Court Opinion

ID: 9928437
Source: CourtListenerOpinion
Date Created: 2024-01-31 19:02:55.582833+00
Date Added: 2024-06-11T09:49:00.688059
License: Public Domain

IN THE
              ARIZONA COURT OF APPEALS
                                DIVISION ONE

              VOICE OF SURPRISE, et al., Plaintiffs/Appellants,

                                       v.

                   SKIP HALL, et al., Defendants/Appellees.

                          No. 1 CA-CV 23-0698 EL
                               FILED 1-31-2024

           Appeal from the Superior Court in Maricopa County
                          No. CV 2022-013360
              The Honorable Christopher A. Coury, Judge

                                 AFFIRMED

                                  COUNSEL

Timothy A. La Sota, PLC, Phoenix
By Timothy A. La Sota
Counsel for Plaintiffs/Appellants/Cross-Appellees
Voice of Surprise and Quintus Schulzke

City of Surprise, Surprise
By Robert W. Wingo, Melinda A. Bird
Counsel for Defendants/Appellees City of Surprise; Mayor Skip Hall;
Councilpersons Patrick Duffy, Chris Judd, Nick Haney, Aly Cline, Jack Hastings,
and Ken Remley; and City Clerk Kristi Passarelli

Berry Riddell LLC, Scottsdale
By Jeffrey D. Gross, Michael W. Zimmerman
Counsel for Defendant/Appellee Truman Ranch 46 SWC, LLC
Gammage & Burnham, Phoenix
By Cameron C. Artigue, Jacqueline Marzocca
Counsel for Defendant/Appellee/Cross-Appellant Dominium Inc.

League of Arizona Cities and Towns, Phoenix
By Nancy L. Davidson
Counsel for Amicus Curiae League of Arizona Cities and Towns

                                  OPINION

Acting Presiding Judge Kent E. Cattani delivered the opinion of the Court,
in which Judge Anni Hill Foster and Judge Daniel J. Kiley joined.

C A T T A N I, Judge:

¶1             This is the second round of expedited appeals in this
referendum matter concerning a City of Surprise ordinance challenged by
Voice of Surprise, a political action committee.1 In the first appeal, the
Arizona Supreme Court held that VOS’s referendum petitions were invalid
due to a technical application error, but also that the City Clerk lacked
authority to reject the petitions on this basis. Voice of Surprise v. Hall (Voice
II), 255 Ariz. 510, 516, 519, ¶¶ 26, 35 (2023). Because Developers had also
contested the validity of the petitions, the Arizona Supreme Court
remanded for the superior court to address VOS’s potential equitable
defenses to a private party’s (rather than the City’s) challenge as well as any
alternative grounds for challenging the petition. Id. at 519, ¶¶ 36–38.

¶2            On remand, the superior court enjoined transmittal of the
referendum petitions for certification or placement of the referendum on
the ballot on multiple bases. The court (1) determined that the matter
sought to be referred was a non-referable administrative (not legislative)
act and (2) rejected VOS’s laches defense to Developers’ claims that the
petitions were invalid due to the application error.

1       For ease of reference throughout this opinion, the parties involved
are: Voice of Surprise and its chairman (collectively, “VOS”), the
referendum proponents; the City of Surprise, the City Clerk, and other City
officials (collectively, the “City”); and developers Dominium, Inc. and
Truman Ranch 46 SWC LLC (collectively, “Developers”), the real parties in
interest.

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                         VOICE, et al. v. HALL, et al.
                           Opinion of the Court

¶3           We hold that, because the ordinance to be referred merely
implemented land use policy established years before, the ordinance was a
non-referable administrative act. Accordingly, and for reasons that follow,
we affirm.

              FACTS AND PROCEDURAL BACKGROUND

¶4            This case involves a referendum effort relating to the Surprise
City Council’s 2022 passage of Ordinance 2022-18, which approved a
preliminary development plan for a large swath of property Developers
want to develop. Although the proposed referendum focuses on the 2022
action, the City’s underlying actions involving this property date back to
2008.

