Wallingford v. Moab City , 2020 UT App 12 ( 2020 )

2020 UT App 12THE UTAH COURT OF APPEALS
LUCY WALLINGFORD, KILEY MILLER, JOHN RZECZYCKI, CAROL
MAYER, DAVID BODNER, MEECHE BODNER, SARAH STOCK,
JOSEPHINE KOVASH, AND LIVING RIVERS,
Appellants,
v.
MOAB CITY AND MOAB CITY COUNCIL,
Appellees,
UTAH SCHOOL AND INSTITUTIONAL TRUST LANDS ADMINISTRATION
AND LB MOAB LAND COMPANY LLC,
Intervenors and Appellees.
Opinion
No. 20180524-CA
Filed January 24, 2020
Seventh District Court, Moab Department
The Honorable Lyle R. Anderson
No. 170700009
Daniel J. McDonald and Kyle C. Fielding, Attorneys
for Appellants
Christopher G. McAnany, Attorney for Appellees
Moab City and Moab City Council
Jody K. Burnett and Robert C. Keller, Attorneys for
Appellees Utah School and Institutional Trust Lands
Administration and LB Moab Land Company LLC
JUDGE RYAN M. HARRIS authored this Opinion, in which
JUDGES MICHELE M. CHRISTIANSEN FORSTER and KATE APPLEBY
concurred.
Wallingford v. Moab City
HARRIS, Judge:
¶1 For several years, LB Moab Land Company LLC
(Developer), a real estate development firm, has been planning a
large mixed-use development project known as Lionsback
Resort (the Project) on land located just east of Moab, Utah and
owned by the Utah School and Institutional Trust Lands
Administration (SITLA). The original iteration of the Project,
including a resort hotel and numerous condominiums, was
approved by the relevant land use authorities more than a
decade ago, and a challenge to the propriety of those approvals
has already been rejected by this court. See generally Moab Local
Green Party v. Moab City, 2012 UT App 113, 276 P.3d 1230.
¶2 More recently, however, Developer has proposed certain
modifications to the Project’s site plan, but those modifications
are publicly opposed by a group of local citizens 1 (Citizens).
Aware of Citizens’ opposition, and also aware that Developer
had threatened litigation if the newly-modified Project was not
approved, the City of Moab (the City) entered into a contract
with SITLA and Developer, pursuant to which the City agreed to
deem the proposed modifications “minor” rather than “major,” a
classification which, under applicable municipal ordinances,
allows the proposed modifications to be approved without a
public hearing. Shortly thereafter, the Moab City Council (the
Council) adopted a resolution—without holding a public
hearing—authorizing the City’s mayor to execute the contract.
¶3 Citizens then sued the City, seeking (among other things)
an order enjoining the Project from proceeding until a public
hearing was held on the proposed modifications. The district
1. The complaining citizens are Lucy Wallingford, Kiley Miller,
John Rzeczycki, Carol Mayer, David Bodner, Meeche Bodner,
Sarah Stock, Josephine Kovash, and Living Rivers.
20180524-CA 2 2020 UT App 12Wallingford v. Moab City
court dismissed Citizens’ lawsuit on summary judgment, and
Citizens appeal. We reverse, concluding that municipalities may
not contract around public hearing requirements found in
statute or ordinance.
BACKGROUND 2
¶4 SITLA owns roughly 175 acres of land (the Property) just
east of Moab, Utah, near the trailhead for the popular Slick Rock
Trail. In 2006, SITLA agreed to lease the Property to Developer
for the purpose of pursuing a “mixed use residential,
commercial, and hotel development” to be known as Lionsback
Resort, “named for a prominent nearby geological feature.”
Moab Local Green Party v. Moab City, 2012 UT App 113, ¶ 2, 276
P.3d 1230.
