A recent Court of Appeals opinion, American Towers v. Town of Morrisville, simultaneously provides a good road map for interpreting evidence in quasi-judicial proceedings, shows how utterly maddening it can be to practice before local government boards, and illustrates how difficult-to-meet standards can be made impossible-to-meet when interpreted by boards and courts.

             Before we visit the case, a couple of comments about cell towers. In the mid 1990s when only a few people owned mobile phones (many were still permanently mounted in cars and called “car phones”), cell towers were an anomaly.  Neighbors became apoplectic when a cell tower – for which they could discern no use – was proposed to be built anywhere near them.

             Local governments everywhere formed committees to draft cell tower ordinances with the underlying assumption that towers were bad and their cancerous spread had to be limited and controlled.  Fast forward to 2012 when the vast majority of Americans – young, old, rich, poor, urban, suburban – live in a wireless world where it’s the loss of cell coverage, not the tower itself, that challenges our existence.  Wireless networks are almost as necessary to modern life as electricity itself.

             Also, there are two kinds of tower builders.  One is the service provider itself, such as AT&T building a tower because it needs to plug gaps in coverage for AT&T customers.  The other kind is the tower company, like American Towers.  American Towers builds towers and leases tower space to Sprint, AT&T and Verizon.  To this end, it is a real estate developer no different than a company that builds shopping centers and leases store space.

             Disclosure:  I have represented American Towers on at least two occasions, but not recently, and it is not currently a client. I did, however, enjoy working for the company and found its site acquisition person great to work with.

 Facts of the Case

             The Town of Morrisville not only has a mid-nineties ordinance, it also has a mid-nineties mindset.  First, towers are only allowed in industrial zoning districts. This restriction is problematic in itself because more towers are needed when usage increases. Second, an applicant must obtain a special use permit, demonstrating by competent, material and substantial evidence that it meets not only six general findings but also twenty additional findings unique to cell towers. Twenty. Count them.

             American Towers sought to place a tower on a 12 acre tract between Highway 540 and homebuyers who obviously didn’t mind living close to an 8 lane divided highway and adjacent to an industrially zoned district.

             Sidebar: The land is owned by the Kathrine R. Everett Trust. Katherine Everett was the only woman in the UNC Law School class of 1920, graduating first in her class. She was one of the first women admitted to the state bar, and was the first woman to argue and win a case before the North Carolina Supreme Court. End sidebar.

             The town council held a series of four public hearings. Four nights.  Six general and twenty special findings.  For one tower. This only happens when opposition is intense and, usually, excessive.

 Evidence in Quasi-Judicial Proceedings

             Judge Steelman clearly explains how applicants for a special use permit must demonstrate that they meet certain standards by presenting competent, material and substantial evidence.  Whether the evidence rises to that level is a question of law, and courts need not defer to the board’s conclusion

            How the board weighs the evidence is another matter.  Courts will only examine the “whole record” to determine if the evidence was sufficient to meet each finding and, in that process, defer to the board.

 The Appraisal Error

             American Towers hired a certified appraiser with MAI credentials to establish the factual basis upon which he concluded that the tower “will not substantially injure the value of adjoining property.”  Once an applicant establishes a prima facie case, this opinion reminds us, it is entitled to the permit unless an opponent presents competent, material and substantial evidence to the contrary. In this case, a lay opponent attempted to draw conclusions using tax values, which was apparently inadequate because it didn’t factor into the board’s findings.

             The town council, however, found that the MAI appraiser’s report was deficient 1) because he studied subdivisions where the tower was there first, rather than vice versa, and 2) because he didn’t factor in “curb appeal.” 

             The court used a 2000 case (SBA v. City of Asheville) to support the board’s conclusion.  However, relevant portions of SBA v. City of Asheville have been overturned by statute. 

             In 2009, the legislature enacted N.C.G.S. 160A-393.  Subsection (k) provides that “[t]he term “competent evidence,” as used in this subsection, shall not be deemed to include the opinion testimony of lay witnesses as to any of the following: a. The use of property in a particular way would affect the value of other property.”

             Although the lay board did not find the lay witness using random tax values to have presented competent evidence, it proceeded on its own to explain why it felt an appraiser who had earned Appraisal Institute credentials conducted a deficient appraisal while it, the lay board, knew better. 

             The court’s affirmation of the board’s decision raises a serious problem.  The statute’s requirement that this standard must be established by expert testimony is completely nullified if a lay board can insert its lay opinion and reject the expert’s evidence on factors irrelevant to an appraisal that meets all professional standards. 

             N.C.G.S. 160A-393 has a similar requirement for traffic, providing that lay testimony about how a certain use will affect traffic on the roads is incompetent. 

             Not for the sake of American Towers but for every future SUP and CUP applicant in the state and boards of adjustment and governing boards who issue such permits, I sincerely hope that American Towers’ attorney will request a rehearing.  Members of the land use bar are already abuzz at this decision’s implications.

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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.