### No. 12351 INTHE SUPREME COURT OF 

### THE STATE OF MONTANA 19 74

STATE OF MONTANA, ex rel. DENZIL J. BARKER 

### and BETTY JEAN 

### BARKER, Petitioners and Appellants, -vs

# - TOWN OF STEVENSVILLE, etal., Respondents, -vs

# - ROBERT B

# .BROWN 

### and FRANCES 

### M. BROWN, 

### etal.

# , Plaintiffs and Respondents, and TOWN OF STEVENSVILLE

## , Plaintiff and Intervenor and Respondent, -vs

# - DENZIL J. 

### BARKER and BETTY 

### JEANBARKER, 

### etal., Defendants and Appellants.

Appeal from: District Court of theFourth Judicial District, Honorable Jack L. Green, Judge presiding. Counsel of Record: For Appellants

### : Christian, McCurdy, Ingraham and Wold, Polson, Montana KeithW. 

### McCurdy argued, Polson, Montana For Respondents: 

### Murray and Holt, Missoula, Montana Harold L. Holt argued, Missoula, Montana Larry Persson, Hamilton, Montana Robert B. 

### Brown, Stevensville, Montana

Submitted: April 24, 1974 Decided

### : 

### Jub

## -2

# 1m
Filed: 

## JUL.

# -21974

### Mr. Justice John ConwayHarrison delivered the Opinion of the Court.This is an appeal from a judgment denying an application for issuance of awrit of mandate. This is a unique case. 

### It is in some respectsmoot,nevertheless we feel justicerequires a study of the matter and the granting of such relief asmay be warranted. InJuly 1971,Denzil and Betty Jean Barkerpurchased two lotswithin the city limits of the Town of Stevensville,Montana. DenzilBarkerwas disabled and confined to awheelchair. Because of his limited income and disability, Barker signed a contract to purchasewhat is commonly called a "double-wide" mobile home. Purchasewas made through one Kratofil, a dealer inHamilton, Montana. After completing arrangements for the purchase, Barkers left Montana on July 17, 1971 for California to sell their home there and move their belongings to Montana. Just prior to leaving they arranged to have one Siphers, the real estate agentwho sold them the lots, to secure a building permit for them in their absence. Siphers agreed to so as a favor and acted gratuitously. Siphers appeared at the Stevensville town councilmeeting
on July 19, 1971 to request the issuance of a building permit. He presented the councilwith a color brochure, a lot layout plan, and a floor plan. The council felt it needed more information and appointed Robert GJeber, the Stevensvillepolice chief, to go to Hamilton,view the mobile home and reportback to the counsil. tlayor Summers also volunteered to view the home. Neither one reportedback to the council. Mayor Summersdid view the home in Hamilton. At this point there is a conflict in the testimony. Mayor Summers said he thought the council had authorized him to issue the permit if, inhis opinion, the Darker homewas similar to a home previously allowed in the town. The council members however deny such authorizationand testified they expected Mayor Summers to reportback to themwith his information.In any event, afterviewing the home, Summers returned to Stevensville and toldRaymond Meadows, the town officialwho issues building permits, to issue one to the Barkers. Meadows started to fillout the permit but lacked information as to thenumber of rooms, baths, etc. and so did not complete it. He testified that had he had that informationhe would have issued it atthat time. Further Meadows, as town building inspector, caused the town's water main and sewer tobe tapped to accept the connections from the Barker home. He testified thatwater and sewer taps aremade

as 

### a part of the normal course of events after abuilding permit has been issued; that the town council's authorization of building permits was normally communicated tohim by the mayor and this had been the practice as long ashe had been inoffice. Later on the same day Summers had told Pleadows to issue the permit, he encountered Siphers on the street and told him the permit would issue. Siphers proceeded toPleadowst officetoget the permit but he too lacked the information regarding thenumber of rooms, baths, etc., so the permit did not issue atthat time, On August 7, 1971, atabout 

