Mayor of Baltimore v. Crane

Singley, J., delivered the opinion of the Court. Two of the concepts frequently encountered in the law of zoning, “vested rights” 1 and “contract zoning,” 2 have acquired a contentious gloss. While both were referred to in the briefs and argument in this case, we are satisfied that neither concept is applicable here, at least not in the strict sense in which they are used in the cases. In 1964, the appellees, Leon A. Crane and Charles Crane (the Cranes) held title, in the name of Grindon Realty, Inc., 3 to an 11.1937-acre tract in the northeastern suburbs of Baltimore which had been acquired in 1952.

Approximately 4.6 acres of the tract lay in the way of a proposed extension of Perring Parkway from Northern Parkway to Belvedere Avenue, and negotiations had been under way for a year or more looking toward the acquisition of the 4.6-acre parcel by the Mayor and City Council of Baltimore (the City). The City ²⁰¹ arranged for an appraisal of the parcel, and its expert concluded that since the Cranes contemplated improving the entire tract with 180 apartment units, the taking of the 4.6-acre parcel, and the consequent reduction in permissible density (16 units per acre), would reduce the value of the Cranes’ holding from $181,341.00 before the taking to $112,000.00 after the taking, a difference of approximately $70,000.00. At this point, an accommodation was worked out. Ordinance No. 148 was introduced in the City Council and was enacted on 24 March 1964, having been approved by the City’s Planning Commission on 4 February 1964, specifically as it related to the Cranes’ proposed development.

In pertinent part, the ordinance provided: “In determining the number of families which may be housed on a lot or tract of land under subsection A of Section 25 and in determining whether or not a tract of land contains five acres under subsection N. of said Section 25, the area of land designated on an approved subdivision plat or builders’ location plat, certified by the Planning Commission as essential to over-all community planning and not for the sole benefit of any one individual, and that the judgment of the Planning Commission with respect to what is essential to over-all community planning should be limited to what might be called major streets, arterial streets and expressways, as shown on the adopted master plans, and thereby or thereafter given or dedicated to the Mayor and City Council of Baltimore by the owner, at the request of the Planning Commission, for the purpose of establishing, extending or widening a street or alley abutting the lot or tract involved, shall be included in the area of such lot or tract of land, and that if buildings have frontage on the new highway, then the Planning Commission can limit the density allowance to the incremental width beyond the right-of-way normally required ²⁰² by the subdivision regulations, and further providing that the Planning Commission may limit the application of [this] Paragraph 31 L if, in the Planning Commission judgment, the absence of a limitation would permit a development of undesirable density or a development which would not be compatible with existing or anticipated future development in adjacent areas.” The practical effect of the enactment of the ordinance was to give the Cranes, upon their conveyance of the 4.6-acre parcel to the City without receiving any consideration therefor, provided that the Planning Commission approved, the right to develop the remaining 6.5 acres to the same density (180 units) as would have been permissible ¡prior to the conveyance on the entire 11.1937-aere tract. After the enactment of the ordinance, the Planning Commission, on 21 April 1964, gave final approval to a subdivision and development plan submitted by the Cranes, contemplating the construction of 180 garden-type units, and the City’s Zoning Commissioner certified that his approval would be forthcoming upon the filing of an appropriate application. Thereafter, the Cranes conveyed the 4.6-acre parcel to the City for a nominal consideration of $1.00 and also granted certain additional utility easements and rights of way to the City, and about one-fourth of an acre to the City’s Board of Education for an aggregate consideration of about $7,500.00. There matters stood until 20 April 1971, when the City enacted a new comprehensive zoning ordinance.

While the zoning ordinance was pending, Mr. Leon A. Crane became concerned about its possible application to the property, and he and his counsel discussed the problem with various city officials. On 28 October 1970, Simon Schonfield, Esq., an Assistant City Solicitor, categorically assured the Cranes’ counsel that “there is no change in the new zoning ordinance which would affect ... [the Cranes’] rights as originally agreed upon . .. [with] the Mayor and City Council of Baltimore.. ..” ²⁰³ On 6 March 1972, Mr. Schonfield submitted a formal opinion in response to a request from the City’s Commissioner of Housing and Community Development. After reviewing the factual background, the opinion concluded: “It is quite evident that the City in accepting the five acres, made itself legally bound to allow the owner of the property to construct the number of dwelling units in accordance with the terms expressed by the provisions of Ordinance No. 148. To allow the City the right to change the density requirements that it had previously approved by an amended zoning ordinance would be unfair and inequitable, as the City is now enjoying the benefits of the transfer of five acres of land.

