NO. 95-285 IN THESUPREMECOURTOFTHESTATE OFMONTANA 1995
MARGUERITE BOLAND; THOMASF. and RUTHCORBALLY; BRIAN BIRKENBUEL; HARRYand RUTHGARDNER; JEANNIE and WILLIAM JUPKA; MARYLAIRD; WINONAand HILMUTH KRUCKENBERG; MINNIE ISLER; EDWARDand SUZANNEMERLO; SUSANBOLAND; RICHARD and DONNAOSWEILER; WILLIAM and CHARLENE KITTO; and BETTY McGAVIN,

Plaintiffs and Appellants,
v. CITY OFGREAT FALLS, MONTANA,

Defendant and Respondent, and TOPGUN, INC.,

Intervener/Defendant and Respondent.
APPEAL FROM: District Court of the Eighth Judicial District,

In and for the County of Cascade, The Honorable Joe Hegel, Judge presiding.
COUNSELOFRECORD:

For Appellants: Marcia Birkenbuel, Attorney at Law, Great Falls, Montana For Respondent: David V. Gliko, City Attorney, Great Falls, Montana For Intervener/Defendant and Respondent: J. Kim Schulke, Linnel, Newhall &Martin, Great Falls, Montana

V~' Submitted on Briefs: December 21, 1995 ?i!

... ...*' rrr, 0 ,"il(l Decided: February 2, 1996Justice Charles E. Erdmanndelivered the opinion of the Court.

This is anappeal from anorder issued bythe Eighth Judicial District Court, Cascade County, granting defendants' motions for summaryjudgment. Weaffirm. The issue onappeal is whether the rezoning of a 12.9 acre area from 7,

A" residence use to 1, CT!residence use constitutes illegal spot zoning. FACTS At issue in this case are four city blocks in the Central Avenue Addition to the City of Great Falls (the Property). The Property waspreviously ownedby the Sisters of Providence (the Sisters) whofor manyyears hadoperated the St. ThomasOrphanage
onthe Property. Several years agothe structures were torn down and the Property becamevacant, being used only for a baseball diamond onthe southwest corner. Thebaseball facility has since been removed. TheProperty is located in anarea zonedasan"A" residence district for use by single family residences andother permitted
uses. TheProperty, however, hasnever beenusedfor single family residences. Adjacent to the Property is apark, the old east side fire station which is nowawarehouse, andawater tower. There is also achurch andatwo-family dwelling unit in the adjacent area. In 1992, James Benson entered into an agreement with the Sisters to purchase the Property in order to construct a condominium development. Benson submitted anapplication to the

2City-County Planning Board to change the zoning of the Property

from "A" residence district, "A" area, to "C" residence district, "B"area, which would allow the condominium development. TheBoard held a hearing in February 1993. Onewritten objection to the project wasreceived within the tine allotted. Anumberof people living near the Property appeared at the hearing andobjected to the zonechange. Oneproperty owner filed aletter andalso spoke in support of the project. The Board recommended to the City Commission that the zonechangebegranted upontwelve conditions. The City Commission set a hearing for April 6, 1993, to consider the adoption of Ordinance #2650. This ordinance would allow the rezoning based uponthe conditions set bythe Board. The public hearing wasultimately held onJune 15, 1993. Tenpeople spoke in favor of the proposed zone change, while three people spoke in opposition. TheCommission adopted the proposed ordinance subject to the completion of azoning contract between Benson, the Sisters, andthe City of Great Falls. Ultimately, the Commission approved the zoning contract andthe condominium project. OnJune30, 1993, twenty-three residents of the adjoining area brought adeclaratory judgment action seeking adetermination that the rezoning action constituted illegal spot zoning andrequesting that the Property be restored to its previous zoning classification. Plaintiffs and defendants filed notions for summary judgment. OnMay4, 1995, the District Court granted defendants' motions for summaryjudgment andfrom this plaintiffs appeal.