### 11

### a. m., Summers again told Siphers that the permit had been granted. Siphers, acting upon that information, called Kratofil inHamilton and told him the permit had been issued and the home could be moved onto the Barker lots. On August 8 Sipherswrote to the Barkers informing them thepermit had been issued. However, the council, Mayor Summers included, went into session on the evening of August 

### 7, 1971and tentatively rejected the application. That decisionwas communicated to Siphers by Summers orally on the 8th, after Siphershad written toBarkers. Kratofil, unaware of therejection, moved one-half of the home onto theBarker lots on the 9th, but due tohigh winds was unable tomove the second half that day. Later that same day Summers called Kratofil and told him that no permit had issued. Being ata loss, Kratofilconsulted counsel and moved the second half of the mobile home a few days later. On August 

### 14, 1971, the town council met informal session and rejected the application.On August 

### 17, 3arkers returned from California and early on the 18th first learned of their troubles. They immediately gathered Lheir plans, neighbors' affidavits in support, and affidavits of a building contractor and an architect and presented them to the 5tevensville Planning Commission. At that time the Planning Commission was inthe process of formation and awaiting approval 2rom the county commissioners, hence it had no legal status and \+,as advisory only. The Planning Commission did, however, recommend approval. This decision, alongwith the plans and affidavits, was resubmitted to the town council. Shortly afterBarkers returned from California two of their neighbors instituted suit against the Rarlcers seeking an injuntion
to compel them toremove the housing unit. The Town of Stevensville intervened, appearing against the Barkers, and cited town ordinances which called for possiblejail sentences. On October 

### 29, 

### 1971, Barkers sought a writof mandate t?compel issuance of the building permit. On October 

### 30, 

### 1971, the town council sent a letter to the Barkers ordering them toremove the home. (The h0rr.e

was removed inMay 1972). The two causes were consolidated for trial before the district court, sittingwithouc 

### a jury. Judgment was entered in favor of the Town of Stevensville and against the Sarkers. They appeal. During oral argument before this Court, counsel informed the Court Lhe mobile home had been repossessed but that Earkers still dwn the lots. Ordinarily this would render the appeal moot, but

we. find other matters j-n this casewhich we feel should be commented upon. We willnot discuss the issues raised by the Barkers. We fi-lid the issue rai-sedby the record, briefs, and argument iswhether the conduct of the town council and the mayor of Stevensvillewas

su fundamentally unfair to the Barkers as torequire reversal. We hold that itwas. The town council on thebasis of the acts of the mayor and clerk should have been estopped from asserting the Barker home would have to be removed from the Town of Stevensvillebecause no building permit had been issued therefore putting the Barkers inviolation of town ordinances. 

## - 4

# -y,~/e are aware of he ,peat weight of authority holding that

A xunicipal corporation isnot bound by acts or statements of its dgents or officers made inexcess of their authority, even where

-3 shird party has relied thereon to his detriment. See: Anno. 

### 6 .LK2d 960; 3McQuillin Municipal Corporations, 3rd Ed., 

### 5 12.126a. Various rationales have been advanced for such a rulebut the most soundly reasoned isthat tobind the corporation to acts and sutements of itsagents or officerswould have the effect of ilidking cityordinances and regulations a nullity every time a luunicipal agent or officer led a third party toact incontravention of such ordinance regulation. 6ALR2d 960, 94. This rule couldbe extremely harsh initsapplication. It is to snitigate this harshness that some stateshave fashioned a qualification to this general rule. The Illinois rule as stated inCities Service OilCo. v. City of Des Plaines, 21 I11.2d 157, 171 N.E.2d 605, 608, is: "The general rule isqualified, however, to enable a party to invoke the doctrinewhere his actionwas induced by the conduct of municipal officers, and where inthe absence of such relief he would suffer a substantial loss and municipality would be permitted to stultifyitself by retractingwhat its agents had done. 11 Application of this qualification has been used sparingly. People ex re1Amer. Nat'l Bank and Trust Co. of Chicago v. Smith, 

### 110 Ill.kpp.2d 354, 249 N.E.2d 232; City of Rockford v. Sallee, 1-29IIl.App.2d 75, 262 N.E.2d 485. Nonetheless it is available for those exceptional cases where itsuse isjustified. Emerald Home Builders, Inc. v. Kolton, 

