Title: City of Anderson v. ASSOCIATED FURNITURE, ETC.

State: indiana

Issuer: Indiana Supreme Court

Document:

423 N.E.2d 293 (1981)
CITY OF ANDERSON (Appellant),
v.
ASSOCIATED FURNITURE & APPLIANCES, Inc. (Appellee).
No. 781S178.

Supreme Court of Indiana.
July 8, 1981.
James E. Freeman, Jr., Deputy City Atty., Anderson, for appellant.
*294 John E. Eisele, Anderson, Theodore F. Smith, Jr., Anderson, for appellee.
GIVAN, Chief Justice.
Appellee has petitioned this Court to accept transfer of this case from the Court of Appeals. 398 N.E.2d 1321. We grant transfer, set aside the decision of the Court of Appeals and reinstate the decision of the trial court.
On January 24, 1977, Associated Furniture & Appliances, Inc. filed a petition with the Madison County Planning Commission for a change in a zoning ordinance which restricted the use of a piece of real estate owned by them. Specifically, Associated sought to rezone the parcel of property from a residential classification to a commercial classification. The City Planning Commission recommended to the Common Council of Anderson that the petition be granted.
On March 10, 1977, the Common Council rejected Associated's petition to amend the zoning ordinance. Appellee sought judicial review in the Madison Superior Court. The trial court entered judgment for Associated and entered findings of fact as requested by the City of Anderson. On appeal by the city the Court of Appeals reversed the trial court holding that the decision of the Common Council was supported by substantial evidence and that the decision of the Common Council could be reversed by a court only where the decision was arbitrary, capricious and an abuse of discretion.
First we address the question of the subject matter jurisdiction of the trial court. The Court of Appeals correctly held that Associated could not utilize the certiorari procedure prescribed for judicial review of decisions of a Common Council when it acts as a board. I.C. XX-X-XX-X [Burns, 1976 (repealed by Acts of 1980, P.L. 8, § 175 effective April 1, 1980)]. In the instant case the appellee sought judicial review of a decision of a Common Council acting in its capacity as a legislative body.
However, in the case at bar the trial court did have subject matter jurisdiction, in that, appellee alleged the decision of the Common Council constituted an unlawful taking of property in violation of the Fifth and Fourteenth Amendments of the United States Constitution and Article 1, §§ 21 and 23 of the Indiana Constitution. Thus, the jurisdiction of the trial court was not based upon a particular statute but rather upon a constitutional claim. Hence, even though appellee erroneously relied upon I.C. XX-X-XX-X, supra, for a jurisdictional basis, the action was properly brought as a direct action for a declaratory judgment, pursuant to I.C. XX-X-XX-X et seq. [Burns, 1976] and for an injunction. Town of Schererville v. Vavrus, (1979) Ind. App., 389 N.E.2d 346; City of Evansville v. Reis Tire Sales, Inc., (1975) 165 Ind. App. 638, 333 N.E.2d 800.
Appellant next argues the trial court erred in granting Summary Judgment in favor of Associated because there were material questions of fact as to whether the real estate had any reasonable value as residential property. However, appellant's argument that the trial court erred in granting Summary Judgment was waived when it stipulated the court could review the evidence presented to the Planning Commission together with all of the reports and other documents filed with it, the transcript of the Common Council meeting, the testimony of Bruce Pearson, an employee of the Planning Commission, and said evidence would be the only evidence presented. In arriving at his decision, the trial judge considered all of the evidence which would ever be before him. The judgment was properly rendered regardless of whether it was denominated a Summary Judgment or simply a judgment.
The city next claims the court order violated the separation of powers doctrine of Article III, § 1 of the Indiana Constitution. This section provides: "[t]he powers of the government are divided into three separate departments; the Legislative, the Executive including the Administrative, and the Judicial; and no person, charged with official duties under one of these departments, shall exercise any of the functions of another, except as in this Constitution expressly provided."
