Prince George's Co. v. Zimmer Development

BERGER, J. This case involves an administrative appeal from a zoning dispute. The Prince George’s County Planning Board of the ³¹⁴ Maryland-National Capital Park and Planning Commission (“Planning Board”) approved the Comprehensive Design Plan (“CDP”) and Specific Design Plan (“SDP”) of appellee, Zimmer Development Company (“Zimmer”), to construct a retail center. Thereafter, the County Council of Prince George’s County, sitting as the District Council (the “District Council”), 1 reversed the decision of the Planning Board. Zimmer petitioned the Circuit Court for Prince George’s County for judicial review.

The circuit court reversed the decision of the District Council and reinstated the Planning Board’s approval of Zimmer’s CDP and SDP. On appeal, the District Council presents four questions for our review, which we rephrase as follows: 1. Whether Zimmer had the requisite standing to maintain a petition for judicial review in the Circuit Court for Prince George’s County. 2. Whether the District Council is vested with appellate jurisdiction or original jurisdiction over zoning issues. 3.

Whether the District Council exceeded the scope of its authority when it reviewed matters other than the issues identified for remand. 4. Whether the District Council erred in expanding its consideration of CDP-1001 and SDP-1001 beyond determining whether the Planning Board’s approval was arbitrary, capricious, discriminatory, or illegal. For the reasons that follow, we affirm the judgment of the Circuit Court for Prince George’s County. FACTUAL AND PROCEDURAL BACKGROUND The disputed property (the “Edwards Property”) is a triangular 4.14 acre property that is zoned for retail as a Local ³¹⁵ Activity Center Zone (L-A-C Zone). 2 The Edwards Property abuts Adelphi Road, Edwards Way, and Riggs Road in Prince George’s County along Maryland Route 212 (Powder Mill Road).

Zimmer is a national real-estate developer with its headquarters located in Wilmington, North Carolina. Zimmer proposes to construct a retail center located on the Edwards Property, which will be anchored by a CVS. Approval or denial of a proposed zoning plan begins with the Planning Board. The Planning Board requires that an applicant obtain three approvals: 1) a Comprehensive Design Plan (“CDP”); 3 2) a Preliminary Plan of Subdivision (“PPS”); 4 and 3) a Specific Design Plan (“SDP”). 5 On March 14, 2011, Zimmer filed Comprehensive Design Plan-1001 (“CDP-1001”) and Specific Design Plan-1001 (“SDP-1001”) with the Planning Board as part of its application to build the retail center.

The Planning Board accepted CDP-1001 and SDP-1001 for joint review. The Planning Board formally reviewed the plans at a public hearing on July 28, 2011 and subsequently approved both CDP-1001 and SDP-1001. Despite the Planning Board’s approval of Zimmer’s application, the District Council, nevertheless, elected to exercise its discretion, pursuant to Prince George’s County Code (hereinafter “PGCC”) § 27-523(a) and § 27-528.01(b), to “call-up” the case for review by the District Council. 6 On November 7, ³¹⁶ 2011, the District Council held a public hearing and entertained oral argument regarding CDP-1001 and SDP-1001. One week after the hearing, the District Council issued an order remanding the case to the Planning Board to reconsider three issues (“the three remand issues”).

Specifically, the Planning Board was directed to “reconsider its decision in light of the [following] reasons,” namely: 1) whether the lack of a community center on the Edwards Property could be “mitigated through amenities benefitting the surrounding community”; 2) whether the proposed location of replacement trees to mitigate “the loss of the existing tree canopy” was sufficient; and 3) “whether access for Edwards Way residents can be improved, to compensate for the increases in traffic to and from the [Edwards] Property.” On February 9, 2012, the Planning Board held a hearing for the express purpose of considering the three remand issues. Approximately four weeks after the hearing, the Planning Board issued an amended resolution. Satisfied with Zimmer’s proposed solutions to the three remand issues, the Planning Board again approved Zimmer’s application. 7 After the Planning Board’s second approval of Zimmer’s application, the District Council exercised its authority to “call up” the case for a second time. On May 21, 2012, the District Council heard oral argument.

