Supreme Court 05.06.10

The Court released its opinion in Halla Nursery v. Chanhassen, another in the recent line of cases ruling on local government errors.  The Court of Appeals ruled last March that Halla could not claim vested rights through a building permit that should never have issued, and the Supreme Court affirms that today in a unanimous opinion written by Justice Meyer.

Half of the opinion is interpretation of a previous settlement between the parties – Halla never pulled permits to build its facilities in the mid-90’s, leading to a consent decree that covered signage on the property.  In 2005, Halla applied for approval of a new sign, which was bigger than allowed in the consent decree and also included illumination and message boards.  The consent decree prohibited illumination and the City ordinance required a CUP for the message boards, but someone in the City planning department approved it anyway.  Only when the sign was just about done and a citizen complained about the electrical hookups being installed did the City catch the error and seek a stop-work order. 

After dispensing with Halla’s arguments about the judgment, Justice Meyer recaps the law on the vested rights doctrine – both in our state and in several other jurisdictions.  The final result is a strong statement:  “we hold that the vested rights doctrine does not apply when a landowner substantially completes a project in reliance on an erroneously issued sign permit.”  Since the analysis was not in any way limited to sign permits, I would expect that rule to also apply to other kinds of permits.


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