Virginia Lawyers Weekly VA Lawyers Weekly
Where a housing developer challenged a town ordinance as an unconstitutional taking, but it had reason to know of this injury no later than 2015, when it began purchasing the land subject to the special use permit, its March 2019 lawsuit was filed too late.
Background
The Town of Chapel Hill, North Carolina requires housing developers seeking a special use permit to set aside a portion of their developments for low-income residents or pay a fee in lieu of that condition. In 2015, Epcon Homestead LLC initiated its purchase of property subject to the fee-in-lieu. Epcon paid the requisite fee installments, commenced the development project and sold each parcel.
After Epcon satisfied its final fee installment in March 2019, it brought this lawsuit under a state cause of action to recover the whole sum it had paid to the town and alleged federal takings and due process violations. Given that at least four years had passed between when it first learned of the special use permit condition and when Epcon filed its complaint, the district court dismissed the case under North Carolina’s three-year statute of limitations for personal injury claims.
Analysis
There is no “distinctive rule” in the Takings Clause context to apply for determining when the limitations period for a § 1983 claim begins to run. And the “standard rule” that a cause of action under § 1983 is “complete and present” when the “plaintiff knows or has reason to know of his injury,” applies to Epcon’s claims.
Here, Epcon alleges that it suffered an injury under § 1983 stemming from the application of an unlawful special use permit condition. As the district court concluded, Epcon first had reason to know of this injury no later than 2015, when it began purchasing the land subject to the special use permit. Thus, its claim that the permit condition violated its rights to just compensation and due process accrued at that point and extinguished three years later. By the time Epcon filed suit in October 2019, the sun had set on its federal claims.
Resisting this conclusion, Epcon maintains that it “suffered no taking or deprivation of any property interest until it was compelled to pay the challenged fees to the Town beginning in 2017 as a condition of the Town issuing certificates of occupancy for the Project.” It emphasizes that “[a]t any time prior to that date, Epcon could have sold the Property, requested a rezoning of the Property to pursue a non- residential use, [or] redesigned the Project in a way that did not implicate the Ordinance’s requirements.”
The distinction Epcon attempts to draw between exactions and regulatory takings proves little more than that the government need not physically appropriate property to enact a taking. Once the government conditions the grant of a land-use permit on the surrender of a landowner’s right to just compensation, a Takings Clause claim becomes cognizable.
The fact that the special use permit did not require and simply permitted Epcon to develop the land for the use described in the application (subject to the condition at issue) is hardly noteworthy—permitting a particular use is an essential feature of any permit. Thus, when Epcon learned of the special use permit condition on its recently acquired land, its takings claim became actionable. Likewise, Epcon’s argument that each payment constituted a “continuing wrong” that tolled the statute of limitations is unpersuasive.
Concurring opinion
Keenan, J., concurring in the judgment:
The continuing-wrong doctrine does not help Epcon. As an initial matter, the doctrine appears to be one of accrual, not tolling, so federal law controls. Under federal law, “[a] continuing violation is occasioned by continual unlawful acts, not continual ill effects from an original violation.”
Thus, if the alleged constitutional violation occurs “in a series of separate acts and if the same alleged violation was committed at the time of each act, then the limitations period begins anew with each violation ….” Epcon’s federal claims allege the town imposed an unconstitutional condition on its permit — a single act. Epcon’s payments pursuant to that permit were not repeated constitutional violations but rather continual ill effects of the original violation alleged. I therefore concur in the court’s judgment affirming the district court’s dismissal of Epcon’s federal claims.
Epcon Homestead LLC v. The Town of Chapel Hill, Case No. 21-1713, March 20, 2023. 4th Cir. (Gregory), from MDNC at Greensboro (Tilley). Jeffrey Lawrence Roether for Appellant. Dan M. Hartzog Jr. for Appellee. VLW 023-2-079. 15 pp.
