MacKey, Schuessler, Bayly v. Mayor and Council of the City of Tucson

IN THE COURT OF APPEALS
STATE OF ARIZONA
DIVISION TWO
PAUL and MAUREEN MACKEY, ) 2 CA-CV 2004-0050
husband and wife; BETTY GAIL ) DEPARTMENT A
SCHUESSLER, a single person; and )
BRUCE BAYLY, an unmarried man, ) OPINION
)
Plaintiffs/Appellants, )
)
v. )
)
MAYOR and COUNCIL OF THE CITY )
OF TUCSON, governing body of the )
City of Tucson, )
)
Defendants/Appellees. )
)
APPEAL FROM THE SUPERIOR COURT OF PIMA COUNTY
Cause No. C20034747
Honorable John F. Kelly, Judge
AFFIRMED
John S. O’Dowd Tucson
and
Anthony Ching Tempe
Attorneys for Plaintiffs/Appellants
Michael Rankin, Tucson City Attorney
By Tobin Rosen Tucson
Attorneys for Defendants/Appellees
H O W A R D, Presiding Judge.
¶1 Appellants Paul and Maureen Mackey, Betty Gail Schuessler, and Bruce
Bayly (collectively, the Mackeys) appeal from the trial court’s judgment denying special
action relief on their complaint, in which they had sought to void appellee City of Tucson’s
transfer of title to a portion of a street and to enforce certain notice requirements for the sale
of public roadways. Finding that the City exchanged the roadway and, therefore, was not
required to comply with the procedural requirements for a sale, we affirm.
¶2 The relevant facts are undisputed. The City of Tucson, a charter city,
conveyed part of a public street to a third party in exchange for title to a different parcel of
land that the City needed for certain planned roadway improvements. To account for a
$44,000 difference in the property values, the third party also agreed to develop a small
park-like area on a portion of the land the City had transferred. The City did not post
notices required by statute for a sale of a roadway or notify adjoining landowners of this
transaction. The Mackeys, residents of the neighborhood where the property is located,
filed a complaint for special action relief asking the court to void the “sale” of the City’s
property and to require the City to comply with the notice requirements of A.R.S. § 28-
7204(C) if it attempted to “sell” the property again. After hearing arguments, the trial court
determined that the transaction involved the disposition of city property, which was a matter
of local concern not governed by the state statute, and moreover, that the transaction
constituted an exchange under A.R.S. § 28-7203 and, thus, was not covered by the notice
and preference rights for a sale under § 28-7204. This appeal followed.
2
¶3 Preliminarily, relying on ASH, Inc. v. Mesa Unified School District No. 4, 138
Ariz. 190, 673 P.2d 934 (App. 1983), the City argues that this appeal is moot because the
Mackeys did not post a supersedeas bond, the transaction has been completed,1 and the
third party to whom the property was transferred is not a party to this action. The Mackeys,
however, request that this court decide the matter, arguing it is one of substantial public
interest that is capable of repetition without judicial review.
¶4 In ASH, the plaintiff sought to invalidate a contract for the sale of school buses
from a third party to the Mesa Unified School District. Id. at 191, 673 P.2d at 935. On
appeal, the district contended that, because the contract with the third party had been fully
executed, the plaintiff’s request that the court declare the contract void and issue a writ of
mandamus requiring the district to award the contract to ASH was moot. Id. This court
agreed that the issue was moot, but stated that an appellate court may hear matters that are
otherwise moot “if the matter is of considerable public importance or the principle involved
is a continuing one.” Id. Finding that the plaintiff had not posted a supersedeas bond or
requested a stay, however, the court concluded that the plaintiff had failed to adequately
preserve the issue for appeal. Id. at 192, 673 P.2d at 936.
¶5 In response, the Mackeys point to Big D Construction Corp. v. Court of
Appeals, 163 Ariz. 560, 562-63, 789 P.2d 1061, 1063-64 (1990), in which our supreme
1
Although the fact that the transaction was completed does not appear in the record,
the City requests that we take judicial notice of the deed as a public record. See Ariz. R.
Evid. 201, 17A A.R.S. Furthermore, the Mackeys do not dispute that the transaction has
been completed.
3
court determined that Arizona has no constitutional provision preventing courts from
considering moot issues, that mootness is a “matter of prudential or judicial restraint,” and
that the court may consider otherwise moot cases involving significant questions of public
importance that are likely to recur.
¶6 Here, the Mackeys did not post a supersedeas bond or request a stay to
preserve the issue. But the Mackeys are not seeking to vindicate a private right, as in ASH;
instead, they are attempting to clarify the public’s right to notice of a sale or exchange of
a public street. And, as the Mackeys note, because the City interprets the statutes as either
inapplicable or as not requiring notice for this type of transaction, this issue is capable of
repetition and could again evade judicial review. Accordingly, we exercise our discretion
and reach the merits of this appeal. See Big D Constr.
