State Farm Insurance Companies, Respondent, vs. Ricky J. Haeflinger, et al., Defendants, Michelle M. Westphal, Appellant.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (1998).

STATE OF MINNESOTA

IN COURT OF APPEALS

C1-00-1047

Reilley Estates,

Appellant,

vs.

City of Ramsey,

Respondent,

Metropolitan Council,

Defendant.

Filed December 26, 2000

Reversed and remanded

Schumacher, Judge

Anoka County District Court

File No. C2993958

Victor E. Lund, Mahoney, Dougherty and Mahoney, P.A., 801 Park Avenue, Minneapolis, MN 55404 (for appellant)

James J. Thomson, Kennedy & Graven, Chartered, 470 Pillsbury Center, 200 South Sixth Street, Minneapolis, MN 55402 (for respondent)

            Considered and decided by Schumacher, Presiding Judge, Toussaint, Chief Judge, and Amundson, Judge.

U N P U B L I S H E D   O P I N I O N

SCHUMACHER, Judge

            Appellant Reilly Estates challenges the dismissal of its declaratory judgment action against respondent City of Ramsey on the basis of lack of jurisdiction.  We reverse and remand.

            Reilly Estates is a partnership that has owned a large tract of land, approximately 75 acres, in the southeastern portion of the City of Ramsey since 1970.  Initially, the land lay outside the Metropolitan Urban Service Area (MUSA) and was zoned R-1R (single-family rural), allowing large lots of at least one acre.  The property was later included in a MUSA expansion sought by the city and approved by the Metropolitan Council in January 1995.  The city's zoning map of the MUSA expansion depicted the property with R-1U zoning (single-family urban), allowing approximately three units per acre.  Reilly Estates' property, however, remains zoned R-1R (single-family rural).

            In 1995, 1996 and 1997, voters in the city, by voter initiative and special election, passed charter amendments in an attempt to limit residential growth.  On April 8, 1997, the city adopted a six-month moratorium effective May 12, 1997, on all residential development in the city.  This moratorium was later extended such that it expired in July 1998.  The moratorium was subsequently extended yet again for another six months as to certain properties.  But this extension did not include some properties, including that of Reilly Estates, because the city council at that time felt that those properties needed no further review.

            In November 1998, Reilly Estates and Arcon Development, Inc. applied for a rezoning from R-1R (single family rural) to R-1U (single family urban) consistent with the MUSA expansion initiated by the city and approved by the Metropolitan Council in 1995.  City zoning administrator Slyvia Frolik prepared a staff report, recommending approval of the rezoning request.  On December 3, 1998, the city planning commission conducted a public hearing on the rezoning application and tabled the application.  On December 15, 1998, the city council adopted an interim ordinance, adding the Reilly Estates property back into the residential development moratorium effective January 25, 1999.  On January 5, 1999, the planning commission tabled the rezoning request because of the moratorium.

In May 1999, Reilly Estates initiated this declaratory action in district court.  The action sought an injunction compelling the rezoning and preventing the city from altering any official controls which would impair or restrict the development of the property under the city's comprehensive plan and ordinances as they existed in November 1998.  In November and December 1999, Reilly Estates filed a motion seeking declaratory relief compelling the city to grant the rezoning request. 

An affidavit signed by city administrator James Norman in January 2000 stated that the rezoning application had been withdrawn and that the city had refunded the unused portion of the application fee.  A responsive affidavit by John (Jack) M. Miller, managing partner of Reilly Estates, stated that the partnership had received no money and wished to receive no money, since as far as it was concerned, the application for rezoning was still pending.

            On January 19, 2000, the district court held a hearing on the motion for declaratory relief.  In an April 18, 2000 order, the district court denied Reilly Estates' motion in its entirety and dismissed Reilly Estates' claims without prejudice.  The court's memorandum explained that because there was no pending application regarding the land there was no justiciable controversy in the matter and the court was without jurisdiction to rule on the motion.  Reilly Estates appealed from the dismissal on jurisdictional grounds.

