GA Appeals Court Holds City’s Sovereign Immunity was Waived as to Developer’s Claim for Declaratory Judgment with Regard to the Validity of City’s Growth Management Code

This post was authored by Matthew Loescher, Esq.

This appeal arose from the denial of Ernest Communities’ application for a land development permit to build town homes on its property in Rincon, Georgia. Ernest sued the city of Rincon, the city council, the mayor, the council members in their individual and official capacities, and the city planner, stating claims for declaratory judgment that the applicable city ordinance was void; permanent injunction; mandamus relief; and damages, pursuant to 42 USC § 1983. The trial court denied summary judgment to the City, granted partial summary judgment to Ernest, declared the ordinance void, and permanently enjoined the regulation of Ernest’s property under the ordinance. The City appealed that order in this case.

On appeal, the City argued that the trial court erred by denying its motion for summary judgment because Ernest’s claims for declaratory judgment and injunction were barred by the doctrine of sovereign immunity. OCGA § 9-4-7 (b) set forth: “In any proceeding involving the validity of a municipal ordinance or franchise, the municipality shall be made a party and shall be entitled to be heard as a party.” Thus, the court found that a municipality would be subject to a declaratory judgment action where, as in this case, the validity of its ordinance was challenged. While the court held that the claim for declaratory judgment was not barred by sovereign immunity, pursuant to OCGA § 9-4-7 (b), it found there was no waiver of sovereign immunity as to the claim for injunctive relief.

The City’s next claimed that the trial court erred by granting summary judgment to Ernest and declaring the city’s growth management code (“GMC”) void because it was not properly adopted. The court noted that there was no applicable statute requiring the City to place an ordinance on its minutes or otherwise incorporate it by reference therein as a condition precedent to adopting it. As such, the trial court was required to review the City’s charter at the outset. Here, however, the charter was not entered in the record, nor did the trial court indicate that it took judicial notice of the charter in making its determination that the adoption was invalid. Without reviewing the charter, the trial court was unable to determine what process the council was required to follow in order to properly adopt the GMC. Accordingly, the court reversed the trial court’s holding that the GMC was improperly adopted and therefore void on that ground.

Next, the City contended the trial court’s declaration that the GMC was void on “right for any reason” grounds should be reversed. The court found that because the trial court did not reach the issue of whether the adoption of the GMC violated the hearing and notice requirements set forth in the ZPL, this issue was beyond the proper scope of its appellate review. The court therefore vacated the trial court’s order, and remanded the case for consideration of this issue.

Lastly, the court noted that the decision-making process of the council involved an evaluation of the relevant facts from the evidence presented and the application of standards as set forth in the GMC. Additionally, the denial was effective immediately, and was “final, binding, and conclusive” of Ernest’s rights to develop the town homes on its property. Accordingly, the denial of the application was deemed a quasi-judicial act. As such, Ernest was required to challenge the denial of its application by writ of certiorari, pursuant to OCGA § 5-4-1. The trial court’s denial of summary judgment to the City as to Ernest’s mandamus claims, was therefore reversed.

City of Rincon v Ernest Communities, LLC, 846 S.E. 2d 250 (GA App. 6/30/2020)