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The Cherry Community Organization v. City of Charlotte

Court of Appeals of North Carolina

November 21, 2017

THE CHERRY COMMUNITY ORGANIZATION, Plaintiff,
v.
THE CITY OF CHARLOTTE; THE CITY COUNCIL FOR THE CITY OF CHARLOTTE; and MIDTOWN AREA PARTNERS II, LLC, Defendants.

          Heard in the Court of Appeals 17 May 2017.

         Appeal by plaintiff from order entered 15 August 2016 by Judge Daniel A. Kuehnert in Mecklenburg County Superior Court, No. 2015-CVS-20180

          James, McElroy & Diehl, P.A., by Jon P. Carroll, John R. Buric, and Preston O. Odom, III, for plaintiff-appellant.

          Charlotte City Attorney's Office, by Senior Assistant City Attorney Terrie Hagler-Gray and Assistant City Attorney Daniel E. Peterson, and Midtown Area Partners II, LLC, by Roy H. Michaux, Jr.

          MURPHY, JUDGE.

         The Cherry Community Organization ("CCO") appeals from the trial court's order granting the City of Charlotte and the City Council's (collectively, "Charlotte") Motion for Summary Judgment, granting Midtown Area Partners II, LLC's ("MAP") Motion for Summary Judgment, and denying CCO's Motion for Summary Judgment. Specifically, CCO maintains: (1) Charlotte's approval of an oral amendment made to MAP's rezoning petition violated its ordinance and was arbitrary and capricious; and (2) Charlotte's violation of city ordinances and N.C. G.S. § 160A-383 renders the zoning amendment null and void. However, because we conclude that CCO failed to show it had standing to maintain its declaratory judgment action, we dismiss this appeal and need not reach the issues raised by CCO.

         Background

         CCO is a nonprofit organization that endeavors to protect the residential character, safety, and stability of, as well as the affordable housing within, the Cherry Community ("Cherry") - a historically African American neighborhood located in the Midtown Morehead Cherry District of Charlotte. In 1999 and 2012, respectively, Charlotte adopted the Cherry Small Area Plan and the Midtown Morehead Cherry Area Plan (the "MMC Area Plan") to guide land-use decisions in Cherry.

         The real property (the "Parcels") at issue in this case involves four parcels owned by MAP in and around Cherry.[1] In August 2014, MAP submitted an application to Charlotte ("Initial Rezoning Petition") to rezone the Parcels from general-use districts to mixed-use development districts in furtherance of plans to construct a mixed-use development, which was to contain office, retail, hotel, and residential spaces. Specifically, MAP proposed constructing a 270, 000 square foot building, 187, 450 square foot parking structure, and 8 single-family attached dwelling units. The building's then-proposed height was 119 feet.

         Two community meetings were held to discuss the nature of the proposed rezoning, and CCO filed a Protest Rezoning Petition urging Charlotte to deny MAP's Initial Rezoning Petition.[2] MAP thereafter submitted an Amended Rezoning Application (the "First Amended Petition") in which it increased the size of the rezoning site from 1.698 to 1.99 acres and requested that MAP be given five-year vested rights regarding its rezoning site plan.

         On 12 February 2015, MAP submitted a Second Amended Rezoning Application, which changed the requested zoning of the Parcels "to B-2 (PED-O), UR-C (PED-O) and R-8 MF (PED-O), " with five-year vested rights. On the basis of the amendment, a new community meeting was held on 4 March 2015. It is this Second Amended Petition (the "Rezoning Petition") that is at issue in this case.

         Charlotte held a public hearing on the Rezoning Petition on 20 April 2015. Representatives of MAP and CCO attended and commented on the Rezoning Petition. Charlotte's Planning Department staff also commented that: (1) MAP's proposed development was inconsistent with the Pedestrian Zoning Overlay District ("PED Overlay") requirements that limit buildings in the area to a maximum height of 100 feet; (2) the proposed development was inconsistent with the MMC Area Plan recommendations relating to the maximum permissible building height, street setbacks, streetscapes, and residential density; and (3) the proposed parking structure would encroach on a portion of the area that the MMC Area Plan recommended for residential development.

         By the time the Rezoning Petition came on for a vote before Charlotte at its meeting, MAP lowered the projected height of its building from 119 feet to 106 feet, which was still 6 feet over the maximum height permitted by the PED Overlay. The motion to approve the Rezoning Petition failed.

