Kethman v. Oceola Township ( 1979 )

88 Mich. App. 94 (1979) 276 N.W.2d 529

KETHMAN
v.
OCEOLA TOWNSHIP

Docket No. 77-4299.

Michigan Court of Appeals.

Decided January 16, 1979.

Drury & Pikkarainen, P.C., for plaintiff.

Foster, Swift, Collins & Coey, P.C. (by Theodore W. Swift and William K. Fahey), for defendant.

Amicus Curiae: Bauckman, Reed, Lang, Schaefer & Travis, for Michigan Township Association.

Before: D.E. HOLBROOK, JR., P.J., and D.E. HOLBROOK and CYNAR, JJ.

D.E. HOLBROOK, J.

Plaintiff is the land contract purchaser of a 90-acre parcel of real property in the defendant township. Were it not for a 33-foot wide access easement appurtenant to his property, the plaintiff's acreage would be landlocked. The defendant township's zoning ordinance, enacted January 6, 1972, requires that all private roads serving as access to more than one parcel of real estate be 66 feet wide. Seeking to divide and develop his property for sale, plaintiff petitioned the defendant for a variance from the above requirement on June 15, 1972.

The plaintiff alleged that on the above date he was granted a variance at a hearing of the defendant's board of zoning appeals. Nearly a year later, the plaintiff was notified by the township zoning administrator that the township considered his "land use permit" to be void and of no effect due to the board of appeals' failure to keep minutes of the meeting at which it was granted. The plaintiff's application fee was returned and he was invited to reapply for a variance exempting his access road from the 66-foot requirement.

The plaintiff received the above communication on May 24, 1973, at which time he had commenced construction of a road bed on his right-of-way. He continued to work toward the completion of his private road, apparently at an accelerated rate, until the defendant placed a stop-work order on his property May 31. This order was lifted soon after, upon the advice of defendant's attorney, and the plaintiff resumed construction. On June 14, 1973, the plaintiff appeared before the defendant's board of appeals for a rehearing of his petition for a variance; on this occasion his "land use permit" was declared null and void. Further, the stop-work order on plaintiff's property was reinstated.

Plaintiff filed a complaint in circuit court on September 4, 1973, alleging that defendant's ordinance was void as applied to plaintiff, that the defendant's action in discontinuing the permit was arbitrary and capricious, and that the plaintiff suffered substantial damages as a result of his loss of potential purchasers. The plaintiff requested that the township be enjoined from further interference with his development and in a second count sought $180,000 damages from the township, alleging that actions taken to enforce the subject ordinance constituted an unconstitutional "taking" of private property.

Despite various defenses raised by the township, the circuit court rendered judgment for the plaintiff, reinstating the plaintiff's variance. The court also found the plaintiff to be entitled to $110,172.25 in damages, apparently on a contract theory. The defendant township appeals from this decision by right, assigning several errors.

The defendant first contends that the lower court erred in holding the original variance granted to plaintiff to be valid.^[1] The defendant maintains that its zoning board of appeals' failure to comply with the written record requirements of MCL 125.271 et seq.; MSA 5.2963(1) et seq. (the township zoning enabling act) rendered the original variance granted plaintiff void ab initio. In making this argument, the defendant township relies upon several cases holding that a decision rendered by a zoning appeal board upon either conclusory findings or upon no record at all is invalid as a denial of due process. Tireman-Joy-Chicago Improvement Ass'n v Chernick, 361 Mich. 211; 105 NW2d 57 (1960), Thomas v Busch, 7 Mich. App. 245; 151 NW2d 391 (1967), Badanek v Schroskey, 21 Mich. App. 582; 175 NW2d 784 (1970), Sitz v General Motors Corp, 24 Mich. App. 119; 179 NW2d 675 (1970).

Each of the cases cited by the defendant, however, began as a suit by neighboring property owners challenging the action of the zoning board. None of these cases involved a party to the proceeding later attempting to invalidate the outcome reached in that proceeding on due process grounds. These cases provide even less support for the proposition advanced by defendant township, i.e., that the body responsible for maintaining the record of a proceeding may later rely upon its own nonfeasance to render the action taken void.

The defendant township will not be heard to say that the decision reached by its own appeal board was "'a whimsical conclusion, and wholly unwarranted under the facts'", Tireman, supra, at 217; nor will the party responsible for the proper conduct of these proceedings be heard to claim that it has been "`denied the essence of a hearing * * * [or] kept in ignorance of the things controlling the action of the board'", Tireman, at 218. The cases cited by the defendant township should not be read so broadly as to require reversal at the behest of the defendant. As against the defendant township, the variance granted plaintiff on June 15, 1972, was not rendered null and void by the township board's failure to keep an adequate record.

