In re Application of EOF Investments, LLC. ( 2015 )

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A14-2176
In re Application of
EOF Investments, LLC
Filed August 10, 2015
Affirmed in part, reversed in part, and remanded
Worke, Judge
Lake Minnetonka Conservation District
Timothy J. Keane, Todd J. Guerrero, Kutak Rock LLP, Minneapolis, Minnesota (for
relators Matt Johnson, Susanne Johnson, David Feldshon, Archelle Georgiou, Rodney
Burwell, Barbara Burwell, Nivin MacMillian)
Michael C. Couri, Couri & Ruppe, P.L.L.P., St. Michael, Minnesota (for respondent EOF
Investments, LLC)
George C. Hoff, Justin Templin, Hoff, Barry & Kozar, P.A., Eden Prairie, Minnesota (for
respondent Lake Minnetonka Conservation District)
Considered and decided by Cleary, Chief Judge; Hudson, Judge; and Worke,
Judge.
UNPUBLISHED OPINION
WORKE, Judge
Relators challenge the grant of a multiple-dock license and a variance to a marina
by the Lake Minnetonka Conservation District. We affirm in part, reverse in part, and
remand for further proceedings.
DECISION
Relators here are property owners who live on Tanager Lake, a bay of Lake
Minnetonka. They challenge respondent Lake Minnetonka Conservation District’s
(LMCD) grant of a multiple-dock license and a variance to respondent EOF Investments,
LLC (EOF). EOF operates a commercial marina on Tanager Lake.
Grants of licenses and variances are quasi-judicial determinations. Honn v. City of
Coon Rapids, 313 N.W.2d 409, 416 (Minn. 1981). This court reviews the decisions of a
quasi-judicial body, such as LMCD, using the substantial-evidence test. Watab Twp.
Citizen All. v. Benton Cty. Bd. of Comm’rs, 728 N.W.2d 82, 93 (Minn. App. 2007),
review denied (Minn. May 15, 2007). The body’s decisions must be legally sufficient
and have substantial factual support in the record. Id. at 93-94. Substantial evidence is
“(1) such relevant evidence as a reasonable mind might accept as adequate to support a
conclusion; (2) more than a scintilla of evidence; (3) more than some evidence; (4) more
than any evidence; or (5) the evidence considered in its entirety.” Minn. Ctr. for Envtl.
Advocacy v. Minn. Pollution Control Agency, 644 N.W.2d 457, 464 (Minn. 2002).
Code
Relators first contend that LMCD erred in issuing a license under section 2.015 of
its Code of Ordinances (Code), because one of the necessary elements for that section to
apply was not fulfilled. Section 2.015, subdivision 3(d), provides that a license “shall
not” be issued if it would “resul[t] in any further extension into non-conforming side
setback areas than the existing dock.” Relators contend that the variance granted by
LMCD to EOF allows further extension of the dock. Relators claim that the variance
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permits three dock slips to extend over the property line, whereas previously only one
dock slip did so.
We do not agree that LMCD violated its Code. LMCD’s order granting the
variance states that it is granting nothing more than what was allowed under a preexisting
variance, granted in 1985: “The extension over the zoning line of north opening slips on
the north dock structure is the same as the extension allowed by the 1985 Order.”
Relators have provided diagrams which suggest that the site plan approved by LMCD
differs from the site plan approved in 1985, but its assertions are unverifiable on the
record before us. First, the 1985 site plan includes a notation that it is “not to scale” as
well as a notation that the “dock slip dimensions [were] added . . . as measured in
[1990],” so its accuracy cannot be relied upon for comparison purposes. Second, the
1985 diagram (even if it is an accurate depiction of what was permitted in 1985) indicates
that the furthest-extending dock reaches four feet over the property line. LMCD’s
recently-granted variance also limits the furthest-extending dock slips to four feet beyond
the property line. Third, the number of dock slips permitted by the 1985 order to extend
over the property line is not specified—the order simply states that a variance is granted
for “the setback to the north, including an extension beyond the lot line extended [for] the
slips opening toward the lot line.” The text includes no limitation on the number of slips
which may extend beyond the property line; that only one slip extends beyond the line in
the “not to scale” diagram cannot overcome this language. In sum, evidence in the record
supports LMCD’s finding that there is no difference between the variance granted in
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1985 and the variance granted here. If the variances granted are identical, there is no
“further extension” of the docks that would render use of section 2.015 inappropriate.
In the alternative, relators assert that section 2.015 cannot apply at all to LMCD’s
grant of a license and variance because, by its language, section 2.015 only applies to
docks “lawfully in existence,” and EOF’s dock is illegal.
