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PO Box 1070, Frankfort, KY 40602  Phone 502.875.2428, Fax 502.875.2845

Supreme Court Review Of Zoning Decision Sought  Posted: October 3, 2008
SUPREME COURT OF KENTUCKY
DOCKET NO. ______________
KENTUCKY COURT OF APPEALS
NO. 2007-CA-001770-MR

WILLIAM LEGRAND; ELSIE EWBANK; VIRGINIA
EWBANK; KATHY COOK; AND ROBERT EWBANK
MOVANTS

ON APPEAL FROM GALLATIN CIRCUIT COURT HONORABLE
ANTHONY W. FROHLICH, JUDGE, ACTION NO. 04-CI-00197

v.

WINSLOW BAKER, IN HIS OFFICIAL CAPACITY
AS GALLATIN COUNTY ZONING ENFORCEMENT
OFFICER AND ZONING ADMINISTRATOR;
AND
NUGENT SAND COMPANY
RESPONDENTS

MOTION FOR DISCRETIONARY REVIEW ON BEHALF OF
WILLIAM LEGRAND, ELSIE EWBANK, VIRGINIA EWBANK,
KATHY COOK, AND ROBERT EWBANK

**************************

MOTION FOR DISCRETIONARY REVIEW

William LeGrand, Robert Ewbank, Elsie Ewbank, Virginia Ewbank and Kathy Cook (collectively, “Movants”) respectfully move this Court for discretionary review of the August 29, 2008 Opinion of the Kentucky Court of Appeals affirming the ruling of the Gallatin Circuit Court that in turn had affirmed a determination by the Gallatin County Board of Adjustments that Nugent Sand Company had nonconforming use rights to conduct sand and gravel mining operations on all lands owned by it that were under a state-issued mining permit at the time that Gallatin County adopted comprehensive planning and zoning regulations.

1. Movants are William LeGrand, Elsie Ewbank, Virginia Ewbank, Kathy Cook, and Robert Ewbank. The Movants are represented by Tom FitzGerald, Kentucky Resources Council, Inc., 213 St. Clair Street Suite 200, Post Office Box 1070, Frankfort, Kentucky, 40602.

2. The Respondents are Winslow Baker, in his official capacity as Gallatin County Zoning Enforcement Officer and Zoning Administrator, and Nugent Sand Company. Mr. Baker is represented by John G. Wright, 101 E. Market Street, Post Office Box 966, Warsaw, Kentucky 41095. Nugent Sand Company is represented by George L. Seay, Jr. and Lesly A.R. Davis, Wyatt, Tarrant and Combs, LLP, 250 W. Main Street, Suite 1600, Lexington, Kentucky 40507; and Jean W. Bird, Wyatt, Tarrant and Combs, LLP, 2800 PNC Plaza, 500 W. Jefferson Street, Louisville, Kentucky 40202.

3. The Opinion of the Court of Appeals in Case No. 2007-CA-001770-MR was issued on August 29, 2008 and is designated “to be published.” The August 29, 2008 Opinion of the Court of Appeals is attached as Exhibit 1. The August 2, 2007 Gallatin Circuit Court Order in Case No. 04-CI-00197 is attached as Exhibit 2. The November 29, 2004 Ruling of the Gallatin Board of Adjustments is attached as Exhibit 3. There is no motion for reconsideration or petition for rehearing pending before the Court of Appeals.

4. No supersedeas bond has been executed. 5. Discretionary review is appropriate to resolve a crucial issue of law concerning the interpretation and application of K.R.S. 100.253(2) to mining operations. In a case of first impression, the Court of Appeals adopted wholesale a doctrine of “diminishing assets” that has no basis in Kentucky law, and in so doing ratified the significant expansion of the scope and area of the nonconforming mining operation of Nugent Sand Company in the Steele Bottom community of Gallatin County, to encompass areas that were in fact dedicated to agricultural use at the time of enactment of the zoning regulations that made the Nugent mining operation nonconforming.

