FILED
United States Court of Appeals
Tenth Circuit
PU BL ISH
October 22, 2007
Elisabeth A. Shumaker
UNITED STATES CO URT O F APPEALS Clerk of Court
TENTH CIRCUIT
CLARA NICH OLS; M ON TY
NICH OLS,
Plaintiffs-Appellants,
v. No. 06-1427
BO AR D O F COU NTY
C OM M ISSIO N ER S O F TH E
C OU N TY O F LA PLA TA ,
C OLO RA D O ,
Defendant-Appellee.
A PPE AL FR OM T HE UNITED STATES DISTRICT COURT
FOR T HE DISTRICT OF COLORADO
(D.C. No. 04-cv-1387-W YD-M EH)
W illiam E. Zimsky, W illiam E. Zimsky, P.C., Durango, Colorado, for Plaintiffs-
Appellants.
Josh A. M arks (Heidi C. Potter, with him on the brief), Berg Hill Greenleaf &
Ruscitti, LLP, Boulder, Colorado, for Defendant-Appellee.
Before K ELLY, BALDO CK , and BR ISC OE, Circuit Judges.
BR ISC OE, Circuit Judge.
Plaintiffs-Appellants M onty Nichols and Clara L. Nichols appeal the
district court’s order granting summary judgment to defendant-appellee Board of
County Commissioners for the County of La Plata, Colorado (the “BO CC”). The
Nichols argue that the BOCC violated their substantive and procedural due
process rights by not approving certain modifications to a Special Use Permit that
the BOCC had granted them under the local zoning ordinances. Specifically, the
Nichols contend that a settlement between the BOCC and a third party has
preclusive effect in the instant case under the doctrine of collateral estoppel and
provides them w ith a property interest in the approval of their requested
modifications. W e exercise jurisdiction under 28 U.S.C. § 1291 and affirm.
I.
The facts are not in dispute. The Nichols own the Bueno Tiempo R anch,
located in La Plata County, Colorado, and governed by the Code of La Plata
County (the “Code”). As part of the Animas Valley Land Use Plan, the Code
designates certain land in La Plata County as falling into one or more Districts.
The Bueno Tiempo R anch falls within the River Corridor District and the Five-
Acre M inimum Single-Family Residential District, as defined in §§ 106-131 to -
134, and §§ 106-191 to -193, respectively, of the Code. The Code does not
permit commercial mining operations— either as of right or by Special Use
Permit— within these districts.
In 2002, the Nichols’ agent, Tim M cCarthy, approached the Planning
2
Director of La Plata County, Joe Crain, about constructing a pond or lake on the
Bueno Tiempo Ranch and selling the topsoil removed during construction. M r.
Crain advised M r. M cCarthy that although the construction of the pond was “an
allowed use in the zone district[,] any sale of topsoil is considered a commercial
use of the land and is not allowed.” Letter from Joe Crain, ROA, Vol. I, at 0174.
M r. Crain also stated, however, that because the Code permits “low-intensity,
tourist-oriented recreational uses” by Special Use Permit, see Code, §§ 106-134,
106-193, “the temporary sale of topsoil in preparation of expanded recreational
use of the property could be considered a temporary, accessory use and regulated
through the Special Use Permit if approved by the Board of County
Commissioners.” Letter from Joe Crain, ROA, Vol. I, at 0174.
A Special Use Permit is discretionary, and the Planning Commission and
BOCC may only approve a Special Use Permit upon “determin[ing] through
careful site plan and compatibility evaluation that the proposal will not be a
detriment to the character of the Animas Valley.” Code, § 106-112(b)(7). The
Code further provides that Special Use Permits “shall only be approved through
the class II land use permit procedures.” Id. § 106-112(d). Section 82-4(b)(3) of
the Code requires an applicant for a class II permit to comply with an array of
standards addressing such issues as air quality, buffering, erosion control,
irrigation, preservation of vegetation, parking, wetlands preservation, and
pollution. See id. §§ 82-4(b)(3), 82-126 to -191.