We do not agree that the dock is illegal. The record shows that at least one of
EOF’s docks was not in compliance with the variance granted in 1985. But under the
Code, an activity is “unlawful” if the actor is “without a currently valid license.” LMCD
Code of Ordinances (LCO) § 1.06, subd. 2 (2015). EOF was issued licenses every year
since 1985, including 2013 and 20141, the time period during which this dispute arose
and was contested. It is true that the licenses granted to EOF over the years were
conditioned upon compliance with the variance granted in 1985, but lack of compliance
with a condition of a license, such as a variance, is merely “grounds for revocation of [a]
license,” LCO § 1.06, subd. 9 (2015), and EOF’s license was never revoked.
Procedural due process
Relators next argue that their procedural due process rights were violated by the
manner in which LMCD approved EOF’s requests for a multiple-dock license and a
variance. Whether the government has violated due process rights is reviewed de novo.
Sawh v. City of Lino Lakes, 823 N.W.2d 627, 632 (Minn. 2012). Procedural due process
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The 2014 license was granted to EOF on October 8, 2014, so there was a period of time
during which EOF’s license application was pending that it did not have an in-force
license. However, under the Code, “[a]ll licenses shall be for a term of one calendar
year,” LCO § 1.06, subd. 6 (2015), and the license issued to EOF expired on December
31, 2014. Nothing in the Code prohibits retroactive issuance of a license.
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requires, at minimum, (1) notice and (2) a meaningful opportunity to be heard before a
party’s rights are infringed. Id. These basic requirements persist in the land-use context,
but “quasi-judicial proceedings do not invoke the full panoply of procedures required in
regular judicial proceedings.” Barton Contracting Co., Inc. v. City of Afton, 268 N.W.2d
712, 716 (Minn. 1978). In the quasi-judicial context, “the opportunity to present
information and argument to rebut opposing statements” is an indication that sufficient
due process protection was provided. Id.Relators contend that LMCD violated its Code because it did not hold a full public
hearing before it issued EOF the license and variance. Relators claim that this violation
means that they did not have an adequate opportunity to be heard. But following EOF’s
applications for a multiple-dock license and a variance, LMCD held a full public hearing
on August 27, 2014. Relators argue that because the site plan attached to EOF’s
applications was amended after the August 27 hearing, another full hearing was required
before approval. Relators note that, following amendments to the site plan, EOF’s
applications were processed using portions of the Code that govern reconfiguration of
non-conforming structures. Relators point to language stating that “[a]n application for
reconfiguration of a non-conforming structure” “shall [require] a public hearing on the
application.” LCO § 2.015, subd. 4(a)-(b) (2015). But EOF did not apply for
reconfiguration of a non-conforming structure; it applied for a multiple-dock license and
a variance. Thus, the governing portions of the Code are sections 1.07, subdivision 6
(governing hearings for variances), and 1.06, subdivision 3 (governing application for
and issuance of licenses). These portions of the Code were not violated.
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We are further satisfied that relators had sufficient notice and opportunity to be
heard. See Sawh, 823 N.W.2d at 632 Though a public hearing was not required under
the Code, LMCD notified relators two days ahead of the meeting at which issuance of the
license and variance was to be determined. Relators’ attorney conferenced with LMCD
staff two days prior to the meeting. At the meeting, LMCD heard public comment, and
relators’ attorney raised concerns, objections, and submitted a letter on behalf of his
clients.
Relators also contend that a full hearing was required because the site plan as
amended after the August 27 hearing could have a greater adverse impact than the site
plan that was considered on August 27. Relators’ primary concern is that the amended
site plan permits a greater number of jet skis. First, relators cite no legal authority to
support their contention that a greater relative adverse impact requires a hearing. Second,
relators concede that according to the portions of the Code under which EOF’s
applications were granted, the Code contains “no meaningful restrictions” on jet skis. It
is unclear what the hearing requested by relators would accomplish. Third, concerns
regarding jet skis, and their potential for noise, wake, and lake-bottom erosion, were
brought up at the August 27 hearing. Relators do not contend that LMCD was unaware
of their concerns regarding jet skis in the context of EOF’s applications.
We conclude that relators’ due process rights were not violated by the manner in
which LMCD granted EOF’s applications.
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Legal standard for variance
Finally, relators argue that LMCD applied the wrong legal standard in granting the
variance to EOF. The standard governing the grant of the variance comes from the Code,
which is equivalent to an ordinance. See Minn. Stat. § 103B.641, subd. 1 (2014) (stating
that LMCD’s rules and regulations have the effect of an ordinance). “Interpretations
of . . . ordinances are questions of law that this court reviews de novo.” Clear Channel
Outdoor Advert., Inc. v. City of St. Paul, 675 N.W.2d 343, 346 (Minn. App. 2004),
review denied (Minn. May 18, 2004). Because we are unable to determine the legal
sufficiency of LMCD’s choice of standard in granting the variance, we reverse the grant
of the variance and remand for further proceedings.
