Opinion ID: 204316
Heading Depth: 2
Heading Rank: 2

Heading: Colorado Common Law

Text: Although the VPRA does not provide relief to Jordan-Arapahoe, it is not the only way to obtain a vested property right under Colorado law. Colorado enacted the VPRA to provide for reasonable certainty, stability, and fairness in the land use planning process, but it was not intended to replace existing common law rights. By its own terms the VPRA provides, Nothing in this article shall preclude judicial determination, based on common law principles, that a vested property right exists in a particular case or that a compensable taking has occurred. COLO.REV.STAT. § 24-68-106(3). In other words, the VPRA expands and clarifies the means by which property owners may gain vested property rights. It does not eliminate or restrict existing methods, and any property right created under Colorado common law may satisfy the vesting requirement. Because Jordan-Arapahoe does not have a vested property right under the VPRA, the only question is whether it has one under Colorado common law. We conclude it does not. To answer this question, a brief review of Colorado property law is helpful. Most commonly, property rights vest in a particular land use after a building permit has been issued and the landowner acts in reliance on it. A city permit can provide the foundation for a vested right, and thus be constitutionally protected from impairment by subsequent legislation, if the permit holder takes steps in reliance upon the permit. P-W Investments, Inc. v. City of Westminster, 655 P.2d 1365, 1371 (Colo. 1982). Indeed, the general rule ... provides that a common law right to develop does not vest until the party has taken substantial steps in reliance on a building permit. Villa at Greeley, Inc. v. Hopper, 917 P.2d 350, 356 (Colo.App.1996); see also Cline v. City of Boulder, 168 Colo. 112, 450 P.2d 335, 338 (1969) (reiterating the rule that a building permit by itself, without reliance, is not enough to create a vested property right). Thus, generally speaking, no preliminary proceedings to the obtaining of a [building] permit give rise to any vested right to pursue a use in a zoned district. Thus, no vested right to a particular use in a zoned district is acquired by approval of [a] plan for it. City of Aspen v. Marshall, 912 P.2d 56, 60-61 (Colo. 1996). [4] Without a building permit, therefore, developers who rely only on zoning or approved uses are facing an uphill battle. For many years, Colorado law simply held that developers without a building permit had no vested common-law development rights as a matter of law. SK Fin. v. La Plata County. Bd. of Cnty. Comm'rs, 126 F.3d 1272, 1278 (10th Cir.1997); see also P-W Invs., Inc., 655 P.2d at 1371; Crawford v. McLaughlin, 172 Colo. 366, 473 P.2d 725 (1970). These cases present a large obstacle to Jordan-Arapahoe since it had yet to obtain a building permit for a car dealership at the time the zoning use was modified. To overcome this obstacle, Jordan-Arapahoe points to a decision by the Colorado Court of Appeals, claiming Colorado law allows property rights to vest by virtue of a zoning classification and detrimental reliance. Eason v. Bd. of Cnty. Comm'rs, 70 P.3d 600 (Colo.App.2003). In Eason, the plaintiff received approval to operate a self-storage business using semi-trailers on his property. Id. at 603. After the initial zoning, the county then wrote a letter to the plaintiff saying he could operate his storage business because the land was properly zoned for such use. Id. at 603. The landowner, relying on the county's representations, obtained a building permit (although it is unclear why a permit was necessary) and moved over 100 semi-trailers onto his property. Id. After he commenced operations and after his building permit expired, the county changed the zoning and ordered him to remove the semi-trailers. Id. When Eason sued, the Colorado Court of Appeals found he had a vested property right in the use allowed under the prior zoning code. The court explained that Colorado common law allowed a vested property right in two ways. The first way was through a duly issued building permit, as established by cases such as City of Aspen and Cline. But the court concluded the common law also allowed vesting to occur in a second limited circumstance. If a zoning classification permitted a particular use, and the property owner reasonably and detrimentally relied on an affirmative act or representation by the county about permitted uses in that classification, the property owner obtained a vested property right. Id. at 605. Colorado law recognizes a protected property interest in a zoning classification when a specifically permitted use becomes securely vested by the landowner's substantial actions taken in reliance, to his or her detriment, on representations and affirmative actions by the government. Id. at 605-06. The court not surprisingly found this principle had been violated where the landowner relied on (1) final zoning allowing the intended use; (2) an affirmative written representation by the county confirming the intended use; (3) the issuance of a building permit; and (4) operation of his business for two years. Eason was told by the government that his use was permitted under its interpretation of the zoning ordinance, and he relied, to his detriment, on that assertion. Id. at 606 Relying on Eason, Jordan-Arapahoe contends it detrimentally relied on