¶7 The Mackeys argue that, because both parcels of property were appraised,
a monetary value was assigned to each, and additional consideration was transferred, the
transaction between the City and the third party is a sale pursuant to § 28-7204, which
requires notice to the public when a public roadway is sold. The Mackeys further contend
§ 28-7204 is a “general law of state concern” that trumps any conflicting provisions in the
city charter and, thus, must apply here. The City responds that the transaction is a matter
of solely local concern to which the state statute does not apply. See City of Tucson v.
Ariz. Alpha of Sigma Alpha Epsilon, 67 Ariz. 330, 195 P.2d 562 (1948). The City also
argues that, even if the state law does apply, the transaction was actually an exchange under
§ 28-7203, which does not require any notice.
4
¶8 When confronted with more than one basis on which to rest our decision, we
generally attempt to decide issues on the narrowest ground, which, in this case, is whether
the transaction was a sale or an exchange under the applicable statutes. See Hill v.
Peterson, 201 Ariz. 363, ¶ 1, 35 P.3d 417, 418 (App. 2001); Towne Dev. of Chandler, Inc.
v. Superior Court, 173 Ariz. 364, 367 n.6, 842 P.2d 1377, 1380 n.6 (App. 1992). Further,
the authority of a charter city on matters of solely local concern has constitutional
underpinnings. See McMann v. City of Tucson, 202 Ariz. 468, ¶ 8, 47 P.3d 672, 675-76
(App. 2002). And we avoid deciding cases on constitutional grounds if nonconstitutional
grounds are dispositive. City of Tempe v. Outdoor Sys., Inc., 201 Ariz. 106, ¶ 7, 32 P.3d
31, 34 (App. 2001). Therefore, we first review the issue of whether the transaction was a
sale or an exchange. We review questions of law and issues of statutory interpretation de
novo. Koller v. Ariz. Dep’t of Transp., 195 Ariz. 343, ¶ 8, 988 P.2d 128, 130 (App. 1999).
¶9 Under § 28-7203, a city may exchange, “with an abutting owner,” “[a]
roadway or portion of a roadway . . . for all or part of a new public roadway.” And § 28-
7204 permits a city to sell a public roadway, but imposes certain notice requirements and
grants abutting landowners a preference in the sale. The City implicitly agrees that it did
not meet the notice requirements of § 28-7204, but claims that the transaction was, in fact,
a § 28-7203 exchange.2
2
The Mackeys do not dispute that the exchange was for “all or part of a new public
roadway” or that the third party was an “abutting owner.” § 28-7203.
5
¶10 The Mackeys point out that the fair market value of the land transferred to the
third party was $44,000 greater than the fair market value of the land that the City received
and that the City therefore received, in addition to the land, an agreement that the third party
would develop a small park. Relying on Fain Land & Cattle Co. v. Hassell, 163 Ariz. 587,
790 P.2d 242 (1990), they contend that the specific dollar amount assigned to the difference
in fair market values and the presence of the additional agreement rendered the transaction
a sale rather than an exchange.
¶11 In Fain, our supreme court analyzed whether a transaction labeled as an
exchange of state trust land for private land was a sale of state trust lands under article 10,
§ 3 of the Arizona Constitution. The court first defined “exchange” as “a ‘reciprocal
transfer of property for other property of value, rather than for a money consideration’” and
stated that “the term ‘exchange’ may be construed to be a form of sale.” 163 Ariz. at 591,
790 P.2d at 246, quoting 30 Am. Jur. 2d Exchange of Property § 1, at 363 (2d ed. 1967).
The court then held that the key distinction between a sale and an exchange is that “an
exchange occurs only if no value is assigned to either of the exchanged properties.” Id.
Finding that the constitution required the state to obtain a “definite value by appraisal and
. . . a consideration at least equal to that amount” before disposing of its lands, the court
concluded that the land department could not validly exchange the state trust lands because
such an “exchange” would effectively be a sale, and under the pertinent law, state trust
lands could only be sold at auction to the highest bidder. Id. at 592, 597-98, 790 P.2d at
247, 252-53.
6
¶12 As the trial court noted, however, Fain did not address the scope and
interaction of §§ 28-7203 and 28-7204. And the Mackeys have not identified any
constitutional provision that applies to the transaction here. Accordingly, Fain is not
dispositive. Instead, whether the existence of definite property values and “boot,” i.e., the
$44,000 overage, requires that the transaction be considered a sale rather than an exchange
under the applicable statutes is a question of legislative intent. In determining legislative
intent, we first look to the language of the statute itself. Martineau v. Maricopa County,
207 Ariz. 332, ¶ 9, 86 P.2d 912, 914 (App. 2004). If that produces any ambiguity, we then
examine the purpose, history, context of the statute at issue, and any relevant, similar
statutes. See Hayes v. Continental Ins. Co., 178 Ariz. 264, 268-69, 872 P.2d 668, 672-73
(1994).