*295 Appellant relies upon State ex rel. Indiana Alcoholic Beverage Commission v. Lake Superior Court, (1972) 259 Ind. 123, 284 N.E.2d 746. In that case, this Court stated a court does not have jurisdiction to grant or renew licenses of alcoholic beverage retailers "except upon judicial review of the administrative action." State ex rel. Indiana Alcoholic Beverage Commission v. Lake Superior Court, supra, at 126, 284 N.E.2d  at 748. In the instant case the appellee requested the court to review the constitutionality of action taken by a legislative body. If appellant were to prevail in this argument, parties would find themselves without remedy where zoning ordinances constituted an unconstitutional taking of property. See City of Evansville v. Reis Tire Sales, Inc., (1975) 165 Ind. App. 638, 333 N.E.2d 800, supra. Where a law or the application of a law is challenged on constitutional grounds, the judiciary has the authority, as well as the duty, to explore the constitutional ramifications of the law. As this Court stated in Town of Homecroft v. Macbeth, (1958) 238 Ind. 57, 64, 148 N.E.2d 563, 567.
In addition to the above appellant's reliance upon the separation of powers doctrine is not viable since that provision applies only to state government action. It has been stated that Article III, § 1 "relates solely to the state government and officers and their duties under one of the separate departments of the state and not to municipal government and officers." Livengood v. Covington, (1924) 194 Ind. 633, 643, 144 N.E. 416, 419; Mogilner v. Metropolitan Plan Commission, (1957) 236 Ind. 298, 140 N.E.2d 220; Willsey v. Newlon Trustee, (1974) 161 Ind. App. 332, 316 N.E.2d 390. We therefore hold appellant's argument that the trial court's intervention violated the separation of powers clause of the Indiana Constitution is not applicable in this case.
Appellant claims the trial court erred in finding the decision of the Common Council contravened I.C. XX-X-X-XX. This statute provides guidelines which a city council or board of county commissioners must follow when establishing new or changing existing land use regulations. As Judge Staton wrote in Metropolitan Board of Zoning Appeals of Marion County v. Sheehan Construction Co., (1974) 160 Ind. App. 520, 526-27, 313 N.E.2d 78, 82.
In the case at bar the trial court made the following findings of fact:
These factual findings are supported by the evidence. The trial court further found the Common Council acted arbitrarily, capriciously and that the failure of the Council to rezone Associated's property constituted an unlawful taking of property. It was uncontroverted that the highest and best use of the land was as commercial rather than residential property. The Court of Appeals correctly held that a refusal to rezone results in an unconstitutional taking only where it prevents any reasonable use of the land. However, there was sufficient evidence to support that conclusion in this case. The attorney for Associated *297 read into the record of the Common Council meeting a letter from a real estate appraiser which stated as follows:
We hold the evidence is sufficient to support the trial court's finding that the only reasonable use of this property was as commercial property and that the Common Council's refusal to rezone the land constituted an unconstitutional taking.
The City also asserts since Associated suffered a negative judgment in the Common Council, it could not challenge the sufficiency of the evidence in the subsequent judicial proceedings, but that it was limited to attacking the Council's decision as being contrary to law. In the first place, the trial court's findings of fact state that all of the facts favored Associated and that "defendant failed to present any evidence in opposition of probative value." Here, as found by the trial court, the evidence leads to but one conclusion and the Council's decision had reached an opposite conclusion. Thus, the decision of the Council was, in fact, contrary to law as found by the trial court. See Dagley v. Incorporated Town of Fairview Park, (1978) Ind. App., 371 N.E.2d 1338.
The record indicates the evidence was sufficient to support the determination of the trial court that the Common Council's denial of Associated's petition to rezone their property was an unconstitutional taking. Accordingly, we reverse the decision of the Court of Appeals and reinstate the decisions of the trial court.
PIVARNIK and PRENTICE, JJ., concur.
HUNTER, J., not participating.
DeBRULER, J., dissents, without opinion.