3
Following M r. Crain’s advice, the Nichols applied for a Special U se Permit,
which the BOCC approved at a hearing on June 3, 2002. The Special U se Permit
required the completion of construction within three years, prohibited retail sale
of material directly from the site, and prohibited any screening or processing of
material on site. Approximately one year later, the Nichols requested a
modification of their Special Use Permit to lift the restrictions on screening and
stockpiling. The BOCC held a public hearing on September 15, 2003, at which
the Nichols presented their request. Ultimately, the BOCC followed the Planning
Commission’s recommendations and granted only one modification to the Special
Use Permit: allowing materials to remain on site overnight to drain prior to
transport. The BOCC did not change the duration of the project or lift the
prohibition on on-site screening. The N ichols did not appeal the BOCC’s
decision.
On February 4, 2004, the Nichols again sought a modification of their
Special Use Permit. The N ichols’ requested modifications were similar to those
that the BOCC had previously denied, but this time, the Nichols based their
request on a settlement between La Plata County and George VanDenBerg. M r.
VanDenBerg, like the Nichols, owned property within the River Corridor and
Five-A cre M inimum Single-Family Residential Districts. Like the N ichols, M r.
VanDenBerg had attempted to construct wetlands on his property while selling
the topsoil removed during construction. In a brief letter to M r. VanDenBerg,
4
dated July 9, 1998, M r. Crain had approved this limited sale of topsoil as part of
the construction of the w etlands. Eventually, however, the County and M r.
VanDenBerg began disputing the scope of his topsoil operation, and in September
2003, the County sued M r. VanDenBerg, alleging that his topsoil operation
violated the Code. After mediation, the County and M r. VanDenBerg entered into
a settlement agreement (the “VanDenBerg Settlement”). The V anDenBerg
Settlement permitted limited screening, stockpiling, and retail operations on M r.
VanDenBerg’s property, and permitted him to continue construction of the
wetlands until December 31, 2007. The County also agreed to draft a letter to the
Colorado Department of Transportation, opining that the activities on M r.
VanDenBerg’s property were not of a commercial nature.
The Nichols’ modification request of February 4, 2004, intentionally
tracked the language of the VanDenBerg Settlement. Nevertheless, the Planning
Commission recommended denying the Nichols’ request because (1) it would
have resulted in a prohibited commercial topsoil business, (2) nothing had
changed to w arrant revision since original approval, and (3) the V anD enBerg case
had nothing to do with the Bueno Tiempo land use approval. The BOCC then
took the Nichols’ request off the agenda for the meeting on M arch 15, 2004,
because the BOCC viewed it as a reiteration of the Nichols’ previous requests and
no new information warranted reconsideration. Again, the Nichols did not appeal
this decision.
5
On M arch 9, 2005, the Nichols brought suit against the BO CC in the U.S.
District Court for the District of Colorado. Pursuant to 42 U.S.C. § 1983, the
Nichols alleged that the BOCC violated their substantive due process, procedural
due process, and equal protection rights. On October 31, 2005, the BOCC moved
for summary judgment. The Nichols filed a response on December 8, 2005, and
in that response, they voluntarily withdrew their equal protection claim, as well as
their substantive and procedural due process claims as they related to the N ichols’
2003 request to modify their Special Use Permit. Their only remaining claims
were alleged violations of their substantive and procedural due process rights
relating to the February 4, 2004, request to modify their Special U se Permit.
The district court granted the BOCC’s motion for summary judgment. It
rejected the Nichols’ substantive and procedural due process claims, holding that
the Nichols did not have a property interest entitling them to protection under the
Due Process Clause of the Fourteenth Amendment. The district court also
rejected the Nichols’ argument that the doctrine of collateral estoppel prevented
the C ounty from relitigating the effect of the criteria listed in the VanDenBerg
Settlement.
II.
This court’s review of an order granting summary judgment “is de novo,
applying the same legal standard employed by the district court.” W olfe v.