3STANDARD OFREVIEW Under Rule 56(c), M.R.Civ.P., summaryjudgment is proper if the record discloses nogenuine issues of material fact, andthe moving party is entitled to judgment asamatter of law. Lutey Const. v. State (1993), 257Mont. 387, 389, 851P.2d 1037, 1038. Theparties stipulated that nogenuine issues of material fact exist in this case. The standard that this Court applies in reviewing agrant of summaryjudgment is the sameasthat initially utilized bythe trial court under Rule 56, M.R.Civ.P. McCracken v. City of Chinook (1990), 242Mont. 21, 24, 788P.2d 892, 894. Since weare reviewing adiscretionary exercise of the City's legislative authority, wemustdecide whether the zoning ordinance in question bears areasonable andnot arbitrary relationship to a permissible state objective. Anderson Ins. v. City of Belgrade (1990), 246Mont. 112, 119-20, 803P.2d 648, 652-53 (citing Cutone
v. Anaconda-Deer Lodge (1980), 187Mont. 515, 524, 610P.2d 691, 696-97). DISCUSSION Does rezoning of a12.9 acre area from "A" residence use to "C" residence use constitute illegal spot zoning? Local municipal governments in Montana are empoweredto enact zoning ordinances restricting the use of property in their jurisdictional area. Section 76-2-301, MCA,states that: For the purpose of promoting health, safety, morals, or the general welfare of the community, the city or town council or other legislative body of cities and incorporated towns is hereby empowered to regulate and 4restrict the height, number of stories, and size of

buildings and other structures; the percentage of lot that maybe occupied; the size of yards, courts, and other open spaces; the density of population; and the location anduseof buildings, structures, andland for trade, industry, residence, or other purposes. Azoning ordinance enacted pursuant to this statute will be found to beaconstitutional exercise of police power if it hasa substantial bearing upon the public health, safety, morals or general welfare of the community. Anderson Ins., 803 P.2d at 650 (citing Freemanv. Board of Adjustment (1934), 97Mont. 342, 352,
34 P.2d 534, 537). Theplaintiffs presented twoseparate issues onappeal. Their initial issue addresses whether the newzoning useis significantly different from the previous use, which is the first element of the "spot zoning" test. Their second issue addresses the second two elements of the "spot zoning" test. Wewill address both issues in the context of the "spot zoning" test previously adopted bythis Court.In Little v. Boardof County Commissioners of Flathead County (1981), 193Mont. 334, 631P.2d 1282, weidentified the following three factors that are generally present whenillegal spot zoning occurs, which werestate asfollows:

1. The requested use is significantly different from the prevailing use in the area.
2. Thearea inwhich the requested useis to apply is rather small, however, this factor is more concerned with the numberof separate landowners benefited bythe requested change than it is with the actual size of the area benefited.

53. The requested change is more in the nature of

special legislation. In other words, it is designed to benefit only one or a few landowners at the expense of the surrounding landowners or the general public. Little, 631 P.2d at 1289. Wenoted that the three factors are not mutually exclusive and cautioned that any definition of spot zoning must be flexible enough to cover the constantly changing circumstances under which the test may be applied. Little, 631 P.2d at 1289. The plaintiffs contend that the City of Great Falls engaged in illegal spot zoning by singling out one small piece of property for
ause that is significantly different from the surrounding area. The plaintiffs argue that the prevailing use in the area has been those uses allowed by the "A" residence zone which does not allow for multiple dwelling structures like those proposed by the condominium developer. Plaintiffs contend that if there is no significant difference between the types of dwelling units allowed in "A" zones and those allowed in "C!"zones, there would benoneed for designating distinct residence zones. Plaintiffs maintain there is asignificant difference between acondominium development andaneighborhood of single family homes located onstandard-sized city lots. The City's position is that the proposed "residential condominium" use is similar to the surrounding single family residential use and that the zoning contract entered into by the parties provides the necessary restrictions to insure compatibility. The City also notes that the "A" residence zone does 6permit "townhouses" asaconditional useandargues that townhouses

are not significantly different in nature, density, andappearance from condominiums. The proposed condominium project consists of single family attached units onthe interior of the Property andsingle family detached units onthe perimeter to act as ascreen between the existing single family dwellings adjacent to the Property andthe rezoned area. TheCity required the developer andthe Sisters to enter into azoning contract that included anumberof restrictions in order to preserve the residential integrity of the Property. Therequirement that the condominium units onthe perimeter of the Property be single family detached units, along with the other restrictions required bythe City, insure that the newdevelopment will becompatible with the surrounding area. It should also benoted that despite the designation as an "A" residence district, the Property was originally used as the site for anorphanage and has never been used for single family residences. The old eastside fire station, now used as a warehouse, awater tower, achurch andatwo-family dwelling unit,
noneof which are single family residences, are located in the area adjacent to the Property. While the maximumdensity level will betwenty-nine percent higher than if the Property weredeveloped solely assingle family detached residences, it is important to note that the "A"residence
zonepermits "townhouses" asaconditional use. In fact, the City