¶5 A couple of years later, in October 2008, the City and
Developer, joined by SITLA, entered into a “Pre-Annexation
Agreement” to facilitate annexation of the Property—which at
that time was located in unincorporated Grand County—into the
City. Under this agreement, Developer agreed to submit a
petition seeking annexation of the Property, and the City agreed
to consider that petition “in compliance with the [a]pplicable
[l]aws.” The parties also agreed that “[t]he Project will be subject
to” the City’s municipal code. In December 2008, the City passed
an ordinance annexing the Property into the City. However, the
Pre-Annexation Agreement contained a provision stating that,
“in the event the City does not approve” the Project, Developer
2. “When reviewing a district court’s grant or denial of a motion
for summary judgment, we view the facts in a light most
favorable to the party opposing the motion.” Anderson Dev. Co. v.
Tobias, 2005 UT 36, ¶ 31, 116 P.3d 323 (quotation simplified). The
facts set forth here are recited with this standard in mind.
20180524-CA 3 2020 UT App 12Wallingford v. Moab City
“shall have the option to terminate this Agreement” and “the
City shall have no further right to annex the Property,” and that
if annexation had already occurred, “then upon request of
[Developer] the City shall immediately commence proceedings
to disconnect the Property from the City.”
¶6 Over the next year, the Project proceeded through the
City’s land use approval process, and in 2009 the City finalized
all necessary approvals for the Project, and authorized
Developer to begin construction. As originally approved, the
Project consisted of a nine-building, fifty-unit hotel—complete
with a café, convention meeting rooms, a health club, and a 105-
stall parking lot—as well as 188 single-family housing lots.
During the City’s land use approval process, certain Moab area
citizens 3 voiced opposition to the Project, and had the
opportunity to be heard at public hearings. See id. ¶¶ 3–4
(describing “public hearing[s]” held before both the City’s
planning commission and the Council). But the City approved
the Project notwithstanding their opposition. Id. Some of the
citizens who were opposed to the Project filed a lawsuit to
challenge the City’s approval of it; their suit was unsuccessful at
the district court level, and this court affirmed the district court’s
dismissal of the lawsuit. See generally id.¶7 The litigation (as well as changing economic conditions)
delayed the Project for several years, and in the interim,
Developer determined, based on updated market analysis, that
modifications to the Project’s master plan would be beneficial.
Among other things, Developer wanted to consolidate the hotel
portion of the Project into one three-story building (instead of
nine separate two-story buildings), and wanted to design the
3. The citizens who brought the challenge to the first iteration of
the Project are—with one exception—different than the Citizens
who bring the current challenge to the Project’s second iteration.
20180524-CA 4 2020 UT App 12Wallingford v. Moab City
hotel units as “three bedroom condominiums with ‘lockout’
doors allowing individual bedrooms that could be rented
separately,” creating a potential for 150 rentable rooms in the
fifty units. Although the Project’s overall footprint would remain
unchanged, the hotel’s footprint would nearly double, as would
the size of its parking lot. In addition, the consolidated hotel
would have certain new amenities, including retail space, a
restaurant, and a conference center.
¶8 According to the City’s municipal code, project
amendments “that change the character, basic design, building
density and intensity, open space or any other requirements and
conditions” will be considered “major changes” that “shall not
be permitted without prior review and approval by the planning
commission,” a process that requires a “[p]ublic [h]earing.” See
Moab, Utah, Mun. Code §§ 17.65.080(A), 17.65.130(B) (2015). On
the other hand, “[m]inor changes” necessitated by “unforeseen
circumstances, such as engineering requirements,” “may be
authorized by Moab City planning department staff” without a
public hearing. Id. § 17.65.130(A). “When in question, the Moab
City planning staff may determine whether the changes shall be
classified as minor or major, or may refer the question” to the
City’s planning commission. Id.
¶9 In 2013, when Developer first proposed its desired
modifications, then-current City staff indicated, at least
preliminarily, that the modifications would be considered
“minor” and would not require a public hearing. Later, however,
after some City staff turnover, the City’s attorney—who is
counsel of record for the City in this case—informed Developer
in a letter that, in the City’s view, its proposed modifications,
including the “larger hotel concept,” were “major changes,”
stating as follows:
Given the scope of the changes . . . , it is my
conclusion that this project should be processed as
20180524-CA 5 2020 UT App 12Wallingford v. Moab City
a “major change” under [the municipal code].
Under [the] proposal, [Developer] would be
substantially changing the configuration, building
types, phasing, and total square footage of the
structures. These are not minor changes due, for
example, to site constrain[t]s.
