Powell v. Calvert County

⁴²⁹ JAMES R. EYLER, Judge. The principal question presented in this appeal requires us to consider and apply the doctrine of vested rights in a zoning context. On March 19, 1997, the Board of Appeals for Calvert County (the Board) granted James W. Graner a special exception for the storage of construction materials. As a result of an earlier petition for judicial review, this Court, in an opinion filed on April 23, 1999, vacated the Board’s approval and remanded the case to the Board for further proceedings on the ground that the reasons given by the Board were insufficient to permit appellate review.

On remand, without receiving additional evidence or argument, the Board amended its opinion in response to this Court’s mandate and granted the special exception. The case is now before us as a result of a second petition for judicial review. We hold that the evidence and reasons given by the Board in its amended opinion are, as explained herein, legally sufficient to support the Board’s decision. We further hold that, because the applicant had acquired vested rights, the Board did not err in refusing to apply an intervening amendment to the zoning ordinance that would have prohibited the special exception.

Factual Background James W. Graner owns approximately 14 acres of land zoned RUR (Rural District) in Calvert County. The acreage in question was part of a larger tract that was developed as a residential subdivision in the late 1980’s. Mr. Graner operates an excavating business on the property, the business having been acquired from his grandfather in 1981. The business utilizes approximately 3 acres out of the total of 14 acres.

In 1984, Mr. Graner was issued a home occupation permit under the Calvert County Zoning Ordinance, which permitted him to locate the office for his business on the premises. In 1986, Mr. Graner was issued a special exception which permitted him to park excavating equipment on the premises. Sometime thereafter, Mr. Graner began storing construction materials. ⁴³⁰ Calvert County sought injunctive relief based on several alleged zoning violations, including storing construction materials. The Circuit Court for Calvert County, in an opinion dated January 23,1996, found that Mr. Graner was in violation of zoning restrictions and ordered, in pertinent part, that he cease outside storage of construction materials and that he apply for a special exception if he wanted to continue to store such materials on the property.

On January 2, 1997, Mr. Graner applied for a special exception to permit the outside storage of construction materials. On March 19, 1997, the Board of Appeals granted the special exception. On petition for judicial review, the Circuit Court for Calvert County, on November 17,1997, affirmed the Board’s decision. On appeal to this Court, the question was whether the evidence was legally sufficient to sustain the Board’s action.

In an unreported opinion, we reversed and remanded the case to the circuit court with instructions to vacate the Board’s decision and to remand the case to the Board for further proceedings consistent with our opinion. Powell v. Calvert County, No. 212, September Term, 1998 (filed April 23, 1999). In doing so, applying the standard of judicial review of an administrative decision, we observed that the Board had made a visit to the site but included no information in the record relating to that visit. It was unclear whether the Board relied on information obtained in that site visit.

Accordingly, because the record was deficient in that the Board may have relied on matters not contained in the record, we remanded the matter for further proceedings. In the interim, on December 5, 1998, the County Commissioners for Calvert County amended the zoning ordinance to prohibit the outdoor storage of materials in connection with a commercial or industrial use on RUR zoned property. On September 2, 1999, the Board, without receiving additional evidence or argument, amended its earlier opinion and approved the special exception. ⁴³¹ Larry Powell and Susan M. Mulvaney, owners of homes in the nearby subdivision, appellants, filed a petition for judicial review in the Circuit Court for Calvert County, raising three issues. In addressing those issues, the circuit court (1) held that the Board had not erred in refusing to apply the intervening amendment to the zoning ordinance, (2) held that there was substantial evidence in the record to support the Board’s decision, and (3) remanded the case to the Board to conduct further proceedings with respect to the question whether Mr. Graner’s home occupation permit was still valid.

Appellants appealed to this Court, identifying Calvert County as appellee. Questions Presented The questions before us are the same as those before the circuit court. As stated by appellants, they are: I. Was the Board of Appeals statutorily prohibited by a change in the law from approving the special exception application at the September 2, 1999 hearing?

II

Is the approval of the subject special exception contingent on the continued validity of the Home Occupation Permit and its associated 1986 special exception?

III

Did the applicant meet his burden of proof that his use satisfies the prescribed standards and requirements of the Calvert County Zoning Ordinance for the requested special exception? Standard of Review Upon review of an agency’s decision, our role “is essentially to repeat the task for the circuit court ... to be certain that the circuit court did not err in its review.” Red Roof Inns v. People’s Counsel for Baltimore County, 96 Md.App. 219, 224 , 624 A.2d 1281 (1993) (quoting Art Wood Enters. v. Wiseburg Community Ass’n, 88 Md.App. 723, 728 , 596 A.2d 712 (1991)) (in turn quoting Mortimer v. Howard Research & Dev. Corp., 83 Md.App. 432, 442 , 575 A.2d 750 (1990)). Thus, our scope of review is narrow.

