The developer of a 9.76 acre residential subdivision in Sun Valley, Idaho was subject to a minimum density requirement of four units per gross acre, meaning they had to build 39 units on the property. Designed as a five-phase project, 26 units were constructed in phases 1 to 4. Initially, 8 units were planned for phase 4, but when the municipality required the developer to drop the number to 6 in order to receive approval, the developer had to propose 13, rather than 11 townhouse units for phase 5 to satisfy the minimum density requirement. The planning and zoning commission approved the amended application, but current residents of the earlier phases, including the homeowner’s association, unhappy with the density of phase 5, appealed to the City Council who then denied the application.
Litigation ensued in state court, ultimately with the Idaho Supreme Court remanding the case for insufficient findings of fact. During the state court proceedings, the present action was filed in federal court alleging a violation of the developer’s substantive due process rights based on the theory that the City Council’s denial arbitrarily interfered with its property rights since they denied the application for phase 5 without any evidence in support and under circumstances forced by the City Council’s own prior actions. The District Court dismissed the claim.
On appeal to the Circuit Court, the developer argued that the U.S. Supreme Court in Lingle v. Chevron, U.S. A., Inc. 544 U.S. 528 (2005) requires a modification of the long standing view in the Circuit that prohibited substantive due process claims pursuant to the Fourteenth Amendment (Armendariz v. Penman, 75 F.3d 1311 (1996)). Because the Circuit had held pursuant to Agins v. City of Tiburon, 447 U.S. 255 (1980) that a land use restriction that does not “substantially advance legitimate state interests” or “denies an owner economically viable use of the his land” effects a taking and that therefore the sole relief would be from a takings clause claims and not a due process claim, and since the U.S. Supreme Court specifically rejected Agins in Lingle, the Ninth Circuit now stated that “Lingle pulls the rug out from under our rationale for totally precluding substantive due process claims based on arbitrary or unreasonable conduct.” The Court further stated, “We now explicitly hold that the Fifth Amendment does not invariably preempt a claim that land use action lacks any substantial relation to the public health, safety, or general welfare.” The case was remanded to the District Court to determine whether in fact a claim has been states and if so, whether it is ripe for adjudication.
Crown Point Development, Inc. v. City of Sun Valley, 2007 WL 3197049 (C.A. 9 (Idaho) 11/1/2007). The opinion can be accessed at:
This case is also discussed on Robert Thomas’s blog, Inversecondemination, at: http://www.inversecondemnation.com/inversecondemnation/2007/11/ninth-circuit-l.html