This dramatic expansion of the concept of what is a “nonconforming use” is:

a. In direct conflict with the admonition in K.R.S. 100.253(2) that the “board of adjustment shall not allow the enlargement or extension of a nonconforming use beyond the scope and area of its operation at the time the regulation which makes its use nonconforming was adopted;”

b. In direct conflict with the body of Kentucky case law requiring that to be considered a preexisting nonconforming use, a use must be in existence at the time that the applicable zoning makes the use nonconforming, and that mere contemplation of use, nor purchase with intent to use is insufficient to confer nonconforming-use status; Perkins v. Joint City-Council Planning Commission, 480 S.W.2d 166, 168 (Ky. 1972);

c. In conflict with the established rule of law in Kentucky that the existence or lack of a claim of preexisting nonconforming use is to be determined on a case-by-case basis, for while reiterating that doctrine, the Court of Appeals has crafted wholesale a new rule categorically applicable to mining activities that allows dramatic expansion and enlargement of a nonconforming use beyond the “scope and area of its operation”; and

d. Is at variance with the principle, recognized by Kentucky Courts and codified at K.R.S. 100.253(2), that nonconforming uses are to be gradually eliminated and are to be held strictly within their boundaries.

STATEMENT OF MATERIAL FACTS

The material facts in this appeal are not disputed, and are presented succinctly in the August 2, 2007 Order of the Gallatin Circuit Court:

On April 10, 2001, Appellee Nugent Sand Company received non-coal sand and gravel mining permit 039-9602 from the Natural Resources and Environmental Protection Cabinet . This permit was for 79.21 acres in the Steele Bottom community in Gallatin County. On October 15, 2001 an amendment to the permit increased the acreage authorized by an additional 148.06 acres. Kathy Cook (an Appellant herein) and Rosalie Cooper filed an administrative challenge to the permits.

On January 10, 2002, Gallatin County adopted zoning regulations. The regulations became effective on January 30, 2002.

On May 8, 2003 the Secretary of the Natural Resources and Environmental (sic) Cabinet entered a final order on the administrative appeal holding the permit and amendment were issued in violation of applicable statutory and regulatory criteria. The Secretary suspended the permit until such time as all applicable statutory and regulatory criteria are fully satisfied.

Appellant Kathy Cook and Rosalie Cooper appealed this ruling to the Franklin Circuit Court. There was one issue. Appellants maintained the Secretary should have revoked, rather than suspend, the permit.

On October 2003 the National (sic) and Environmental Protection Cabinet reissued the permit and amendment.

On July 1, 2004 Appellants William LeGrand, Robert Ewbank, Elsie Ewbank, Virginia Ewbank and a (sic) Kathy Cook wrote a letter to Gallatin County Zoning Administrator Winslow Baker challenging whether the Nugent sand and gravel mining operation was in conformance with the Gallatin County Zoning Regulations.

By letter dated July 11, 2004 the Zoning Administrator made the determination the mining activity was a preexisting nonconforming use and that it applied to all the property owned by Nugent at the time of the enactment of the ordinance (January 30, 2002).

William LeGrand, Robert, Elsie and Virginia Ewbank and Kathy Cook appealed the decision of the Zoning Administrator. An evidentiary hearing was conducted on October 5, 2004. The board granted the parties additional time to brief the issues.

The Board entered the following determination on November 29, 2004:

IT IS THEREFORE determined that the opinion of Enforcement Officer Winslow Baker is affirmed, to wit the operations of Nugent are a “pre existing nonconforming use” and Nugent’s operations may encompass the total acreage owned as of January 30, 2002 (the publication and effective date of the Gallatin County Zoning Ordinance).”

IT IS FURTHER DETERMINED that the “pre-existing nonconforming use” shall only to extend to the total acreage owned as of January 30, 2002 (the publication and effective date of the Gallatin County Zoning Ordinance) that were lawfully permitted by the Kentucky Natural Resources and Environmental Protection Cabinet (Permit No. 039-9602) [transcript of Nugent hearing of October 5, 2004, pp15, 19].

On December 8, 2004 Appellants filed their appeal with this Court.

