City of College Park v. Precision Small Engines

Deborah S. Eyler, J. In this appeal we are called upon to interpret a Memorandum of Understanding (“MOU”) entered into between appellant City of College Park (“the City”) and appellant Prince George’s County Council, sitting as the District Council (“the County”), by which the City assumed the power to enforce County zoning violations within the City’s corporate limits. The appellees are Gregory Hnarakis and Thomas Stokes, owners of 9651 Baltimore Avenue, College Park (“the Proper ⁷⁷ ty”), and Precision Small Engines, Inc. (“PSE”), a tenant of the Property. In the Circuit Court for Prince George’s County, the appel-lees filed a declaratory judgment action against the appellants asking the court to declare that the terms of the MOU prohibit the City from requiring non-residential occupancy permits and building permits under City law, independent of those issued by the County. The court entered a Memorandum Opinion so ruling.

On appeal, the appellants ask whether the court’s ruling was legally erroneous. For the following reasons, we answer that question in the affirmative' and shall reverse the judgment of the circuit court. FACTS AND PROCEEDINGS -a- Division of Zoning Authority between the County and the City Md. Code (2012), section 22-104 of the Land Use Article (“LU”), vests the District Council with authority to adopt zoning laws within Prince George’s County. Pursuant to that authority, the County adopted its zoning ordinance, codified at Subtitle 27 of the County Code (“Zoning Ordinance”).

As pertinent, the Zoning Ordinance requires County residents to apply for a use and occupancy permit (“U & 0 Permit”) for any non-residential use. County Code, § 27-253. Before a U & 0 Permit is issued, the property is inspected by the County Building Inspector and must be certified as complying with the Zoning Ordinance. Id.

A U & 0 Permit is required at the time of new construction; when an occupant proposes a change in use; and when a new occupant takes possession of property, even if the use does not change. Id. Separate from the Zoning Ordinance, the County also requires property owners or occupants to obtain a building permit prior to “new construction, alteration, removal, demolition, or other building operation” within the County. County Code, § 4-352(a). ⁷⁸ A municipal corporation within the County, such as the City, does not have zoning authority except as specifically authorized by State law; however, it has “concurrent jurisdiction” within its corporate limits to enforce County zoning laws.

LU § 22-119(a). To exercise that enforcement power, the municipal corporation must enter into a written agreement with the County, addressing: (1) the method by which the county will be advised of citations issued by a municipal inspector; (2) the responsibility of the municipal corporation or the county to prosecute violations cited by the municipal corporation; (3) the disposition of fines imposed for violations cited by the municipal corporation; (4) the resolution of disagreements between the municipal corporation and the county about the interpretation of zoning laws; and (5) any other matter that the district council considers necessary for the proper exercise of the authority granted by this section. LU § 22-119(b). On October 22, 2002, pursuant to LU section 22-119, then codified at Md. Code (1957, 1997 Repl.

Vol., 2002 Supp.), section 8-112 of Article 28, the City and the County entered into the MOU, in which they agreed that the City would assume responsibility for enforcing the County Zoning Ordinance within the City’s corporate limits. The recitals state that the City “wishes to assume the duty and exercise the power of enforcement of zoning laws within its corporate limits,” and the County is “willing to cooperate with the City in the enforcement of the County’s zoning laws, subject to certain conditions.” The pertinent terms of the MOU are as follows. The City assumed the duty to enforce the zoning laws effective December 1, 2002, and was granted “all enforcement powers then possessed by County government!!.]” ¶ 1(a). The City’s assumption of those duties “shall not be deemed to diminish any City power or authority under §§ 8-112.1 or 8-112.3 of the ⁷⁹ Regional District Act, or any other law.” ¶ 1(b) (emphasis added). 1 The procedures the City must follow to enforce the County Zoning Ordinance are set forth in Paragraph 2 of the MOU.

In particular, the City must follow procedures spelled out in an outline attached as “Exhibit A” to the MOU 2 and “require compliance on all properties within municipal boundaries, except for construction operations proceeding under a County grading or building permit and uses which are the subject of active [U <& 0 Permit] applications on file with the [County Department of Environmental Resources, now DPIE].” ¶ 2(a). The City must enforce the Zoning Ordinance through its City enforcement officers acting under the direction of the City Manager and the City Attorney, and the City Attorney is authorized to appear before the County Board of Appeals, Planning Board, District Council, and any State court to enforce or defend claims or appeals. ¶ 2(b). ⁸⁰ Subsection 2(c) of the MOU, which is central to the instant appeal, states: The City is not authorized to issue building, grading, [U & 0], or other permits now issued by the County Department of Environmental Resources [now known as DPIE], the City is not authorized to override Department interpretations of the Ordinance in issuing permits, and the City is not authorized to perform inspections for permit applications. The City may initiate and pursue enforcement action for any property which does not have the required permits for its use or uses. (Emphasis added.) The City must file with the County a copy of any citation or violation notice it issues. ¶ 2(d).