The defendant next claims that any rights obtained by the plaintiff at the original hearing were rendered null and void by the plaintiff's fraudulent misrepresentations at that hearing. Twp of West Bloomfield v Chapman, 351 Mich. 606; 88 NW2d 377 (1958). The defendant contends that the plaintiff was granted a variance in reliance upon his testimony that the subject parcel was to be divided into eight lots and that the plaintiff had personally unsuccessfully approached the owners of the land adjoining his right-of-way in an attempt to purchase additional land for width. According to the defendant, its appeals board rejected the plaintiff's second petition for a variance when it learned that the plaintiff now intended to divide the parcel into 11 separate lots and that in fact the plaintiff had never personally approached the said landowners. The plaintiff offered evidence tending to show that the proceeding at which his variance was granted was very "informal". He testified that he was asked merely to submit a "rough" sketch of his intentions. The plaintiff alleged that he was never instructed to present a precise description of his plans which would be immutable. The plaintiff also testified that he had informed the board simply that the neighbors had been approached, not that he had personally attempted to purchase additional right-of-way. According to the plaintiff, his land contract vendor had approached the abutting landowners on his behalf.

The trial court chose to adopt the plaintiff's portrayal of the subject hearing, and there is ample evidence to support this interpretation. This factual determination that the plaintiff was not guilty of fraudulent misrepresentations in the original hearing is not clearly erroneous and is therefore binding on appeal. GCR 1963, 517.1.

We find the variance originally awarded the plaintiff to have been valid. As a result, the question on review becomes whether the defendant township properly reconsidered and revoked the plaintiff's variance in June of 1973.

The township zoning enabling act, MCL 125.271 et seq.; MSA 5.2963(1) et seq., does not expressly provide for the rehearing of a granted variance application. Analogically, the city and village zoning enabling act, MCL 125.581 et seq.; MSA 5.2931 et seq., similarly does not expressly allow for such a rehearing, yet such a power has been implied under exceptional circumstances. In McVeigh v Battle Creek, 350 Mich. 214; 86 NW2d 279 (1957), the appellant city was granted a rehearing before the zoning board of appeals seven days after the hearing during which the plaintiff's variance was granted. The trial court, citing general language of "finality after 5 days" contained in MCL 125.585(d); MSA 5.2935(d), held that as a matter of law such a rehearing must be held within five days. The Supreme Court affirmed, stating:

"It is urged by defendant, city of Battle Creek, that a zoning board of appeals has inherent power to grant a rehearing where no rights have intervened between entry of the original order and the order granting a rehearing. We note that neither the statute nor the zoning ordinance grants or authorizes a rehearing. We are not unmindful of the fact that zoning appeal boards are not courts, nor are they possessed of the powers of a court. Such boards are limited to the statute and the ordinance. It is our opinion that such boards do not have the inherent power to grant a rehearing." 350 Mich. 214, 217; 86 NW2d 279 (1957). (Emphasis supplied.)

The court's admonition is also relevant to a consideration of the authority of a township board to grant a rehearing. Here, also, neither the enabling act nor the defendant's ordinance provides for the rehearing of a granted variance. Here, also, the appeal board is imbued with no inherent powers, and thus possesses only those powers expressly invested in it by statute or ordinance. See 3 Anderson, American Law of Zoning (2d ed), § 20.50, p 568. For this reason we hold that the defendant township acted beyond its authority in ordering the reconsideration of the validity of the plaintiff's variance several months after the original hearing. This power, not granted by statute, will not be implied. Given our resolution of this issue, we need not consider whether the plaintiff relied upon the instant variance to such extent as to create in him vested rights in its continuance. See Dingeman Advertising, Inc v Algoma Twp, 393 Mich. 89, 98; 223 NW2d 689 (1974), City of Lansing v Dawley, 247 Mich. 394; 225 N.W. 500 (1929), and Souter v Board of Zoning Appeals of the City of Grand Rapids, 63 Mich. App. 451; 234 NW2d 562 (1975). We do note in passing, however, that plaintiff's reliance upon the variance appears to have been substantial.

Finally, counsel for the defendant township, aided by the excellent amicus curiae brief submitted by the Michigan Township Association, challenge both the court's authority to award the plaintiff damages and the amount of damages awarded. While the plaintiff's complaint seeks damages for the unjust taking of plaintiff's property, the trial court's opinion describes the damages awarded in contractual terms. The plaintiff contends in defense of the court's award that defendant's revocation of plaintiff's variance was not a governmental function and that it was in fact a breach of contract to which governmental immunity does not apply, Zynda v Aeronautics Comm, 372 Mich. 285; 125 NW2d 858 (1964). The appellant contends, on the other hand, that the court has awarded the plaintiff damages sounding in tort, a clear violation of the Michigan law of governmental immunity since the defendant was engaged in a purely governmental, nonproprietary, function: zoning. See: Galli v Kirkeby, 398 Mich. 527, 534-535; 248 NW2d 149 (1976).

In order to remedy this confusing state of affairs, it is necessary that we briefly consider each of the possible bases for upholding the court's award. First, it is clear that tort damages will not lie under the instant circumstances. The plaintiff's complaint and proofs do not support such an award, and the doctrine of governmental immunity is clearly applicable under Galli, supra.