Barnhart, 446 F.3d 1096, 1100 (10th Cir. 2006). Under Fed. R. Civ. P. 56(c),
6
summary judgment is appropriate “if the pleadings, depositions, answ ers to
interrogatories, and admissions on file, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that the moving party is
entitled to a judgment as a matter of law.” “W hen applying this standard, we
examine the factual record and reasonable inferences therefrom in the light most
favorable to the party opposing summary judgment.” Sundance Assocs., Inc. v.
Reno, 139 F.3d 804, 807 (10th Cir. 1998) (citations and internal quotation marks
omitted). W here, as here, “there is no genuine issue of material fact in dispute,
then we next determine if the substantive law was correctly applied by the district
court.” Id. (citations and internal quotation marks omitted). Two issues are the
source of controversy on appeal: (1) whether the VanDenBerg Settlement has
preclusive effect under the doctrine of collateral estoppel, and (2) whether the
BOCC violated the Nichols’ substantive and/or procedural due process rights.
W e address each in turn.
Collateral estoppel
The district court correctly concluded that collateral estoppel does not
apply here. In determining the preclusive effect of a state court judgment, the full
faith and credit statute, 28 U.S.C. § 1738, “directs a federal court to refer to the
preclusion law of the State in which judgment was rendered.” M arrese v. Am.
Acad. of Orthopaedic Surgeons, 470 U.S. 373, 380 (1985). This statute
“embodies concerns of comity and federalism that allow the States to determine,
7
subject to the requirements of the statute and the Due Process Clause, the
preclusive effect of judgments in their ow n courts.” Id. Here, a county court
judge in La Plata County, Colorado, adopted the VanDenBerg Settlement and
entered it as a consent decree, so Colorado law governs its preclusive effect.
Under Colorado law, “[t]he doctrine of collateral estoppel precludes
relitigation of an issue that was already litigated and decided in a previous
proceeding.” G rynberg v. Ark. Okla. G as Corp., 116 P.3d 1260, 1263 (Colo. Ct.
App. 2005). Collateral estoppel, also known as issue preclusion, “is intended to
relieve parties of the cost and vexation of multiple lawsuits, conserve judicial
resources, and, by preventing inconsistent decisions, encourage reliance on
adjudication.” Bebo Constr. Co. v. M attox & O’Brien, P.C., 990 P.2d 78, 84
(Colo. 1999) (citations and internal quotation marks omitted). It bars relitigation
of an issue if:
(1) The issue precluded is identical to an issue actually litigated and
necessarily adjudicated in the prior proceeding; (2) The party against
whom estoppel was sought was a party to or was in privity with a
party to the prior proceeding; (3) There was a final judgment on the
merits in the prior proceeding; (4) The party against whom the
doctrine is asserted had a full and fair opportunity to litigate the
issues in the prior proceeding.
Id. at 84-85. The party seeking collateral estoppel has the burden of establishing
each of these elements. Id. at 85.
The district court and the B OCC are correct that the V anDenBerg
Settlement does not meet the first element of the collateral estoppel test. “To
8
satisfy the first element of collateral estoppel, the issue to be precluded must be
identical to an issue actually litigated and necessarily adjudicated in the prior
proceeding.” Grynberg, 116 P.3d at 1263. “For an issue to be actually litigated,
the parties must have raised the issue in the prior action.” Bebo Constr. Co., 990
P.2d at 85. A party must have asserted it “by appropriate pleading, . . . through a
claim or cause of action against the other [party].” Id. Furthermore, “the issue
must [have been] submitted for determination and then actually determined by the
adjudicatory body.” Id. (emphasis added).
