Opinion ID: 2549692
Heading Depth: 3
Heading Rank: 2

Heading: The Municipality Had Authority To Impose the Conditions and Requirements.

Text: Spinell argues that the municipality has no authority to require Spinell to construct and warrant streets or install landscaping as a condition for a building permit or certificate of occupancy. It asserts that the conditions the municipality imposed on the issuance of building permits and certificates of occupancy were only binding on the subdivider of the property. Spinell argues that because it was not the subdivider of any of the properties at issue, the municipality could not require Spinell to construct and warrant streets or install landscaping in order to receive a building permit or certificate of occupancy. We conclude that whether Spinell was the subdivider is irrelevant, because AMC 21.15.120(E) gives the municipality authority to enforce the plat notes and plot notes against Spinell. The municipality did not have to issue building permits or certificates of occupancy as long as the requirements listed on the plat notes were unfulfilled. Subsection 21.15.120(E) of the Anchorage Municipal Code authorizes the platting authority to place conditions on the final approval of a subdivision plat. [8] The platting authority indicates those conditions through notations on the plat. Subsection .120(E) provides that these notes become restrictive covenants in favor of the municipality that run with the land. Spinell attempts to distinguish the conditions and requirements the municipality imposed here from the conditions and requirements running with the land under the code. It argues that the disputed conditions and requirements do not fall within subsection .120(E) and do not run with the land, but instead are personal obligation[s] imposed on the subdivider by the platting board. Spinell notes that the subdivider must post a performance bond to guarantee the installation of the landscaping, and argues that this condition is a personal obligation rather than a restrictive covenant running with the land. Spinell then argues that it is not a subdivider and does not stand in the place of a subdivider but is merely a subsequent lot owner. The municipality argues that under AMC 21.15.120(E), [o]nce the landscaping requirements were set forth on the recorded plat, they became a restrictive covenant, and the land could not be occupied or maintained in a fashion which failed to meet the terms of the plat note. We agree. Subsection .120(E) clearly states that plat notes may be enforced against the subdivider or any subsequent owner by the municipality. The municipality was not obliged to issue building permits and certificates of occupancy to Spinell or anyone else if the conditions and requirements in the plat notes had not been met.
Spinell argues that the Anchorage Municipal Code, the 1997 Uniform Administrative Code (UAC), and the 1997 Uniform Building Code (UBC) [9] required the municipality to issue a building permit or certificate of occupancy whenever an applicant complies with the administrative and technical requirements provided in the building codes, and the proposed structure constitutes a permitted use of the property under the applicable zoning ordinances. The municipality responds that these codes do not obligate it to issue permits or certificates if the building official finds any violations of those codes or any other laws. Uniform Administrative Code § 303.1, which governs the issuance of building permits, states in part: The application, plans, ... and other data filed by an applicant for permit shall be reviewed by the building official. Such plans may be reviewed by other departments of this jurisdiction to verify compliance with any applicable laws under their jurisdiction. If the building official finds that the work described in an application for a permit and the plans, specifications and other data filed therewith conform to the requirements of this code and the technical codes and other pertinent laws and ordinances, and that the fees specified in Section 304 have been paid, the building official shall issue a permit therefor to the applicant. Uniform Administrative Code § 309.3, which discusses certificates of occupancy, states in part: After the building official inspects the building or structure and finds no violations of the provisions of this code or other laws which are enforced by the code enforcement agency, the building official shall issue a certificate of occupancy.... Spinell argues that these provisions obligated the building official to issue building permits and final (rather than temporary) certificates of occupancy. [10] It is undisputed that Spinell's applications for building permits and certificates of occupancy complied with administrative and structural requirements for the homes it constructed or planned to construct. It is also undisputed that building the single-family homes Spinell constructed or planned to construct was a permissible use of the land under the applicable zoning ordinances. Spinell asserts that the only requirements that it failed to meet were the additional public improvement conditions the municipality imposed. Spinell argues that the AMC did not authorize these requirements for completing public improvements, and that therefore the building official should have issued the permits and certificates. But under UAC § 309.3, the municipality does not have to issue a certificate of occupancy if there are any violations of any provisions of the AMC, the UAC, UBC, or the plat notes. A final certificate of occupancy is essentially a guarantee to third parties that the building official inspected the completed project and found no violations of any ordinance, plat note, or building or zoning code. [11] The municipality characterizes Spinell's argument as ask[ing] this court to ... compel Anchorage to perpetrate widespread fraud upon homebuyers, lenders, title companies, and others by forcing the municipality to issue final certificates of occupancy despite Spinell's violations of the plat notes. Spinell would have the municipality ignore violations of the plat notes and issue building permits and certificates of occupancy as long as Spinell did not commit those violations. We do not think the UAC, UBC, and AMC require this result. It is irrelevant to our analysis whether the landscaping had to be installed by Spinell or its predecessors in interest in each of the subdivisions. Our analysis turns on the circumstance that the plat notes contain a restrictive covenant that runs with the land, is tied to the certificate of occupancy, and states that landscaping will be installed in the subdivision. Spinell had both constructive and actual notice of those provisions. The sales agreement for Spinell's purchase of the Muirwood Park Subdivision, for example, contained a handwritten note initialed on behalf of Spinell stating that [t]his agreement is contingent on the buyer Spinell Homes reviewing and approving the requirements of platting and plat notes. Also illustrative is the plot plan Spinell submitted for a lot in the Ponds Subdivision which indicated where buffer landscaping would be installed and which stated that [a]ll work shall be done as shown on this plot plan. When the platting authority placed notes on the relevant plats indicating the landscaping requirements, Spinell was placed on constructive notice of those requirements. Plat notes are covenants that run with the land and are enforceable by the municipality against subsequent owners. The certificate of occupancy is an administrative enforcement tool that enables the municipality to ensure compliance with all laws, conditions, and obligations. Landscaping requirements in Anchorage have historically been tied to the issuance of certificates of occupancy. [12] Because the conditions had not been fulfilled, the municipality was not obligated to issue a certificate of occupancy.
