ATTORNEYS FOR APPELLANTS
James P. Moloy
Joseph D. Calderon
ATTORNEY FOR APPELLEES
Brian J. Zaiger
SUPREME COURT OF INDIANA
EQUICOR DEVELOPMENT, INC., )
An Indiana Corporation, )
THOMAS E. GOINS, and )
STEPHEN ROUDEBUSH, )
) Indiana Supreme Court
Appellants (Petitioners Below), ) Cause No. 29S02-0105-CV-239
v. ) Indiana Court of Appeals
) Cause No. 29A02-9909-CV-661
THE WESTFIELD-WASHINGTON )
TOWNSHIP PLAN COMMISSION, )
Appellee (Respondent Below). )
APPEAL FROM THE HAMILTON SUPERIOR COURT
The Honorable Jerry M. Barr, Judge
Cause No. 29D02-9806-MI-349
ON PETITION FOR TRANSFER
November 15, 2001
We hold that in the absence of a claimed violation of due process
or equal protection rights, or their state counterparts, it is improper to inquire
into the motive behind a zoning commissions denial of a subdividers proposed primary
plat. However, under the circumstances of this case, the commission is estopped
from raising the deficiencies it cited to deny the proposal.
Factual and Procedural Background
In February 1998, Equicor submitted a primary plat to the Westfield-Washington Township Plan
Commission for the development of 27.2 acres as a cluster housing development.
The Technical Advisory Committee reviewed the plat and concluded that no changes were
necessary. Accordingly, the Plan Commissions staff determined that the Commission should approve
the plat. At that point, the Plan Commission submitted a proposal to
the Town Council to suspend Section 110, the provision in the Local Zoning
Ordinance governing cluster housing. The Commission also published notice of a March
23, 1998 public hearing on Equicors proposed plat. On March 23, the
Commission approved the suspension of Section 110, but Equicors primary plat was grandfathered
and Equicor was allowed to proceed.
At the hearing on Equicors proposal, both Plan Commission members and owners of
the neighboring property expressed concern about the density of the proposed development.
The Plan Commission referred the plat to the Subdivision Committee for further review.
Three weeks later, on April 13, the Town Council took the final
action necessary to suspend Section 110. On April 15, a subcommittee of
the Subdivision Committee recommended that Equicor add additional green space and make some
minor changes to the streets, and Equicor undertook to do both. The
plat was returned to the full Subdivision Committee for final review and was
again reviewed on April 29. On May 26, the Plan Commission voted
to deny approval of the plat.
The Commission members who were polled after the vote cited a failure to
comply with the requirement of Section 110 that the applicant designate two on-site
and one-half off-site parking spaces, excluding garages and carports, for each one to
three bedroom unit. In submitting its primary plat for approval, Equicor did
not list the number and location of all the parking spaces. Equicor
contended, however, that the plat showed two on-site spaces in the form of
two spaces in the driveway of each unit and curbside parking adequate for
the one-half space off-site.
Equicor filed a Petition for Writ of Certiorari in the trial court, contending
that the Commissions denial was arbitrary, capricious, illegal, and contrary to law.
The trial court affirmed the decision of the Plan Commission, concluding that the
decision was supported by substantial evidence establishing that the denial was based on
Equicors failure to designate the number and location of parking spaces for the
development. The Court of Appeals agreed with the trial court that there
was substantial evidence supporting the Commissions denial of Equicors plat, but nevertheless reversed.
Equicor Dev., Inc., v. Westfield-Washington Township Plan Commn, 732 N.E.2d 215 (Ind.
Ct. App. 2000). The Court of Appeals found the Commissions decision was
arbitrary and capricious because the Commissions true motive was a concern for density
and because similar plats had been approved without requiring the designation of parking
spaces. Id. at 220-24. The Court of Appeals did not address
Equicors argument that the Plan Commission, having failed to notify it of the
alleged parking deficiency, was estopped from denying its permit on that basis.