the representations or affirmative actions of Arapahoe County when it developed its property for sale to CarMax. Addressing this argument requires us to determine (1) whether Jordan-Arapahoe pleaded enough facts to show they took substantial action in reliance to their detriment on (2) representations or affirmative actions by Arapahoe County. Jordan-Arapahoe pleaded in its Complaint enough facts to show detrimental reliance, and Arapahoe County does not argue otherwise. We thus must resolve whether Jordan-Arapahoe relied on a representation or affirmative action by Arapahoe County. Jordan-Arapahoe contends Arapahoe County's approval of the PDP is enough of a representation or affirmative action for rights to vest under Eason. But as explained above, the Code makes clear no vested right exists until Arapahoe County approves a final development plan. Thus, approval of the PDP alone cannot qualify as an affirmative action or representation because Jordan-Arapahoe could not have reasonably relied on the PDP approval as creating a vested right absent the second-step final approval. Arapahoe County, on the other hand, argues the only affirmative act or representation that will satisfy Eason is approval of a final development plan pursuant to the procedure set forth in the Code. That position does not follow from Eason either, however, because it improperly conflates VPRA requirements with the common law. As is often the case, we are left with the middle ground. Eason plainly requires some affirmative action or representation beyond preliminary approval of a development plan or the mere fact a use is permitted in the zoning classification. Rather, affirmative action or representation may come in the form of a letter, as it did in Eason, or some other act or conduct by the relevant authority. But Eason does not establish a vested common law property right where zoning is followed by some detrimental reliance only on the zoning classification. If it did, developers could expend money on land for an intended use and lock municipalities into zoning before the municipalities were certain such zoning was in the public's interest. Eason does, however, stand for the principle that once a planned development in a zoning classification is backed by affirmative actions or representations by county officialssuch as active acquiescence by word or deed or through some other unequivocal confirmationthen parties who rely on those affirmations will have vested property rights under the common law. But the analysis will be case-by-case and factually intensive. This framework allows counties to issue initial land use regulations that will alert developers of potential investments, see what proposals come forward under those regulations, then decide whether they wish to approve those proposals. In other words, Eason's holding keeps discretion with local governments while simultaneously encouraging developers, landowners, and potential purchasers to seek additional approvals of permitted uses before expending substantial development funds. Here we see no affirmative representation or other action by the County of the specificity required by Eason other than its approval of the preliminary development plan. That alone is not enough. We might be at the end of the discussion but for the recent decision in Moreland Properties, LLC v. City of Thornton, 559 F.Supp.2d 1133 (D.Colo.2008). In that case, a municipality had published an ordinance listing allowable uses for a property owner's land, among them, the sales of cars and other vehicles. The property owner's agent confirmed the permitted use with a representative of the local municipality. Id. at 1136-37. When the property owner attempted to sell his property to CarMax, the local municipality imposed new requirements on the land that made the sale impractical. Id. at 1138-39. The district court found a vested property right had been established under Eason. Id. at 1147-48. First, the court found the local municipality had provided an affirmative representation beyond the preliminary development plan. Id. In the alternative, the court reasoned a published ordinance listing permitted uses constituted an affirmative act or representation. Id. at 1147. Whether the facts in Moreland align with ours is not entirely clear, but in any event we disagree the holding is persuasive here. In Moreland, for instance, the zoning appears much more akin to approval of a final development plan than to approval of a preliminary plan, leading the court to conclude the county lacked the discretion to deny final approval. [5] Additionally and most critically under Eason, the property owner in Moreland relied not only on the permitted uses under the zoning classification but also on the local government's confirmation of permitted uses. To the extent the Moreland court relied on those facts to reach its conclusion a vested property right had been established, we agree with that outcome. But to the extent Moreland concludes a published zoning classification alone is sufficient alone to establish vested property rights, we find the holding conflicts with Eason. Moreland thus does not alter our conclusion that the zoning scheme here and Arapahoe County's conduct did not create a vested property right to develop a car dealership. In sum, Jordan-Arapahoe cannot establish a protected property right under Colorado common law and has thus not stated a claim upon which relief can be granted.