¶5            At that time, the City undertook a series of interlocking steps
aimed toward establishing a planned development on the property with a
mix of residential as well as office, retail, and restaurant uses. First, the City
adopted an amendment to its General Plan 2020 changing the property’s
land use designation from low-density residential to mixed use. See
Resolution 08-104 (adopting GPA08-019). The City then annexed the
property, which had previously been part of a county island. See Ordinance
08-31. When annexed, the property was placed into Surprise’s single-
family residential (R1-43) and general commercial (C-3) zones, consistent
with its prior zoning as county land. The next month, in September 2008,
the City adopted Ordinance 08-37, which approved a planned area
development (“PAD”) application for the property.

¶6             As approved, the PAD designation incorporated Surprise’s
neighborhood commercial (C-1), community commercial (C-2), and mixed
use planned development (MU-PD) zoning districts under the zoning code
in effect at the time.2 See Old Code §§ 125-155(b)–(c), -186 (MU-PD), -187
(C-1), -188 (C-2). It also contained a variety of detailed requirements
involving overall design standards, including building height restrictions
and architectural criteria, designated setbacks and parking needs, as well
as specifications for landscaping, lighting, and signage.

¶7            Although the Old Code contemplated consideration of a
preliminary development plan as part of PAD approval, see Old Code § 125-
35(c)–(d), the PAD application did not include, and the City did not then
approve, a preliminary development plan for the property. The Old Code

2      Surprise’s zoning code has since been amended, but all parties agree
that the code in effect in 2008 (“Old Code”) governs here.

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                        VOICE, et al. v. HALL, et al.
                          Opinion of the Court

likewise contemplated a concurrent determination of allowable residential
density for the PAD property. See Old Code §§ 125-194(b)(5)(b.) (criteria for
the city council’s determination of reasonableness of densities in a PAD),
-35(g)(2) (characterizing an increase in density as a “[m]ajor change[]” to a
previously approved PAD); see also Old Code § 125-186(b)(2) (requiring
allowable density in an MU zoning district be determined at the time of
rezoning). Nevertheless, the City did not expressly consider or decide a
specific allowable residential density as part of the 2008 PAD approval.

¶8             Regardless, the PAD zoning went into effect in October 2008.
But development did not then proceed, and the land remained vacant for
years. Eventually, in December 2021, Developers submitted a preliminary
development plan for “a master-planned, horizontal mixed-use
development integrating residential uses with commercial activities, such
as retail, restaurant, office, service, mini-warehouse, and other similar
uses,” expressly in accordance with the permissible uses and other
strictures of the 2008 PAD zoning. The plan proposed 601 dwelling units
of three types on the property, yielding an overall residential density of 20.9
dwelling units per acre—just under the 21 dwelling units per acre
maximum permitted under Surprise’s general plan.

¶9            On August 16, 2022, the City Council passed Ordinance 2022-
18 approving this preliminary development plan. Ordinance 2022-18
expressly noted that the plan was “substantially consistent” with the PAD
zoning adopted by Ordinance 08-37 in 2008 as well as the Old Code,
although it further acknowledged that the 2008 PAD approval had neither
included a preliminary development plan nor established a residential
density allowance.

¶10           Opposing this action, VOS sought to refer Ordinance 2022-18
for a vote by the people. To qualify for the ballot, VOS would have to
submit petition sheets with 3,114 signatures within 30 days after the
ordinance was adopted. See Ariz. Const. art. 4, pt. 1, § 1(8); A.R.S. § 19-
142(A). VOS initiated its referral effort on August 29 by filing with the City
Clerk an application for a petition serial number and a statement of
organization—but without including the text of the challenged ordinance
as required by A.R.S. § 19-111(A). Although the City Clerk noticed the
omission, she accepted the application without comment and issued a serial
number for the petition sheets. On September 16, VOS submitted petition
sheets with 5,432 signatures supporting referral.

¶11         A week later (after the 30-day period for submitting
referendum petitions had expired), Dominium sent the City Clerk a letter

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                         VOICE, et al. v. HALL, et al.
                           Opinion of the Court

urging rejection of the petition sheets for several reasons, including VOS’s
failure to attach the ordinance to its serial-number application and that the
ordinance was administrative and thus not referable. Relying on the
application error (without taking a position on any alternative grounds),
the City Clerk rejected all petition sheets and signatures on October 5, 2022.

