In the recently issued opinion Wilson v. City of Mebane, several things just didn’t seem right to Mr. Wilson.  Or fair, for that matter.  So he sued.  And he won, but it took a lengthy and costly trip to the Court of Appeals.

             This is basically a vested rights case, but if you stick with me to the last couple of paragraphs I’ll explain something about case interpretation that is universally true but never found in a legal treatise or taught in law schools.

 The Facts

             Mr. Wilson bought a residential lot in Mebane in 2005 and tried to rezone it to a commercial designation.  He was turned down.  A year later, a developer wanted to build a Walgreens next door on 3 lots totaling 1.62 acres.  Two of the lots were zoned for commercial use, but the one next to Mr. Wilson’s lot was residentially zoned.

             At the time, Mebane had both a landscape ordinance and a zoning ordinance.  Both ordinances controlled development, and the landscape ordinance required a 50 foot buffer between commercial and residential uses (i.e. a 50 buffer between Walgreens and Mr. Wilson).  There was, however, an exemption for lots under 5 acres.  The zoning ordinance was silent on the issue.

             [Side Bar: You’re wondering as I am why Mebane had two separate and distinct ordinances that controlled different aspects of zoning.  Mebane also decided that they could do it a better way and decided to fix it, and that’s why we now have a case to discuss. End Side Bar]

             The developer had a series of meetings with the city planner who explained that the 50 foot buffer could be waived.  Nonetheless, the developer tried to buy Mr. Wilson’s lot, and Mr. Wilson offered it for a commercial rather than a residential price.  So, the developer decided to move forward without buying it.

             The opinion doesn’t say it, but I don’t think I’m going too far onto a limb to suggest that Mr. Wilson still smarted from being turned down by the City on his own commercial rezoning, and now he learns that the City might support the development of a Walgreens next door that needs his land but is unwilling to pay what he considers a fair price.

             The developer then submitted four different versions of its site plan during the calendar year 2008, spending lots of money in the process. The final plan was approved in February of 2009 and a building permit was issued.

             But there was a problem. The City of Mebane was drafting and approving a new Unified Development Ordinance throughout this period that did not contain the buffer exemption for lots less than 5 acres.  In fact, the new UDO was adopted two weeks after the developer’s first (and rejected) site plan was submitted.

 The Appeal

             Mr. Wilson was not amused that the developer got a building permit without being required to comply with the new UDO’s buffer requirements.  So he appealed the staff’s decision to the Board of Adjustment, contending that the developer had not acquired a vested right and that he should be required to provide a 50 foot buffer.

             The BOA turned Mr. Wilson down, finding that the developer had acquired a common law vested right to develop under the old ordinances.  So, Mr. Wilson petitioned for a Writ of Certiorari to obtain judicial review of the BOA’s decision.  And then the judge turned him down too, finding that the developer had acquired a vested right to develop pursuant to the former law.

 Understanding the Lawyer’s Role and the Client’s Dilemma

             Attorneys with litigation experience know that there is a critical point in a case where their client’s lawsuit has been unsuccessful.  The attorney must decide if appeal stands a chance, and the client must decide if he or she will continue to pay legal fees based on their attorney’s advice.  It can be a tense moment, depending upon cost, client motivation and the attorney’s demonstrated skill.  Mr. Wilson’s attorney advised him correctly, and he decided to pull the trigger and appeal.  The victorious party usually has no choice but to defend.

 The Law on Vested Rights

             There are two ways to continue doing what you are doing under a prior law.  Both are referred to colloquially as being “grandfathered,” but the legal term is “vesting.”

             The first way to obtain a vested right is by statute (generally, obtaining a valid building permit, entering into a Development Agreement, or having a site plan to vest).  The other way is by “common law.”

             Common law vesting has been described in legal terms many times.  A lay definition might be more helpful:

             A person who 1) incurs substantial expenditures 2) in good faith reliance on 3) valid governmental approval of the project, may proceed under the law that existed when the approval was granted 4) without the government at a later time being able to pull the rug out from under him by changing the law.

 The Opinion

             There is nothing circuitous about this opinion. It was written by Judge Hunter (from Greensboro) who went straight to the key issue – show me the valid government approval upon which the developer relied to make its expenditures. 

             Judge Hunter relied upon the straightforward timeline.  New UDO adopted in February of 2008.  Final approval of the developer’s site plans and issuance of building permit in February 2009.

             Judge Hunter was not persuaded by the City’s argument that the developer had relied upon its assurances that it could proceed under prior law before obtaining approval yet after the new UDO was adopted.  Assurances by staff do not constitute “valid governmental approval.” His position was legally correct.

 The Gremlin called “They”

            The facts contain long descriptions of the developer’s meetings with and reliance upon the advice of city staff.  Inexperienced developers too often consider a city or county to be a single-celled organism with a unified thought process and singular voice, spoken through a member of the planning staff.

             Attorneys who represent developers commonly hear such phrases as “I met with them and they told me such and such.”  Or “I did everything they told me to do.”  Peel back a couple of layers and they is usually a member of the planning staff.

             Staff are absolutely indispensible in the zoning process, but whether “they” is the planning director or the most recently hired college grad, they do not ultimately control the planning board, the elected body, or the courts.

 The Legal Insight

            Legal principles are easy to learn and almost just as easy to explain.  The difficulties arise in the application of the law to certain fact patterns.  Thus, the facts of a case are critical in the opinion’s interpretation, and even more critical in deciphering how it becomes legal precedent.

             When a case starts in the trial courts, facts are often disputed, and they are explained and described in volumes of documents.  On appeal, facts must be whittled down to the essential few bullet points.  And when a judge writes an opinion, he or she then summarizes the facts even more, choosing which to emphasize and which to ignore.  This is universal.

             Thus, when future lawyers and judges are required to distinguish between two competing opinions and decide whether an earlier case establishes precedent, he or she studies the facts.  The problem is, the facts recited in the opinion are always the abridged version (when compared to facts before the trial court), and being incomplete they are decidedly imperfect. One never knows years later which key facts might have been omitted because the judge was focusing on one issue rather than another (e.g. the primary legal point but not the seemingly minor procedural point that becomes the issue in a future case).

             In the present case, the absence of a key fact jumped out at me.

             Early in the opinion it was stated that the planning director advised the developer to rezone the residential lot so that he was building on 3 commercial lots instead of placing 1/3 of a drugstore on a lot zoned for residential use.  But the facts say nothing about the rezoning having taken place.  Maybe it was not necessary to say it.  And maybe rezoning didn’t occur.

             But if the third lot had not been rezoned, then the building permit would have been wrongly issued for that reason alone.  And a discussion of vested rights would have been superfluous.

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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

Mr. Terrell can be contacted at