As the district court noted, the Colorado courts have not yet decided
whether a settlement agreement and consent decree are “actually determined by
the adjudicatory body” for the purposes of collateral estoppel. But cf. Bennett
Coll. v. United Bank of Denver, 799 P.2d 364, 368 (Colo. 1990) (“Under certain
circumstances a stipulation between parties to central questions of fact and law or
a stipulation to questions of fact may render a judgment not ‘final’ as to those
questions, and in a subsequent proceeding collateral estoppel should not prevent
the litigation of those questions unless the parties in the original lawsuit intended
the questions to be settled as to future actions.”). The Colorado Supreme Court,
though, relies on the Restatement (Second) of Judgments § 27 (1982) when
formulating collateral estoppel principles. See, e.g., Bebo Constr. Co., 990 P.2d
at 85-86 & n.3; M ichaelson v. M ichaelson, 884 P.2d 695, 701 & n.7 (Colo. 1994);
Bennett Coll., 799 P.2d at 368; see also In re M cM ahon, 356 B.R. 286, 295-96
9
(Bankr. N.D. Ga. 2006) (applying Colorado law and holding that the Colorado
Supreme Court would apply § 27 in determining the preclusive effect of a default
judgment). The Restatement clarifies that,
[i]n the case of a judgment entered by confession, consent, or
default, none of the issues is actually litigated. Therefore, the rule of
this Section does not apply with respect to any issue in a subsequent
action. The judgment may be conclusive, however, with respect to
one or more issues, if the parties have entered an agreement
manifesting such an intention.
Restatement (Second) of Judgments § 27 cmt. e (1982). 1
Other authorities similarly decline to afford preclusive effect to settlements
and consent decrees under the doctrine of collateral estoppel. See, e.g., Hughes
v. Santa Fe Int’l Corp., 847 F.2d 239, 241 (5th Cir. 1988); 18A Charles Alan
W right, Arthur R. M iller & Edward H. Cooper, Federal Practice and Procedure §
4443 (2d ed. 2002); cf. Ross v. Old Republic Ins. Co., 134 P.3d 505, 511 (Colo.
Ct. App. 2006) (“A consent judgment is not a judicial determination of any
litigated right, and it is not the judgment of the court, except in the sense that the
court allows it to go upon the record and have the force and effect of a
judgment.”). The Restatement explains the rationale for such a rule:
The interests of conserving judicial resources, of maintaining
consistency, and of avoiding oppression or harassment of the adverse
party are less compelling when the issue on which preclusion is
sought has not actually been litigated before. And if preclusive effect
1
On at least two occasions, the Colorado Supreme Court has cited comment
e as support for its collateral estoppel jurisprudence. See Bebo Constr. Co., 990
P.2d at 86; Bennett Coll., 799 P.2d at 368.
10
were given to issues not litigated, the result might serve to
discourage compromise, to decrease the likelihood that the issues in
an action would be narrowed by stipulation, and thus to intensify
litigation.
Restatement (Second) of Judgments § 27 cmt. e (1982). Therefore, under the
“actually litigated and necessarily adjudicated” element of Colorado’s collateral
estoppel test, the VanDenBerg Settlement does not have preclusive effect on any
of the issues in controversy in the instant litigation.
The Nichols’ reliance on Satsky v. Paramount Communications, Inc., 7
F.3d 1464, 1468 (10th Cir. 1993), is misplaced. The court in Satsky addressed
the effect of a consent decree under the doctrine of res judicata, also known as
claim preclusion. Id. The effect of a consent decree differs in the collateral
estoppel, or issue preclusion, context: “In most circumstances, it is recognized
that consent agreements ordinarily are intended to preclude any further litigation
on the claim presented but are not intended to preclude further litigation on any of
the issues presented. Thus consent judgments ordinarily support claim preclusion
but not issue preclusion.” 18A Charles Alan W right, Arthur R. M iller & Edward
H. Cooper, Federal Practice and Procedure § 4443 (2d ed. 2002); see also Arizona
v. C alifornia, 530 U .S. 392, 414 (2000) (holding that, under federal law,
settlements have claim-preclusive effect between the parties to the settlement,
“[b]ut settlements ordinarily occasion no issue preclusion . . . unless it is clear . . .
that the parties intend their agreement to have such an effect”).