¶12            Two days later, VOS filed a statutory special action against
the City, also naming Developers as real parties in interest. See A.R.S. § 19-
122(A); see also Ariz. R.P. Spec. Act. 2(a)(1). VOS sought injunctive and
declaratory relief compelling the City Clerk to accept and process the
petition sheets for submission to the county recorder for verification and,
ultimately, placement of the referendum on the ballot.

¶13           The City answered, raising as defenses both the application
error and that adoption of Ordinance 2022-18 was a non-referable
administrative act. The City and Dominium, both joined by Truman Ranch,
also opposed VOS’s injunction request, relying on (among other
arguments) the application error and the administrative-act issue.
Dominium then timely filed an answer and counterclaim, again asserting
the application error as well as the administrative-act issue.

¶14           After an evidentiary hearing, the superior court denied VOS’s
request for injunctive relief and entered judgment for all defendants. The
court reasoned that, given the statutory requirement of strict compliance in
the referendum process, VOS’s application error precluded the relief it
sought. In light of that ruling, the court declined to reach the defendants’
alternative arguments, including their assertion that Ordinance 2022-18
was a non-referable administrative act. VOS appealed, and this court
affirmed. See Voice of Surprise v. Hall (Voice I), 255 Ariz. 204, 205, ¶ 2 (App.
2023).

¶15            The Arizona Supreme Court granted review, reversed, and
remanded. See Voice II, 255 Ariz. at 519, ¶ 40. Although agreeing “that VOS
did not strictly comply with § 19-111(A), and that [application] error cannot
be undone,” id. at 516, 519, ¶¶ 26, 37, the court held that the City Clerk was
not authorized to reject the petition sheets on that basis, id. at 519, ¶ 35. The
court remanded because Dominium (not just the City) had also challenged
the referendum petition based on the now-established application error,
but the private party’s counterclaim might be subject to a laches defense
that had not yet been litigated. Id. at ¶¶ 36–37. The court further observed
that all defendants’ alternative bases for challenging the petition—
“including that the matter is seeking to refer a non-referable administrative

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                        VOICE, et al. v. HALL, et al.
                          Opinion of the Court

or executive matter”—could be addressed in the first instance on remand.
Id. at ¶ 38.

¶16           On remand, the City (joined by Truman Ranch) moved for
summary judgment on VOS’s complaint on the basis that Ordinance 2022-
18 was not a legislative act and was instead a non-referable administrative
act.3 After briefing and argument, the superior court granted summary
judgment against VOS, holding that adoption of Ordinance 2022-18 was a
non-referable administrative act and that VOS thus was not entitled to the
relief it requested. The court alternatively ruled that VOS had not
established a laches defense to the petitions’ invalidity based on the
application error.

¶17           The court denied VOS’s motions for reconsideration and new
trial and entered final judgment dismissing VOS’s claims and enjoining the
City from processing the petitions or placing the referendum on the ballot.
VOS timely appealed. See A.R.S. § 19-122(A); see also ARCAP 10.

                               DISCUSSION

¶18          The Arizona Constitution reserves to the qualified electors of
incorporated cities the power of referendum. Ariz. Const. art. 4, pt. 1, § 1(8).
This power permits qualified electors to submit city council actions to a
popular vote—but only if the action is legislative, not administrative, in
nature. Id. (power of referendum on matters on which the relevant
governmental entity is “empowered by general laws to legislate”);

3      Developers’ role in the litigation expanded after remand as well.
Even before the mandate issued, Truman Ranch filed an answer and
counterclaim to VOS’s complaint, along with a crossclaim against the City
under A.R.S. § 19-122(C), asserting invalidity of the referendum petitions
based on the application error, the administrative-act issue, and other
grounds. Dominium likewise filed a crossclaim against the City Clerk
under A.R.S. § 19-122(C) seeking to enjoin placement of the referendum on
the ballot due to the application error and the administrative-act issue.
       The City answered without opposing either crossclaim and likewise
did not oppose Developers’ respective motions for judgment on the
pleadings on the crossclaims. VOS intervened, however, and opposed
Developers’ dispositive motions on laches and other grounds. VOS also
successfully moved to dismiss Dominium’s counterclaim (and later its
crossclaim), largely on the basis that as a foreign (Minnesota) corporation
not registered to do business in Arizona, Dominium was not permitted to
“maintain” a judicial proceeding in this state. See A.R.S. § 10-1502(A), (E).