Eastern Outdoor Adver. Co. v. Mayor & City Council of Baltimore, 128 ⁴³² Md.App. 494, 515, 739 A.2d 854 (1999), cert. denied, 358 Md. 163 , 747 A.2d 644 (2000). We apply different standards of review to the agency’s legal and factual findings. When reviewing an agency’s legal conclusions, we “must determine whether the agency interpreted and applied the correct principles of law governing the case and no deference is given to a decision based solely on an error of law; the court may substitute its own judgment.” Richmarr Holly Hills, Inc. v. American PCS, L.P., 117 Md.App. 607, 652 , 701 A.2d 879 (1997)(quoting Lee v. Maryland Nat'l Capital Park & Planning Comm’n, 107 Md.App. 486, 492 , 668 A.2d 980 (1995)).

An agency’s factual findings and its decisions involving mixed questions of law and fact, however, will be given deference such that we cannot substitute our judgment for that of the agency’s. Friends of the Ridge v. Baltimore Gas & Elec. Co., 120 Md.App. 444, 465 , 707 A.2d 866 (1998), vacated in part by 352 Md. 645 , 724 A.2d 34 (1999). We will “accept the agency’s conclusions if they are based on substantial evidence and if reasoning minds could reach the same conclusion based on the record.” Id.

(quoting Columbia Rd. Citizens’ Ass’n v. Montgomery County, 98 Md.App. 695, 698, 635 A.2d 30 (1994)). Finally, if there is no “substantial or sufficient evidence to support the factual findings of the Board, the Board’s decision will be reversed because it was arbitrary and illegal.” Eastern Outdoor Adver., 128 Md.App. at 515 , 739 A.2d 854 (citing Mossburg v. Montgomery County, 107 Md.App. 1, 30 , 666 A.2d 1253 (1995)). Discussion I. Appellants contend that, at the time of the September 2, 1999 hearing, the Board was not legally permitted to approve the special exception because the intervening amendment to the zoning ordinance was applicable and prohibited the use in question.

Appellants argue, relying primarily on O’Donnell v. Bassler, 289 Md. 501 , 425 A.2d 1003 (1981), that ⁴³³ the doctrine of vested rights is not applicable because the special exception that was in place prior to the amendment was invalidated by judicial review. Consequently, appellants argue that, in the eyes of the law, there was no valid special exception until it was reissued on September 2, 1999, after the amendment. We disagree. Prospective v. Retroactive The threshold inquiry, before getting to vested rights, is whether the amendment in question, as a matter of statutory construction, applies to the issuance of the special exception in question.

We reviewed the relevant principles in Holland v. Woodhaven Bldg. & Dev., 113 Md.App. 274 , 687 A.2d 699 (1996), and we quote from that opinion: The rules governing retroactivity that we address in this case are rules of statutory construction. 4 Such rules are easy to state but difficult to apply. A number of Maryland cases can be cited for the general proposition that a statute is presumed to operate prospectively from its effective date absent a clear expression of legislative intent that the statute is to be applied retroactively. Arundel Corp. v. County Comm’rs of Carroll County, 323 Md. 504, 510 , 594 A.2d 95 (1991); Mason v. State, 309 Md. 215, 219 , 522 A.2d 1344 (1987); WSSC v. Riverdale Heights Volunteer Fire Co., 308 Md. 556, 560-60 , 520 A.2d 1319 (1987) and cases discussed therein. Despite the presumption of prospectivity, a number of other cases support the proposition that when a legislative change in law affects only procedural matters, rather than substantive rights, it applies to all actions, whether accrued, pending, or future, unless a contrary intention is expressed.

Roth v. Dimensions, 332 Md. 627, 636-38 , 632 A.2d 1170 (1993); Starfish Condo. Assoc. v. Yorkridge Serv. Corp., Inc., 295 Md. 693, 705 , 458 A.2d 805 (1983); Winston v. Winston, 290 Md. 641, 649-50 , 431 A.2d 1330 (1981); Holmes v. Crim. Injuries Comp.

Bd., 278 Md. 60 , 63 n. 2, 359 A.2d 84 (1976); Richardson v. Richardson, 217 Md. 316, 320 , 142 A.2d 550 (1958). ⁴³⁴ [There is] another line of cases that hold that “an appellate court must apply the law in effect at the time a case is decided, provided that its application does not affect intervening vested rights.” O’Donnell v. Bassler, 289 Md. 501, 508 , 425 A.2d 1003 (1981) (citing County Council for Prince George’s County v. Carl M. Freeman Associates, Inc., 281 Md. 70, 76 , 376 A.2d 860 (1977); Rockville Fuel & Feed Co. v. City of Gaithersburg, 266 Md. 117, 127 , 291 A.2d 672 (1972)). See also Yorkdale v. Powell, 237 Md. 121, 124 , 205 A.2d 269 (1964) (quoting Woman’s Club of Chevy Chase v. State Tax Comm., 195 Md. 16, 19 , 72 A.2d 742 (1950)). A countervailing principle to that statement is that, absent legislative intent to the contrary, a change in procedural law will not be applied retroactively to undo proceedings that already have concluded prior to the passage of the law. Luxmanor Citizens Assoc. v. Burkart, 266 Md. 631, 645 , 296 A.2d 403 (1972); The Wharf v. Department, 92 Md.App. 659, 675-76 , 610 A.2d 314 , cert. denied, 328 Md. 239 , 614 A.2d 84 (1992).