11
Due process
The district court correctly held that the Nichols did not have a
constitutionally protected property right in the approval of their February 4, 2004,
request to modify their Special Use Permit. The Due Process Clause of the
Fourteenth Amendment provides that no state shall “deprive any person of life,
liberty, or property, without due process of law.” U.S. Const. amend. XIV , § 1.
Under the Due Process Clause, “[p]rocedural due process ensures the state w ill
not deprive a party of property without engaging fair procedures to reach a
decision, while substantive due process ensures the state w ill not deprive a party
of property for an arbitrary reason regardless of the procedures used to reach that
decision.” H yde Park Co. v. Santa Fe City Council, 226 F.3d 1207, 1210 (10th
Cir. 2000).
To prevail on either a procedural or substantive due process claim under 42
U.S.C. § 1983, “a plaintiff must first establish that a defendant’s actions deprived
plaintiff of a protectible property interest.” Id. 2 In Board of Regents v. Roth, 408
U.S. 564, 577 (1972), the Supreme Court defined the property interests protected
2
The Supreme Court has clarified that courts must address this issue— i.e.
whether the plaintiff has a protected property interest at all— before addressing
whether the government’s substantive decision or procedures comport with due
process. See Fed. Lands Legal Consortium v. United States, 195 F.3d 1190, 1195
(10th Cir. 1999) (quoting Am. M frs. M ut. Ins. Co. v. Sullivan, 526 U.S. 40, 59
(1999)).
12
by the Due Process Clause:
To have a property interest in a benefit, a person clearly must have
more than an abstract need or desire for it. He must have more than a
unilateral expectation of it. He must, instead, have a legitimate claim
of entitlement to it. It is a purpose of the ancient institution of
property to protect those claims upon which people rely in their daily
lives, reliance that must not be arbitrarily undermined. It is a purpose
of the constitutional right to a hearing to provide an opportunity for a
person to vindicate those claims.
Property interests, of course, are not created by the Constitution.
Rather, they are created and their dimensions are defined by existing
rules or understandings that stem from an independent source such as
state law— rules or understandings that secure certain benefits and
that support claims of entitlement to those benefits.
W e have explained further that “constitutionally protected property interests are
created and defined by statute, ordinance, contract, implied contract and rules and
understandings developed by state officials.” Hulen v. Yates, 322 F.3d 1229,
1240 (10th Cir. 2003).
In the municipal land use context, moreover, “the entitlement analysis
presents a question of law and focuses on ‘whether there is discretion in the
defendants to deny a zoning or other application filed by the plaintiffs.’” Hyde
Park Co., 226 F.3d at 1210 (quoting Norton v. Vill. of Corrales, 103 F.3d 928,
931-32 (10th Cir. 1996)). “A property interest exists if discretion is limited by
the procedures in question, that is, whether the procedures, if followed, require a
particular outcome.” Crown Point I, LLC v. Intermountain Rural Elec. Ass’n, 319
F.3d 1211, 1217 (10th C ir. 2003) (citing Hyde Park Co., 226 F.3d at 1210). On
13
the other hand, “where the governing body retains discretion and the outcome of
the proceeding is not determined by the particular procedure at issue, no property
interest is implicated.” Id. (citing Hyde Park Co., 226 F.3d at 1210); see also
Jacobs, Visconsi & Jacobs, Co. v. City of Lawrence, 927 F.2d 1111, 1116-17
(10th Cir. 1991) (holding that, where state law required the zoning board to
consider six enumerated factors, those factors were “insufficient to confer upon
the applicant a legitimate claim of entitlement”).
The Nichols did not have a constitutionally protected property right in the
approval of their February 4, 2004, request to modify their Special U se Permit.
The Nichols do not dispute that the Code provided the BOCC with discretion in
approving or rejecting their Special Use Permit— and any modifications to that
Special Use Permit. The Nichols contend, however, that the BOCC’s discretion
“dissolved” following the entry of the VanDenBerg Settlement.