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                         VOICE, et al. v. HALL, et al.
                           Opinion of the Court

Wennerstrom v. City of Mesa, 169 Ariz. 485, 488 (1991). We review de novo
the superior court’s determination that adoption of Ordinance 2022-18 was
not legislative and thus non-referable. See Redelsperger v. City of Avondale,
207 Ariz. 430, 432, ¶ 7 (App. 2004); see also Beck v. Neville, CV-22-0134-PR,
2024 WL 91185, at *2, ¶ 10 (Ariz. Jan. 9, 2024) (summary judgment).

¶19            The distinction between legislative and administrative acts is
not always easy to discern. See Wennerstrom, 169 Ariz. at 489. As a general
rule, legislative acts address “subjects of a permanent and general
character” and “make new law,” “prescribe[] a new policy or plan,” or
“declar[e] a public purpose and mak[e] provision for ways and means of its
accomplishment.” Id. (citation and emphasis omitted); see also id. (citing
Pioneer Tr. Co. of Ariz. v. Pima County, 168 Ariz. 61, 65 (1991)) (“[A]n act that
declares a public purpose and provides for the ways and means of its
accomplishment is legislative.”). In contrast, administrative acts address
“subjects of a temporary and special character” and “execute law already
in existence,” “pursue[] a plan already adopted” (by the enacting legislative
body or a superior power), or “merely carr[y] out the policy or purpose
already declared by the legislative body.” Wennerstrom, 169 Ariz. at 489
(citation and emphasis omitted). Accordingly, we determine whether a
given action was legislative or administrative by “consider[ing] whether
the action is (1) permanent or temporary, (2) of general or specific (limited)
application, and (3) a matter of policy creation or a form of policy
implementation.” Redelsperger, 207 Ariz. at 433, ¶ 15 (reciting the
Wennerstrom factors).

¶20           The most compelling consideration in this context is the third:
whether Ordinance 2022-18 created new policy or implemented existing
policy. See Wennerstrom, 169 Ariz. at 489. And here, Ordinance 2022-18
merely implemented the policy and overall plan created in 2008 with the
City’s adoption of PAD zoning for the property.

¶21           In 2008, Ordinance 08-37 rezoned the property from single-
family residential and general commercial to a PAD incorporating the
neighborhood commercial (C-1), community commercial (C-2), and mixed
use planned development (MU-PD) zoning districts—rendering a
legislative decision determining (and limiting) the permissible land uses for
future development. See Fritz v. City of Kingman, 191 Ariz. 432, 433, ¶ 7
(1998) (reiterating that rezoning decisions are legislative). The PAD
approval also adopted a variety of detailed standards—design, height, and
architectural criteria constraining buildings along with setbacks,
landscaping, pedestrian, and parking requirements—that specified the
character of development contemplated and how such development was to

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                       VOICE, et al. v. HALL, et al.
                         Opinion of the Court

proceed. Although the PAD—by design—authorized “a variety of
appropriate land uses including retail, employment, and commercial with
residential components,” it set the parameters and policy for the
development to come. Cf. Pioneer Tr., 168 Ariz. at 65 (“At that point, the
decision had been made.”).

¶22           Ordinance 2022-18 implemented this previously established
development policy. Developers’ 2022 proposal chose a variety of uses
from within the menu of land uses authorized in 2008, and it rendered a
concrete site plan consistent with the discrete standards adopted in 2008.
The City Council acknowledged as much in Ordinance 2022-18 itself, (1)
reciting that Developers’ proposal “would implement the [2008] PAD by
allowing development of land uses permitted by the PAD in accordance
with design and development standards set forth in the PAD” and (2)
expressly requiring that “development and use of the subject site . . . shall
be substantially consistent with and shall be regulated by the [2008 PAD],
Ordinance No. 08-07.”

