NO. 88-202
IN THE SUPREME COURT OF THE STATE OF MONTANA
1988
CONRAD MITCHELL,
Plaintiff and Appell-ant.,
-vs-
TOWN OF WEST YELLOWSTONE,
a municipal corporation, by and
through its town council,
Defendant and Respondent.
APPEAL FROM: District Court of the Eighteenth Judicial District,
In and for the County of Gallatin,
The Honorable Thomas Olson, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Thomas R. Anacker argued; Kirwan & Rarrett, Bozeman,
Montana
For Respondent:
Lineberger & Harris; Peter S. Lineberger argued,
Rozeman, Montana
Submitted: October 12, 1988
Decided: December 8, 1988
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Clerk
Mr. Justice John C. Sheehy delivered the Opinion of the
Court.
Conrad Mitchell appeals from a summary judgment entered
against him and in favor of the Town of West Yell-owstone in
the District Court, Eighteenth Judicial District, Gallatin
County. Mitchell had filed a declaratory judgment action
challenging the constitutionality of a town ordinance.
The issue on appeal is whether the District Court
lacked subject matter jurisdiction of the declaratory
judgment action because Mitchell had failed to exhaust his
administrative remedies under the ordinance before filing
suit. We determine that the District Court had subject
matter jurisdiction in this cause and reverse.
The Town of West Yellowstone has adopted an ordinance
applicable in the business district which provides that
before building permits will be issued for new or expanded
uses within the district, the applicant for a permit must
provide specified off-street parking spaces. Cash-in-lieu
payments may be made instead of providing off-street parking
spaces. If the applicant for a permit seeks a variance from
the off-street parking requirements, he may appear before a
Board of Adjustment established under the ordinance. This
Board has the power to vary the requirements when strict
compliance with the ordinance would create unnecessary
hardship or be unreasonable under the circumstances. A
person aggrieved by the decision of the Board of Adjustment,
or any taxpayer or interested person may, under the
ordinance, present to a district court a petition that the
decision is illegal, within 30 days after the filing of the
decision in the office of the Board.
Mitchell, a general contractor, who had resided in West
Yellowstone since 1971, is the owner of Lot 9, Block 1 of the
original townsite of West Yellowstone. Prior to this case,
he had been engaged in one way or another with more than 25
contruction projects requiring building permits in the Town
of West Yellowstone, and never, prior to this case, had any
dispute with the process for obtaining building permits.
The off-street parking ordinance was adopted by the town
council of West Yellowstone in 1982. Before that, Mitchell.
had architectural plans prepared for future construction on
Lot 9, which Mitchell intended to be implemented over a
period of time as money became available. He implemented his
first phase of construction on Lot 9 before the ordinance
took effect. After the effective date of the zoning
ordinance, Mitchell had constructed other buildings on Lot 9,
each time obtaining a building permit and going through the
proper procedure prior to construction.
In May, 1986, Mitchell gave Don Buettner, the town
building official, a copy of his architectural plans and
discussed with Buettner his proposal to construct another
commercial building on Lot 9. Mitchell did not fill out a
building permit application, but he did make it known to
Buettner that he intended to do the further construction.
Buettner took the plans to the West Yellowstone Planning
and Zoning Board in 1986. He testified that the Planning and
Zoning Board requested a "variance procedure" because of the
parking "problem."
Mitchell did nothing further until January, 1987, when
he again asked for a permit for the project, and Buettner
told him that his request WAS "negative" because of the
previous planning and zoning board "procedures."
Buettner treated the July, 1986, and January, 1987,
verbal inquiries as requests for a building permit by
Mitchell, and gave him a decision on March 22, 1987, by
letter. The letter informed Mitchell that the judgment of
the Planning and Zoning Board was to "come forth for review,
and obtain a variance." Mitchell was further informed by the
letter that a total of nine parking spaces would be needed
for the unfinished portion of his complex on Lot 9.
Mitchell did not take any further steps to procure a
permit through the provisions of the ordinance. Instead, he
filed a declaratory judgment action in the District Court,
against West Yellowstone, challenging the validity of the
ordinance on grounds that it was invalidly enacted under
state law, and that it denied equal protection because it
unreasonably discriminated against new development in favor
of existing development by applying funds received as
cash-in-lieu payments from new development to improve parking
areas located within areas of existing development.