As you know, under Utah law municipalities are
bound to adhere to their own land use ordinances.
Although a minor change might appear to be
expedient, in my opinion that would run contrary
to the Moab ordinance. Similarly, attempting to
process this application as a minor change would
likely invite a legal challenge by other interested
persons. Given the past litigation history as to this
project, the parties should use care to follow the
review processes to the letter.
¶10 In response to the City’s new position, SITLA informed
the City that, if the proposed changes were not processed as
minor changes, it would “exercise [its] right to pull the project
from city jurisdiction,” a right it believed it had pursuant to both
Utah statutory law 4 as well as the terms of the Pre-Annexation
4. SITLA’s statutory argument is grounded in a Utah statute
stating that, “[u]nless otherwise provided by law,” a
municipality does not have “jurisdiction over property owned
by the state.” Utah Code Ann. § 10-9a-304(1) (LexisNexis 2015).
Citizens argue that Utah law, in this instance, provides
“otherwise,” pointing to the next statutory subsection, which
states that, when a “specified public agency”—a term that is
statutorily defined to include SITLA, see id. § 10-9a-103(60)—
seeks to “develop its land,” that agency “shall submit to the land
use authority a development plan and schedule” that will allow
the municipality to assess the agency’s “compliance with
(continued…)
20180524-CA 6 2020 UT App 12Wallingford v. Moab City
Agreement. The City did not necessarily agree with SITLA’s
position, but in an effort to avoid litigation over the meaning of
the Pre-Annexation Agreement and Utah statutory law, the City
entered into negotiations with SITLA and Developer about how
to resolve their disagreement.
¶11 The result of those negotiations was a document
captioned “Zoning Status Agreement” (ZSA), which was
eventually executed in March 2017 by the City, Developer, and
SITLA. Under the ZSA, Developer agreed to take responsibility
for certain Project-related items that had previously been tasked
to the City, including traffic studies and sewer infrastructure.
SITLA expressly agreed, for the purposes of the Project, to
“consent[] to the City’s exercise of its local planning and zoning
jurisdiction.” Most notably for present purposes, the City in
return agreed to “deem[]” Developer’s proposed Project
modifications “[m]inor” changes, “which will be reviewed and
acted upon by the Moab City planning department staff” and
“which would not require a public hearing.”
¶12 The ZSA was first presented to the Council at a meeting
in December 2016, and re-considered at two additional meetings
in February 2017, before finally being approved, by a 3–2 vote, at
a fourth meeting in late February 2017. Immediately after the
vote, however, one of the Council members who had voted
“yes” stated that she wanted “to change [her] vote to no”
because she had “too many unanswered questions” about the
(…continued)
applicable land use ordinances,” id. § 10-9a-305(8)(a). We do not
resolve this statutory interpretation dispute here; we note only
that the parties had (and still have) a disagreement about
whether Utah statutory law allows SITLA to avoid municipal
land use regulation when it seeks to develop its property.
20180524-CA 7 2020 UT App 12Wallingford v. Moab City
Project. After some discussion, she was not allowed to change
her vote, and the Council’s approval of the ZSA stood.
¶13 Utah law distinguishes between a public hearing and a
public meeting. A “public hearing” is “a hearing at which
members of the public are provided a reasonable opportunity to
comment on the subject of the hearing,” Utah Code Ann. § 10-9a-
103(41) (LexisNexis 2015), while a “public meeting” is “a
meeting that is required to be open to the public” under Utah’s
Open and Public Meetings Act, but at which public comment is
not necessarily allowed, id. § 10-9a-103(42). All four meetings at
which the Council considered the ZSA were open to the public,
and therefore qualified as public meetings. However, none were
designated as public hearings, and all parties in this case agree
that none qualified as public hearings under Utah law.