Ordinance 148 was pending before the City Council for one year prior to its adoption on March 25, 1964, and it appears that the City had full opportunity to consider its impact on the community and general public.” “In view of the above, it is our opinion that the approval of the Planning Commission and the Department of Public Works to allow the Grindon Realty Company to construct 180 dwelling apartments in compliance with the provisions of Ordinance 148 constitutes a valid and enforceable legal agreement, and it therefore follows that the Grindon Realty Company should be permitted to construct its proposed building project of 180 dwelling units.” In 1973, the Cranes joined with Mr. Howard Brown in an informal partnership looking toward the development of the property. A preliminary development plan for the erection of two midrise buildings containing 178 units (rather than the 180 garden-type apartment units projected in 1964) was submitted to the City’s Planning Commission, which on 25 June 1973, questioned the appropri ²⁰⁴ ateness of the scale and density of the project, but recognized the Cranes’ right to construct 178 units. Less than three weeks later, the Planning Commission disapproved the preliminary plans primarily because “multiple dwelling development of 100 or more apartment units is [a] conditional use which must be approved by the Mayor and City Council” (under the new zoning ordinance) and ended with the ominous note that: “As part of the vote to reject the preliminary development plan for the Perring Apartments, the Commissioners also recommended that the City make an effort to negotiate acquisition of this property to become open land or parkland.” In August, 1973, the Cranes instituted suit in the Superior Court of Baltimore City against the City, the City’s Board of Estimates and the City’s Planning Commission (hereafter referred to collectively as “the City”) seeking declaratory relief, a writ of mandamus and damages. The defendants filed an answer to the declaratory action, a demurrer to the mandamus suit, and a general issue plea to the action in damages.

The case came on for trial before Liss, J. without a jury. From an order of the Superior Court granting declaratory relief, 4 the defendants appealed to the Court of Special Appeals. We granted certiorari before the matter came on for hearing in that Court. The City advances a four-pronged argument: (i) The Cranes cannot require the City to disregard the provisions of the 1971 zoning ordinance, by which it is legally bound; (ii) The 1964 transactions cannot be viewed as creating “contract” rights; (iii) Any rights which the Cranes might have had to construct a complex with 180 units were extinguished due to their failure to ²⁰⁵ undertake any construction or improvements under the approved plan for a period of almost eight years following tentative approval; and (iv) The March 6, 1972 City Solicitor’s opinion has no binding or precedential effect on either this Court or the City.

Early on, we noted that, in our opinion, this case involves neither a vested right nor contract or conditional zoning, as those terms are generally used in zoning cases. The trial court took essentially the same position in this regard. What was involved was a City ordinance, neither enacted for the benefit of the Cranes, nor especially tailored to their needs, but presenting an open-ended offer to any developer who would give a portion of his tract “for the purpose of establishing, extending or widening a street or alley abutting the lot or tract involved,” to have the land contributed added, for the purpose of density restrictions, to the tract retained, provided the developer obtained the concurrence of the Planning Commission. 5 The Cranes accepted the offer, conveyed the 4.6-acre parcel, and received Planning Commission approval for the construction of 180 units on the remaining 6.5 acres. We have, on numerous occasions, dealt with attempts at contract zoning, and have repeatedly explained why such zoning is not permitted.

For example, in Wakefield v. Kraft, 202 Md. 136, 143 , 96 A. 2d 27, 29-30 (1953), Judge Hammond, for the Court, stated: ²⁰⁶ See also Montgomery County v. National Capital Realty Corp., 267 Md. 364 , 297 A. 2d 675 (1972); Baylis v. City of Baltimore, 219 Md. 164 , 148 A. 2d 429 (1959). Thus, had the City agreed to allow the Cranes to include the 4.6-acre tract in their density computation, without enacting an ordinance granting this benefit to all similarly situated property owners, the arrangement would have amounted to contract zoning. Because the ordinance was made applicable to anyone willing to dedicate or give land to the City for the purpose of highway construction, extension or widening, we are convinced that this cannot be equated with contract zoning. ²⁰⁵ “. . . [W]hen a legislative body in this collective, communal lawmaking restricts the use of property, those restricted are entitled to the reliance that all others similarly situated will be similarly restricted. A rezoning ordinance may not do violence to this principle. . . .

Such an ordinance must not amount to the granting of a special privilege.” ²⁰⁶ Conversely, the Cranes argue that once they had accepted the City’s offer and actually conveyed the 4.6-acre tract to the City, receiving in return Planning Commission approval for the construction of 180 units on the remaining 6.5 acres, they acquired a “vested right” to build the 180 units. We are of the opinion that this is a misconception. In Steuart Petroleum v. Board of County Comm’rs, 276 Md. 435 , 347 A. 2d 854 (1975), we reviewed the cases in the area. Normally, a property owner acquires no vested right to build in reliance on an existing zoning classification or under an outstanding permit unless he has materially altered his position, usually by the commencement of