Eventually, the District Court granted the motion of
West Yellowstone for a summary judgment saying:
I am persuaded to require plaintiff to complete his
application process through the zoning commission
in West Yellowstone. I do this in view of the
discretion vested in the commission to consider the
particular piece of property involved and the
public parking available. There is even a question
as to whether plaintiff made a formal application
for a building permit. Finally, the commission may
set the cash-in-lieu figure low enough to make a .
full blown constitutional attack unwise. Plaintiff
has too many administrative options open to him.
This matter is dismissed for failure to exhaust
administrative remedies.
On appeal, Mitchell argues that the zoning ordinance is
unconstitutional on its face, that the right to challenge a
town ordinance is accorded plaintiffs under the Uniform
Declaratory Judgment Act, adopted by Montana, B 27-8-101, et
seq., MCA; that administrative agencies do not have the power
to determine the constitutionality of a zoning ordinance;
that declaratory relief is independent of administrative
remedies; and therefore a constituti.ona1 attack against the
validity of a town ordinance may be brought in District Court
without first exhausting administrative remedies under the
ordinance.
The Town of West Yellowstone responds that the District
Court lacked subject matter jurisdiction because Mitchell
failed to exhaust his administrative remedies; that
Mitchell's primary objection to the ordinance is that he was
not "grandfathered" thereunder; that the exhaustion of
administrative remedies doctrine applies unless the
administrative avenue is futile; and that in any event, the
Town of West Yellowstone is immune from suit in this case
pursuant to § 2-9-111, MCA.
Section 27-8-202, MCA, provides, among other things,
that any person interested under a municipal ordinance may
have determined, any question of construction of validity
arising under the ordinance and obtain a declaration of
rights, status or other legal relations thereunder. Section
27-8-201, MCA, provides that courts of record have power to
declare rights, status and other legal relations whether or
not further relief could be claimed. We agree that the power
to decide the constitutionality of an ordinance in a
declaratory judgment action is as was affirmed in Driscoll v.
Austintown Associates (Ohio 1975), 328 N.E.2d 395, 399, where
the Court said:
The "general powers conferred in section 2721.02"
to render declaratory judgments are contained in
the first sentence of that statute: "Courts of
record may declare rights, status and other legal
relations whether or not further relief is or could
be claimed." This general grant of power is
certainly broad enough to encompass actions
contesting the constitutionality of township zoning
ordinances.
Moreover, in this case, Driscoll had standing to bring a
declaratory judgment action because of his personal stake in
the outcome of the controvery before the District Court.
Western Litho v. Board of City Commissioners, et al. (1377)
174 Mont. 245, 247, 570 P.2d 891, 892.
The District Court, therefore, had the power, and the
plaintiff had the right to sue, to determine the
constitutionality of the zoning ordinance in a declaratory
judgment action, in ordinary circumstances. The question
here is whether he must first exhaust his administrative
remedies under the ordinance before seeking a declaratory
judgment .
The District Court recognized, and the briefs on appeal
show that there is a split of authority on this question
among the states. West Yellowstone cites authority that
zoning applicants must first exhaust their administrative
remedies before seeking relief in the courts: Inc. v. City of
Overland Park (Kan. 1986), 718 P.2d 1302; Hatch v. Utah
County Planning Department (Utah 1984) , 695 P. 2d 550; Turner
v. Lane County (Ore. 1982), 665 P.2d 370; Hansen v. Keim
(Colo. 1982), 650 P.2d 1313; Johnson County Memorial Gardens,
and Minor v. Cochise County (Ariz. 1980), 608 P.2d 309.
West Yellowstone also relies heavily on English v. City of
Carmel (Ind. 1978), 381 N.E.2d 540; and Ackerly
Communications v. City of Seattle (Wash. 1979), 602 P.2d
1177. The District Court in its order seemed to rely on Anne
Arundel County Commissioners v. Buch (Md. 1948), 58 A.2d 672.
Mitchell, on the other hand, sets store on Kingsley v.
