Bracken v. City of Ketchum

537 P.3d 44

Roy BRACKEN, an individual; RRJ LLC, an Idaho limited liability company; and Penguin LLC, an Idaho limited liability company, Plaintiffs-Appellants,

v.CITY OF KETCHUM, Idaho an Idaho municipal corporation; Micah Austin, an individual, Suzanne Frick, an individual, and Nina Jonas, an individual, Defendants-Respondents.

Docket No. 48721

Supreme Court of Idaho, Boise, November 2022 Term.

Opinion Filed: September 15, 2023

Rehearing Denied: November 2, 2023

Robert J. Elgee, and Alturas Law Group, LLC, Hailey, attorneys for Appellants. Robert J. Elgee argued.

White, Peterson, Gigray & Nichols, P.A., Nampa, attorneys for Respondents. Matthew A. Johnson argued.

BEVAN, Chief Justice.

This appeal is about whether an aggrieved applicant may bring a direct action against a city, its administrators, and its mayor for alleged misconduct pertaining to the granting of a conditional use permit without first exhausting administrative remedies and seeking judicial review. The answer is almost always "no," but based on the unique facts in this case we hold that the applicant was excused from exhausting administrative remedies.

I. FACTUAL AND PROCEDURAL BACKGROUND

The factual background and procedural history of this case are complex, but the relevant facts are not in dispute. On April 29, 2016, Roy Bracken applied for a conditional use permit to operate a gas station off Main Street in Ketchum, Idaho. Bracken had secured an option on the property where he wished to locate the gas station. When Bracken filed his application, gas stations were permitted at the site under Ketchum's applicable zoning laws. While Bracken's application was pending, the City of Ketchum, through its mayor Nina Jonas, commissioned an online public survey for opinions about whether a gas station should be permitted at the proposed site. The results of the survey were introduced at a public hearing before the Ketchum Planning and Zoning Commission (the "P&Z Commission") on July 9, 2016. According to Steve Cook, an architect in Ketchum since 1972, who also served on the P&Z Commission for almost nine years, the survey was unprecedented. Also, at some unknown time during the application process, Mayor Jonas, City Administrator Suzanne Frick, and former Sun Valley Mayor Ruth Lieder attended a dinner at Barbi Reed's house. Reed lived across from the proposed site and was the chairperson of a group called the "Citizens Against Bracken Station." Frick admitted that the meeting was "about [Bracken's] application."

Bracken's first application was ultimately denied based on the possibility of a traffic flow problem. Rather than appeal the denial of his first application, Bracken revised his application, and nearly one year later, on April 10, 2017, he presented a second application and site plan that was redesigned to address the concerns raised about his first application. Bracken presented the second application to Micah Austin—the Ketchum Planning Director and Zoning Administrator. Austin denied Bracken's application, claiming that it was the same, or substantially the same, as Bracken's earlier application.

On May 8, 2017, Bracken appealed Austin's rejection of his second application to the P&Z Commission, which orally reversed Austin's decision at a hearing on June 8, 2017. Before a written decision was entered, Bracken resubmitted the second application to Austin on June 19, 2017, along with the appropriate plans and payments. Austin rejected the application as untimely because: (1) the P&Z Commission had not entered a final written decision, and (2) upon preliminary review, Planning and Building Staff advised that the application was incomplete and missing required information. Austin physically returned the application to Bracken.

Around this time, Austin—in collaboration with the Ketchum City Council, Frick and Mayor Jonas—decided the previous traffic study Bracken submitted could not be used because his engineer had not used a valid Idaho engineer stamp. Austin emailed Bracken, stating that any application submitted must include not only the application and application fee, but also several new requirements: (1) a site plan, (2) a new traffic study from someone other than Bracken's original engineering firm, (3) circulation plans and exhibits, (4) a lighting plan, (5) a photometric plan, (6) a letter from the Idaho Transportation Department stating the proposal complied with certain standards, (7) a draining plan, and (8) a landscaping plan. None of these added items were required by the applicable Ketchum Municipal Code.

