Everyone who pays a mortgage or property taxes supports some level of private property protection, but two bills filed this week create more mischief than their sponsors realize.  Or . . . maybe they don’t.

              House Bill 652 (Property Owners Protection Act) and House Bill 687 (Local Abuse of Authority Attorney Fees) have no balance, simultaneously deifying all actions by property owners and villainizing good faith actions or mistakes by planners and other government officials.

             The Property Owners Protection Act has typical explanatory “whereases.”  The first whereas states that the NC Supreme Court “has repeatedly held that land use regulations . . . are to be strictly construed against the government and liberally construed in favor of free use of land.”  This is true, although modern courts have trended towards some deference to local government ordinance interpretations where there is a reasonable dispute.

             The third whereas states “sometimes overzealous staff interpret and enforce land use regulations beyond the scope of the law or ordinance . . .” (emphasis added).  And . . . this is true too.  I spend my life in the hallways of city and county government buildings across the state, and occasionally I do meet staff who aggressively use their positions of power to effect private visions of land development far beyond what is required by ordinance.

             But the proposed remedy is draconian and ill-advised.  If a landowner disagrees with a staff person’s interpretation and wins in court, the judge “shall award to the property owner, as costs, the actual attorneys’ fees incurred” in the challenge.

 Problem 1 – this provision leaves no discretion in the hands of the judge.  Most challenges relate to ordinance provisions that simply are not clear, and the original interpretation is more often than not made in good faith.  If the General Assembly wants to make it easier to challenge the government, it should make attorneys’ fees discretionary based upon the underlying facts.

 Problem 2 – “actual attorneys’ fees” is an open invitation to overzealous attorney billing to correct an ordinance interpretation that is statutorily presumed to be in bad faith.

 Problem 3 – This mandate could paralyze planning staffs and unnecessarily involve governmental attorneys in routine decisions. The punitive provision kicks in when a government is found to have made nothing more than an “improper interpretation.”  I have personally litigated many ordinance interpretations and attest to the rarity of a clear-on-its-face ordinance that a staff person intentionally – or stupidly – interprets another way.

 Problem 4 – The Law of Unintended Consequences has never been codified, but it applies universally.  Here, if I were the attorney representing neighboring property owners challenging a rezoning related to someone’s “free use of property” to the derogation of my own client’s free use, I could make an excellent argument for the neighbors’ attorneys’ fees as well. I don’t think this is the bill’s intent.

 Problem 5 – Governmental litigation can get expensive. Very expensive. And the taxpayers (other private property owners) subsidize the litigation.

             House Bill 652 also amends the Protest Petition statute (NCGS 160A-385) to expand protests to text amendments as well as map amendments.  Of course, it would be unprofessional to call legislators idiots, and I don’t.  But I do say that the proposal itself is idiotic.  A qualified protest petition is determined by the signatures of property owners who own land in a buffer area surrounding a parcel being rezoned.  A text amendment applies to the entire city.  If there is a way to determine a buffer for a text amendment, I’m all ears.

             Anybody?  I’m listening.

             The other bill (Local Abuse of Authority Attorneys Fees) has the same problems as H652.  This bill mandates the award of attorneys’ fees to someone who challenges a city or county whose action is found to be “an abuse of authority.”

             Irony upon ironies, H652’s second whereas is that local governments have the staff and attorney power to draft clear standards and, therefore, any lack of clarity is held against them.  However, H687, drafted by a legislative team with staff and attorneys at their beck and call is, itself, a model of muddy legislation.

 Problem 1 – the legislation does not acknowledge the statutorily recognized and court-sanctioned concept of implied powers.  Where do implied powers fall in this scheme?  Does this legislation eliminate implied powers?  If so we’re in trouble.  The same applies to generally described “police powers” that are sanctioned by legislation even if not enumerated.

 Problem 2 – what is the line between authority and abuse of authority?  Does a mere judicial victory over the interpretation of a statute constitute an abuse of authority?

 Problem 3 – as with H652, the Law of Unintended Consequences means that neighbors challenging a zoning decision for which there was insignificant technical error could have their attorneys’ fees paid.

             In North Carolina the general rule is that each side in litigation bears its own costs, including attorneys’ fees.  There are statutorily created exceptions, such as in cases of fraud, civil rights violations and other bad-actor actions.  I have practiced law for and against governments in every region of this state and I speak from deep experience.  Legislating mandatory attorneys’ fees in these situations is wrong-headed, contrary to established policies, and presumes local government staff and elected officials are “bad guys” rather than presuming that they are public-spirited citizens and servants as is the case far, far more often than not.

             If not shelved entirely, these bills should at least be modified only to address situations where there are clear facts demonstrating governmental bad faith, not just good faith differences of opinion.   

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Tom Terrell

Terrell_TomMr. Terrell is widely regarded as one of North Carolina’s leading land use attorneys, representing both private and governmental entities in matters related to real estate development. His practice “footprint” covers the state from the mountain counties to the coast and occasionally includes…

Terrell_TomMr. Terrell is widely regarded as one of North Carolina’s leading land use attorneys, representing both private and governmental entities in matters related to real estate development. His practice “footprint” covers the state from the mountain counties to the coast and occasionally includes parts of Virginia and South Carolina. His many clients are involved in commercial and residential real estate, solid waste hauling and disposal, telecommunications, quarries/asphalt and miscellaneous litigation related to permit denials, vested rights and rezonings.

He has published numerous articles and speaks regularly to legal, governmental and business groups on a variety of issues related to land use and zoning.

Mr. Terrell has served as a leader in numerous civic and legal endeavors, including Chairman of the Board of Trustees of the N.C. State Health Plan, Chairman of the Board of Trustees of Winston-Salem State University, and service on the Board of Directors of the UNC-CH General Alumni Association, Board of Directors of the High Point Chamber of Commerce, Board of Visitors of Guilford College and Board of Center Associates of the Center for Creative Leadership, and as a founding member of the N.C. Bar Association Zoning, Planning and Land Use Section.

More information can be found at https://www.foxrothschild.com/thomas-e-terrell-jr/.

Mr. Terrell can be contacted at mailto:tterrell@foxrothschild.com.