            An appeal may be taken from either an order or judgment of dismissal for lack of jurisdiction.  City of Shorewood v. Metropolitan Waste Control Comm'n, 533 N.W.2d 402, 403-04 (Minn. 1995).  The existence of jurisdiction is a question of law subject to de novo review.  Frost-Benco Elec. Ass'n v. Minnesota Pub. Utils. Comm'n, 358 N.W.2d 639, 642 (Minn. 1984).  "On appeal from a declaratory judgment, we apply a clearly erroneous standard to the factual findings, but review the trial court's determination of questions of law de novo."  Rice Lake Contracting Corp. v. Rust Env't & Infrastructure, Inc., 549 N.W.2d 96, 98-99 (Minn. App. 1996) (citation omitted), review denied (Minn. Aug. 20, 1996).

The only prerequisite for a court's exercise of jurisdiction in a declaratory judgment action is the presence of a "justiciable controversy." Id. (citation omitted).  This generally requires a genuine or present controversy, capable of specific relief, presented by persons with truly adverse interests.  Id.  In this case, Reilly Estates has staked out the position that, consistent with the 1995 MUSA extension, it is entitled to rezoning for which it applied.  The city, on the other hand, has consistently avoided granting the rezoning request by tabling the application and repeatedly extending the residential development moratorium.  The controversy is genuine, the parties' interests adverse, and specific relief possible.

The district court determined that there was no present controversy because there was no application currently pending before the city.  But while the application technically may no longer be pending, its absence does not necessarily end the present controversy.  In declaratory judgment actions, courts view the present controversy requirement leniently.  Id. at 99.  The requirement is satisfied if there is a controversy of "sufficient immediacy and reality" to warrant issuance of a judgment.  Id. (citation omitted).

"The required immediacy or imminence is not subject to any mechanical test."  Holiday Acres No. 3 v. Midwest Fed. Sav. & Loan Ass'n, 271 N.W.2d 445, 448  (Minn. 1978).  In Holiday Acres No. 3, the supreme court noted, albeit in a different context, that where plaintiff's attempt has been frustrated, requiring a second attempt in order to freeze the factual context for judicial determination is unwarranted and unrealistic.  Id.  This is particularly so where the words and actions of the defendant leave little doubt a second attempt would be rebuffed. Id.

"As a general rule a party who is seeking rezoning must first exhaust the administrative remedies available before bringing an action for judicial relief unless the remedies are inadequate or nonexistent."  Amcon Corp. v. City of Eagan, 348 N.W.2d 66, 71 (Minn. 1984).  But "parties are not required to utilize administrative remedies if the administrative bodies have unequivocally committed themselves to a position and exhaustion of remedies would be futile."  Ellingson & Assocs., Inc. v. Keefe, 410 N.W.2d 857, 860 (Minn. App. 1987) (citing State Bd. of Med. Exam'rs v. Olson, 295 Minn. 379, 387, 206 N.W.2d 12, 17 (1973)).

            In Amcon Corp., the plaintiffs had not submitted a zoning application for a specific zoning classification, nor had it been formally rejected by the city council.  348 N.W.2d at 71.  But the court noted that the council's practice led to the inevitable conclusion that the city had no intention of ever allowing the sought-after zoning.  Id. at 71-72. The court reversed the dismissal of a declaratory action, stating "[w]e will not require plaintiffs to reapply to the city council for [a] zoning designation when to do so would be futile." Id. at 72. 

Similarly, our review of the record in this case leads to the inevitable conclusion that the city has no intention of granting Reilly Estates the rezoning it seeks.[1]  The city used various delaying tactics including tabling and moratoria to consistently avoid granting the rezoning request.  City charter amendments and a recently proposed revised comprehensive plan plainly stake out the city's position against granting the requested rezoning.  It would be futile to require Reilly Estates to reapply for the rezoning it seeks.  The controversy is of sufficient immediacy and reality to afford judicial review.

Reversed and remanded.

[1] Indeed, although not evidenced in the record, counsel for both parties agreed at oral argument that the city had in fact since denied a subsequent rezoning application submitted by Reilly Estates.