On February 8, 2005 the Honorable William L. Graham, Franklin Circuit Judge, entered an Order in Franklin Circuit Court Case Number 03-CI-673 affirming the Order of the Secretary of the Natural Resource (sic) and Environmental Protection Cabinet for suspending rather than revoking the license. Kathy Cook and Rosalie Cooper appealed this decision to the Court of Appeals.

On November 16, 2006 the Court of Appeals unanimously affirmed the Franklin Circuit Court in Court of Appeals Case Number 2005-CA-000705-MR. The court held the Secretary had the power to suspend rather than revoke the permits and the Court held the Secretary’s decision was not arbitrary.

Order, Gallatin Circuit Court, Case No. 04-CI-00197, Division I, August 2, 2007.

On August 2, 2007, the Gallatin Circuit Court entered an Order in Case No. 04-CI-00197, upholding the Ruling of the Gallatin County Board of Adjustments of November 29, 2004 and granting Summary Judgment in favor of Appellees.

Appellants raised two grounds for appeal before the Gallatin Circuit Court. First, Appellants argued that Nugent’s use of the property in question was not entitled to the status of “pre-existing nonconforming use” because on January 30, 2002, mining was being conducted under an unlawfully issued permit and that therefore Nugent’s use of the land could not be considered lawful within the meaning of K.R.S. 100.253(1). Order, Gallatin Circuit Court, August 2, 2007. The Circuit Court rejected that claim, and Appellants did not request that the Court of Appeals review that portion of the Circuit Court decision.

The Gallatin Circuit Court Order described the other issue in this manner: The second issue involves the scope of the nonconforming use. The Gallatin County Board of Zoning Adjustment determined the preexisting nonconforming use:

shall only extend to the total acreage owned as of January 30, 2002 (the publication and effective date of the Gallatin County Zoning Ordinance)that were lawfully permitted by the Kentucky Natural Resources and Environmental Protection Cabinet (Permit No. 039-9602).

K.R.S. 100.253(2) deals with the scope of such a use. It provides:

The board of adjustment shall not allow the enlargement or extension of a nonconforming use beyond the scope and area of its operation at the time the regulation which makes its use nonconforming was adopted…

The Appellants maintain the Board committed error since the scope of the existing use should be limited to the actual area being mined on January 30, 2002.

Order, Gallatin Circuit Court, August 2, 2007.

The August 2, 2007 Order of the Gallatin Circuit Court rejected Appellants’ argument that the Board of Adjustments Ruling improperly expanded the scope and area of the nonconforming use, concluding that: Existing uses are determined on a case-by-case basis. See Perkins v. Joint City-County Planning Commission, Ky., 480 S.W.2d 166 (1972). This Court holds that the Board’s determination was supported by substantial evidence and was not arbitrary. The Board’s ruling that defines the scope of the preexisting and nonconforming use to be the amount of land owned by Nugent and within the mining permit is reasonable and consistent with the spirit and intent of K.R.S. 100.253(2).

Order, Gallatin Circuit Court, August 2, 2007.

Appeal to the Court of Appeals followed, resulting in the Opinion in Case No. 2007-CA-001770-MR, issued on August 29, 2008, from which Discretionary Review is sought by this Court.

QUESTIONS OF LAW INVOLVED

1. Whether the Court of Appeals correctly interpreted and applied K.R.S. 100.253(2) using an unprecedented doctrine of “diminishing assets” to allow significant expansion of both the scope and area of a nonconforming mining operation of Nugent Sand Company in the Steele Bottom community of Gallatin County, to encompass areas that were in fact dedicated to agricultural use at the time of enactment of the zoning regulations that made the Nugent mining operation nonconforming.

2. Whether the Court of Appeals interpretation and application of K.R.S. 100.253(2) conflicts with the admonition in K.R.S. 100.253(2) that the “board of adjustment shall not allow the enlargement or extension of a nonconforming use beyond the scope and area of its operation at the time the regulation which makes its use nonconforming was adopted.”