         Several hours later, prior to adjourning the meeting, MAP agreed to bring the building's height down to a compliant 100 feet. Accordingly, Charlotte passed a motion to "reconsider" the Rezoning Petition as orally amended at the next scheduled meeting. At the next meeting on 28 September 2015, Charlotte voted 10-to-1 against sending the orally amended Rezoning Petition back to the Zoning Committee for a recommendation, and 10-to-1 in favor of rezoning the Parcels as outlined.

         CCO petitioned the Mecklenburg County Superior Court for Writ of Certiorari and later added a claim for declaratory judgment against Charlotte and MAP. After the trial court dismissed CCO's certiorari petition, all parties moved for summary judgment on CCO's declaratory judgment claim. On 15 August 2016, the trial court granted summary judgment in favor of Charlotte and MAP and dismissed the case with prejudice. CCO timely appealed.

         Standing

         Typically, landowners may use their property as they wish, free from the interference of the government. However, our Supreme Court has held that lawful zoning ordinances are an exercise of the State's police powers. See e.g., Turner v. City of New Bern, 187 N.C. 541, 549, 122 S.E. 469, 474 (1924). The interference by the State, by exercising its police powers, is the pinnacle of intrusion on private property rights by the government. Accordingly, our Courts appropriately have set a high bar for third parties to establish standing to bring actions relating to the exercise of police powers between the State and its citizens. CCO does not clear the bar to allow it to privately exercise Charlotte's police power over MAP.

         As a preliminary matter, we must address Charlotte and MAP's assertion that CCO lacks standing to prosecute this declaratory judgment action. Already, LLC v. Nike, Inc., 568 U.S. 85, 90-91, 184 L.Ed.2d 533, (2013) ("We have repeatedly held that an actual controversy must exist not only at the time the complaint is filed, but through all stages of the litigation." (citation and internal quotation marks omitted)); see Burgess v. Gibbs, 262 N.C. 462, 465, 137 S.E.2d 806, 808 (1964) ("A universal principle as old as the law is that the proceedings of a court without jurisdiction of the subject matter are a nullity."). Standing must be maintained throughout the entirety of the suit. Charlotte and MAP contend that CCO has not forecasted evidence that it sustained special damages as a result of the rezoning at issue that are distinct from the rest of the community.[3] We agree and therefore modify and affirm the decision of the trial court to dismiss CCO's claims and, as a result, we need not reach the merits of CCO's appeal.

         Standing refers to "[w]hether a party has a sufficient stake in an otherwise justiciable controversy" so as to properly seek adjudication of a matter, Sierra Club v. Morton, 405 U.S. 727, 731-32, 31 L.Ed.2d 636, 641 (1972), and it "is a necessary prerequisite to a court's proper exercise of subject matter jurisdiction, " Thrash Ltd. P'ship v. Cty. of Buncombe, 195 N.C.App. 678, 680, 673 S.E.2d 706, 708 (2009) (citation omitted). As standing is a question of law, we review the issue of standing de novo, Cherry v. Wiesner, __ N.C.App. __, __, 781 S.E.2d 871, 876, disc. review denied, __ N.C. __, 792 S.E.2d 779 (2016), and the party invoking jurisdiction, in this case CCO, bears the burden of establishing standing, Thrash Ltd. P'ship, 195 N.C.App. at 680, 673 S.E.2d at 708.

         Specifically, "[s]ince standing is a jurisdictional requirement, the party seeking to bring [a] claim before the court must include allegations which demonstrate why she has standing in the particular case[.]" Wiesner, __ N.C.App. at __, 781 S.E.2d at 877. In establishing the elements of standing, "each element must be supported in the same way as any other matter on which [CCO] bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation." Id. at, 781 S.E.2d at 877 (quoting Neuse River Found, 155 N.C.App. at 113, 574 S.E.2d at 51) (emphasis added).

         A party only has standing to challenge a zoning ordinance in an action for declaratory judgment when it "has a specific personal and legal interest in the subject matter affected by the zoning ordinance and . . . is directly and adversely affected thereby." Taylor v. City of Raleigh, 290 N.C. 608, 620, 227 S.E.2d 576, 583 (1976) (citations omitted). In this way, the standing requirement for an action for declaratory judgment is analogous to the requirement that a party seeking review of a municipal decision by writ of certiorari suffer damages that are "distinct from the rest of the community." Compare Heery v. Zoning Bd. of Adjustment, 61 N.C.App. 612, 614, 300 S.E.2d 869, 870 (1983) (holding that petitioners failed to allege that they would be subject to special damages distinct from the rest of the community), with Wiesner, __ N.C.App. at __, 781 S.E.2d at 880 ...


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