¶14 Just a few weeks after the ZSA was executed, Citizens
filed the instant lawsuit challenging the City’s decision to enact
the ZSA without a public hearing. 5 Among other forms of
requested relief, Citizens asked the district court for an order
enjoining the Project from proceeding until a public hearing was
held on the proposed modifications. Citizens named only the
City and the Council as defendants, but SITLA and Developer
moved to intervene, and the court granted their request. Soon
thereafter, SITLA and Developer filed a motion for summary
judgment, eventually joined by the City, asserting that the City
possessed the power to enter into agreements to resolve
disputes, and that the ZSA was a lawful contract entered into to
5. Citizens also filed an administrative appeal with the Moab
City Appeal Authority, but the City dismissed that appeal for
lack of jurisdiction, concluding that the City’s decision to enact
the ZSA was a legislative decision, rather than an administrative
decision, and therefore not subject to administrative review. See
Moab, Utah, Mun. Code § 17.72.150(B)(1), (A)(1) (2015).
20180524-CA 8 2020 UT App 12Wallingford v. Moab City
resolve potential litigation. At oral argument on the motion,
Citizens’ counsel summarized the issue as “whether or not
through a settlement agreement can the City circumvent their
mandatory zoning ordinances requiring a public hearing for a
major change.”
¶15 At the conclusion of the argument, the court granted the
motion for summary judgment, concluding that the City had
“flexibility” to resolve issues through negotiated settlement
agreements, and that a court should not second-guess such
agreements absent evidence of “collusion,” which the court
believed was not present in this case. The court then entered a
written order dismissing Citizens’ lawsuit.
ISSUE AND STANDARD OF REVIEW
¶16 Citizens now appeal from the district court’s order of
dismissal, and contend that the court erred in concluding that
the City could, by entering into a negotiated settlement
agreement with a developer, circumvent public hearing
requirements. We review a district court’s grant of summary
judgment for correctness, giving no deference to the court’s
decision below. Bahr v. Imus, 2011 UT 19, ¶ 15, 250 P.3d 56.
Summary judgment is appropriate “only when, viewing all facts
and reasonable inferences therefrom in the light most favorable
to the nonmoving party, there is no genuine issue as to any
material fact and the moving party is entitled to a judgment as a
matter of law.” Morra v. Grand County, 2010 UT 21, ¶ 12, 230 P.3d
1022 (quotation simplified); see also Utah R. Civ. P. 56(a).
ANALYSIS
¶17 This case requires us to examine the scope of municipal
power to enter into contracts in the land use context. The City, in
20180524-CA 9 2020 UT App 12Wallingford v. Moab City
an argument joined by SITLA and Developer, asserts that it has
virtually unbounded power to enter into contracts, even in the
land use context. Citizens acknowledge that the City, like all
Utah municipalities, has broad power to contract, but Citizens
maintain that this power, at least in the land use context, has
limits, and may only be exercised in accordance with state and
local land use statutes and ordinances. Specifically, Citizens
assert that a Utah municipality may not circumvent public
hearing requirements through exercise of its power to contract.
For the reasons explained herein, we agree with Citizens.
¶18 There is no question that Utah municipalities enjoy broad
powers, both general and specific. Our legislature has granted
municipal legislative bodies the power to provide for the general
welfare of their citizens, including the power to
pass all ordinances and rules, and make all
regulations, not repugnant to law, necessary for
carrying into effect or discharging all powers and
duties conferred by this chapter, and as are
necessary and proper to provide for the safety and
preserve the health, and promote the prosperity,
improve the morals, peace and good order,
comfort, and convenience of the city and its
inhabitants, and for the protection of property in
the city.
Utah Code Ann. § 10-8-84(1) (LexisNexis 2015). And specifically,
as relevant here, our legislature has granted municipalities
power to “sue and be sued” and to “enter into contracts,” see id.§ 10-1-202; see also Utah County v. Ivie, 2006 UT 33, ¶ 10, 137 P.3d
797 (discussing the “general contracting powers” of Utah
municipalities), and to “enact all ordinances, resolutions, and
rules and . . . enter into other forms of land use controls and
development agreements that they consider necessary or
appropriate for the use and development of land within the
20180524-CA 10 2020 UT App 12Wallingford v. Moab City
municipality,” Utah Code Ann. § 10-9a-102(2) (LexisNexis
2015). 6
¶19 But these powers are not limitless. The grants of power to
municipalities make clear that cities may not take action that is
“repugnant to law,” id. § 10-8-84(1), or that is “expressly
prohibited by law,” id. § 10-9a-102(2). Further, our supreme
court has made clear that “[s]pecific grants of authority may
serve to limit the means available under the general welfare
clause, for some limitation may be imposed on the exercise of
power by directing the use of power in a particular manner.”