Approximately thirty days later, the District Council issued a written opinion reversing the decision of the Planning Board and again denying Zimmer’s applications for both CDP-1001 and SDP-1001. In support of its decision, the District Council set forth fourteen specific grounds for denying Zimmer’s application. ³¹⁷ As a result of the denial of its application, Zimmer filed a petition for judicial review in the Circuit Court for Prince George’s County. 8 The circuit court held a hearing on January 11, 2013. On March 15, 2013, the circuit court, through a comprehensive written opinion, reversed the District Council. 9 In its memorandum opinion, the circuit judge first concluded that Zimmer had the requisite standing to seek judicial review. Specifically, the circuit court concluded that Zimmer is not “doing business” in Maryland and, therefore, is not subject to Maryland’s laws governing unregistered foreign companies. 10 Next, the circuit court concluded that the District Council exercised appellate jurisdiction from the Planning Board and not original, de novo, jurisdiction.

The circuit court found that “the [District] Council’s authority is limited to appellate review of the Planning Board’s decisions” and that its “authority is limited to determining whether the Planning Board’s decision was arbitrary, capricious, discriminatory, or illegal.” As such, the circuit court judge found that the District Council is prohibited from “second guessing” the Planning Board’s judgment, absent a showing that the Planning Board’s decision was arbitrary, capricious, discriminatory, or illegal. The circuit court further found that the District Council was limited in its review to the three remand issues. As a result, the circuit court held that the District Council improperly exceeded the scope of its review. Specifically, the circuit court noted that “it was improper for the [District] Council to expand its review in the second ‘call-up’ to consider new issues ³¹⁸ outside the scope of remand and that were never even discussed at oral argument.” Finally, the circuit court considered the District Council’s fourteen reasons for denying Zimmer’s application.

The circuit court observed that only two of the fourteen stated reasons for denial were raised in the District Council’s initial order of remand. After reviewing each of the fourteen grounds for denying Zimmer’s application, the circuit court further observed that none of the District Council’s grounds for denial were supported by substantial evidence. As such, the circuit court reversed the decision of the District Council and reinstated the Planning Board’s approval of CDP-1001 and SDP-1001. 11 This timely appeal followed. We shall recite the relevant standard of review in the applicable section of our “Discussion,” infra.

DISCUSSION I. The District Council first contends that the circuit court lacked subject matter jurisdiction over the action. Specifically, the District Council argues that, because Zimmer does not own property or operate a business in Prince George’s County, it is not a “person” under Maryland law whose interests are subject to judicial review. As such, the District Council asks us to remand this case with an order instructing the circuit court to dismiss the action for lack of subject matter jurisdiction. Zimmer maintains that the District Council failed to raise this issue before the circuit court and, therefore, the issue is not preserved for our review.

Zimmer claims that the District ³¹⁹ Council’s subject matter jurisdiction argument “is a thinly veiled [ ] attempt to pursue a standing challenge that it failed to preserve below.” Indeed, Zimmer contends that the only standing argument advanced by the District Council was entirely unrelated to the argument it presents on appeal. Zimmer further argues that, assuming arguendo, this issue is somehow preserved for our review, Zimmer has the requisite standing to challenge the District Council’s decision. We agree with Zimmer that this issue concerns one of standing and further agree that it is not preserved for our review. Maryland Rule 8-131(a) expressly provides that we normally will not decide an issue “unless it plainly appears by the record to have been raised in or decided by the trial court.” Maryland Rule 8-131(a).