Standard of Review
Indiana Code section 4-21.5-5-14 prescribes the scope of court review of an administrative
decision. That section provides that a court may provide relief only if
the agency action is: (1) arbitrary, capricious, an abuse of discretion, or otherwise
not in accordance with law; (2) contrary to constitutional right, power, privilege, or
immunity; (3) in excess of statutory jurisdiction, authority, or limitations, or short of
statutory right; (4) without observance of procedure required by law; or (5) unsupported
by substantial evidence. See also Dept of Natural Res. v. Ind. Coal
Council, Inc., 542 N.E.2d 1000, 1007 (Ind. 1989) ([A]n administrative act is arbitrary
and capricious only where it is willful and unreasonable, without consideration and in
disregard of the facts and circumstances in the case, or without some basis
which would lead a reasonable and honest person to the same conclusion.).
Section 4-21.5-5-14(a) further provides that [t]he burden of demonstrating the invalidity of the
agency action is on the party . . . asserting invalidity. In
reviewing an administrative decision, a court is not to try the facts de
novo or substitute its own judgment for that of the agency. Ind.
Code § 4-21.5-5-11 (1998); accord Ind. Dept of Envtl. Mgmt. v. Conard, 614
N.E.2d 916, 919 (Ind. 1993). This statutory standard mirrors the standard long
followed by this Court. See Town of Beverly Shores v. Bagnall, 590
N.E.2d 1059, 1061 (Ind. 1992).
On appeal, to the extent the trial courts factual findings were based on
a paper record, this Court conducts its own de novo review of the
record. Cf. Houser v. State, 678 N.E.2d 95, 98 (Ind. 1997) (Because
both the appellate and trial courts are reviewing the paper record submitted to
the magistrate, there is no reason for appellate courts to defer to the
trial courts finding that a substantial basis existed for issuing the warrant.).
If the trial court holds an evidentiary hearing, this Court defers to the
trial court to the extent its factual findings derive from the hearing.
GKN Co. v. Magness, 744 N.E.2d 397, 401 (Ind. 2001). Here, the
trial court held an evidentiary hearing which focused primarily on the Commissions motives
for rejecting Equicors proposed primary plat and heard similar arguments on a motion
to correct error. There was also a record of minutes of the
Commissions meetings and legal briefs filed to the court. To the extent
findings turn solely on this paper record, review is de novo. Id.
I. Inquiry into Motive and Comparison with Other Cases
The Court of Appeals concluded that the Commissions decision was arbitrary and capricious
. . . in light of the true motive behind the Commissions decision
[and] their discriminatory treatment of Equicors proposed primary plat as compared to similarly
situated plats. Equicor, 732 N.E.2d at 223. Chief Judge Sharpnack dissented,
concluding that it was improper for the majority to find arbitrary action based
on inconsistency with prior Commission decisions. Id. at 224.
An inquiry into the motive of an agency action may be proper in
some circumstances, notably where there is a claimed violation of rights protected by
the Fourteenth Amendment. Thus, in the context of a zoning administrative action,
[a] violation of substantive due process rights is demonstrated if the governments actions
were not rationally related to a legitimate state interest or were motivated by
bias, bad faith, or improper motive. John E. Long, Inc. v. Borough
of Ringwood, 61 F. Supp. 2d 273, 280 (D.N.J. 1998). [A] plaintiff
must show that the state administrative agency has been guilty of arbitrary and
capricious action in the strict sense, meaning that there is no rational basis
for the . . . [administrative] decision. Brody v. City of Mason,
250 F.3d 432, 438 (6th Cir. 2001) (holding citys grant of permit to
operate business in residential neighborhood not arbitrary and capricious); accord Greenbriar, LTD. v.
City of Alabaster, 881 F.2d 1570, 1577 (11th Cir. 1989). An improper
motive may also be demonstrated by evidence of extreme partisan political considerations, personal
conflicts of interest and gain, or invidious discriminatory intent. Long, 61 F.
Supp.2d at 283.
In some sense, if an agencys unstated reason for its action is incorrect
as a matter of law, the action may be viewed as based on
an improper motive. We think the improper motive required to permit examination
of the agencys reasons is more restrictive than that. In significant part
this conclusion is driven by practical considerations. If motivation is open to
question in every case where the agency is claimed to have cited an
incorrect factor for its decision, it raises the prospect of discovery of each
member of the agency as a routine step toward judicial review of administrative
action. This in turn escalates the potential cost and delay by an
order of magnitude. The Administrative Orders and Procedures Act
See footnote was designed to
preclude this sort of obstacle to agency action.
Cf. Thompson v. Med.
