Washington's Vested Rights Doctrine: How We Have Muddled a Simple Concept and How We Can Reclaim it

• Publication year: 2000

SEATTLE UNIVERSITY LAW REVIEWVolume 24, No. 3WINTER 2001

Washington's Vested Rights Doctrine: How We Have Muddled a Simple Concept and How We Can Reclaim It

Roger D. Wynne(fn*)

ABSTRACT

Washington's land use vested rights doctrine needs repair. The doctrine attempts to balance the interests of developers and municipalities by freezing the law applicable to the review of a land use permit application on the date that the developer submits that application. But the details of a doctrine originally designed to provide certainty and fairness now frequently offer neither in sufficient measure. The doctrine's inconsistent rationales account for much of the confusion that has become a fixture of the doctrine, and courts and the legislature have failed to resolve a host of issues clearly, accessibly, or fairly. This is especially true in the context of development projects that require multiple permits. The legislature should adopt a statutory rule that replaces the muddled details of the common-law doctrine with a principle that reestablishes certainty and at least strives for fairness.

Table of Contents

Introduction............................................................... 855

I. Why the Doctrine? The Hazards of Divergent Rationales ............................................... 857

A. The Mandamus Rationale: A Bad Fit, but Still Invoked ..................................................................... 858

B. The Fairness/Certainty Rationale: The More Appropriate and Dominant Approach ........................ 861

C. Is the Mandamus Rationale Dead? ............................. 864

II. What Is the Rule? The Unresolved Issues That Plague the Doctrine ....................................... 865

A. To Which Types of Land Use Permit Applications Does the Doctrine Apply? Extending the Doctrine in Fits and Starts ................... 866

1. The Judiciary's Initial, Almost Matter-of-Fact Extension of the Doctrine Beyond Building Permit Applications ................................ 866

2. The Judiciary's Subsequent Reluctance to Extend the Doctrine and the Legislature's One-Time Intervention ........................................ 867

3. The Unique Case of Site-Specific Rezones: The Mandamus Rationale Rears Its Head in the Wrong Place ............................................... 869

4. So, What Is the Rule? ........................................... 872

B. What Bodies of Law Does the Doctrine Freeze in Time? Bounding the Substantive Reach of the Doctrine ............................................................... 873

1. "Health and Safety" Regulations ........................... 873

a. Haas v. City of Kirkland ....................................874

b. Rhod-A-Zalea and 35th, Inc. v. Snohomish County .............................................875

c. Overstreet and Kirchheim ................................876

d. A "Health and Safety Distinction Is Relevant to the Law of Nonconforming Uses, Not the Vested Rights Doctrine ...............879

2. Land Use Procedures That Do Not Affect Substantive Requirements ..................................... 879

3. GMA Impact Fees Pursuant to RCW 82.02 .................................................................... 882

C. When Does the Doctrine Begin to Freeze Law in Time? Fixing a Date Certain on the Date of a Complete Application Submittal .............................. 884

1. When Is the Application "Complete"? .................. 884

2. Is the Good Faith of the Developer or the Local Jurisdiction Relevant to the Point at Which the Doctrine Applies? ................................ 885

3. Must the Application Be Filed During the Period That the Laws Under Which the Developer Seeks to Develop Are in Effect? ............ 886

4. May a Moratorium Thwart a Developer from Freezing the Applicable Law for a Given Application? ............................................... 887

5. Must the Application "Comply" with Applicable Laws at the Time of Submittal? ........... 888

6. Does Freezing the Law for Purposes of the Underlying Application Also Freeze the Law for Purposes of Exercising SEPA Substantive Authority? ......................................... 890

7. May an Applicant Modify or Supplement an Application Without Affecting the Date on Which the Applicable Law Is Frozen? .............. 891

8. May an Applicant "Opt" to Be Considered Under a Later Version of a Particular Law? ........... 892

D. For How Long and for What Purpose Does the Doctrine Apply? Contorting the Doctrine to Fit the Reality of Multiple- Permit Proj ects ................. 893

1. Two Possible Approaches: Follow Either the Mandamus or Fairness/Certainty Rationale .............................................................. 894

a. The Mandamus Rationale Justifies a Right "To Use" or "To Develop," but Only as of the Date of Building Permit Application Submittal ......................................894

b. The Fairness/Certainty Rationale Justifies Freezing in Time the Law That Controls Each Permit Application, but Only on an Application-by-Application Basis ................................................................897

c. The Hazards of Blending the Two Approaches ......................................................899

2. The Legislature Adopted Four Contradictory Vested Rights Rules That Affect Residential Subdivisions ............................. 899

3. Noble Manor's Distortion of the Doctrine .............. 906

a. Bad Facts Can Make Bad Law............................906

b. Division Two's Reliance on Dicta.......................907

c. Where the Washington Supreme Court Went Wrong.....................................................907

d. The Elusive Holding of Noble Manor..................910

4. The Fruits of Noble Manor .................................... 912

III. How Can We Repair the Doctrine? Toward a Statutory "Applicable Law Rule" ............................................................................. 916

A. The Legislature Can Reestablish Certainty ................. 917

1. Replace the Common Law "Vested Rights Doctrine" with a Statutory "Applicable Law Rule" ......................................... 917

2. Centralize the Applicable Law Rule in RCW 36.70B ....................................................... 918

3. Resolve the Unanswered Questions Clearly, Even at the Risk of Being Wrong ............. 919

B. The Legislature Should Strive for Fairness .................. 919

1. Establish Guiding Principles ................................. 919

a. When in Doubt, Keep It Simple ...................... 919

b. Protect Diligent Development and Discourage Speculation .................................... 920

2. Use the Principles to Define the Contours of an Applicable Law Rule That Resolves the Questions Left Unanswered by the Vested Rights Doctrine ......................................... 922

a. The Applicable Law Rule Should Apply to All "Project Permit Applications" as Defined in RCW 36.70B.020(4) .................. 922

b. The Applicable Law Rule Should Freeze in Time Those "Development Regulations" Within the Meaning of the GMA That Affect the Type, Degree, or Physical Attributes of New Developments or Uses ..................................... 924

c. For Any One Application, the Applicable Law Rule Should Freeze the Relevant Law-Including SEPA Policies-in Effect on the Date an Application Is Deemed Complete Pursuant to RCW 36.70B.070 .............................................925

d. For Multiple-Permit Projects, Protect Only Consolidated Applications or "Prompt," Sequential Applications ...................928

C. Why Not? Answering the Potential Naysayers ........... 930

1. Why Change Something That Is a "Model" for the Rest of the Country? .................................. 930

2. Why Not Leave It to the Judiciary? ...................... 931

3. Won't the Legislature Be Paralyzed by Political Gridlock? ................................................ 932

4. Won't Constitutional Protections Limit the Legislature's Ability to Act? ................................. 934

a. Takings ........................................................... 934

b. Equal Protection .............................................. 935

c. Due Processs ................................................... 935

D. The Bottom Line: We Must Reclaim Certainty and Fairness ............................................................... 939

INTRODUCTION

Every real estate developer wants to manage the risks inherent in a project. One of those risks is that after purchasing property with a particular project in mind, the local government could change the development regulations applicable to the property in a way that either precludes the project or diminishes its value. To reduce this risk, developers(fn1) in Washington often invoke the state's vested rights doctrine. Seattle newspapers report the doctrine being invoked, for example, by a real estate development company to blunt amended county laws that could preclude its "mini-city," slated for development in an otherwise rural area;(fn2) by a pipeline company to challenge new zoning laws that could dictate the pipeline's...