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Thun v. City of Bonney Lake

Court of Appeals of Washington, Division 2

May 1, 2018

KARL J. THUN and VIRGINIA S. THUN, husband and wife; DANIEL POVOLKA, SALLY BAYLEY, THERESA BOOTH, and NANCY LEGAS, heirs of Thomas J. Povolka; LOUISE LESLIE and TERESA M. AFORTH, trustees of the William and Louise Leslie Revocable Trust; and VIRGINIA LESLIE and KAREN LESLIE, trustees of the Virginia Leslie Revocable Trust, Appellants,
v.
CITY OF BONNEY LAKE, a municipal corporation, Respondent.

          WORSWICK, J.

          Karl J. and Virginia S. Thun, Thomas J. Povolka, William and Louise Leslie Revocable Trust, and Virginia Leslie Revocable Trust (collectively Thun) filed a lawsuit against the City of Bonney Lake (City), alleging that the City's adoption of an ordinance rezoning the majority of Thun's property constituted an unconstitutional regulatory taking. The trial court granted the City's motion for summary judgment dismissal of the case.

         Thun appeals, arguing that there is a genuine issue of material fact regarding the purpose of the City's ordinance and that the trial court misinterpreted the law in holding that the ordinance did not confer a public benefit. We affirm summary judgment dismissal of Thun's regulatory takings claim.

          FACTS

         I. Background

         Thun owns approximately 36 acres of property near the city limits of Bonney Lake. A majority of Thun's property is located on a steep hillside that slopes into the Puyallup River Valley. The slopes vary from 20 percent to 40 percent or greater and pose a high landslide risk. Thun's property was originally zoned C-2 (commercial), which permitted a maximum of 20 residential units per acre.

         In 2004, the Central Puget Sound Growth Management Hearings Board ordered the City to revise its zoning designations to comply with Washington's Growth Management Act (GMA). The GMA requires each city to adopt development regulations that provide open space areas between urban growth areas and that protect critical areas, including areas susceptible to erosion or sliding. RCW 36.70A. 160; former RCW 36.70A.060(2) (1998); see former RCW 36.70A.030(5), (9) (1997). The City identified a number of areas with zoning designations that it deemed inconsistent with the GMA, including Thun's property.

         In March 2005, Thun entered into a purchase and sale agreement with a developer to construct a 575-unit condominium complex on his property. On September 13, the developer submitted an application to the City for a site development permit for the condominium complex. That same day, the City adopted Ordinance 1160 (Ordinance), which rezoned all but roughly 5.5 acres of Thun's property from C-2 to RC-5 (residential/conservation). Thun's proposed development was not allowed under the rezone because RC-5 zoning authorizes only one residential unit per five acres. The City subsequently denied the developer's site development permit application. Thun estimates that the City's rezone reduced the value of his property from $6.00 per square foot, or $2.50 in certain areas, to $0.35 per square foot.

         In adopting the Ordinance, the City noted that its purposes were to (1) manage areas that are steep and prone to geologic instability, (2) protect tree cover on areas that cannot be densely developed due to steepness, (3) "protect the magnificent entry to [the City], " and (4) comply with the GMA, which requires the City to identify open space corridors between urban growth areas. Clerk's Papers (CP) at 248. The City's mayor at the time of the adoption of the Ordinance stated in a declaration that he disagreed with adoption of the Ordinance in part because he believed that the City's primary purpose in adopting the Ordinance was to protect the magnificent entry to the City, and not to address the danger of landslides.

         II. Procedure

         A. Thun's First Appeal

         In 2008, Thun filed a lawsuit against the City, arguing that the Ordinance's rezone constituted an unconstitutional regulatory taking. The trial court granted summary judgment dismissal of Thun's regulatory takings claim. Thun v. City o/BonneyLake, 164 Wn.App. 755, 758, 265 P.3d 207 (2011). We affirmed the trial court's dismissal of Thun's claim, reasoning that it was not ripe for review. 164 Wn.App. at 768.

         We determined that because neither Thun nor the City was certain of how much of Thun's property was zoned C-2 or RC-5, and because we were not presented with evidence regarding permissible uses of the C-2 property or the feasibility of permissible uses, Thun's claim was not ripe. 164 Wn.App. at 766-67. As a result, we could not "reach just and accurate results if neither the size of the parcels nor the permitted uses thereon [was] reasonably known before trial." 164 Wn.App. at 767.

         B. Current Litigation

         In 2013, Thun attended a preapplication meeting with the City. At the meeting, Thun submitted a "conceptual plan" for a 96-unit condominium complex with retail and office space on the C-2 portion of his property, as well as a plan for one residential unit for each five acres on the RC-5 portion of his property. CP at 4. Thun and the City also verified the size of the C-2 portion of his property and determined that the C-2 zoning permitted a 131-unit condominium complex with retail and office space. The preapplication meeting was "not considered a final determination of the subject project." CP at 93. Thun did not submit a site development plan or a permit application to the City after the preapplication meeting.

         In 2016, Thun again filed suit against the City, seeking damages for the City's alleged unconstitutional regulatory taking of his property under article I, section 16 of the Washington Constitution. The City filed a motion for summary judgment dismissal of Thun's claim, arguing that Thun's regulatory takings claim remained unripe for review and, alternatively, that Thun failed to meet the threshold requirement of a regulatory takings claim.

         The trial court granted the City's motion for summary judgment dismissal of Thun's claim. The court determined that Thun's regulatory takings claim was ripe for review because the preapplication meeting provided a reasonable idea of the permissible uses of Thun's C-2 property and because the court could waive prudential ripeness.[1] But the trial court then ruled that Thun had failed to show that the rezone constituted a regulatory taking and dismissed Thun's lawsuit. In its order, the trial court stated it was granting the City's motion because "the rezone seeks to prevent a harm by safeguarding the ...


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