The Nichols provide no authority supporting their claim that the
VanDenBerg Settlement limited the BOCC’s discretion in such a way as to give
them a constitutionally protected property right. A search of land-use and zoning
due process cases has likewise revealed no legal support for this proposition. The
few cases that are even remotely analogous provide support for the BOCC, rather
than the Nichols. See, e.g., Crowley v. Courville, 76 F.3d 47, 52 (2d Cir. 1996)
(holding that an applicant had no property interest in the zoning board’s issuance
of a new parking variance, where the applicant intended to change the property’s
14
use from office to retail); Triomphe Investors v. City of Northwood, 49 F.3d 198,
203 (6th Cir. 1995) (holding that, where a special use permit had been issued
previously on the same property, the owner did not have a property interest in the
issuance of another special use permit). The VanDenBerg Settlement was an
agreement between the BOCC and M r. VanDenBerg. The Nichols were neither
parties nor third-party beneficiaries to it. Further, there is no evidence that the
BOCC intended the terms and conditions of the VanDenBerg Settlement to apply
to other Special Use Permits, or to result in a de facto amendment of the
otherwise discretionary criteria contained in the Code. Cf. Hyde Park Co., 226
F.3d at 1212-1213 (“Because the ordinances as written contain no standards
governing the City Council’s exercise of discretion, the ordinances simply do not
impose ‘significant substantive restrictions’ on the City Council’s power of
review.” (quoting Jacobs, 927 F.2d at 1117 n.4) (emphasis added)). The fact that
the BOCC entered into a settlement agreement with M r. VanDenBerg, under the
specific facts and circumstances of that case, does not transform the terms and
conditions of the settlement into a constraint on the BOCC’s discretion in other
cases. See Fed. Lands Legal Consortium v. United States, 195 F.3d 1190, 1200
(10th Cir. 1999) (“Courts have adopted this rule, because ‘[a] constitutional
entitlement cannot be created— as if by estoppel— merely because a wholly and
expressly discretionary state privilege has been granted generously in the past.’”
(quoting Conn. Bd. of Pardons v. Dumschat, 452 U.S. 458, 465 (1981)) (alteration
15
in original) (emphasis omitted)).
W e note that the N ichols have bypassed the usual avenue for parties whose
zoning requests have been denied. The N ichols could have appealed the BOCC’s
decision, contending the BO CC had abused its discretion. See Colo. R. Civ. P.
106(a)(4)(I) 3 ; Sundheim v. Bd. of County Comm’rs, 904 P.2d 1337, 1345 (Colo.
Ct. App. 1995), aff’d, 926 P.2d 545 (Colo. 1996). The Nichols chose not to
pursue this avenue of relief after the BOCC denied either of their requests to
modify the Special U se Permit. “Federal courts should be reluctant to interfere in
zoning disputes which are local concerns.” Norton, 103 F.3d at 933; see also
Hyde Park Co., 226 F.3d at 1212 (“W ithout clearly defined limitations on the City
C ouncil’s exercise of discretion to assist us in our construction of local law, we
hesitate to infer such limits and involve this federal court in a land use regulation
dispute which is purely a matter of local concern.”).
3
Colo. R. Civ. P. 106(a) provides that “relief may be obtained in the
district court by appropriate action”:
(4) W here any governmental body or officer or any lower judicial
body exercising judicial or quasi-judicial functions has exceeded its
jurisdiction or abused its discretion, and there is no plain, speedy and
adequate remedy otherw ise provided by law:
(I) Review shall be limited to a determination of whether the
body or officer has exceeded its jurisdiction or abused its
discretion, based on the evidence in the record before the
defendant body or officer.
Rule 106(b) provides for a thirty-day statute of limitations for such actions.
16
W ithout a constitutionally protected property right in the approval of their
February 4, 2004, request to modify their Special Use Permit, the N ichols’
substantive and procedural due process claims necessarily fail.
A FFIR ME D.
17