State v. Hutchinson, 624 P.2d 1116, 1126 (Utah 1980); see also Call
v. City of West Jordan, 727 P.2d 180, 181 (Utah 1986) (holding that,
by enacting specific land use statutes, “the legislature has set
forth specific procedures that a municipality must follow to
exercise the powers granted to it”). Thus, while municipalities
have broad general welfare powers, those powers are cabined by
provisions of more specific statutes and ordinances that may
apply in a particular context.
¶20 One type of requirement that appears in statutes and
ordinances, as applicable in certain contexts, is the requirement
6. This particular provision (along with various other provisions
in Utah’s Municipal Land Use, Development, and Management
Act, some of which we refer to herein) was amended in both
2018 and 2019. In this opinion, however, we refer to and apply
the statutory provisions in effect at the time the ZSA was enacted
in February 2017. See Harvey v. Cedar Hills City, 2010 UT 12, ¶ 12,
227 P.3d 256 (“As a general rule, when adjudicating a dispute we
apply the version of the statute that was in effect at the time of
the events giving rise to the suit.” (quotation simplified)). No
party urges us to apply a more recent version of the Utah Code,
and no party argues that application of one version over another
would lead to a different outcome in this case.
20180524-CA 11 2020 UT App 12Wallingford v. Moab City
that municipalities conduct some of their business in public, so
that the citizens of the municipality may know how the public’s
business is being conducted. See, e.g., Hutchinson, 624 P.2d at
1121 (stating that “[t]he ultimate limitation upon potential
abuses by local governments is the people themselves,” whose
“vigilance and sound judgment” restricts and directs “all
democratic governments”). For instance, driven by a conviction
that all political subdivisions within our state should “take their
actions openly” and “conduct their deliberations openly,” see
Utah Code Ann. § 52-4-102(2), our legislature has enacted the
Open and Public Meetings Act, mandating that most meetings of
municipal legislative bodies be “open to the public,” id. § 52-4-
201(1). Moreover, as applicable to this case, Utah’s Municipal
Land Use, Development, and Management Act (LUDMA)
contains provisions requiring that the “adoption” or
“modification” of any municipal “land use ordinance[s]” be
subject to a duly-noticed “public hearing.” 7 See id. § 10-9a-205(1);
see also id. § 10-9a-502(1)(b) (stating that a planning commission
“shall . . . hold a public hearing on a proposed land use
ordinance”). And the Moab Municipal Code, as discussed
already, requires that any “major changes” to previously
approved development projects “shall not be permitted without
prior review and approval by the planning commission,” a
process that requires a “[p]ublic [h]earing.” See Moab, Utah,
Mun. Code §§ 17.65.080(A), 17.65.130(B) (2015).
7. As noted above, a “public hearing” has been statutorily
defined as “a hearing at which members of the public are
provided a reasonable opportunity to comment on the subject of
the hearing,” Utah Code Ann. § 10-9a-103(41), as distinguished
from a “public meeting,” which is required to be “open to the
public” but at which the public may not have an opportunity to
comment, see id. § 10-9a-103(42).
20180524-CA 12 2020 UT App 12Wallingford v. Moab City
¶21 In this case, the City determined in 2016, after reviewing
the nature and scope of the changes proposed by Developer to
the Project, that the modifications constituted major changes,
and that therefore a public hearing before the City’s planning
commission would be required. SITLA took issue with the City’s
determination, and threatened to “pull the project from city
jurisdiction if this issue can’t be addressed.” In an effort to
resolve the situation short of a lawsuit, the parties agreed to
enter into the ZSA, under which the City won certain
concessions from SITLA and Developer, but in exchange agreed
to treat the proposed modifications as minor changes that
“would not require a public hearing.”
