Last week the N.C. Court of Appeals published yet another opinion (PHG v. City of Asheville) that (1) further defines the template for deciding quasi-judicial zoning applications and (2) curtails the all-too-frequent seduction of board members to slip into legislative shoes while wearing a (quasi) judicial robe.

Full disclosure: I argued PHG to the Court in September, and I’m eager to provide the color commentary of what actually happened at the board level and how the case evolved. I am not without opinions. But while we’re inside the window when Asheville is deciding whether to petition the NC Supreme Court for discretionary review, I’ll be broad. For now.

First, credit where credit is due. PHG was very ably handled before the city council by my colleague Bob Oast of the McGuire Wood Bissette firm whose preparation made the difference. And I never go into litigation at the trial or appellate level without my colleague and collaborator Kip Nelson who finds case distinctions faster than any computer program yet written.

The Facts

PHG applied for a Conditional Use Permit (CUP) to construct a 7 story hotel in a developing part of the downtown business district. At least 5 reviewing boards and staff recommended approval. PHG put on 3 hours of evidence, primarily through 3 highly qualified experts from three well-known and respected companies.

Except for a man who approached to ask a question about traffic safety, there was zero evidence in opposition. Zero.

Council members themselves provided evidence and testimony during the hearing. They argued with PHG’s experts. Council member Bothwell was incensed that the traffic engineer was unaware whether smoke from the wildfires in Rutherford County has reached Asheville the day the traffic study was conducted. He did research on his iPad during the hearing. Another council member argued that the industry standard for traffic studies was not good enough for Asheville and insisted that the project should have been delayed to conduct traffic analyses in multiple seasons.

The public hearing closed. Council members immediately moved denial without discussion. Three weeks later, the council adopted 44 findings stating why PHG failed to meet its burden. And the findings were, in large part, nit-picky quibbles with PHG’s evidence.

Judge Tyson’s Opinion

The decision and the judge who authored it cannot be discussed separately. Judge John Tyson has now authored 5 opinions in two years that clarify the template for quasi-judicial decisions (Dellinger v. Lincoln County, Innovative 55 v. Robeson County, Ecoplexus v. Currituck County, Little River v. Lee County, and PHG).

These cases are all consistent. They create a modern canon that will be long referenced and cited. They protect the rights of parties against governments that wish to ignore their own ordinances and the rules of evidence. But most importantly, they are not from-the-bench legislation. Rather, they revive and confidently apply the principles of two seminal N.C. Supreme Court cases – Humble Oil and Woodhouse.

And it cannot be avoided or missed that Judge Tyson’s decision has a tone of rebuke. As I move into my 34th year of law practice and having appeared before boards in more than 250 towns, villages, counties, and cities in 3 states, I know the difference between a government that errs and a government that goes completely off the rails. It is rare when it occurs. But in this case it takes one reading of the transcript to recognize a council beholden to no one, no rules of procedure, and no recognized law.

The 7 Key Points

(1)       Yet again, Judge Tyson reminds us that if an applicant makes a prima facie case of entitlement he is entitled to the permit. To make a prima facie case requires not a burden of proof but a burden of production, after which the burden then shifts to the opposition.

(2)       Asheville argued that because it made findings that the standard of review should have been a highly deferential whole record review. Judge Tyson dismissed Asheville’s findings as “unnecessary” and “extraneous and superfluous” because there was no conflicting evidence before the council. The correct standard – which was applied by the trial court – was the non-deferential de novo review. Why? Because whether the applicant presented competent, material, and substantial evidence is a question of law.

If Asheville were to have prevailed on this point, every local government from now to eternity could make a Teflon coated decision escaping meaningful judicial review. Which is what, to my observation, Asheville was attempting.

(3)       The prominence of the Woodhouse case continues to rise. The Woodhouse court said, among other things, that it is an unacceptable and intolerable burden to require an applicant to anticipate and disprove every single objection to the project. Judge Tyson has recognized this point in most of the cases cited above.

(4)       Judge Tyson wrote at length on the definitions of “competent,” “material,” and “substantial,” to explain why Asheville erred as a matter of law when it declared each of these experts’ testimonies to be irrelevant and improper. I predict that PHG will be oft-cited on these points.

(5)       Council members’ personal or policy preferences are completely immaterial in a quasi-judicial case. Decisions must be based solely on the evidence presented. It is improper for council members (as here) to bring extraneous and incompetent evidence into the hearing. And the “unsubstantiated opinions of City Council members do not constitute competent evidence . . . [to rebuke an expert].” And citing Howard v. Kinston, the Court reminds us that a CUP cannot be denied based on reasons that are “merely an excuse to prohibit the requested use.”

(6)       There are two outlier zoning cases (SBA v. Asheville and Am. Towers v. Morrisville) where boards denied applications for special use permits. Both cases seem to grant local boards authority to raise the bar ever higher on an expert’s testimony as an excuse to deny a permit. PHG distinguishes both cases and reigns them in.

(7)       For future matters involving an appraiser conducting a market impact study, PHG is a must read.

Stay tuned. Pending the ultimate outcome of this decision I have more interesting tidbits from the hearing.

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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