The difficulty stems from the Code itself, which according to its text describes
three standards for granting a variance. Section 1.07 of the Code governs variances.
Subdivision 1 of this section, entitled “General Statement,” states that “[w]here practical
difficulties or particular hardships occur . . . , [LMCD] may permit a variance from the
requirements of this Code.” (Emphasis added.) Subdivision 6, however, entitled
“Hearings,” provides that LMCD “may grant a variance from the literal provisions of this
Code in instances where their strict enforcement would cause undue hardship because of
circumstances unique to the individual property.” (Emphasis added.) These standards
are distinct from one another. See Krummenacher v. City of Minnetonka, 783 N.W.2d
721, 729-30 (Minn. 2010) (discussing the distinctions between the “practical difficulties,”
“particular hardship,” and “undue hardship” standards in the context of granting a
variance). None of the terms emphasized above are defined in the Code. See LCO § 1.02
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(2015). Unsurprisingly, relators contend that the “undue hardship” standard applies,
while LMCD contends that the “practical difficulties” standard applies.
In LMCD’s order granting EOF the variance and multiple-dock license, the
language used is unclear. It states that “[LMCD] finds that there is a hardship . . . within
the meaning of LMCD Code Section 1.07 and that granting the variance amendment as
requested is consistent with the spirit and intent of the Code.” (Emphasis added.) It does
not say “particular hardship” or “undue hardship,” nor does it reference a specific
subdivision of section 1.07.
LMCD is not permitted to choose whichever standard it wishes when considering
a particular application for a variance, because such “flexibility”—as LMCD expresses
the matter in its brief2—would be arbitrary. See Rodne v. Comm’r of Human Servs., 547
N.W.2d 440, 444-45 (Minn. App. 1996) (stating that the determinations of quasi-judicial
bodies are reviewed for arbitrary action).
We must examine the Code to determine which standard is appropriate to use in
this case. See State v. Irby, 848 N.W.2d 515, 518 (Minn. 2014) (“[w]e begin with the
text”). Our supreme court has provided guidance for situations where, as here, provisions
seem to conflict.
If a general provision in a [code] conflicts with a special
provision in the same . . . [code], we interpret the two
provisions, if possible, in a manner that gives effect to both
2
EOF’s brief similarly states that “LMCD does not have to apply the hardship standard”
and that LMCD has “the freedom” to choose among the standards. The argument
apparently is that LMCD can simply list every standard in its Code and then choose
whichever standard it wishes to apply to each variance application. This is a recipe for
favoritism and for arbitrary and capricious decision-making.
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provisions. But if the conflict between two [codes] is
irreconcilable, the special provision prevails and will be
interpreted as an exception to the general provision, unless
the general provision was enacted at a later session and it is
the manifest intent of the [enacting authority] that the general
provision prevail.
Nielsen v. 2003 Honda Accord, 845 N.W.2d 754, 756 (Minn. 2013).
Here, there is no way to reconcile these distinct standards, and we must interpret
the Code according to the specific provision articulated in subdivision 6. Viewed in light
of section 1.07 as a whole, subdivision 1 is a general statement of purpose while
subdivision 6 lays out specific procedures which are to be followed in granting a
variance.
EOF argues that if an ordinance is ambiguous it must be interpreted in favor of the
landowner and against the local government, citing Frank’s Nursery Sales, Inc. v. City of
Roseville, 295 N.W.2d 604 (Minn. 1980). This case is inapposite. Frank’s Nursery Sales
was denied a building permit, but argued that it qualified as a “lawn and garden” center
as defined in Roseville’s zoning ordinances, and thus Roseville had no basis upon which
to deny the permit. Id. at 605-09. Frank’s Nursery Sales was “government versus
landowner” (Roseville versus Frank’s Nursery Sales). This case is “landowner versus
landowner” (the relators versus EOF), because LMCD granted the variance to EOF,
which relators argue adversely affects them. And even if this case is viewed as
“government versus landowner,” the applicable landowners are the relators, who argue
that they will suffer the negative implications of the government action, just as was
argued in Frank’s Nursery Sales. Id.
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LMCD has made no attempt to argue that its grant of a variance would satisfy the
undue hardship standard. But whether EOF’s application for a variance satisfies this
standard is a determination for LMCD in the first instance. Further findings of fact may
be necessary. We thus reverse LMCD’s grant of the variance and remand for
consideration of EOF’s variance request under the undue hardship standard.
Affirmed in part, reversed in part, and remanded.
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