¶22 The practice of contracting around municipal zoning
requirements is known as “contract zoning.” See 1 Am. Law
Zoning § 9.21 (5th ed. 2008) (stating that “contract zoning is
present where a local government contracts away its zoning
power or obligates itself by advance contract to provide a
particular zoning for the benefit of a private landowner”
(quotation simplified)); see also Dacy v. Village of Ruidoso, 845 P.2d
793, 796 (N.M. 1992) (stating that the term “‘[c]ontract zoning,’
properly used, describes an agreement between a municipality
and another party in which the municipality’s consideration
consists of either a promise to zone property in a requested
manner or the actual act of zoning the property in that manner”).
Some jurisdictions have a statute that specifically permits
contract zoning in certain circumstances. See 112 Am. Jur. 3d
Proof of Facts § 13 (2010) (stating that thirteen states, not
including Utah, “provide statutory authorization for
municipalities and developers to enter into contractual zoning
arrangements”). But “in jurisdictions that do not have a statute
specifically permitting contract zoning, this practice has been
found illegal by numerous state courts.” Id. § 11; see also Ford
Leasing Dev. Co. v. Board of County Comm’rs, 528 P.2d 237, 240
(Colo. 1974) (stating that contract zoning is “a concept held
20180524-CA 13 2020 UT App 12Wallingford v. Moab City
illegal in most states as an [u]ltra vires bargaining away of the
police power”); Ada County v. Walter, 533 P.2d 1199, 1201 (Idaho
1975) (stating that county commissioners “do not have the
authority to enter into an agreement which would constitute a
change in the zoning”); Warner Co. v. Sutton, 644 A.2d 656, 659
(N.J. Super. Ct. App. Div. 1994) (“A municipality has no power
to circumvent these substantive powers and procedural
safeguards by contract with a private property owner.”); Dacy,
845 P.2d at 797 (“We agree that in most situations contract
zoning is illegal.”); 83 Am. Jur. 2d Zoning and Planning § 38
(“Absent valid legislative authorization, contract zoning is
impermissible.”).
¶23 Courts generally offer two related reasons why contract
zoning is unlawful. First, because a municipality’s adoption of
land use rules and restrictions is an exercise of its police power,
it must exercise that police power for the general welfare of all of
its citizens and not by contract with any particular landowner.
See Warner Co., 644 A.2d at 659 (stating that “zoning is inherently
an exercise of the State’s police power,” and that a
“municipality’s exercise of its police power to serve the common
good and general welfare of all its citizens may not be
surrendered or curtailed by bargain or its exercise controlled by
the considerations which enter into the law of contracts”
(quotation simplified)); see also 8 McQuillin Mun. Corp. § 25:104
(3d ed. 2019) (“Courts generally disfavor contracts in which a
zoning authority promises to rezone property in a particular
manner because such a contract represents a bargaining away of
the police power.”).
¶24 Second, and relatedly, “the legislative power to enact and
amend zoning regulations requires due process, notice, and
hearings,” and “by binding itself to enact the requested
ordinance . . . the municipality bypasses the hearing phase of the
legislative process.” Chung v. Sarasota County, 686 So. 2d 1358,
1359–60 (Fla. Dist. Ct. App. 1996) (quotation simplified); Dacy,
20180524-CA 14 2020 UT App 12Wallingford v. Moab City
845 P.2d at 797 (“By making a promise to zone before a zoning
hearing occurs, a municipality denigrates the statutory process
because it purports to commit itself to certain action before
listening to the public’s comments on that action.”); 8 McQuillin
Mun. Corp. § 25:104 (3d ed. 2019) (“Another reason to disfavor
[contract zoning] is that a promise to rezone evades the statutory
procedures designed to insure a fair hearing for all concerned
parties.”). “Implicit in these holdings is not only the courts’
concern with the municipality’s surrender of its legislative
function, but also the effect such consent judgments have on the
public’s right to be heard.” Warner Co., 644 A.2d at 660. “The
obvious danger in settling [potential] litigation [through contract
zoning] . . . is that it at least appears that the municipality,
presumably protecting the public at large, may be bargaining
away its legislative duties without public scrutiny or political
accountability.” Id.¶25 We find the reasoning of these cases persuasive, and
conclude that the City, by adopting the ZSA without a public
hearing, committed an unlawful act of contract zoning. Because
the City had already determined, pursuant to its own internal
review, that Developer’s proposed modifications were major
changes under the Moab Municipal Code, those modifications
could not be approved without a public hearing. See Moab, Utah,
Mun. Code §§ 17.65.080(A), 17.65.130(B) (2015). By passing a
resolution—without a public hearing—adopting a contract that
altered the public hearing requirements set forth in city
ordinances, the City violated not only LUDMA but also its own
municipal code. We view the City’s actions in this case as
particularly violative of contract zoning principles, because the
provisions that were circumvented were not ordinary
restrictions on, say, building height or the use of a particular
parcel, but were the public hearing requirements themselves.
