Opinion
No. C0-96-2328.
Filed July 8, 1997.
Appeal from the District Court, Mower County, File No. C9-95-1579.
Evan H. Larson, (for Appellants).
James R. Andreen, Erstad Riemer, P.A., (for Respondent).
Considered and decided by Norton, Presiding Judge, Peterson, Judge, and Amundson, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1996).
UNPUBLISHED OPINION
Appellants argue that the district court erred by granting respondent's motion for summary judgment because: (1) respondent is not protected by statutory immunity; (2) respondent violated its duty of care by issuing appellants a building permit without determining whether the permit property was in a flood plain; and (3) appellants' claim of equitable estoppel raises fact questions for the jury. Summary judgment is proper because respondent is protected from liability by statutory immunity. We affirm.
FACTS
In the spring of 1991, appellants Patrick and Sandra Sheedy (the Sheedys) acquired an option to purchase real estate in the Royal Manor Subdivision of respondent Mower County near the Red Cedar River. When applying for a residential building permit from Mower County, Patrick Sheedy claimed that he did not know his property was located in a flood plain. On the portion of the permit application asking whether the proposed construction was located in a flood plain Sheedy wrote "N/A." Sheedy stated that he believed the Mower County Planning Director would review his proposed building site to ensure that it met all requirements. Mower County claims, however, that Sheedy said his property was not located in a flood plain when he submitted his building permit application. The Sheedys proceeded to build a home on the property after Mower County issued them a residential building permit.
In the fall of 1994, the Sheedys became aware that their home and nine neighboring homes were built within the flood fringe of a flood plain. Importantly, the Mower County Flood Plain Ordinance provides that no structure shall be built in the flood fringe unless it complies with the terms of the ordinance. The ordinance allows residences and other structures to be built in the flood fringe if certain requirements are met, i.e., the basement or first floor must be at or above the Regulatory Flood Protection Elevation. The Sheedys' home did not meet these requirements.
The Sheedys learned that a federal buyout program was available to assist with the cost of removing the homes from the flood fringe and relocating them to higher ground. The buyout was a federal program administered by the Federal Emergency Management Agency (FEMA) and was known as the Hazard Mitigation Grant Program (HMGP). Under the program, federal funds covered 75% of the cost of relocating a home, with the county and homeowner splitting the remaining cost. All of the Sheedys' neighbors qualified for this program, leaving only the Sheedy home in the flood fringe. Based on the results of a federal agency's cost-benefit analysis, the Sheedys' home was not included in the buyout program.
The Sheedys filed a lawsuit against Mower County seeking: an injunction to compel flood plain relief; damages and estoppel based on Mower County's alleged negligence in issuing a building permit; and civil rights violations under 42 U.S.C. § 1983. Mower County filed a motion for summary judgment.
The district court concluded that Mower County was not entitled to statutory immunity, but nevertheless granted summary judgment because: (1) Mower County had no duty to advise the Sheedys that the property covered by the building permit was located in a flood plain, and (2) the Sheedys could not use an equitable estoppel claim as a basis for damages. In order to appeal the summary judgment decision, the parties stipulated to dismissing the civil rights claim with prejudice. Judgment was then entered pursuant to the district court's order.
DECISION
When reviewing an appeal from summary judgment, this court must ask whether any genuine issues of material fact exist, and whether the district court erred in its application of the law. State by Cooper v. French , 460 N.W.2d 2, 4 (Minn. 1990). "This court must view the evidence in the light most favorable to the party against whom judgment was granted," in this case, the Sheedys. Fabio v. Bellomo , 504 N.W.2d 758, 761 (Minn. 1993).
Mower County alleges that the district court erred by concluding that the county it is not entitled to statutory immunity. Whether a governmental entity is protected by statutory immunity is a legal question that this court reviews de novo. Johnson v. State , 553 N.W.2d 40, 45 (Minn. 1996).
