Love's Travel Stops v. City of Wall

2023 S.D. 68
South Dakota Supreme Court·Decided December 28, 2023·No. 30277·Published·Cited by 1 cases

Opinion

#30277-r-SRJ 2023 S.D. 68

IN THE SUPREME COURT

OF THE

STATE OF SOUTH DAKOTA

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LOVE’S TRAVEL STOPS & COUNTRY STORES, INC., and ONE SHOT, LLC, Plaintiffs and Appellees,

v.

CITY OF WALL, SOUTH DAKOTA; CITY COUNCIL FOR WALL, SOUTH DAKOTA; and PLANNING and ZONING COMMISSION FOR WALL, SOUTH DAKOTA, Defendants and Appellants.

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APPEAL FROM THE CIRCUIT COURT OF THE SEVENTH JUDICIAL CIRCUIT PENNINGTON COUNTY, SOUTH DAKOTA

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THE HONORABLE HEIDI L. LINNGREN Judge

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RONALD A. PARSONS, JR. of Johnson, Janklow & Abdallah, LLP Sioux Falls, South Dakota

KENT R. HAGG of Hagg & Hagg, LLP Rapid City, South Dakota

STEPHANIE TRASK of City of Wall, South Dakota Attorneys for defendants and appellants.

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ARGUED

OCTOBER 4, 2023

OPINION FILED 12/28/23

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MICHAEL F. NADOLSKI JEFFREY D. COLLINS DANA VAN BEEK PALMER of Lynn Jackson Shultz & Lebrun, P.C. Sioux Falls, South Dakota Attorneys for plaintiffs and appellees.

JENSEN, Chief Justice [¶1.] Love’s Travel Stops & Country Stores, Inc. (Loves) entered into a conditional agreement to purchase property in Wall, South Dakota (City). Loves applied to rezone the property and sought a building permit to develop a new travel stop on the property. After the City Council denied these requests, Loves filed a petition for writ of mandamus, writ of certiorari, and request for declaratory relief with the circuit court. The circuit court granted Loves’ petition in part (Mandamus Order) declaring that the City’s Zoning Ordinance did not apply to the subject property and granted mandamus relief requiring the City to reconsider Loves’ application for a building permit after it “review[ed] and determine[d] whether any member of the City Council is disqualified” from considering Loves’ application under SDCL 6-1-17. Neither party appealed the circuit court’s ruling. [¶2.] The City Council subsequently conducted a conflict-of-interest analysis and determined that no member was disqualified from considering Loves’ application under SDCL 6-1-17. Thereafter, the City Council reconsidered and again denied Loves’ building permit application. Following the denial, Loves filed a motion for order to show cause requesting the circuit court to find the City in contempt of the court’s order and sought issuance of a building permit. The circuit court found the City to be in contempt for willfully and contumaciously disobeying its Mandamus Order and ordered the City to issue Loves a building permit. The City appeals the circuit court’s contempt order. We reverse.

Factual and Procedural Background [¶3.] Loves is a privately owned corporation that operates 24-hour truck stops across the United States. One Shot, L.L.C. (One Shot), a South Dakota limited liability company, owns real property located in the southwest corner of the City. Loves entered into an agreement to purchase a 13-acre parcel of land (the Property) from One Shot, conditioned upon obtaining City zoning and permitting approvals to develop and construct a new travel stop on the Property. At the time, the Property was located within the City, but had not been platted or designated to one of the four established zoning districts in the City’s Zoning Ordinance. 1 [¶4.] All rezoning and building permit applications within the City must be approved at regular city council meetings. The City Council is comprised of a six- member panel. At the outset of this case, Rick Hustead, Jerry Morgan, Stan Anderson, Mike Anderson, Dar Haerer, and Dan Hauk all served on the City Council. 2 Hustead is the owner of Wall Drug Store, Inc., a popular rest stop and tourist attraction located within the City. Hustead also owns the Wall Auto Livery gas station and convenience store. Mike Anderson is the owner of a Dairy Queen franchise in the City, and Welsh owns a local motel. [¶5.] On August 22, 2019, Loves presented its plan to build and develop a travel stop to the City Council. These plans garnered significant interest

1. The four zoning districts listed within the City’s Ordinance include general residential, general commercial, general industrial, and planned unit development.

2. Dar Hearer was replaced by Kelly Welsh while Loves’ building permit was being reconsidered.

throughout the community. Hustead was among the council members who expressed their opposition to Loves’ plans, citing the potential affect on Wall Drug’s business and the safety and economic value of nearby neighborhoods. Several community members also expressed opinions and concerns with Loves’ building plans. [¶6.] On October 16, 2019, Loves sought to rezone the Property from the City’s agricultural district to its general commercial district. 3 In response to this request, the City published a notice of hearing on the application for rezoning. The meeting was set to be heard by the City’s Planning and Zoning Commission (Commission) on November 5, 2019. The Commission was split with three votes in favor of recommending the application to the City Council and three votes opposed. Hustead and Stan Anderson were among the three votes in opposition to the rezoning application. [¶7.] Following the Commission hearing, Loves submitted a written request to have the City recuse Stan Anderson and Hustead from considering the application because of their personal conflicts and dual roles in the City government. 4 In response to this request, the City attorney informed Loves that

3. Loves alleges that the City initially represented that the Property was zoned as agricultural land and needed to be rezoned to the general commercial district. Loves claims it did not discover that the Property had not been zoned until after its initial re-zoning application was submitted.

4. In their petition for writ of certiorari and writ of mandamus, Loves alleged that Hustead and Stan Anderson could not legally sit on the Commission because they were members of the City Council. The circuit court did not address this issue in its Mandamus Order, and it was not directly raised as an issue in the contempt proceedings.

she did not identify any conflicts of interest regarding Loves’ application and therefore declined to have any member of the City Council removed. [¶8.] Loves applied for a building permit on January 20, 2020. The City Council considered both the rezoning request and the building permit application at the next City Council meeting. The City Council voted unanimously to deny Loves’ application to rezone the Property. The meeting minutes reflect that the City Council’s justification for denying the application was because “[a] decision for the best interest of the health, safety and welfare of this community [was] not possible at [the] time with the lack of a completed study and update to the Master Comprehensive Plan.” Shortly thereafter, council members moved and voted unanimously to deny Loves’ building permit application because the Property was “not zoned for a commercial business.” [¶9.] On March 24, 2020, Loves filed a petition for writ of mandamus, for writ of certiorari, and for declaratory relief with the circuit court. The petition alleged that the City Ordinance prohibited members of the City Council from sitting on the Commission, that some members of the City Council were biased and had conflicts of interest requiring recusal from considering Loves’ application, and that the Commission and City Council failed to properly consider the zoning request and application for a building permit. The petition sought a court declaration that the City’s zoning ordinance was not applicable to their building plans, that the City must reconsider Loves’ application in accordance with South Dakota law, and further requested the court to require the City to issue Loves a building permit.

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