¶26 While a municipality’s power to enter into contracts is
broad, a municipality may not—as the City did here—contract
20180524-CA 15 2020 UT App 12Wallingford v. Moab City
around public hearing requirements found in statute or
municipal ordinance. Under its interpretation of its own
ordinances, the City had already determined that Developer’s
modifications were major changes that warranted a public
hearing. It could, of course, have changed its mind on that point
by issuing a reversal of its decision, but it never did. If it had
made such a decision in isolation—a decision the parties all
agree would have been an “administrative” decision—that
decision would have been administratively appealable to the
municipal appeal authority. See Utah Code Ann. § 10-9a-
302(5)(b)(ii) (LexisNexis 2015). But instead of formally reversing
its decision, the City simply agreed to “deem[]” the changes
“[m]inor” as part of the ZSA, and included that provision in a
larger, wider-ranging agreement that invoked broader questions
of municipal policy; indeed, both Citizens and the City now
agree that adoption of the ZSA was a “legislative” act rather
than an “administrative” one.8 By cloaking the issue within a
8. Before the district court, Citizens’ first cause of action was for
mandamus, asking the district court to order the City to facilitate
an administrative appeal of the “major change/minor change”
issue. In this vein, their chief argument in opposition to SITLA’s
summary judgment motion was that the district court lacked
jurisdiction to grant the motion, because the matter should have
been handled administratively. In making this argument,
Citizens characterized the challenged municipal decision as
“administrative,” and did not ever characterize it as
“legislative,” and did not specifically cite LUDMA’s provisions
that require a public hearing before a legislative enactment.
Given the posture of Citizens’ arguments below, the City now
contends that Citizens did not preserve any argument that
enactment of the ZSA was a legislative act, and did not preserve
any argument that LUDMA (as opposed to the Moab Municipal
Code) required a public hearing before the ZSA could be
(continued…)
20180524-CA 16 2020 UT App 12Wallingford v. Moab City
broader legislative act, the City rendered unavailable to Citizens
any administrative appeal, but at the same time—by enacting the
ZSA without a public hearing—the City also deprived Citizens
of public hearings mandated under both LUDMA (for legislative
actions, including adoption of the ZSA), see id. §§ 10-9a-205(1)(a),
502(1)(b); see also Call v. City of West Jordan, 727 P.2d 180, 183
(Utah 1986) (stating that, “[i]n requiring a public hearing” before
a municipal legislative body, “our legislature contemplated that
interested parties would have an opportunity to give their
views, pro and con, regarding a specific legislative proposal, and
thereby aid the municipal government in making its land use
decisions”), and the Moab Municipal Code (for consideration of
(…continued)
enacted. We disagree. The City overlooks the fact that Citizens
argued, in the alternative, that the City had engaged in unlawful
contract zoning, and that the City was not free to enter into a
contract to avoid the application of its ordinances. It is of course
true that, absent an exception, an appellate court will not
consider an issue unless it has been preserved. Patterson v.
Patterson, 2011 UT 68, ¶ 12, 266 P.3d 828. “An issue is preserved
for appeal when it has been presented to the district court in
such a way that the court has an opportunity to rule on it.” Id.(quotation simplified). While “we view issues narrowly, . . . new
arguments, when brought under a properly preserved issue or
theory, do not require an exception to preservation.” State v.
Johnson, 2017 UT 76, ¶ 14 n.2, 416 P.3d 443. In our view, Citizens
raised the broader contract zoning legal theory before the district
court, even though they did not support that theory with as
many arguments and citations as they do on appeal. We
therefore do not believe that Citizens are faced with a
preservation problem, especially in light of the City’s agreement
that passage of the ZSA was a legislative act, and therefore
proceed to evaluate Citizens’ arguments on their merits.
