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The Curious Case of Fairway Outdoor Advertising

March 14, 2013

Last week, the North Carolina Court of Appeals filed its opinion in Fairway Outdoor Advertising v. Town of Cary, COA 12-518. The dispute can be traced back to an administrative decision by the Town, which Fairway appealed to the Town’s Board of Adjustment (the “BOA”). The BOA is a quasi-judicial body and serves as the finder of fact in these matters.

When a party elects to appeal a BOA decision, it is heard via certiorari by the Superior Court, which sits in an appellate capacity – an often unfamiliar role as it traditionally serves as the fact finder in the judicial system. As such, its review is limited. With respect to questions of law, its review is de novo, meaning it may largely disregard the conclusions made by the BOA and substitute its own judgment freely. However, with respect to questions of fact, review is conducted under the whole record test, which provides that the BOA’s findings will not be disturbed if they are supported by competent, material and substantial evidence in the record. Relatively recently, these standards were even codified by the General Assembly in N.C. Gen. Stat. § 160A-393(k).

In analyzing any quasi-judicial land use decision, the first step is always sorting out which issues fall under which standard (and occasionally there is some crossover, which only complicates the analysis further). In the Fairway opinion, the Court of Appeals (“COA”) appears to have omitted that crucial step.

Clue #1 is that the COA failed to recite the standard of review in appeals from a BOA decision, which is an almost ubiquitous transition between the factual narratives and legal analysis in land use cases. Clue #2 is the repeated references and citations to the factual findings of the Superior Court. Except in narrow circumstances not at issue here, it is error for the Superior Court to make its own findings of fact in these types of cert actions. The COA’s error ended up being two-fold: first, the Court misidentified the fact finder; and second, the Court should have been conducting its analysis as to the timeliness of Fairway’s BOA appeal de novo.

In fact, § 160A-393(k)(2) states in no uncertain terms that when “the issue before the court is whether the decision‑making board erred in interpreting an ordinance, the court shall review that issue de novo. The court shall consider the interpretation of the decision‑making board, but is not bound by that interpretation, and may freely substitute its judgment as appropriate.” Given that the opinion devotes a full-page at the start of its timeliness analysis to the rules of statutory construction and their application to zoning ordinances, there’s not a lot of wiggle room to explain the Court’s approach.

In the end, the COA may have reached the correct determination of the issues presented (although that is not at all clear from the opinion). Nonetheless, the perils and complexity of land use litigation are underscored when even the Court occasionally struggles with some of its nuances. Perhaps this oversight explains why Judge Hunter concurred in the result only.

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