Second, an award of damages based upon breach of contract is equally unsupportable. This Court considered a similar question in Midwest Teen Centers, Inc v Roseville, 36 Mich. App. 627, 629-630; 193 NW2d 906 (1971). In pertinent part that panel stated:

"Our examination of the law in this case has failed to reveal any authority whatsoever that would establish that this permit is a contract. On the contrary, the only case plaintiff cites on this point, Eastwood Park Amusement Co v Mayor of East Detroit, 325 Mich. 60 [38 NW2d 77] (1949), clearly points in the opposite direction; namely, that this permit is a license and not a contract. There, the Michigan Supreme Court stated at 76 its approval of the language used in People v Schafran, 168 Mich. 324, 330, 334 [134 N.W. 29] (1912), that:

"`The licensee has no vested property right in his license; in fact, it would not be in the power of the legislature to make an irrepealable contract as to that which affects the public morals or public health so as to limit the exercise of the police power over the subject matter. * * *

"`We have already covered the first, second, and third request to charge and have said that a license to sell liquor is not a contract but only a promise to enjoy the privilege on the terms named for a specific time, unless it be sooner revoked. The granting of a license is an exercise of police power, and does not include any contractual relations whatsoever. Stone v Mississippi, 101 U.S. 814; 25 L. Ed. 1079 (1880).'

"The granting of this dance hall permit was clearly an exercise of the City of Roseville's police power. There is no evidence of any consideration running from plaintiff to defendant which is a basic ingredient of any contract. Payment of a simple license or permit fee is not such consideration as will support the existence of a contractual relationship. There is no indication that this permit was anything more than a written promise to enjoy the privilege of operating a teen club, in Roseville, on the terms named for the period specified, subject to the city's absolute right to revoke this privilege, pursuant to the procedure in condition 19." (Emphasis supplied.)

See also: 101 CJS, Zoning, § 239, p 1002; § 314, p 1097 et seq.; 9 McQuillin, Municipal Corporations (3d rev ed), § 26.14, pp 29-30; 4 Rathkopf, The Law of Zoning and Planning, p 82-4. While the defendant township clearly was not free to revoke the plaintiff's variance at will, its action did not constitute a breach of contract. Souter v Bd of Zoning Appeals of the City of Grand Rapids, 63 Mich. App. 451; 234 NW2d 562 (1975), cited by the plaintiff in support of his claim, is not relevant to the instant issue.

Finally, the trial court's award of damages may be upheld, at least in part, if the facts of this case indicate that the defendant township has unconstitutionally taken private property for its own use. As the Court explained in Armstrong v Ross Twp, 82 Mich. App. 77, 82-83; 266 NW2d 674 (1978):

"In Buckeye Union Fire Insurance Co v Michigan, 383 Mich. 630, 640-644; 178 NW2d 476, 482-483 (1970), the Supreme Court held that the Legislature's power to grant governmental agencies sovereign immunity is limited by the constitutional provision prohibiting the taking of private property for public use without compensation. Const 1963, art 10, § 2. In Tamulion v State Waterways Commission, 50 Mich. App. 60, 66-67; 212 NW2d 828, 831 (1973), this Court recognized that a compensatory obligation arises under the constitution, not in tort, for inverse condemnation, and that sovereign immunity does not insulate the state from liability thereon.

"A township may not so restrictively zone property as to confiscate it. Property is not confiscated unless the ordinance `would preclude its use for any purpose to which it is reasonably adapted'. Kirk v Tyrone Twp, 398 Mich. 429, 444; 247 NW2d 848, 854-855 (1976), Kropf v Sterling Heights, 391 Mich. 139, 163; 215 NW2d 179, 189 (1974). Mere disparity in value between uses, Brae Burn, Inc v Bloomfield Hills, 350 Mich. 425, 433; 86 NW2d 166, 170 (1957), Reibel v Birmingham, 23 Mich. App. 732, 738; 179 NW2d 243, 246 (1970), or depreciation in value caused by rezoning, Lamb v City of Monroe, 358 Mich. 136, 144; 99 NW2d 566, 570 (1959), will not justify a finding of confiscation."

In this case, as in Armstrong, however, the plaintiff's complaint and the proofs at trial do not support the conclusion that a "taking" has occurred:

"Each of the complaints alleges in conclusional terms confiscation, but in evaluating the complaint we ignore conclusions and look to the facts alleged. Binder v Consumers Power Co, 77 Mich. App. 343, 346-347; 258 NW2d 221, 224 (1977). In each case we find plaintiffs have pled depreciation in value, not confiscation. * * * Plaintiffs' loss suffered in reliance upon the building inspector's representation sounds in tort, not inverse condemnation. Since neither complaint alleges facts in avoidance of immunity, Ross Township's motion for summary judgment should have been granted." Armstrong, at 83. (Emphasis supplied.)

Since the record does not support the trial court's award of damages, that portion of the lower court's decision is reversed. In all other respects we affirm.

Affirmed in part and reversed in part. No costs, a public question being involved.

NOTES

[1] Although denominated a "land-use permit", the plaintiff's exemption from the requirements of defendant's ordinance was clearly more properly termed a "variance", see 3 Anderson, American Law of Zoning (2d ed), § 18.02, p 136.