Political subdivisions, including Mower County, are immune for "[a]ny claim based upon the performance or the failure to exercise or perform a discretionary function or duty, whether or not the discretion is abused." Minn. Stat. § 466.03, subd. 6 (1996). If a governmental decision involves "political, social and economic considerations that lie at the center of discretionary action, including consideration of safety issues, financial burdens, and possible legal consequences, it is not the role of courts to second-guess such policy decisions." Watson v. Metropolitan Transit Comm'n , 553 N.W.2d 406, 411 (Minn. 1996). Discretionary acts are those that require balancing "complex and competing factors at the planning, rather than the operational, stage of development." Ostendorf v. Kenyon , 347 N.W.2d 834, 837 (Minn.App. 1984). Conversely, operational decisions relating to ordinary day-to-day operations are not immune. Holmquist v. State , 425 N.W.2d 230, 232 (Minn. 1988).
The Sheedys argue that Mower County is not entitled to immunity because the issuance of the building permit involved only ministerial duties. The Minnesota Supreme Court has held, however, that the issuance of building permits is a discretionary activity protected by statutory immunity. Anderson v. City of Minneapolis , 287 Minn. 287, 288-89, 178 N.W.2d 215, 217 (1970). The proposition that the government entity's granting of building permits is discretionary and protected by statutory immunity has been repeatedly affirmed. See, e.g. , Snyder v. City of Minneapolis , 441 N.W.2d 781, 787 (Minn. 1989) (affirming Anderson's holding that issuance of building permit is generally discretionary conduct); Vrieze v. New Century Homes, Inc. , 542 N.W.2d 62, 66-67 (Minn.App. 1996) (holding that granting building permits is discretionary and subsequent approval of modification to buildings permits is discretionary conduct).
In Anderson , the plaintiffs sued the city for granting a building permit that was subsequently cancelled because it violated a city zoning ordinance. 287 Minn. at 288, 178 N.W.2d at 217. The court held that the plaintiffs were precluded from suing the city because:
The act of an employee of the city in issuing the building permit in a doubtful case involved an exercise of discretion in the sense that the city's employee had to make a judgment as to whether plans submitted in support of the application for the permit constituted a permissible use of the property in the area involved.
Id. In addition, the court stated that, if the proposed use of the authorized building permit was illegal, so that the employee should have exercised no discretion or judgment, the owner is still precluded from recovering damages because the owner is charged with knowledge of the law. Id. at 289, 178 N.W.2d at 217.
The Sheedys allege that Anderson and its progeny are not dispositive because no evidence suggests that Mower County believed that this was a doubtful case. Consequently, they argue that Mower County exercised no discretion or judgment when granting the building permit; it merely verified the property location and granted the permit. Even if, however, it could be said that Mower County exercised no discretion in issuing the permit, the Sheedys still would have no cause of action because they are charged with knowledge of the flood plain ordinance. Id. The district court erred by failing to observe that the Sheedys' assumed knowledge of the law precludes their cause of action against Mower County. Therefore, not only is summary judgment proper because Mower County is protected by statutory immunity, but also because the Sheedys are presumed to have knowledge of the flood plain ordinance.
Due to our conclusion that Mower County is protected from liability by statutory immunity, we decline to reach the duty and equitable estoppel issues the Sheedys raise. We note, however, that even if Mower County is not protected by statutory immunity, the trial court properly concluded summary judgment is appropriate. The Sheedys did not establish that Mower County had a duty to advise them that the property covered by the building permit was located in a flood plain. See Cracraft v. City of St. Louis Park , 279 N.W.2d 801, 803-04 (Minn. 1979) (in order to recover against city, plaintiffs must show breach of duty owed to them in individual capacity, not merely breach of obligation owed to general public). Specifically, the Sheedys did not show that Mower County assumed a duty on their behalf by virtue of the flood plain ordinance because: the record contains no evidence that Mower County had actual knowledge that the Sheedys' proposed residence was to be built in the flood plain; the Sheedys relied generally on Mower County's issuance of the permit, rather than relying specifically on a representation pertaining to the existence or nonexistence of the flood plain; the flood plain ordinance was designed to protect the public as a whole, not those who build in the flood plain; and Mower County's issuance of the permit did not increase the risk of harm of building in the flood plain.
Finally, the district court properly concluded that the Sheedys could not use equitable estoppel as a basis for recovering damages from Mower County. See Snyder , 441 N.W.2d at 790-91 (estoppel does not furnish basis for damages and is generally used as "a shield, not a sword").