Id. at 283-84, 687 A.2d 699 . We further observed in Holland that, when the Court of Appeals in Washington Suburban Sanitary Commission v. Riverdale Heights Volunteer Fire Co., 308 Md. 556, 560 , 520 A.2d 1319 (1987), overruled a prior decision and announced the general principle that statutes are construed to operate prospectively absent a clear legislative intent to the contrary, it did not restrict the rule to certain types of cases. In Holland , the issue was whether the appellants had standing to appeal a zoning decision to a board of zoning appeals. Holland, 113 Md.App. at 282 , 687 A.2d 699 .

Appellants in that case, as do the appellants in this case, relied on O’Donnell v. Bassler, 289 Md. 501 , 425 A.2d 1003 (1981), for the proposition that, in zoning cases, an appellate court must apply the law in effect at the time the case is decided, provided its application does not ⁴³⁵ affect intervening vested rights. Holland, 113 Md.App. at 283 , 687 A.2d 699 . We stated in Holla,nd that we saw no reason to distinguish zoning cases in that manner. We observed that the Court of Appeals could have limited its holding in Riverdale Fire Co., supra, to exclude zoning cases, but it did not do so.

In fact, it later applied its holding in a zoning case. See Arundel Corp. v. County Comm’rs of Carroll County, 323 Md. 504, 510 , 594 A.2d 95 (1991). We concluded in Holland : [T]he principles that seem to survive Riverdale Fire Company are that, absent clear legislative intent to the contrary, (1) a statute ordinarily will be presumed to operate prospectively; (2) a statute that changes procedure only ordinarily will be applied to pending cases; and (3) new procedural law, although applicable to pending cases, will not ordinarily be applied to undo procedures that already have concluded. Holland, 113 Md.App. at 287 , 687 A.2d 699 .

Applying those principles in Holland , we held that the amendment in question did not operate retroactively to confer standing. Because it did not state whether it was to be applied retroactively but merely provided that it was to take effect on a certain date, we held that it was to be applied prospectively only under the general rule announced in Riverdale Fire Company. Holland, 113 Md.App. at 287-88 , 687 A.2d 699 . In the case before us, the amendment provided that it was effective as of December 8, 1998.

As was true in Holland , it contained no other provision with respect to prospective or retroactive application. Unlike the amendment in Holland , however, the amendment before us does by its terms operate retroactively. We cautioned in Holland that while zoning cases are not exempt from the principles of construction set forth in Riverdale Fire Company, changes in zoning laws, such as zoning reclassifications, ordinarily will apply retrospectively by their very terms. Such in rem changes to the status of property necessarily will raise the question of whether the changes interfere with the property owner’s vested rights. ⁴³⁶ Holland, 113 Md.App. at 286-87 , 687 A.2d 699 (emphasis in original) (citations omitted).

The amendment in this case was tantamount to a change in zoning classification. As of its effective date, the outside storage of construction materials was not a use permitted by special exception, absent vested rights. Compare Arundel Corp. v. County Comm’rs of Carroll County, 323 Md. 504 , 594 A.2d 95 (1991)(where applications for conditional uses were filed prior to an amendment changing the nature of the documentation required to support the applications, held that under the general rule in Riverdale Fire Company, 308 Md. 556 , 520 A.2d 1319 (1987), the change had prospective application only and did not apply to the pending applications) with County Council of Prince George’s County v. Collington Corp. Ctr. I, 358 Md. 296 , 747 A.2d 1219 (2000) (a change in an ordinance that prohibited a use was akin to a down-zoning and applied retroactively in accordance with and to the extent expressly provided by the legislative body).

Vested Rights The formulation of the rule for deciding when rights have vested has varied in verbiage, if not substance. The O’Donnell formulation, in a construction context, is that [generally, in order to obtain a vested right in an existing zoning use that will be protected against a subsequent change in a zoning ordinance prohibiting that use, the owner must initially obtain a valid permit. Additionally, in reliance upon the valid permit, the owner must make a substantial beginning in construction and in committing the land to the permitted use before the change in the zoning ordinance has occurred. Steuart Petroleum Co. v. Board of County Comm’rs of St. Mary’s County, 276 Md. 435, 442-44 , 347 A.2d 854, 859-60 (1975), County Council for Montgomery County v. District Land Corp., 274 Md. 691, 707 , 337 A.2d 712, 721 (1975).

O’Donnell v. Bassler, 289 Md. 501, 508 , 425 A.2d 1003 (1981). We refer to O’Donnell’s statement of the rule because