¶23          Highlighting the omission of a preliminary development plan
and residential density allowance from the 2008 PAD approval, VOS argues
that Ordinance 2022-18 must have created, not just implemented, policy.
VOS asserts that, because the 2008 enactments permitted so many uses and
allowed such a wide range of residential densities, they necessarily
contemplated future legislative acts.

¶24           To be sure, the Old Code contemplated consideration of a
preliminary development plan and determination of allowable density at
the time of rezoning. See Old Code §§ 125-35(c)–(d), -194(b)(5)(b.). And the
City acknowledged the prior omissions when adopting both via Ordinance
2022-18.

¶25            But design and development standards were adopted in 2008
as part of the PAD approval, even if not as components of a preliminary
development plan. See also Old Code § 125-35(c)(2)(a.)–(l.) (listing types of
design and development criteria to be considered). And the 2008 PAD
authorized—and limited—land use by incorporating three discrete zoning
districts. Developers’ 2022 preliminary development plan did not seek
different design standards or new land uses but rather worked within the
strictures of the established PAD zoning. Although VOS asserts that the
menu of land uses allowed under the 2008 PAD was too broad, the time to
challenge the breadth of permissible uses was in 2008. See Pioneer Tr., 168
Ariz. at 66. At that point, the public was on notice of which uses were
sanctioned, rendering subsequent approval of conforming plans

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                        VOICE, et al. v. HALL, et al.
                          Opinion of the Court

administrative in nature. Cf. Redelsperger, 207 Ariz. at 437, ¶ 27 (quoting
Sandblom v. Corbin, 125 Ariz. 178, 184–85 (App. 1980)) (noting that issuance
of use permits is generally administrative and zoning generally legislative
because “the public is not affected to as great a degree by the issuance of
[use] permits as they would be in cases of changes in zoning, because they
are already on notice that these special uses are permissible by
administrative decree”). Indeed, the additional detail provided in the 2022
plan was in the nature of a site plan conforming to the 2008 strictures, and
approval of a conforming site plan is an administrative act. See id. at 438,
¶ 28 (citing 3 Edward H. Ziegler, Jr. et al., Rathkopf’s The Law of Zoning and
Planning § 46:7 (4th ed. 1994)).

¶26            Likewise, although the 2008 PAD did not expressly designate
the permissible residential density, the density question was not the blank
slate VOS alleges. The 2008 PAD zoning incorporated the mixed-use
planned-development zoning district, which would generally allow any
variety of residential use permitted in the city. See Old Code § 125-155(b)
(MU-PD column). But the Old Code also mandated that density in PAD
zoning, as in an MU-PD district itself, be consistent with the density
designated in Surprise’s general plan. Old Code §§ 125-186(b)(1) (MU-PD
density ranges consistent with general plan), -194(b)(5)(a.) (PAD density
flexible, but consistent with the land use as designated in the general plan).
The 2008 PAD, albeit by default, thus did incorporate a range of permissible
densities based on the property’s mixed-use designation in General Plan
2020: up to 21 dwelling units per acre.

¶27              This range is admittedly broad, and the City only ultimately
picked a specific number—601 dwelling units, corresponding to a density
of 20.9 dwelling units per acre—in Ordinance 2022-18. But as of 2008, the
permissible range was on the record in a PAD approval that, by its terms,
applied to “[a]ll present and future owners of the property”—owners who
were thus entitled to rely on the approvals (and required to comply with
the restrictions) adopted in the 2008 PAD. And the density specified in
Ordinance 2022-18 was less than the maximum density allowed. Cf. Old
Code § 125-35(g)(2) (characterizing an increase, but not a decrease, in density
as a major change to a PAD approval). The “logical and practical time” for
any challenge to a density range perceived as overly broad was in 2008,
“after the contested proceedings and public hearings, . . . before the
legislative members leave office through expiration of terms or elections
. . . . [and] also before owners, developers, and lenders expend huge sums
of money to comply with the conditions.” See Pioneer Tr., 168 Ariz. at 66.

