapel could protect the Adamses “from another municipality
    attempting” involuntary annexation of their property.                  J.A. 3030
    (emphasis added). Indeed, as the Adamses themselves point out, the
    town of Indian Trail had attempted such involuntary annexations
    previously.
    The Adamses also argue that their substantive due process
    rights were violated in light of Black’s prior representation that
    the property’s zoning would not change if they voluntarily annexed
    it. Although the R-40 designation did not change under the Village
    zoning ordinance, the Adamses argue that the changes in the meaning
    of that designation under the ordinance significantly lessened the
    value of their property.        We conclude that the Adamses’ evidence,
    even taken as true, cannot give rise to an inference of conduct
    “fall[ing]      so   far   beyond   the    outer   limits       of    legitimate
    governmental action that no process could cure the deficiency.”
    11
    Tri-County 
    Paving, 281 F.3d at 440
    .      It is undisputed that when the
    property was annexed, its zoning did not change.            In fact, the
    zoning changed only in August 2000, nearly a year after the
    annexation.    Concerns regarding the density requirements that were
    eventually adopted were discussed at the August 3, 2000, public
    hearing concerning the ordinance.        That those concerns did not
    carry the day cannot constitute the basis for a claim of government
    conduct so egregious as to amount to a violation of the Adamses’
    substantive due process rights.     Moreover, it is worth noting that
    the Village honored all plats and subdivision plans that were filed
    with Union County before enactment of the Village zoning ordinance.
    There is no reason to doubt that the Adamses would have received
    the same treatment had they filed a plat prior to the ordinance’s
    enactment.    The district court therefore correctly granted summary
    judgment on this claim.
    V.
    The Adamses further argue that the district court erred in
    granting summary judgment against them on their Equal Protection
    claims.    We disagree.
    The   Equal   Protection   Clause   of   the   Fourteenth   Amendment
    “limits all state action, prohibiting any state from denying a
    person equal protection through the enactment, administration, or
    enforcement of its laws and regulations.”           Front Royal & Warren
    County Indus. Park Corp. v. Town of Front Royal, 
    135 F.3d 275
    , 289
    12
    (4th Cir. 1998) (internal quotation marks & emphasis omitted).            To
    establish an Equal Protection claim with a “class of one,” a
    plaintiff    must   show   that   he   “has    been   intentionally   treated
    differently from others similarly situated and that there is no
    rational basis for the difference in treatment.”                 Village of
    Willowbrook v. Olech, 
    528 U.S. 562
    , 564 (2000).                 Because the
    Adamses do not allege the infringement of a fundamental right or
    claim a suspect classification, Appellees need only show that the
    challenged action “is rationally related to a legitimate state
    interest.”    City of Cleburne v. Cleburne Living Ctr., Inc., 
    473 U.S. 432
    , 440 (1985).
    The Adamses maintain that Black intentionally treated them
    differently than he treated similarly situated landowners when he
    solicited the voluntary annexation of their property.            The record
    does not bear that out, however.            In fact, Black testified in his
    deposition that he had “talked to a lot of people” about voluntary
    annexation.    J.A. 2671; see J.A. 2676-77.3
    The Adamses also maintain that Appellees violated their Equal
    Protection rights by denying their request to rezone their property
    from R-40 to R-20.     The Adamses emphasize that theirs was the only
    3
    The Adamses claim that they were treated differently from
    similarly situated landowners because the Village failed to conduct
    the statutorily requisite verification of their annexation petition
    or publish the statutorily required notice advertising the public
    annexation hearing. The Adamses do not contend, however, that they
    were harmed by this treatment.
    13
    zoning request the Village ever denied, and they note that 79% of
    the zoning permits issued by the Village for new house construction
    on property zoned for lots with a minimum size of 40,000 square
    feet were, in fact, issued for lots with less than 40,000 square
    feet in spite of their R-40 zoning.   However, the Adamses ignore
    the uncontradicted evidence that these lots had been platted under
    Union County zoning, that the plats for those subdivisions had been
    approved, adopted, and accepted under Union County zoning, and that
    the Village had no lawful right to deny those building permits
    because the Union County zoning was the lawful zoning ordinance in
    place at the time the developments were platted. Thus, the Adamses
    failed to create a genuine issue of fact regarding whether these
    other lots were similarly situated to theirs.4
    VI.
    In sum, we conclude that although the Adamses’ constitutional
    claims are not moot, the district court properly determined that
    the Appellees were entitled to summary judgment on each of them.
    AFFIRMED
    4
    We note that while the Adamses contend that the district
    court erred in remanding their claims for fraud, negligent
    misrepresentation, and unfair trade practices, they do so only on
    the basis that the court erred in granting summary judgment on
    their other claims.
    14
    

Document Info

Docket Number: 06-2115

Citation Numbers: 259 F. App'x 545

Judges: Traxler, Gregory, Friedman, Eastern, Virginia

Filed Date: 12/11/2007

Precedential Status: Non-Precedential

Modified Date: 11/5/2024

Authorities (17)

Tri-County Paving, Incorporated v. Ashe County Ashe County ... , 281 F.3d 430 ( 2002 )

Armstrong v. United States , 80 S. Ct. 1563 ( 1960 )

Keystone Bituminous Coal Assn. v. DeBenedictis , 107 S. Ct. 1232 ( 1987 )

Memphis Light, Gas & Water Division v. Craft , 98 S. Ct. 1554 ( 1978 )

Steel Co. v. Citizens for a Better Environment , 118 S. Ct. 1003 ( 1998 )

Village of Willowbrook v. Olech , 120 S. Ct. 1073 ( 2000 )

Levald, Inc. v. City of Palm Desert , 998 F.2d 680 ( 1993 )

Houlton Citizens' Coalition v. Town of Houlton , 175 F.3d 178 ( 1999 )

sylvia-development-corporation-karel-dohnal-individually-and-as-agent-for , 48 F.3d 810 ( 1995 )

Penn Central Transportation Co. v. New York City , 98 S. Ct. 2646 ( 1978 )

United States Parole Commission v. Geraghty , 100 S. Ct. 1202 ( 1980 )

Palazzolo v. Rhode Island , 121 S. Ct. 2448 ( 2001 )

Friends of the Earth, Inc. v. Laidlaw Environmental ... , 120 S. Ct. 693 ( 2000 )

Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional ... , 122 S. Ct. 1465 ( 2002 )

Pennsylvania Coal Co. v. Mahon , 43 S. Ct. 158 ( 1922 )

front-royal-and-warren-county-industrial-park-corporation-a-virginia , 135 F.3d 275 ( 1998 )

Kirby Forest Industries, Inc. v. United States , 104 S. Ct. 2187 ( 1984 )

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