The Court of Appeals has regularly held that “the primary purpose of Rule 8-131 (a) is to ensure fairness for all parties in a case and to promote the orderly administration of law.” Elliott v. State, 417 Md. 413, 434 , 10 A.3d 761 (2010) (quoting State v. Bell, 334 Md. 178, 189 , 638 A.2d 107 (1994)). “Lack of subject matter jurisdiction may be raised at any time, including initially on appeal” and “the issue of subject matter jurisdiction need not be raised by a party, but may be raised by a court sua sponte.” Dutcher, supra, 365 Md. at 405, 780 A.2d 1137 . The preservation rule, however, clearly applies to standing issues and “[w]e ordinarily do not decide issues of standing not raised in the trial court.” Garner v. Archers Glen Partners, Inc., 405 Md. 43, 55 , 949 A.2d 639 (2008); see also Dorsey v. Bethel A.M.E. Church, 375 Md. 59, 71 , 825 A.2d 388 (2003) (“[A]ny dispute concerning [a party’s] standing should have been raised and litigated in the [c]ircuit [c]ourt, not the Court of Special Appeals.”). At the outset, we agree with Zimmer that the issue advanced before us by the District Council is one of standing, not subject matter jurisdiction. The District Council admits as much in its brief as it repeatedly refers to the issue as one of standing, including arguing that “Zimmer had no standing to seek a petition for judicial review.” Moreover, Maryland ³²⁰ Code (2012) § 22-407 of the Land Use Article (“L.U.”), which governs judicial review of decisions of the District Council, clearly contemplates standing, not subject matter jurisdiction.

Turning to the substantive merits of the District Council’s argument, the record before us clearly reflects that the District Council failed to raise the issue of Zimmer’s standing under L.U. § 22-407 in the circuit court. Although the District Council argued that Zimmer lacked standing in the circuit court, the District Council’s standing argument was expressly premised under Maryland Code (1975, 2007 Repl. Vol.) § 4A of the Corporations and Associations (“C.A.”) Article, not L.U. § 22-407. Specifically, the District Council argued that Zimmer was in violation of C.A. § 4A-1002(a), which requires that, before doing business in Maryland, “a foreign limited liability company shall register with the [Maryland State Department of Assessment and Taxation].” See C.A. § 4A-1002(a).

Indeed, the record is devoid of any argument before the circuit court related to L.U. § 22-407. Ultimately, the District Council failed to raise the issue of Zimmer’s standing based on L.U. § 22-407 before the circuit court. The District Council failed to challenge Zimmer’s standing based on L.U. § 22-407, and because the District Council now bases its standing argument on L.U. § 22-407, the issue is not preserved for our review. As such, inasmuch as the question is one of standing—and not of subject matter jurisdiction—and because the issue was not raised before the circuit court, the District Council’s standing argument is not preserved for our review on appeal.

II

The District Council next contends that the circuit court improperly determined that the District Council’s review of the Planning Board is limited to that of appellate jurisdiction and not original, de novo, jurisdiction. The District Council maintains that the circuit court erred in applying the reasoning of Cnty. Council of Prince George’s Cnty. v. Curtis Regency, 121 Md.App. 123 , 708 A.2d 1058 (1998), to this case. ³²¹ Specifically, the District Council argues that Curtis Regency is inapplicable to the case at bar because the holding of Curtis Regency is limited to that of subdivisions, not zoning issues. As shall be discussed, we hold that the District Council is vested with appellate jurisdiction and not original, da novo, jurisdiction.

We further hold that the circuit court did not err in applying the reasoning of Curtis Regency to this case. A. Standard of Review In reviewing the decision of an agency, we “look[ ] through the circuit court’s ... decision[ ], although applying the same standards of review, and evaluate[ ] the decision of the agency.” People’s Counsel v. Surina, 400 Md. 662, 681 , 929 A.2d 899 (2007). We are “limited to determining if there is substantial evidence in the record as a whole to support the agency’s findings and conclusions, and to determine if the administrative decision is premised upon an erroneous conclusion of law.” Hamza Halici v. City of Gaithersburg, 180 Md.App. 238, 248 , 949 A.2d 85 (2008) (internal quotation marks and citations omitted). When applying the “substantial evidence” test, a reviewing court must decide “whether a reasoning mind reasonably could have reached the factual conclusion the agency reached.” Layton v. Howard Cnty.