3. Whether the Court of Appeals decision is in conflict with the body of Kentucky case law requiring that to be considered a preexisting nonconforming use, a use must be in existence at the time that the applicable zoning makes the use nonconforming, and that mere contemplation of use, nor purchase with intent to use is insufficient to confer nonconforming-use status; Perkins v. Joint City-Council Planning Commission, 480 S.W.2d 166, 168 (Ky. 1972).

4. Whether the Court of Appeals, by adopting a new rule categorically applicable to a particular industrial use (i.e. mining) acted in a manner inconsistent with the established rule of law in Kentucky that the existence or lack of a claim of preexisting nonconforming use is to be determined on a case-by-case basis; and

5. Whether the Court of Appeals Opinion is at variance with the principle, recognized by Kentucky Courts and codified at K.R.S. 100.253(2), that nonconforming uses are to be gradually eliminated and are to be held strictly within their boundaries.

REASONS WHY DISCRETIONARY REVIEW SHOULD BE GRANTED

Discretionary review is “a matter of judicial discretion and will be granted only when there are special reasons for it.” Ky. CR 76.20(1). Special reasons justifying a grant of discretionary review include situations where the Court of Appeals decision would create a manifest injustice or was clearly erroneous. Philipps, Jr., 7 KENTUCKY PRACTICE, RULES OF CIVIL PROCEDURE ANNOTATED 861, n. 1 (6th Ed, West Group 2005). While Kentucky case law does not delineate precisely the guidelines for granting discretionary review, this court has granted substantial consideration to cases of first impression that involve untested or difficult questions of law, matters of importance to the general public interest, and questions of statutory interpretation. Id.

The question of whether K.R.S. 100.253(2) can be read to incorporate a special “sand and gravel mine” exception using a concept of “diminishing assets” to allow significant expansion of both the scope and area of a nonconforming mining operation, even to the extent that areas that were in fact dedicated to agricultural use at the time of enactment of the zoning regulations that made the Nugent mining operation nonconforming would be considered “nonconforming mining operations”, is one of great consequence to the surrounding landowners in this case and across the Commonwealth.

The Court of Appeals interpretation and application of K.R.S. 100.253(2) conflicts irreconcilably and dramatically with the admonition in K.R.S. 100.253(2) that the “board of adjustment shall not allow the enlargement or extension of a nonconforming use beyond the scope and area of its operation at the time the regulation which makes its use nonconforming was adopted.”

By allowing a preexisting mining operation to expand to include lands on which the “existing use” was agricultural at the time that the zoning was adopted, the Court of Appeals decision does violence to the principle that a use must be in existence at the time that the applicable zoning makes the use nonconforming, and that mere contemplation of use, nor purchase with intent to use is insufficient to confer nonconforming-use status; Perkins v. Joint City-Council Planning Commission, 480 S.W.2d 166, 168 (Ky. 1972). The decision granting non-conforming status broadly to all properties owned by Nugent that were under permit, including those lands that were being put to conforming uses (farming), conflicts with the principle that an expansion of a nonconforming business into “areas which have heretofore been in conformance with the zoning code and map” is not allowed. Covington Board of Adjustment v. Remke’s Market, Inc., Ky. App., 705 S.W.2d 953, 954 (1986). Just as the Covington Court rejected the idea that a nonconforming use right could be extended to convert an area that was in conformance with the zoning into a parking lot for a nonconforming use, the prohibition against extension of the area of a nonconforming use in KRS 100.253(2) prevents conversion of lands that were in use for raising crops or other agricultural purposes at the time of the adoption of zoning, to a sand and gravel mine.

Most of the properties in which Nugent claims some interest and in fact a portion of the one and only tract on which sand and gravel operations are occurring were being farmed and continued to be farmed as late as the 2004 hearing. Farming is a conforming use in the applicable zone, and those properties could not be considered eligible for “non-conforming” status where the usual and customary use of the properties was for agricultural purposes. Durning v. Summerfield, Ky., 235 S.W.2d 761 (1951).