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                        VOICE, et al. v. HALL, et al.
                          Opinion of the Court

¶28            Furthermore, Ordinance 2022-18 lacked other hallmarks of
policy-creating actions. For example, this court’s last foray into the
legislative/administrative question—Workers for Responsible Development v.
City of Tempe, 254 Ariz. 505 (App. 2023)—highlighted an ordinance’s
substantive additions to prior zoning that rendered it legislative: “extensive
tax, expenditure, sale, and development decisions beyond what is provided
in the zoning designation.” Id. at 515, ¶ 44. Here, Ordinance 2022-18
included no such provisions. The Workers court also observed that the
ordinance at issue there “neither identifies the previously declared policy
decision it intends to implement nor suggests that the MU-4 zoning
designation is the policy it intends to carry out.” Id. at ¶ 46. Here, in
contrast, Ordinance 2022-18 did just that: It expressly cross-referenced the
City’s steps in 2008 establishing the policy for the property (from Resolution
08-104 approving general plan amendment GPA08-019, through
annexation by Ordinance 08-31, to approval of specifically delineated PAD
zoning pursuant to Ordinance 08-37). And it explicitly found that the
proposed preliminary development plan “is substantially consistent with”
and “would implement” the previously adopted PAD. In short, Ordinance
2022-18 did not create new policy but rather implemented a policy
previously adopted.

¶29            As     to    the     other   two     Wennerstrom     factors—
permanent/temporary and general/specific—VOS urges that each leads to
the conclusion that adoption of Ordinance 2022-18 was a legislative act. See
Redelsperger, 207 Ariz. at 433, ¶ 15. VOS asserts that Ordinance 2022-18 was
permanent because its permissions and restrictions were “just as
permanent as any rezoning,” creating entitlements that run with the land.
But while Ordinance 2022-18 was “permanent” in the same sense as a use
permit or approved plat, its permanence stemmed from conformity with
the 2008 legislative act—because the 2008 PAD rezoning was “permanent,”
so was approval of a conforming use. Although VOS relies on Workers for
this point, the Workers analysis in fact undercuts its argument. There, the
development agreement to be referred established entitlement, for
example, to purchase certain property and receive deviations from
otherwise-applicable zoning. Workers, 254 Ariz. at 514, ¶¶ 37, 40. The
parameters here, however, were set in 2008.

¶30          VOS likewise asserts that Ordinance 2022-18 was of general
and not limited scope, but its argument merely restates that the burdens
and benefits of preliminary development plan approval and density
designation are “permanent.” Moreover, its primary authority (Workers
again) undermines its position. The Workers court highlighted the
ordinance’s “declar[ation of] a public purpose” (to “improve or enhance the

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                        VOICE, et al. v. HALL, et al.
                          Opinion of the Court

economic welfare” of residents) and “provi[sion] for the ways and means
of its accomplishment” (including a phased master-planned real estate
development constructed over 15 years, providing for phased purchase of
city property, agreement to tax abatement on one side and cash
contributions to specified city funds on the other). Id. at 514–15, ¶¶ 38–43.
In contrast, here, any comparable declaration of public purpose and plan to
accomplish it arose not with Ordinance 2022-18, but rather with the
adoption of PAD zoning in 2008.

¶31           In sum, adoption of Ordinance 2022-18 was an administrative
act implementing the policies established by legislative act in 2008, and thus
is not referable. See Wennerstrom, 169 Ariz. at 488. The superior court
properly so held, and thus properly dismissed VOS’s claims and enjoined
placement of the matter on the ballot. Because the referendum effort fails
for this reason, we do not address the viability of VOS’s laches defense
against Developers’ assertion of invalidity based on the application error or
Dominium’s cross-appeal from dismissal of its counter- and crossclaims.
Because VOS has not “prevail[ed] by an adjudication on the merits” against
a government entity, see A.R.S. §§ 12-348(A), -2030, we deny its request for
attorney’s fees against the City on those bases.

                               CONCLUSION

¶32           The judgment is affirmed.

                          AMY M. WOOD • Clerk of the Court
                          FILED: AA

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