Bd. of Appeals, 399 Md. 36, 48-49 , 922 A.2d 576 (2007) (internal quotation omitted). “In applying the substantial evidence test ... [we] must review the agency’s decision in the light most favorable to the agency, since decisions of administrative agencies are prima fade correct and carry with them the presumption of validity.” Pollock v. Patuxent Inst. Bd. of Review, 374 Md. 463, 476-77 , 823 A.2d 626 (2003). “Furthermore, not only is the province of the agency to resolve conflicting evidence, but where inconsistent inferences from the same evidence can be drawn, it is for the agency to draw the inferences.” Id. at 477 , 823 A.2d 626 (citations and internal quotations omitted). “We are less deferential in our review, however, of the legal conclusions of the administrative body and may ³²² reverse those decisions where the legal conclusions reached by that body are based on an erroneous interpretation or application of the [applicable] statutes, regulations, and ordinances____” Surina, supra, 400 Md. at 682 , 929 A.2d 899 (internal quotations omitted). “When determining the validity of those legal conclusions reached by the [administrative] body, however, ‘a degree of deference should often be accorded the position of the administrative agency’ whose task it is to interpret the ordinances and regulations the agency itself promulgated.” Id. (internal citations omitted). Thus, “[e]ven though the decision of the Board of Appeals was based on the law, its expertise should be taken into consideration and its decision should be afforded appropriate deference in our analysis of whether it was ‘premised upon an erroneous conclusion of law.’ ” Id. at 682-83 , 929 A.2d 899 (internal citations omitted).

Finally, in an administrative appeal, the appellant bears the burden of establishing an error of law or that the agency’s final decision was not supported by substantial evidence. Taylor v. Harford Cnty. Dep’t of Soc. Servs., 384 Md. 213, 222-23 , 862 A.2d 1026 (2004).

B. Jurisdiction of the District Council The District Council argues that it is vested with original jurisdiction and that it is not limited in the scope of its review to the standard of review for appellate jurisdiction. The District Council further maintains that the circuit court improperly relied upon Curtis Regency in rendering its decision. Specifically, the District Council contends that the application of Curtis Regency is limited to that involving subdivisions and does not extend to zoning matters, such as the case before us. The Maryland Regional District Act (the “RDA”) was enacted by the General Assembly to empower Prince George’s County to create zoning enabling legislation.

Cnty. Council of Prince George’s Cnty. Council v. Billings, 420 Md. 84, 96 , 21 A.3d 1065 (2011) (quoting Prince George’s Cnty. v. Ray’s Used Cars, 398 Md. 632, 635-36 , 922 A.2d 495 (2007)). The RDA specifically provides for the creation of a county Planning ³²³ Board.

L.U. § 20-202(a)(l). The RDA further provides that the Planning Board: (i) “is responsible for planning, subdivision, and zoning junctions that are primarily local in scope; and (ii) shall exercise, within the county planning board’s jurisdiction, the following powers: 1. Planning; 2. Zoning; 3.

Subdivision; 4. Assignment of street names and house numbers; and 5. Any related matter. L.U. § 20-202(a)(l).

(Emphasis added). The District Council, pursuant to PGCC § 27-523, 12 is only authorized to affirm, reverse, or modify the decision of the Planning Board, or to return the case to the Planning Board to take further testimony. 13 Indeed, the District Council is expressly limited in its consideration to “the facts and information contained within the record made at the hearing before the Planning Board.” PGCC § 27-523(c). In our view, based on the testimony, documents, and evidence presented at the hearing before the Planning Board, the District Council is limited to determining whether the Planning Board’s decision was “arbitrary, capricious, discriminatory, or illegal.” See Curtis Regency, supra, 121 Md.App. at 137-38 , 708 A.2d 1058 . ³²⁴ Indeed, if the District Council were vested with de novo review, the Planning Board’s legal responsibility to engage in fact finding would be rendered meaningless. 14 The Planning Board’s thorough evidentiary process could be simply discarded in favor of the review by the District Council, which neither conducts its own evidentiary hearing nor develops its own record. Further, the Planning Board’s decision is final if no appeal is taken from the decision of the Planning Board.

See PGCC § 27-523(d) (“If the [District] Council fails to act within the specified time, the Planning Board’s decision is automatically affirmed.”). The District Council argues that the circuit court erred in extending our reasoning in Curtis Regency to include zoning issues. In Curtis Regency , the Planning Board preliminarily approved a subdivision plat proposed by Curtis Regency Service Corporation and Rose Valley Limited Partnership (“Curtis Regency”). Id. at 126 , 708 A.2d 1058 .

A local citizens’ group appealed the Planning Board’s decision