Court of Appeals 06.02.2009

We return from a month’s haitus to a decision in the Monticello broadband-bond case, one of the cases we previewed for argument in February.  The Court affirmed the district court’s decision to throw out a competitor’s challenge to Monticello’s public fiber-optice network initiative.  The decision to give a broad reading to “public utility or convenience” is unanimous; the holdings to allow bonding for start-up costs and the lower court’s refusal to allow an amended complaint drew a dissent.  Barring Supreme Court intervention, it’s all systems go for municipal projects of this sort – the question is, will any other city want to carry the costs of such a project?  North Saint Paul voters overwhelmingly said no earlier this year.  Proposers would do well not just to consider the up-front costs, especially if those are somehow provided by stimulus money or other grants, but the long-term upkeep as well.

Also in the published cases today: a not-nearly-so-harmonious decision on Intoxylizer source code  that appears to be a big deal but probably isn’t.  The Court declared a district court in error for a factual finding that the State “doesn’t possess” the DWI-machine source code.  This contradicts the Supreme Court’s latest decision on the matter, which holds that the State by contract “possesses” the code, even though it is locked in a court battle with the manufacturer to get what the rest of us would consider “possession”: an actual copy.  The main issue, though, remains whether the machine breath test has much of an impact upon the outcome of the case: here, the Court made its finding of error but affirmed anyway based on other evidence of drunk driving (such as being found by onlookers and police passed out at the wheel of a running car, say).  The status quo remains that source code is a key issue in .20 prosecutions or the (rare) DWI where all you’ve got is the BAC level, but otherwise it’s not a silver bullet for the defense.

On the unpublished side, the Court answers a tough question in St. Paul v. MGM Properties: what happens when a city brings a zoning-enforcement action in court, begins to lose, and then raises the doctrine of exhausting administrative remedies as a defense to the landowner’s (successful) summary judgment motion?  The whole thing is thrown out and everyone is re-directed to the administrative process.  The takeaway: it’s improper to infer from the City’s decision to sue in district court that pursuit of administrative remedies would be futile.  The Court identified some other issues with the lower court’s decision, but the ultimate decision to only adjust the dismissal from “with prejudice” to “without prejudice” and suggest that the parties come back if an administrative process doesn’t resolve the issue is the surprising thing here.  (Full disclosure: Chad Lemmons of Kelly & Lemmons reprents MGM in this case).

There is also a decision in Three Putt LLC v Minnetonka, also previewed here (along with the Monticello case) prior to argument.  In the preview, I’d suggested that a key issue would be PUD as a zoning district v. PUDs as contracts.   It was the first merits issue discussed, but the Court didn’t take long to come down firmly on the “contract” side.  It does so in a way that doesn’t advance the law on PUDs, either, as the Court took the issue to be whether the two properties had a single contract (clearly not true) instead of whether there was an overarching district that provided a single set of regulations favorable to Three Putt’s interests.   The rest of the opinion primarily applies contract principles to all facets of the land dispute, in all instances to the detriment of the appellant.  The Court does reiterate that the burden of persuasion rests with the person challenging a city zoning action, not the city or recipient of the approval.


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