7determined that V[tlhe exact project proposed for the Property

could bebuilt asatownhouse project bysubmitting anamendedplat to cause lot lines to be located on the commonwalls of the attached single family dwelling units

. . .'I Moreover, if townhouse units were built where the single family detached condominium units are proposed, the density level would be even higher than that contemplated bythis zonechange. We conclude that the proposed condominium project is essentially residential in nature andnot significantly different from the prevailing use inthe area. Therefore, the first prong of the Little test is not satisfied. Having madethat determination, wenowmust determine whether it is necessary to proceed to the final twoelements of the Little test. In explaining the test, westated that "[iIf spot zoning is invalid, usually all three elements are present or, said another way, the three statements maymerely benuances of oneanother." Little, 631P.Zd at 1289 (citing Hagman, Urban Planning and Land Development Control Law (1971) at 169). Since weheld in Little that "usually" all three elements are required to establish illegal spot zoning, it is possible illegal spot zoning canoccur in the absence of anelement. Wetherefore find it necessary to examine the remaining elements of the test. Our review of the record reflects that the remaining elements of the Little test are not satisfied.The second and third elements of the Little test must be

analyzed together. Thenumberof separate landowners affected by the rezoning relates directly to whether or not the rezoning constitutes special legislation in favor of only oneperson. Since
noneof the surrounding landowners havebeengranted permission to build condominiums on their property, plaintiffs argue that rezoning the Property benefits only the condominium developer. We determine that the plaintiffs' viewpoint is too narrow in its scope.Weagree with the plaintiffs that the primary focus of the second andthird Little factors is not the benefit resulting from the development of the Property, but rather the benefit to landowners asaresult of the rezoning. However, wedisagree with plaintiffs' contention that only the condominium developer will benefit asalandowner from the zoning change. Our review of the record indicates that the orphanage was razed onor about March 1983. After the building wasrazed, the Property was placed for sale and for approximately seven years prior to the proposed development the Sisters had received no serious offers topurchase the land. TheProperty hasdeteriorated
over the years to the extent that it nowcontains avariety of nuisances andeyesores, including broken glass, animal excrement, noxious weeds, unkept anddeadvegetation, unfilled basements, and abandoned boilers. The City offered testimony that the zoning change would increase the value andsalability of the surrounding

9property by eliminating the existing blight resulting from the

nonuse of the lots andbyeliminating the uncertainty of the future
use of the Property, thereby benefitting the surrounding neighborhood. Wetherefore agree with the District Court which found that the zoning change would benefit the adjacent property
owners whose property values would tend to increase from the project development. Thus, rezoning the Property will directly benefit more landowners than merely the individual developer. We therefore conclude the zoning change is not in the nature of special legislation designed to benefit only one landowner. Having concluded that the zoning change does not constitute spot zoning, wemust nowdetermine whether Ordinance #2650bears a reasonable relationship to the advancement of the public health, safety, morals or general welfare of the community. Section 76-z-301, MCA;Anderson Ins., 803P.2d at 652. The City recognized the community's need for adequate and affordable housing in its Mission andGoals Statement. Aspart of its comprehensive review of the zoning change request, the City Commission determined that rezoning the Property would address the community's housing shortage, as well as provide a positive economic benefit to the community asawhole. Theeconomic benefit extends not only to the developer but also to the Sisters, the construction companies and local labor force, the potential condominium purchasers, andthe local taxing authorities. While the rezoning ordinance applies to afour square block area, the

10Commission examined anumber of factors and determined that the

rezoning benefits both directly andindirectly asignificant number of landowners and has asubstantial bearing onthe general welfare of the community. Rezoning the Property to allow for the housing development is a reasonable exercise of the City's legislative authority. Furthermore, the Commission addressed the integrity of the surrounding area in attempting to meet its need for additional housing. The Commission determined that there were adequate public improvements, including transportation routes, water and sewer facilities, schools, and parks in the surrounding neighborhoods. The zoning contract regulates and restricts the development to prevent overcrowding, traffic and parking problems, and junk structure problems. After a full and complete review of the circumstances, the Commission determined that the rezoning ordinance encourages the most appropriate use of the land and should have anegligible effect onthe balance of land uses in the
area. Wehave stated that: The purpose of zoning is not to provide for the highest or best use of each particular lot or parcel of land within the zones or community, rather it is to benefit the communitygenerally by the sensible planning of land uses taking into consideration the peculiar suitabilities and most appropriate use of land throughout thecommunity. Anderson Ins., 803 P.Zd at 651 (citing Cutone, 610 P.2d at 694). Weconclude that the rezoning ordinance does not constitute illegal spot zoning and that the City acted in areasonable manner 11and within its statutory power when it rezoned the Property. We

hold that the District Court did not err in granting defendants' motions for summary judgment, and therefore, affirm the District Court's order. 

