Appletree, or CEO, J.D.?

Practice area:

The Law Court issued a ruling in a Rule 80B appeal that once again underscores how, in the absence of the Legislature stepping in to tidy up in this area, applicants for municipal approvals will continue to act at their peril without knowledgeable counsel guiding their development efforts, and even then, they could be caught in a loop of unavoidable delay. Appletree Cottage, LLC. v. Town of Cape Elizabeth, 2017 ME 177.

The facts are simple. On June 30, 2015, a property owner submitted an application for a building permit to build two structures on his lot. The town’s code enforcement officer (“CEO”) issued the permit. As is typical, there was no record but the application, and no explanation by the CEO regarding the approval, just his stamp and notation of approval. The abutter appealed to the Town ZBA, arguing that the structures weren’t accessory as required under the zoning ordinance. The ZBA made a record and heard testimony, including from the CEO, who explained why he had approved the application, and the ZBA affirmed. The Superior Court (Mills, J.) affirmed the ZBA. The Law Court, Justice Jabar writing for the unanimous panel (missing Justices Mead and Humphrey), vacated and remanded.

At the time the CEO’s approval issued, the ordinance required appellate, not de novo, review by the ZBA. So the operative decision was that of the CEO. But the CEO’s decision didn’t include any fact finding or conclusions of law, which the Court said was required. Hence, the Court remanded for the CEO “to make detailed findings and conclusions.” (¶ 20.)

The bottom line takeaway from this decision is that ordinances in Maine should make all reviews of CEO decisions de novo. Currently, a big chunk of municipalities does, but a big chunk does not. If you want something approved by a CEO in a municipality with an ordinance that does not use de novo review, then you face a potentially difficult situation.

A CEO as a practical matter can’t issue findings of fact and conclusions of law on every appealable application s/he receives, and the record for such requests is typically scanty, i.e. the application. But in municipalities with appellate review, those CEO decisions, if challenged, appear inadequate, automatically requiring a remand and do-over by the CEO to make findings and conclusions, with all the delay such a remand and do-over entails.  In Appletree, the application was filed over two years ago, and now the CEO must start again from scratch.

As reflected in Appletree, apparently the Court will not accept a CEO explanation to the ZBA post hoc. The initial decision of the CEO must itself include the explanation (although as a practical matter, what will happen here after the remand is presumably a post hoc explanation).

The Law Court seemed to recognize the difficulties this situation presents, but said:

“We recognize that—as was the case here—municipal ordinances governing a CEO’s review of and action on a permit application may not provide a mechanism for creating a record adequate for appellate review. Nonetheless, since at least 2008, municipalities have been on notice of their obligation to create such a record when the decision of the CEO is the operative one for appellate purposes. See Mills, 2008 ME 134, ¶¶ 18-20, 955 A.2d 258. Here, until the Town recently amended its Ordinance to authorize the ZBA to conduct de novo hearings, the CEO’s decision had been the operative one, so the Town bore the responsibility for creating a record of the CEO’s findings and conclusions, as the CEO will be required to do on remand.

So now what to do?

If you are a developer in a municipality with an ordinance with appellate versus de novo review (and sometimes it can be tricky to tell), option #1 is to play Russian roulette, and hope no one challenges the CEO’s decision. Under this option, if someone does assert such a challenge, then you will be stuck with a remand for a do-over and delay.

Option #2, if you think someone might file such a challenge and you want to try to avoid that delay, then you need to give the CEO a nice reviewable record – at a minimum, a comprehensive application – and you have to persuade the CEO to issue findings of fact and conclusions of law. I’m thinking you will want to include proposed findings and conclusions in your package to the CEO.

Another third, holistic remedial option would be to fix the dog’s breakfast that is the current state of the law on appealability and related issues under Rule 80B (and while we’re at it, Rule 80C). There are ways, some not too complicated or controversial, in which at least some of these problems could be fixed, without intruding into a municipalities’ home rule powers.

Why hasn’t this third option been pursued to date? My guess is because there’s no constituency to advance the legislation, with the effort that requires, because these problems arise ad hoc. No individual developer or municipality has a sufficient vested interest in fixing something outside a particular project. So you need somebody else to take this on, like an organization whose members collectively have an interest in the fix going forward. (Hello, Maine Municipal Association?)

In the meantime, hire a lawyer – as a developer, to include draft findings and conclusions in your application, or if you are a municipality, as your CEO to issue permit approvals and other appealable determinations.