The City must enforce the Zoning Ordinance consistent with its plain language and in consultation with the County Attorney to ensure consistency. ¶ 3(a). The City is not permitted to impose stricter standards than those imposed by the County. ¶ 3(b). A property owner or occupant may appeal any zoning citation or notice of violation issued by the City in enforcing the Zoning Ordinance to the County Board of Appeals. ¶ 3(c). The MOU runs from year to year and will be extended automatically for a one-year term on December 1 of each subsequent year unless either party exercises its right to terminate it. ¶ 9.

The MOU is “intended only for the benefit of the parties [ie., the City and the County], and no rights are intended or shall be deemed to be granted to any other persons.” ¶ 10. On October 22, 2002, the MOU was approved by a unanimous vote of the County Council. It then was approved by a unanimous vote of the City Council on November 19, 2002. From then until the present, the City has enforced the Zoning Ordinance through its Public Services Department (“PSD”).

The City inspects for and investigates suspected violations of the Zoning Ordinance, including the lack of a required U & O Permit, and prosecutes those violations in court. The County continues to issue its U & O Permits and to conduct preliminary inspections for those permits. The County also continues ⁸¹ to issue its own building permits; the City has no involvement in the enforcement of building permit violations. -b- The City’s Building Code and Occupancy Permits The City is empowered by Md. Code (2013), section 5-211(a) of the Local Government Article (“LG”), formerly codified at Md. Code (1957, 2001 Repl. VoL), section 2(b) of Article 23A, to “adopt regulations regarding the erection of buildings and signs,” including by adopting a “building code” and “requirements for building permits.” Under LG § 5—211(b), it may require “inspection of and require repairs to ... drainage and sewage systems ... electric lines and wires ... gas pipes ... plumbing apparatus ... and ... water pipes.” Pursuant to this authority, in 1967, the City enacted a building code, now codified at Chapter 87 of the City Code. 3 The City requires a City building permit for any type of construction or demolition that will require a County building permit.

City Code § 87-3. In addition, the City is empowered by LG section 5-202, formerly codified at section 2(a) of Article 23A, to adopt ordinances to protect “persons and property from danger and destruction” and to “protect the health, comfort, and convenience of the residents of the municipality.” It is further authorized by LG section 5-209, formerly codified at section 2(b) of Article 23A, to “regulate any place where noxious things are manufactured, offensive trades are conducted, or that may cause unsanitary conditions or conditions detrimental to health.” Pursuant to that authority, in 1966, the City adopted Chapter 144 of the City Code, titled “Occupancy Permits.” Chapter 144 requires any residential property that is rented and any non-residential property that must be issued a County U & O Permit to also have a City issued occupancy permit. The City employs six full-time code enforcement officers to perform initial occupancy permit inspections and annu ⁸² al health and safety inspections. It performs over 4,000 such inspections each year. c.

The Declaratory Judgment Action PSE operates a small engine repair and equipment distributorship business at the Property. On September 16, 1993, it was issued a County U & 0 Permit. It did not apply for or obtain a City occupancy permit, however. The City has issued numerous municipal infraction citations to PSE, as well as to other tenants at the Property, for failure to obtain a City occupancy permit.

Hnarakis also was issued six municipal infraction citations for failing to obtain City building permits before undertaking construction at residential properties he owns in the City. Both PSE and Hnarakis defended against the infractions in proceedings before the District Court of Maryland, sitting in Prince George’s County, by arguing that Paragraph 2(c) of the MOU prohibits the City from issuing any occupancy permits and building permits, including permits it is authorized to issue under the City Code. In some of the cases against PSE, this defense was successful and the municipal infractions against it were dismissed by the District Court; in others it was not successful. The defense was not successful for Hnarakis in any of the cases against him, and he was found guilty by the District Court.

Hnarakis noted de novo appeals from those judgments to the Circuit Court for Prince George’s County. On December 1, 2014, during the pendency of some of the District Court cases, the appellees (including PSE) filed this declaratory judgment action. The operative complaint is the “Third Amended and Restated Complaint for Declaratory Relief,” filed on October 9, 2015, as amended by the “First Amendment to Third Amended and Restated Complaint for Declaratory Relief,” filed on January 4, 2016 (“TAC”). In the TAC, PSE, Hnarakis, and Stokes are plaintiffs and the County and City are defendants.

The TAC sets forth one count for declaratory relief and alleges that such relief is appropriate ⁸³ because there have been inconsistent adjudications of the meaning of the MOU by the District Court. The plaintiffs asked the court to declare and adjudge whether the MOU bars the City from “requiring] owners of non-residential properties within [its] corporate limits ... to obtain non-residential occupancy permits or building permits.” 4 On December 4, 2015, the City and the County moved for summary judgment. They asserted that the MOU was unambiguous; that Paragraph 2(c) prohibits the City from issuing County U & 0 Permits or from issuing County building permits; but that it does not otherwise alter the City’s powers under State law or modify the existing City building code or the City occupancy permit requirements. They further argued that the plaintiffs could not enforce the MOU because they