Daily Development for Thursday, September 22,
Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law
Of Counsel: Blackwell Sanders Peper Martin
Kansas City, Missouri
ZONING AND PLANNING; ESTOPPEL: Construction
in violation of a zoning classification is unlawful, even when construction is
authorized by a building permit issued voluntarily by the appropriate
authorities. Failure to request a stay pending appeal of a court ordered
building permit does not estop a city from enforcing its zoning regulations
(including potentially razing the building).
Lake Bluff Housing Partners v. City of South
Milwaukee, 588 N.W.2d 45 (Wis. App. 1998).
Developer planned to build a multifamily
housing development. Before building permits were issued, the land on which the
project was to be built was rezoned to single family use in order to prohibit
the proposed multifamily housing. The developer sued, arguing that it had vested
rights in the prior zoning classification. The trial court agreed, and issued a
writ of mandamus directing the city's building inspector to issue permits
necessary for the project's construction. The permits were issued, and
appeal, the Wisconsin Supreme Court held that the developer did not have vested
rights in the original zoning classification "because it never submitted an
application for a building permit conforming to the zoning and building code
requirements in effect at the time of the application," and directed that
the trial court "quash the writ."
By the time the Wisconsin Supreme Court's
decision was issued, the developer had finished building its project. Fearing
that the city would try to have the development razed, the developer brought a
declaratory judgment action seeking an order that the city was "equitably
estopped from revoking the building permits issued to the developer," and
enjoining the city from "issuing raze orders" for the project. The
trial court granted the developer its requested relief.
The court of appeals held that Wisconsin law
is settled that "a building permit grants no right to an unlawful
use." In addition, it held that the city's issuance of the permits did not
waive its obligation to enforce its zoning regulations, which were promulgated
by the city under the authority granted to it by Wis. Stat. §62.23. Section
62.23(8) specifically recognizes that structures that do not comply with local
zoning regulations are subject to being razed.
Further the court held that, those who build
in violation of lawful zoning regulations have no refuge from the requirements
of Wis. Stat §62.23(8) merely because construction is completed before
lawfulness of the regulations is determined. It noted that a contrary rule would
encourage construction in violation of zoning codes the builder could keep the
fruits of its unlawful construction merely by tying the matter up in litigation
while it sped completion of its project.
The fact that the city did not seek a stay of
the original order pending appeal did not alter the Court of Appeals' analysis.
It rejected the developer's related estoppel argument on two grounds. First,
equitable estoppel in land use cases does not apply against the government
unless the government is seeking to negate or modify the landowner's vested
rights. As noted, the city's rezoning did not negate or modify any of the
developer's vested rights. Moreover, erroneous governmental action or inaction
does not prevent ultimate redress of the community's rights. Second, unless
circumstances are altered irretrievably (such as where a building is razed
pursuant to an order under Wis. Stat § 66.05), a party changing its position in
reliance on a trial court order or judgment, will have to undo the change if the
judgment or order is reversed on appeal, even if a stay pending appeal is not
Comment: Estoppel should be based upon
circumstances making the ordinary legal result inequitable. Typically this is
because someone has relied on action or inaction of the party to be estopped.
That was not the case here. The developer knew that the city was appealing the
ruling. Why didn't the city have
the ruling stayed on appeal? Presumably because it didn't want to post an appeal
bond (assuming that such a requirement would apply to a Wisconsin city).
This is not a reason for the developer to assume that the city is not
continuing to oppose the construction.
in the Daily Development section generally are extracted from the Quarterly
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