Spinell argues that per AMC 21.87.055, [13] once the municipality accepts a performance bond from a subdivider to guarantee the installation of public improvements, the municipality's only remedy when improvements are not completed is to proceed against the performance bond, not to deny a certificate of occupancy or building permit. Spinell points to commentary supporting this position: Where a subdivision plat has been approved by the planning board and a bond to assure improvement of the streets and other required installations has been furnished, a building permit cannot be withheld on the ground that the street has not been suitably improved as required by the planning board, as required by a collateral statute. It is contemplated that permits will issue once the bond is furnished, and the map approved and filed. [14] Relying on this language, Spinell argues that the municipality had to complete the subdivision improvementsparticularly the streets in the Michael Subdivisionat its own expense. Spinell claims that the municipality had no authority to withhold building permits or certificates of occupancy from Spinell merely because the improvements had not been constructed. Spinell also cites to a Maryland case in which a developer acquired two subdivision lots from a prior developer who had posted a performance bond to guarantee the improvement of a road adjoining the subdivision. [15] The defendant county issued building permits to the new developer, which began construction. Later, the county threatened to withhold certificates of occupancy until the public improvements were completed. The Maryland Court of Special Appeals ruled that the county could not withhold certificates of occupancy from the new developer once the new developer met the county's building regulations, but could only proceed against the initial developer's performance bond. [16] The court explained that [i]t would make no sense to require posting of a bond if the performance itself were nonetheless required as a necessary predicate to issuance of the necessary permits. [17] But here, the subdivision agreement for the Michael Subdivision between the municipality and the initial subdivider expired in 1990, and Spinell did not purchase the subdivision until 1996. It appears undisputed that the municipality could not proceed against the bond posted by the initial developer. The municipality argues in its brief that it could not look to the bond from the original subdivider because that bond had expired and the original subdivider was now defunct. Spinell's reply brief does not rebut that contention. There is no basis for us to think that the original subdivider's bond is still in effect. Furthermore, as the municipality observes, the language in AMC 21.87.055 regarding default by the subdivider is permissive rather than mandatory. That provision states that in the event of a default by the subdivider the municipality may demand payment. [18] The AMC does not require the municipality to use public funds to complete subdivision improvements for the benefit of private lot owners when the original subdivider abandons the project and goes out of business, as the original subdivider did here. The AMC only requires that if the municipality obtains any funds from the performance bonds, it apply those funds towards the construction and installation of the improvements. The municipality had no obligation to accept streets in the Michael Subdivision that did not meet its standards or to repair them at public expense.
Spinell next argues that AMC 21.45.125(D) prevents the municipality from withholding final certificates of occupancy pending the installation of landscaping. Subsection 21.45.125(D), which appears in the AMC chapter titled Supplementary District Regulations, states that [a]ll landscaping shall be installed within 18 months after receiving a temporary or final certificate of occupancy, whichever comes first. But AMC 21.85.190, which appears in the code chapter titled Subdivision Standards: Improvements, states in part that [l]andscaping shall be provided on an individual lot basis not later than the issuance of a certificate of occupancy. Spinell advances a strained interpretation of AMC 21.85.190 in an effort to harmonize the two code provisions. Spinell claims that section .190 makes clear that it is the issuance of the certificate of occupancy that triggers the subdivider's deadline to install the landscaping, and not the other way around. Spinell argues that the date a certificate of occupancy is issued merely establishes ... the date of default of the subdivider's obligation to install the landscaping. We disagree. Section.190's location in the AMC chapter on subdivision improvements indicates that it controls the timing for the installation of landscaping improvements in subdivisions. The section requires the installation of landscaping before the municipality issues a certificate of occupancy.
The twelve Michael Subdivision lots that the municipality subjected to the on-lot landscaping requirement were zoned R-2M. On-lot (also referred to as visual enhancement) landscaping is not required by AMC 21.40.045(M) for lots zoned R-2M unless the lot contains more than three dwelling units. [19] Spinell argues that because the lots in the Michael Subdivision only had single-family homes, on-lot landscaping was not required. But although the zoning laws did not require on-lot landscaping for the lots in the Michael Subdivision, the plat notes for those lots did. Zoning laws set out the minimum standards that a party must meet. More specific plat notes control over the more general zoning requirements. [20]
For two Ridgemont Subdivision lots, the municipality required Spinell to obtain written approval for the design of its proposed homes from a homeowners' association as a condition for issuing building permits. This requirement was part of the settlement of litigation between the municipality, the homeowners' association, and the prior developer of the subdivision. Spinell obtained the required permission from the homeowners' association and the municipality issued the building permits. Spinell cites several authorities [21] to support its argument that [i]t is well established that, where the proposed building complies with the building code and zoning ordinances, a building permit cannot be denied on the ground that the building would violate the terms of a restrictive covenant against the property. There is a dispute about whether the agreement bound Spinell. But because Spinell in fact obtained permission from the association and the municipality issued the permits, and because Spinell has not demonstrated how it was harmed by this requirement, there is no reason for us to decide whether the municipality overstepped. At most, the requirement slightly delayed the permits (by ten and twenty-nine days). These sorts of delays do not amount to actionable takings. [22] There is no indication that Spinell was deprived of all economically viable use of its property or that it had to alter its design. The fact that this condition was imposed in the context of litigation suggests that this condition does not reflect a blanket policy of the municipality. Instead, this appears to have been a case-specific requirement, and we have not been provided with the specifics. Spinell consequently has not demonstrated that the superior court erred. [23]