Miller (R.I. 1978), 388 A.2d 357; Texas State Board of
Pharmacy v. FJalgreen Texas Company (Tex. 1975), 520 S.W.2d
845; KMIEC v. Town of Spider Lake (Wis. 1973), 211 N.W.2d
471; and Clayton v. Bennett (Utah 1956), 298 P.2d 531.
Mitchell cites especially State of Wyoming v. Kraus, et al.
(Wy. 1985), 706 P.2d 1130, holding that declaratory relief
was appropriate to challenge the validity of the agency
regulations but that it was not proper merely to obtain
review of an administrative decision.
Admitting that the respective parties may draw comfort
from the cases upon which they rely, we look to the decisions
from this Court for guidelines.
In Bailey v. Department of Health and Environmental
Sciences (1983), 204 Mont. 253, 664 P.2d 325, Bailey appealed
a district court ruling denying his application for a writ of
mandamus. Bailey had submitted plans for expansion of a
trailer park in Missoula County in 1968, and claimed that the
zoning officials had given him "blanket approval" to build
according to his plans. On subsequent applications to the
zoning authorities for permission to develop further trailer
spaces, his applications were denied. He did. not proceed
further in the administrative proceedings. This Court upheld
the denial of mandamus since he had not established a clear
legal duty on the part of the zoning authorities to grant the
permits. There is no issue in Bailey involving a
constitutional attack against the zoning ordinance itself.
In Selon v. Board of Personnel Appeals (Mont. 1981), 634
P.2d 646, 38 St.Rep. 1676, we held that the District Court
had no jurisdiction for judicial review under the
Administrative Procedure Act of an order of the State Board
of Personnel Appeals, where the appellant, the Department of
Administration, had failed to exhaust its administrative
remedies. In Selon, the jurisdictional issue did not involve
a constitutional attack upon the ad.ministrative procedures.
In BGM Enterprises v. State Department of Social and
F-ehabilitation Services (1983), 673 P.2d 1205, 40 St.Rep.
1827, this Court dismissed an appeal for lack of jurisdiction
because the appellant had not taken advantage of a hearing in
the administrative proceedings which wou1.d have been provided
if RGM had acted in time. No quest.ion of constitutional
validity of the statutes under which the Department was
acting was involved in the BGM appeal.
The controlling case for this action is Jarussi v. Board
of Trustees (1983), 204 Mont. 131, 135, 664 P.2d 316, 318.
In that case, Jarussi appealed the dismissal by the school
board of his employment as principal and teacher in St.
Ignatius, Montana. His appeal was based on violations of
Montana's open meeting law, 5 2-3-203, MCA. The school
board, after judgment against it in the District Court,
raised on appeal the issue that Jarussi had not exhausted his
administrative remedies before filing in the District Court.
In holding that Jarussi was not required to exhaust
administrative remedies, this Court said:
Moreover, the exhaustion doctrine does not apply to
constitutional issues. (Citing authority.) Here,
Jarussi claims violation of his constitutional
right to observe the deliberations of the School
Board under the right to know provisions of the
Montana Constitution, Art. 11, 5 9. Constitutional
questions are properly decided by a judicial body,
not an administrative official, under the
constitutional principle of separation of powers.
Art. 111, Section 1, 1972 Mont. Const.
Mitchell's complaint in this case raises directly the
constitutional question of equal protection under the
provisions of the off-street parking ordinance adopted by
West Yellowstone. The determination of that question is not
within the power of the Board of Adjustment of West
Yellowstone. When such a bona fide constitutional issue is
raised, a plaintiff has a right to resort to the declaratory
judgment act for a determination of his rights; and he may
not be required to submit himself to the provisions of the
ordinance which he claims are unconstitutional. This is so,
even though, as the District Court implied, the monetary
result to the plaintiff under the zoning ordinance may be
inconsequential. The first business of courts is to provide
a forum in which the constitutional rights of all citizens
may be protected.
As to the claim of West Yellowstone that it is immune
from suit under the Declaratory Judgment Act because of §
2-9-111, MCA, this issue was not disposed of by the District.
Court, and we do not therefore address it on appeal.
Accordingly, we reverse the summary judgment granted in
the District Court and remand the cause for further
proceedings.
v
Justice
We concur:
/
' chief Justice
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Justices