### 11 Ill.App.3rd 888, 298 N.E.2d 275. 2 Municipal Corporation Law, Antieau (1973 Ed.), 

### 5 16A..05, criticizes the general rule, saying: 

### he prevailing rule isunjust and should be repudiated or atleast qualified." In 2 Nunicipal Corporation Law, Antieau (1973 Ed.), S16A.06,

a test is suggested for circumstances 

### inwhich the doctrine should

IIIt issuggested that there should be no general rule that estoppel isnot tobe applied inpolice power situations. Rather courts should be encouraged toweigh inevery case the gravity of the injustice to the citizen

### if the doctrine is not applied against the injury to the commonweal if the doctrine is applied in that case. Where any danger to the public is slight and.a citizen has made a good faith and substantial change in position in reasonable reliance upon the conduct or representations of municipal officials and agents, several courts have estopped the local government from exercising their 'police power' in a way inconsistentwith their prior representations ar actions.II 

### We agreewith this approach. In cases of this kind there should be a balancing of the municipal corporation's unwarranted assumption of risk of liability for acts or statements of its agents or employees made in excess of their authority against the harm done to good faith, innocent and unknowledgeable third parties who act in reliance upon those representations. It follows that each casewill necessarily have to be judged upon its own unique factual situation. We do not suggest that a municipal corporationwill not be able to enforce valid city ordinanceswhen its agents have acted in excess of their authority. However,by the same token,we are notwilling to permit the municipal corporation to deny the validity of its agents' actions in all cases. To do so lends itself too readily to situations in which equity and justicewould be denied. Applying what has been said heretofore to the instant case,
we find that a town official, the mayor, represented to ~arkers' agent that a building permit had issued,when in fact it had not, thereby resulting in a course of action by the Barkers and their agent leading to a substantial loss. We have a situationwhere application for a building permit
was made to the to~m council. The to~m council felt that more informationwas necessary in order for it 

### to reach a decision. To that end oneman was appointed 

### by the council and another volunteered to obtain that information. Neither man ever reportedback to the to~m council. Yet at a subsequent meeting, the applicationwas rejected for lack of that information. Such a procedure does not comport with elemental fairness.'de now have the ~roblern of granting appropriate relief. 'the huusing unit is gone and cannot be put back. We willnot go so far

i3 to give the Barkers carteblanche tomove any housing unit of Chcir choice onto their lots, without meeting the terms of the il~plicable ordinances. We do hold however, that upon proper appliddcion they are entitled to a fairreview, and if denied, a written 2xplanation of the reasons within a reasonable time. Costs inthese consolidated cases shallbe taxed in the district court infavor of the Barkers and against theTown of ~revensville, including an attorney fee hereby fixed atthe sum ui $750.00.

We Concur : fl 

### \ i 

# .

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### - ,i. -: *m. \ -J-,4:-rld-jSui-2$ 

# ---- --we----- 

## ----- Chief Justice



## ................................. Justices.

### Nlr. Justice Gene B. 

### Daly specially concurring: 

### I concur with the majority that to prevent unnecessarily harsh results to the common weal in selected cases, where the factspermit, an equitable exception to the rule can be applied. However, once committed to this rationale the Court must proceed to do equity. Here the majority has given the Barkers the right to a fair review upon proper application. I assume this would be before the municipal authorities, in which case this result could have been obtained without the aid of this Court. These people asked for the right to proceed to assemble and occupy a two-widepreconstructed home on their property, not carte blanche authority to move any house onto the property. The housing unit is gone by repossession,but nowhere in the record is it indicated it cannot or will not be replaced. Therefore, the appellants have gained nothing unless equity gives them the relief prayed for.



## ------------ 

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# A/%

Justice

h.fr. J~~~-: 

### L~ce Frank 1. 

### Yaswell specially concurring

### -inJustice 

### ~aiy's specially 

### concurring opinion< 

### I concur in the 

### foregoing specially concurring opinion of 

### 3r. Justice Dafy.



### Justice.