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Lockerbie Glove Factory Town Home Owners Association, Inc. v. Indianapolis Historic Preservation Commission

Court of Appeals of Indiana

June 8, 2018

Lockerbie Glove Factory Town Home Owners Association, Inc., Andre B. Lacy, Julia L. Lacy, Elliot J. & Serena Androphy, Cherri D. Hobgood, James & Cheryl Arnold, and William B. Young, Appellants-Petitioners,
Indianapolis Historic Preservation Commission, and Dan Jacobs, Appellees-Respondents.

          Appeal from the Marion Superior Court The Honorable Michael D. Keele, Judge Trial Court Cause No. 49D07-1609-CT-32940

          Attorneys for Appellants James K. Gilday Gilday & Associates, P.C. Indianapolis, Indiana Gene R. Leeuw Leeuw Oberlies & Campbell, P.C. Indianapolis, Indiana.

          Attorney for Appellee: Indianapolis Historic Preservation Commission Thomas J.O. Moore Office of Corporation Counsel Indianapolis, Indiana.

          Attorneys for Appellee: Dan Jacobs Jason A. McNiel Derek R. Molter Samuel Gardner Ice Miller LLP Indianapolis, Indiana.

          Robb, Judge.

         Case Summary and Issues

         [¶1] Lockerbie Glove Factory Town Home Owners Association, Inc., and eight residents of the townhomes (collectively "Remonstrators") appeal a decision by the Indianapolis Historic Preservation Commission ("Commission") granting a certificate of appropriateness to Dan Jacobs for the purpose of constructing a retail, residential, and parking project known as "Block 20" on a parcel of land in the Lockerbie Square Historic District in Indianapolis, Indiana. The Remonstrators raise several issues for our review which we consolidate and restate as: 1) whether a Commission member was presumptively biased, making the Commission decision invalid, and if there is no presumed bias, whether the trial court should have granted the Remonstrators' motion to compel to allow discovery regarding actual bias; and 2) whether the trial court erred in denying the Remonstrators' petition for judicial review. Concluding the Remonstrators failed to show that the Commission decision was invalid due to bias or that they are otherwise entitled to relief from the Commission decision, we affirm.

         Facts and Procedural History

         [¶2] The Commission was created in 1967. In 1982, the Commission's enabling legislation was recodified at Indiana Code chapter 36-7-11.1. The Commission is a nine-member appointed board tasked with preserving historically significant areas and structures in Indianapolis. The Commission designates historic districts, which may be a single structure or a larger area, adopts a historic preservation plan for the area, and then has design and zoning review jurisdiction within those districts. After the adoption of a historic preservation plan for any historic district, "all governmental agencies shall be guided by and give due consideration to the plan in any official acts affecting the area." Ind. Code § 36-7-11.1-8(c). Pursuant to Indiana Code section 36-7-11.1-9(a), "[a] person may not construct any exterior or architectural structure or feature in any historic area . . . until the person has filed with the secretary of the [C]ommission an application for a certificate of appropriateness . . . ." The Commission must hold a public hearing on any such application and "determine whether the proposal will be appropriate to the preservation of the area and to the furtherance and development of historic preservation." Ind. Code § 36-7-11.1-9(c). If the Commission determines the proposed construction will be appropriate, the secretary shall issue a certificate of appropriateness. Ind. Code § 36-7-11.1-10(a). However, the Commission "may impose any reasonable conditions, consistent with the historic preservation plan, upon the issuance of a certificate of appropriateness . . . ." Ind. Code § 36-7-11.1-10(b). "A final determination of the [C]ommission upon an application for certificate of appropriateness is subject to judicial review in the same manner and subject to the same limitations as a final decision of a board of zoning appeals under IC 36-7-4." Ind. Code § 36-7-11.1-10(c).

         [¶3] The Commission first created a historic preservation plan ("historic plan") for Lockerbie Square in 1968, which was revised and updated in 1978 and again in 1987. The original Lockerbie Square historic district (known as the "Historic Core") is a four-block area bounded by East Street to the west, Michigan Street to the north, College Avenue to the east, and New York Street to the south. The historic district has since been expanded to include additional properties outside but contiguous to the Historic Core (known as the "Secondary Area"). In 1973, the Lockerbie Square People's Club, a neighborhood association, was formed to promote the revitalization of the Lockerbie Square neighborhood, and eventually a group of residents formed Lockerbie Square Foundation, Inc., a not-for-profit focused on fundraising for preservation projects.

         [¶4] The 1968 plan "provided planning recommendations to guide the future development of the area." Appendix of Appellants, Volume 6 at 13. But the plan "did not reflect the maturing preservation philosophy gaining acceptance around the country which promotes historic districts as neighborhoods in which people live . . . ." Id. Therefore, the 1968 plan was revised in 1978 in an attempt "to preserve the unique historic character of Lockerbie Square by encouraging the revitalization of the district as a dynamic urban neighborhood . . . ." Id. The 1978 plan "sought to assist [the rehabilitation] effort through education and through the review of all development and redevelopment activities within the district." Id. The 1987 update "follows a recommendation incorporated into the 1978 plan" to shift the emphasis to new development on existing vacant land once the majority of historic properties were rehabilitated. Id.