# a!

Justice
Weconcur:

12Justice Terry N. Trieweiler dissenting.

I dissent from the majority's conclusion and conclude that when the City of Great Falls rezoned a 12.9 acre area from "A" residence use to "C" residence use it engaged in classic spot zoning.The majority opinion correctly sets forth the law regarding spot zoning. However, I disagree with its application of that law to the facts in this case. For example, under the first criteria for spot zoning established in LittleY.BoardofCountyCommissionersofFlatheadCounty(1981) , 193 Mont. 334, 346, 631 P.2d 1282, 1289, the question is whether the proposed use is different than the prevailing use in the area. I conclude that the proposed condominium development was a significantly different use than the single-family residential use of the surrounding area. In an "A" residence district, only single-family dwellings are allowed. In a"C" residence district, apartment houses, multiple dwellings, and townhouses are allowed. Although, as the majority points out, townhouses are permitted as
aconditional use in "A" residential districts, conditional uses
are not automatically granted. Conditional uses are permitted only after submission of a detailed application, and after all the procedures pertaining to azone change, including apublic hearing, have been complied with. Single-family residential use is substantially different than multiple-unit housing. In an "A" residential district, homes, along with the property on which the homes are located, are 13individually owned. Eachindividual property owner is responsible

and accountable for the maintenance of his or her ownproperty. Ownership in acondominium unit, onthe other hand, provides title to the dwelling unit, but nopersonal ownership of the land on which the unit is located. A condominium owner owns only a percentage interest in the commonelements which include the land
onwhich his or her dwelling unit is located. Individual unit
owners have no personal control over maintenance of the real property onwhich they reside. Furthermore, the population density of the area where this proposed condominium development is to be located will be twenty-nine percent higher than it would be if developed for single-family residential use. It logically follows that the traffic volume in the neighborhood can be expected to increase twenty-nine percent morefollowing the development of the area for condominium usethan it would following development of the area for single-family residential use. Anyonewhohasever lived in both asingle-family residential
area and a condominium development, or driven through the two different types of neighborhoods, knowsthat the character of each is entirely different from the other. In short, there is nothing similar about a condominium development and a single-family residential neighborhood. If the two types of neighborhoods were as similar as the City of Great Falls nowcontends, and as the majority nowholds, then there would benoreason for the City of Great Falls to restrict condominium developments to class "C" 14residential areas, rather than simply allow any type of residential

construction in aclass "A" residential area. For these reasons, I conclude that the proposed use of the land in question was significantly different from the prevailing
use in the area and I disagree with the majority's conclusion to the contrary. In Little, we set forth the second and third factors to be considered as follows: Second, the area in which the requested use is to apply is rather small. This test, however, is concerned more with the number of separate landowners benefited by the requested change than it is with the actual size of the area benefited. Third, the requested change is more in the nature of special legislation. In other words, it is designed to benefit only one or afew landowners at the expense of the surrounding landowners or the general public. Little, 193 Mont. at 346, 631 P.2d at 1289 (citations omitted; emphasis added). The second test, as pointed out, is concerned with the number of separate landowners benefited by the requested change. In this case, only one landowner is benefited by the change. That is the
owner who intends to develop the property for multiple-unit residential construction, and who will presumably profit more by developing it for that purpose, rather than single-family residential use. For the samereason, the third Little factor is satisfied in this

case. The developer of the condominium in the middle of asinglefamily residential neighborhood will profit by his development at

15the expense of those surrounding landowners whopurchased andmoved

into their homes based on the assumption that the residential character of the neighborhood would remain asit wasbecause of the zoning restrictions that were then in place. In summary, I conclude that the proposed condominium development to which the appellants objected was significantly different from the prevailing use of their neighborhood, will benefit only the developer, and was in the nature of special interest legislation intended to benefit the developer at the expense of surrounding landowners and the public in general. For these reasons, I dissent from the majority opinion. I would reverse the order of the District Court which granted summary judgment to the respondent and remand to the District Court with instructions to enter summary judgment in favor of the appellants.

Justice William E. Hunt, Sr., joins in the foregoing dissenting opinion.

Justice

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