Licensing Bd., 180 Ind. App. 333, 337, 389 N.E.2d 43, 46 (1979) (By
enacting the Administrative Adjudication Act (the Act) in 1947 the Indiana legislature recognized
the basic need for unfettered action by administrative agencies operating within the sphere
of their authority.). The common thread of the cases examining motive is
a contention that the decision was based on considerations personal to either the
applicant (e.g., race or gender discrimination) or personal to one or more members
of the agency (e.g., bribery or political retaliation). We conclude that a
bona fide claim of violation of due process or equal protection rights, or
their state law counterparts, is required before an inquiry into the subjective motivation
of the agency may be launched.
Equicor plausibly contends that opposition to cluster housing was the real reason for
rejecting its plat. But Equicor does not claim that the agency was
motivated by malice or improper outside influence. Rather, the contention is that
parking designation is pretextual, and plats with similar parking designations have been approved
in the past. Therefore, Equicor argues, the action is arbitrary and capricious.
In support of this view, Equicor cites the Commissions support for suspension
of Section 110 as evidence that the real reason for disapproval was hostility
to cluster housing. This contention boils down to a claim that the
agency cited a proper factor but was really motivated by a consideration that
could constitutionally have been written into the ordinance but was not. This
is a claim of error, but not of denial of due process or
equal protection. In the absence of a claim that the decision was
the product of constitutional violation, the test of arbitrary and capricious action is
whether there is no reasonable basis for the action. Ind. Civil Rights
Commn v. Delaware County Circuit Court, 668 N.E.2d 1219, 1221 (Ind. 1996).
We think this is an objective standard, and does not turn on the
subjective motivation of the agency. In this case, the Commission was objectively
correct in pointing to the failure of the plat to designate the parking
spaces with specificity even if, as Equicor contends, anyone with common sense could
figure out that there were indeed the required number of spaces. As
a result, even if failure to designate parking was not the real reason
for disapproval, the Commissions motivation is irrelevant as a matter of law.
We also believe past approval of similarly situated plats does not establish that
the Commissions decision was reversible as arbitrary and capricious. If the basis
for denial is a failure to meet a requirement of the governing ordinance,
albeit one previously enforced laxly or not at all, the inquiry is not
whether there are prior inconsistent decisions, but rather whether there is substantial evidence
supporting the agencys decision. As Chief Judge Sharpnack pointed out, if the
administrative agency is, in effect, estopped by its prior decisions, it becomes unable
to correct its errors in subsequent determinations. In short, past weak enforcement
does not invalidate an otherwise valid requirement, and inquiry into the Commissions subjective
motivation is improper unless there is a claimed denial of due process or
II. Duty to Inform Applicant of Deficiencies and Estoppel
Equicor argues that the Plan Commissions decision must be reversed because the Commission
failed to raise the claimed deficiency at its first known opportunity and gave
Equicor no opportunity to correct it. Given this failure, Equicor contends that
the Commission is estopped from denying approval. Although the Commission asserts that
Equicor did not raise this argument in the trial court and has therefore
waived it on appeal, it appears that Equicor raised this contention at least
twice in the trial court.
As a general matter, government entities are not subject to equitable estoppel.
State ex rel. Agan v. Hendricks Superior Court, 250 Ind. 675, 678, 235
N.E.2d 458, 460 (1968). However, this Court has held that in certain
situations application of estoppel of government entities is appropriate. See id.; see
also Cablevision of Chicago v. Colby Cable Corp., 417 N.E.2d 348, 356 (Ind.
Ct. App. 1981); Tippecanoe County Area Plan Commn v. Sheffield Town Developers, Inc.,
181 Ind. App. 586, 599-600, 394 N.E.2d 176, 185 (1979), trans. denied.
Specifically, estoppel may be appropriate where the party asserting estoppel has detrimentally relied
on the governmental entitys affirmative assertion or on its silence where there was
a duty to speak. See Hendricks, 250 Ind. at 678, 235 N.E.2d
at 460 (applying estoppel to the State where the State failed to raise
its objections in prior proceedings); Sheffield, 181 Ind. App. at 599-600, 394 N.E.2d
at 185 (holding that estoppel was applicable where the County had a duty
to speak and did not, and developer relied on the Countys silence to
its detriment); cf. Ind. Dept of Envtl. Mgt. v. Conard, 614 N.E.2d 916,
921 (Ind. 1993) (denying estoppel in the absence of any detrimental reliance on
statements made by the government agency); City of Crown Point v. Lake County,
510 N.E.2d 684, 688 (Ind. 1987) (same).
Although the Plan Commission suggested other changes in the plat, it was silent
as to any parking issue. In response to the suggestions that were
made, Equicor added green space and made minor changes to the streets, but
made no changes in the apparently acceptable parking. Equicor thus relied on
the Plan Commissions silence by proceeding in the reasonable belief that the plat
would be approved and failing to make changes in the easily correctable flaws
in the parking designation.