In the interim, between the P&Z Commission's oral decision and the written decision it entered on July 7, 2017, the City passed a new ordinance prohibiting gas stations from accessing Main Street in Ketchum. The ordinance's adoption was unusually expedited. At one point in the hearing on the proposed ordinance, a councilman asked Austin, "My question is directed at Micah [Austin] and why is there a sense of urgency for passing this ... P&Z should just do their job. I don't think the sense of urgency should come from us, P&Z doesn't think this is appropriate, because it sure sounds to me like passing three readings is going after one person. So tell me why I'm not doing that." Austin replied:

Sure, I'd be happy to explain that. In the State of Idaho an applicant's rights are vested at the time an application is accepted by the city and so if that application is submitted when a certain ordinance is on the books their rights are vested according to that ordinance that is on the books. When we presented this amendment to the P&Z Commission on April 10, that same day the applicant for the Bracken station submitted another application on April 10 that very morning. We rejected that because the code says you can't resubmit for a denied conditional use permit within 12 months. They appealed my decision to deny that application and the Planning and Zoning Commission overturned my decision and found that the application that was submitted on April 10th was a brand-new application never-before-seen in the City of Ketchum and that it was substantially different. According to that ruling, then they had to submit findings of fact no later than July 8th. After July 8th, that applicant, assuming we get the findings out, after July 8th, that applicant for Bracken station can resubmit that "new application" and their rights will be vested under whatever ordinance is on the books at the time.

We have a special meeting on this Friday at 4 o'clock to approve those findings and it's up to the Commission to approve those findings at that time, but the reason we are recommending the waiver of those 2nd and 3rd readings is because we don't believe that application reflects the community's values. And we do believe there is a sense of urgency and that we have been through this, like I've mentioned, over seven months last year and with the P&Z Commission, and, quite frankly, we don't believe that it would do the applicant service, the community, or staff to accept a new application while we have an ordinance on this and before you all that everyone agrees on. So, yes, there is a sense of urgency, and yes, there is no question about it. We are concerned about a single application coming in and tying up city staff and the community for months and months and months which is what we know is not what the community wants.¹

The Ketchum City Council ultimately voted to waive the usual second and third readings of the proposed ordinance and adopted it immediately at the hearing on July 3, 2017.

As noted above, the P&Z Commission issued its written decision on July 7, 2017, holding that Bracken's second application was substantially and materially different from his first application, and ordering "the Administrator [Austin] receive and review the Second Application for completeness, and upon determination that such is complete, initiate the typical [conditional use permit] application review process set forth in Ketchum Municipal Code and pursuant to the Idaho Local Land Use Planning Act." On that same day, the City published the newly adopted ordinance in the Idaho Mountain Express and Guide. Ketchum Municipal Code section 1.20.010 designates the Idaho Mountain Express as Ketchum's official paper for publication, not the Idaho Mountain Express and Guide.

On July 7, 2017, Bracken talked to Austin about his second application. Although the ordinance had not yet been published in the City's official paper, Austin told Bracken that a city ordinance prohibiting gas stations on Main Street had just been published. But the ordinance was not published in the official paper, the Idaho Mountain Express, until five days later, on July 12, 2017. Respondents took no further steps to review Bracken's second application.

On December 11, 2017, Bracken hand delivered a letter to Austin reciting the P&Z Commission's order that directed Austin to "receive and review" his second application. Bracken critiqued Austin's handling of the second application, provided another check for the application fee, and made a formal request for the City to process his application and initiate the typical conditional use permit process. Austin stated that the new law dictated that there would be no gas stations on Main Street, emphasizing that the redesigned and appealed application was never accepted. Austin informed Bracken that, in his view, no application had been submitted because that would require action on the City's part and there was no action taken by the City. Austin stated refiling was not an option because "they had been careful about not keeping anything here."

When Bracken submitted his identical copy of the appealed application for filing on December 13, 2019, Austin again refused to accept it. The return of Bracken's applications was known and approved by Mayor Jonas. In fact, Jonas admitted at one point that she instructed Austin to return one of the applications based on Austin's...