         [¶5] In 2001, the Athenaeum Foundation acquired property at 428 N. East Street and sought from the Commission a certificate of appropriateness that would allow it to demolish the building then existing on that property and turn the property into a paved surface parking lot. The property in question is part of the Secondary Area of the Lockerbie Square Historic District, bounded on the west by Cleveland Street, on the north by Michigan Street, on the east by East Street, and on the south by Allegheny Street. The People's Club supported the Athenaeum's request to demolish the building, but opposed the property being used as a parking lot on a long-term basis as the historic plan's recommended land use for the property was residential. The Commission issued the certificate of appropriateness but, pursuant to its authority under Indiana Code section 36-7-11.1-10(b), required the following recorded covenants: that the certificate of appropriateness would allow use of the property as a parking lot for a period of three years; that the property would not be used as a parking lot beyond those three years unless the Athenaeum had applied for and was granted another certificate of appropriateness; that during the three year period, the Athenaeum would use reasonable and good faith efforts to support alternative parking solutions within two blocks of the property; and that if reasonable alternative parking was established within two blocks within three years, the Athenaeum would "diligently pursue using the [property] for residential purposes pursuant to the [historic plan]." Id., Vol. 4 at 13-14.

         [¶6] Over the next fifteen years, the Athenaeum worked with the People's Club and various other organizations to fulfill the covenant and develop the property. On April 28, 2016, Dan Jacobs submitted an application for a certificate of appropriateness for the Block 20 project on the property. The application describes the project as a "229 space parking garage, wrapped with 67 apartment units, " with retail space on the first floor. Id., Vol. 4 at 80. Jacobs held several meetings with Commission staff members, appeared at two preliminary review hearings, and made numerous changes to the plans in response to concerns voiced by the Commission and community members. By the time of the final hearing, the plans called for a five-story, multi-use building with sixty-seven apartment units, retail and gallery space on the first floor, a roof deck, and 261 internal parking spaces, including sixty-seven spaces for residents and 194 spaces for the public. The final hearing was scheduled for August 3, 2016.

         [¶7] On July 27, 2016, the Remonstrators submitted a letter to the Commission outlining their objections to the project. The Remonstrators are all residents of the Lockerbie Glove Factory Town Homes, fifty-eight single family homes adjacent to the proposed development by virtue of being situated on the east side of East Street. They are not a part of, nor are they represented by, the People's Club. The Remonstrators raised several objections to Jacobs' application for certificate of appropriateness, including: 1) that the covenant prohibits anything other than residential use on the property; 2) the project violates the historic plan in multiple ways; 3) the project will increase noise in certain areas; 4) the project will adversely affect traffic on East Street; and 5) "[s]ome parts of the so-called residential portion of the development seem more like short-term leasing, which fits more the description of a hotel . . . ." Id., Vol. 2 at 44.[1]

         [¶8] At the final hearing on August 3, 2016, the People's Club voiced its "strong support" of the project. Id., Vol. 5 at 121. The Remonstrators, represented by James Gilday, Treasurer of the Glove Factory HOA, spoke in opposition to the application, raising as their "main point" the multiple violations of the historic plan. Id. at 122. The Remonstrators asked the Commission to "fulfill its duty to enforce the historic plan and disregard all other considerations to the contrary by rejecting this proposal." Id. at 128-29. A Commission staff member then addressed the Commission:

We've had probably a dozen meetings on this project over the last couple of months. And I think the comment that was made earlier about the design evolving for the better, staff would agree with that. And in addition to what's in the staff report, I would like to address some of the comments that were just made. . . . I would like to reiterate that the Lockerbie Square [historic] plan is a set of recommended guidelines for any project. Staff is not aware of anything in the plan being necessarily [a] requirement, so that somebody would be in violation of if they didn't comply with that, but rather a set of guidelines to direct staff in making a recommendation on the proposed design, which is what we did in the staff report.

Id. at 129-30. Commission staff recommended the application for a certificate of appropriateness be approved, and the recommendation was approved by the Commission five to one. One of the Commissioners voting to approve the certificate of appropriateness was Alex White. At the end of the first preliminary review hearing in June, Commissioner White had stated,

Mr. Jacobs, just one thing, you probably considered this. I was on the Athenaeum building committee for many years, and we had a devil of a time dealing with acoustics from the successful band shell and the interior theater. So I don't know if you have an acquisition[2] on your consultant list yet, but that might be advice on how you treat this, especially the façade facing the Athenaeum.

Id. at 91-92.

         [¶9] The Remonstrators then filed a petition for judicial review in Marion Superior Court. While the case was pending, the Remonstrators filed a motion to compel, seeking discovery from the Commission on the issue of the possible bias of Commissioner White in favor of the Athenaeum and Jacobs based on his statement from the first preliminary hearing quoted above. The trial court denied this motion. After briefing and oral argument on the petition for judicial review, the trial court issued its Findings of Fact, Conclusions of Law and Judgment denying the Remonstrators' petition and affirming the Commission's award of a certificate of appropriateness:

After the multiple hearings, the [Commission], in its expert discretion, voted to issue the Certificate of Appropriateness to Jacobs. [The Remonstrators'] arguments are generally invitations to reweigh the evidence properly considered by the [Commission], which this Court declines to do. [The Remonstrators] have not carried their heavy burden of proving that the [Commission's] decision in this matter was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; or unsupported by substantial evidence.

Id., Vol. 2 at 23. The Remonstrators now appeal.

         Discussion and Decision

         I. Standard of Review

         [¶10] Indiana Code section 36-7-11.1-10(c) provides that the Commission's final determination regarding an application for a certificate of appropriateness "is subject to judicial review in the same manner and subject to the same limitations as a final decision of a board of zoning appeals under IC 36-7-4." Indiana Code section 36-7-4-1614(d) provides that a reviewing court, whether the trial court or this court,

shall grant relief . . . only if the court determines that a person seeking judicial relief has been prejudiced by a ...

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