¶13 Section 28-7203 provides that a governing body may exchange a part of a
roadway under certain circumstances, without specifically requiring notice or appraisal.
See also A.R.S. § 28-7211. Section 28-7204 provides that a governing body may sell a
part of a roadway, but requires notice and grants a preference in the sale to abutting land
owners. Therefore, despite the Fain court’s statement that an exchange is a form of sale,
in these statutes, the legislature has clearly distinguished an exchange from a sale, assigning
fewer procedural requirements to the former. But we must still determine whether the
legislature intended § 28-7203 exchanges to include transactions in which real estate parcels
of unequal appraised value are exchanged.
7
¶14 The purpose of § 28-7203 appears to be to allow a streamlined procedure for
a governing body to transfer roadway land to an abutting landowner and to receive in return
land needed for a new public roadway. Because the statute does not include the notice and
preference provisions of § 28-7204, the legislature apparently concluded that the protective
provisions were unnecessary for an exchange with an abutting landowner. But the
legislature could have intended to limit that streamlined procedure to the type of “pure”
exchange, i.e., one without any appraised property values, defined in Fain. Neither the
specific chapter governing the disposition of public roadways nor the general definition
section of the Arizona Revised Statutes, see A.R.S. § 1-215, defines exchange. Therefore,
after considering the language of the statutes and their purpose, the legislative intent remains
unclear.
¶15 Other statutes pertaining to similar issues provide some insight into the
legislative intent. Section 37-603, A.R.S., which prescribes the “method of exchange” for
public lands, provides:
The exchange [between governing bodies] shall be
conducted without formalities, advertisements for bids or
considerations of other offers by other persons, but the value of
the respective parcels of land being so exchanged shall be
substantially the same as determined by an appraisal to be
made by a qualified appraiser to be appointed by the governing
body of the county, city, town, or school district having control
of the land to be exchanged, provided that in the event the value
of the respective parcels of land are not substantially equal, the
exchange may be made on payment by the governing body,
owning the less valuable parcel of land, to the other governing
body of an amount in cash substantially the same as the
difference in value of the parcels of land.
8
Similarly, § 37-609, A.R.S., addresses exchanges of sovereign land. Subsection B prohibits
the exchange unless certain conditions are met, including:
The fair market value of the sovereign land of this state
that is included in the proposed exchange is greater than the fair
market value of the other land that is included in the proposed
exchange and this state will be compensated for the difference
in value with a cash payment to the department from the other
party in the exchange.
¶16 In these two statutes, the legislature explicitly labeled the transaction an
exchange despite also explicitly requiring the real property to be appraised and permitting
a cash payment to equalize the value of the parcels. Therefore, we must reject the
Mackeys’ contention, based on Fain, that the appraisal of the property and the transfer of
any additional consideration, as a matter of law, rendered the transaction a sale.
¶17 Additionally, other statutes, applying to different types of exchanges,
explicitly require that the parcels exchanged have substantially equivalent value. See, e.g.,
A.R.S. §§ 9-407, 37-615. Thus, when the legislature intends that exchanges be limited to
parcels of real property having substantially equal value, it has said so. Section 28-7203
does not require that the parcels of real property be of substantially equivalent value.
¶18 Having examined the language, purpose, and context of §§ 28-7203 and 28-
7204, see Hayes; Martineau, we conclude that the legislature did not intend to require that
an exchange for roadway purposes under § 28-7203 be limited to parcels of substantially
equivalent value or to those transactions in which no monetary value for the properties has
9
been set. 3 Notwithstanding Fain, therefore, we agree with the trial court that the transaction
here was an exchange under § 28-7203. The City therefore had no obligation to post
notices or otherwise inform adjoining landowners of the impending transaction, and the trial
court correctly denied the Mackeys their requested special action relief. 4
¶19 Our holding today furthers the legislative purpose of allowing the City to use
an expedited procedure for the limited purpose of exchanging roadway property with
abutting owners. It also avoids penalizing the City for prudently having had the property
valued and receiving additional consideration for its more valuable land. In our discretion,
both parties’ request for attorney fees are denied.
¶20 Affirmed.
____________________________________
JOSEPH W. HOWARD, Presiding Judge
CONCURRING:
___________________________________
JOHN PELANDER, Chief Judge
3
The Mackeys have not presented any evidence on the value of the parcels or argued
that the labeling of the transaction as an exchange was a subterfuge, with the $44,000
overage being the true substance of the transaction.
4
In light of this conclusion, we do not address whether the City’s action was, in fact,
a matter of solely local concern, exempting it from the state statutes altogether.
10
____________________________________
M. JAN FLÓREZ, Judge
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