20180524-CA 17 2020 UT App 12Wallingford v. Moab City
Developer’s changes, which the City had concluded were major),
see Moab, Utah, Mun. Code §§ 17.65.080(A), 17.65.130(B) (2015).
¶27 And LUDMA did require a public hearing prior to
adoption of the ZSA. A “public hearing” is required prior to
adoption of any “land use ordinance,” see Utah Code Ann. §§ 10-
9a-205(1)(a), 10-9a-502(1)(b), and a “land use ordinance” is
defined as a “planning, zoning, development, or subdivision
ordinance of the municipality,” id. § 10-9a-103(25). The City
approved the ZSA by adopting “Resolution #14-2017,” and
under the terms of the ZSA itself, the City was required—despite
the language of the existing municipal code—to deem as minor
certain changes that it had already determined to be major.
Citizens persuasively argue that the resolution adopting the ZSA
therefore effectively modified (or, stated another way, created a
case-specific exception to) municipal land use ordinances, and
that therefore Resolution #14-2017 was a land use ordinance for
which a public hearing was required prior to enactment.
¶28 Given that a public hearing was therefore required (by
statute) prior to passage of the resolution adopting the ZSA, and
will be required (by ordinance, given the City’s determination
that the proposed changes were major) prior to approval of
Developer’s proposed changes, the City was not in a position—
despite its relatively broad power to enter into contracts—to
enter into a contract that would allow it to circumvent those
public hearing requirements. 9
9. In response to Citizens’ argument that the City did not have
the authority to circumvent statute or ordinance by way of
contract, the district court took a broad view of the City’s power
to contract, determining that it could review the City’s
contracting decisions only for “collusion” or “bad faith.” The
court apparently drew this standard from Utah case law arising
(continued…)
20180524-CA 18 2020 UT App 12Wallingford v. Moab City
¶29 The City certainly has the power to enter into and adopt
contracts like the ZSA, and nothing in this opinion should be
construed to the contrary. See Dacy, 845 P.2d at 797–98 (noting
that not all contract zoning is illegal, and that a municipality can
enter into contracts that do not “commit [the municipality] to
any specified action before the zoning hearing,” and do not
“circumvent statutory procedures or compromise the rights of
affected persons”). But it must hold a public hearing before it
does so, and must allow members of the public, including
Citizens, to be heard on the matter. The City (backed by SITLA
and Developer) maintains that the terms of the ZSA are
advantageous to the City, and that its adoption is in the best
interest of the City and its citizens. We express no opinion on
this question, but simply note that, if the ZSA is truly in the best
interest of the residents of Moab, the City and Developer
theoretically should be able to persuade the Council to approve
it, even after a public hearing.
¶30 Moreover, the City has the power to approve Developer’s
proposed changes, but given its determination that the changes
at issue are major, any such approval may occur only following a
public hearing before the City’s planning commission.
Alternatively, the City has the power to reverse its previous
determination that the changes are major, but doing so in
(…continued)
in the public procurement context. See, e.g., Cal Wadsworth
Constr. v. City of St. George, 898 P.2d 1372, 1375 (Utah 1995)
(stating that, in the procurement context, “courts will not
interfere with [municipalities’] judgment unless fraud,
dishonesty, collusion, or lack of good faith is involved”). To our
knowledge, this standard has never been applied in the contract
zoning context, and in our view was inappropriately applied
here by the district court.
20180524-CA 19 2020 UT App 12Wallingford v. Moab City
isolation will trigger administrative appeal rights on the part of
Citizens or others who disagree with the reversal.
¶31 While the City unquestionably has the power to pursue
any of these options, one thing it cannot do is bury an otherwise
administrative decision in a broader legislative contract, and
then approve that contract by resolution without first holding a
public hearing. The City’s power to contract, while broad, does
not extend that far.
CONCLUSION
¶32 We therefore reverse the district court’s entry of summary
judgment, and remand this case for further proceedings
consistent with this opinion.
20180524-CA 20 2020 UT App 12