We are dealing here with a formal defectfailure to designate the spaces.
There is no claim that the project is substantively flawed, and the Commission
does not assert that the project in fact has less parking than required.
As Equicor points out, the plat itself reveals driveways (on-site) and curbside
spaces (off-site) that are apparently in compliance with the requirement of two on-site
and one-half off-site spaces per unit. Raising a formal defect such as
failure to designate these visible, if undesignated, spaces at the last moment permits
agencies to fumble endlessly with proposals that are entirely lawful. Under these
circumstances, the Plan Commissions failure to object to the undesignated spaces resulted in
Equicors detrimental reliance thereon and, therefore, estoppel is appropriate in this case.
See Middleton Motors v. Ind. Dept of State Revenue, 269 Ind. 282, 286,
380 N.E.2d 79, 81-82 (1978) (DeBruler, J., dissenting).
In Sheffield, the Court of Appeals relied on our conclusion in Knutson v.
State ex rel. Seberger, 239 Ind. 656, 662-64, 157 N.E.2d 469, 472-73 (1959),
that once a town board has determined that a plat complies with the
statutory requirements, review is a ministerial act and approval is mandatory. See
also 83 Am. Jur. 2d Zoning and Planning § 556, at 445-46 ([W]here
the applicant has met the statutory and local regulatory standards, approval of the
plat is a ministerial act, and it is arbitrary as a matter of
law to deny approval of a plat that meets those standards.). This
holding has been reaffirmed on several occasions by the Court of Appeals.
See Hickory Hills Dev. Co. v. Coffman, 699 N.E.2d 1214, 1216 (Ind. Ct.
App. 1998), trans. denied
See footnote ;
Dosmann v. Area Plan Commn, 160 Ind. App. 605,
312 N.E.2d 880, 884 (1974); Suburban Homes Corp. v. Anderson, 147 Ind. App.
419, 261 N.E.2d 376 (1970).
Here, Equicor submitted documents to and appeared before the Commission on several occasions.
In February of 1998, Equicor first submitted its proposed primary plat application
to the Plan Commission. The Technical Advisory Committee reviewed the application in
March, and concluded that no changes to the plat were necessary. The
Plan Commission staff then determined that approval should be granted. That same
month, the Commission took the first step toward suspension of the section of
the Local Zoning Ordinance dealing with cluster housing. At a public hearing
on March 23, it was determined that the amendment would be prospective only,
and Equicors application would be unaffected. More detailed review of the plat
was conducted by the Subdivision Committee, which recommended three changes to Equicors primary
plat, none of which related to the parking designation. On April 23,
the Subdivision Committee reviewed Equicors changes and referred the plat to the Commission
for final review. On May 26, the Plan Commission reviewed the plat
and denied approval, for the first time citing the failure to designate the
number and location of parking spaces as a primary reason for its disapproval.
In sum, the Plan Commission had ample opportunity to point out any deficiency
in the designation of parking, and Equicor reasonably relied on the absence of
any parking issue in processing its proposal. Under these circumstances, the Commission
was estopped from asserting this deficiency as the reason for its disapproval of
We reverse the trial court and remand to the Westfield-Washington Township Plan Commission
for final review of Equicors proposed primary plat consistent with this opinion.
SHEPARD, C.J., and DICKSON, SULLIVAN, and RUCKER, JJ., concur.
Ind. Code 4-21.5.
Hickory Hills concludes that, because the approval of a plat is a
ministerial rather than a discretionary act, a plan commission does not act as
an administrative agency in the approval or disapproval of a plat and the
rules of discovery are not applicable to subdivision application proceedings. 699 N.E.2d
at 1217. We do not address this point here.