At the time of adoption of zoning regulations affecting the properties in question, Nugent Sand Company had included in a permit numerous properties, including what is identified as the Sproul tracts, the O’Connor and Leroy Tracts, the Blankenship Tract and portions of the Jackson tract, all of which were being used for farmland as of January 30, 2002 and continued to be so used as late as the 2004 hearing. Transcript of Hearing Before Gallatin Board of Adjustments, p. 61. Farming is a conforming use in the zone adopted for these properties on January 30, 2002. Discretionary review is appropriate also in that the Court of Appeals Opinion creates an industry-specific categorical rule that allows significant physical expansion of an existing nonconforming use, rather than evaluating on a case-by-case basis the scope of the nonconforming rights. While reiterating that the existence of a nonconforming use is to be determined on a case- by-case basis, adopted a new rule categorically applicable to a particular industrial use (i.e. mining), in a manner inconsistent with the established rule of law in Kentucky that the existence or lack of a claim of preexisting nonconforming use is to be determined on a case-by-case basis. The protection provided by KRS 100.253(2) for existing nonconforming uses balances the legitimate expectations of the owner of a nonconforming use and those of nearby neighbors that the nonconforming use will be extinguished and not expended or enlarged in scope or area.

Adoption of a “diminishing assets” concept by the Court of Appeals is inconsistent with that principle, recognized by Kentucky Courts and codified at K.R.S. 100.253(2), that nonconforming uses are to be gradually eliminated and are to be held strictly within their boundaries.

Existing Kentucky case law provides sufficient flexibility to include, within a claim of preexisting nonconforming use, those lands for which “substantial construction” has begun or “substantial liability” incurred at the time that zoning renders the use nonconforming. Mere acquisition of the other properties, even where coupled with expenses of drilling a handful of test holes and conducting an archaeological survey on land, has never before been sufficient to allow a party to claim non-conforming status where the lands are being put to conforming uses. This is not an instance in which “substantial construction” has been made or “substantial liability” incurred, and failing that, the general rule is that for a property to quality as nonconforming use the use must have been actually demonstrated prior to the zoning ordinance.

Perkins v. Joint City-County Planning Commission, Ky., 480 S.W.2d 166 (1972). (Emphasis added).

Finally, where the General Assembly intended to allow the enlargement or extension of facilities necessary to support continuation of a nonconforming use, it has done so explicitly. K.R.S. 100.253(2) allows the enlargement or extension of facilities of a nonconforming use necessary to maintain that use for a use consisting of:

the presenting of a major public attraction or attractions, such as a sports event or events, which has been presented at the same site over such period of years and has such attributes and public acceptance as to have attained international prestige and to have achieved the state of a public tradition, contributing substantially to the economy of the community and state, of which prestige and status the site is an essential element, and where the enlargement or extension was or is designed to maintain the prestige and status by meeting the increasing demands of participants and patrons[.]

The General Assembly has not adopted such a provision allowing a Board of Adjustments to “grant approval, effective to maintain nonconforming-use status” that would allow enlargement or extension of the area or scope of a sand and gravel mining operation. The Court of Appeal erred as a matter of law in adopting a doctrine of “diminishing assets” that was used by neither the Board of Zoning Adjustments nor the Gallatin Circuit Court; that is unprecedented in the Commonwealth, and that would allow expansion of the area and scope of mining operations in a manner conflicting with the prohibitory language of K.R.S. 100.253(2).

CONCLUSION

For these reasons, Appellants respectfully request that this Court grant Discretionary Review of the August 29, 2008 Opinion of the Court of Appeals affirming the August 2, 2007 Order of the Gallatin Circuit Court that upheld the November 29, 2004 Ruling of the Board of Adjustments that Nugent had pre-existing nonconforming status for all of the properties it owned as of January 30, 2002 which were under a valid mining permit, and for all other relief to which Appellants may appear entitled.

Respectfully submitted,



_________________________
Thomas J. FitzGerald
Kentucky Resources Council, Inc.
P.O. Box 1070
Frankfort, Kentucky 40602
(502) 875-2428
(502) 875-2845 fax


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