Commercial Zoning

Challenging Zoning Ordinances and the Applicable Statute of Limitation/Repose

To resolve the uncertainty of zoning ordinances—previously protected from challenge by the arcane, equitable defense of laches—the North Carolina General Assembly enacted in 1981 a nine-month statute of limitations. This statute, more appropriately described as a statute of repose, defined the window within which “a cause of action as to the validity of any zoning ordinance … shall be brought.” The policy behind this window has been artfully described: “There is a strong need for finality with respect to zoning matters so that landowners may use their property without fear of a challenge years after zoning has apparently been determined.” Pinehurst Area Realty, Inc. v. Village of Pinehurst, 100 N.C. App. 77, 80-81, 394 S.E.2d 251, 253 (1990), review denied and appeal dismissed, 328 N.C. 92, 402 S.E.2d 417, cert. denied, 501 U.S. 1251, 115 L. Ed. 2d 1055 (1991).

In 1996, the General Assembly trimmed that nine-month statutory window to two-months:

A cause of action as to the validity of any zoning ordinance, or amendment thereto, adopted under this Article or other applicable law shall accrue upon adoption of the ordinance, or amendment thereto, and shall be brought within two months as provided in G.S. 1-54.1.

N.C.G.S. §160A-364.1 (municipalities); see also N.C.G.S. §153A-348 for county-based zoning ordinances.

This summer, in Schwarz Properties, LLC v. Town of Franklinville, __ N.C. App. __, 693 S.E.2d 271 (2010), the North Carolina Court of Appeals ruled that the two-month statute of repose foreclosed even an ultra vires challenge to a zoning ordinance, citing the Court’s holding in White v. Union County, 93 N.C. App. 148, 377 S.E.2d 93 (1989). That is, the statute of limitation/repose applies even to zoning ordinances or zoning ordinance amendments that are not, in essence, adopted pursuant to the zoning power. This significant moment denotes the strict application North Carolina courts are willing to make as to an already strict window. Developers and local governments alike should take note of this decision.

A link to the full decision can be found here.

Mike Thelen is an associate in Womble Carlyle’s Real Estate and Real Estate Litigation practice groups. He regularly represents a wide variety of clients, from local governments to businesses, in both state and federal venues throughout North Carolina.

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