may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1998).
STATE OF MINNESOTA
IN COURT OF APPEALS
Richard J. Haefele, et al.,
The City of Eden Prairie,
Filed July 20, 1999
Hennepin County District Court
File No. 98015283
Craig M. Mertz, Chadwick, Mertz & Koehler, P.A., 600 West 79th Street, Suite 210, Post Office Box 623, Chanhassen, MN 55317 (for respondents)
George C. Hoff, Paula A. Callies, Hoff, Barry & Kuderer, P.A., 7901 Flying Cloud Drive, Suite 260, Eden Prairie, MN 55344 (for appellant)
Considered and decided by Toussaint, Chief Judge, Willis, Judge, and Norton, Judge.
Appellant City of Eden Prairie challenges a temporary injunction preventing the city from interfering with use of a property as a group home serving up to sixteen persons. Because the district court adequately addressed each of the Dahlberg factors, and those factors balance in favor of issuing an injunction, the issuance of the temporary injunction was not an abuse of discretion. We affirm.
The subject property is located in a rural district zoned for single-family dwellings. Respondent Richard Haefele purchased the property in 1985 as a nonconforming duplex. Due to the nonconforming-use status, the property may be used as a group home serving seven to sixteen persons pursuant to state law. Minn. Stat. § 462.357, subd. 8 (1998). In 1985, Haefele leased the property to an entity called "Welcome Home" that used the property as a group home for approximately ten years. After Welcome Home left, Haefele attempted to rent or sell the property for use as a group home serving seven to sixteen persons.
In 1997, Haefele began negotiating with respondent Solid Foundations, Inc., to become tenants operating a group home. Respondent Jennifer Coughlin, director of respondent Solid Foundations, Inc., contacted the city regarding the use of the property as a group home and was told there was no zoning problem with her proposed use. Coughlin and Haefele contracted for approximately $15,000 in repairs to the property and Coughlin spent another $42,000 in preparing to use the property as a group home.
In December 1997, after neighborhood opposition to the project surfaced, city staff indicated that they now believed that Haefele had abandoned the property's nonconforming-use status, such that the property was no longer eligible for a seven- to sixteen-person group home. The city attorney prepared a memorandum dated February 13, 1998, recommending a finding of abandonment. By a letter to respondents dated February 18, 1998, the city enclosed a copy of that memorandum and described the appeals process to challenge its conclusion. An April 2, 1998, memorandum from city staff to the Board of Adjustments and Appeals outlines the case for abandonment. After Haefele and Coughlin appeared before the board on April 9, 1998, the board ruled that the property's nonconforming-use had been abandoned. In June 1998, the city council affirmed the board's determination that the nonconforming-use status had been abandoned.
Respondents filed a complaint challenging the finding of abandonment of the property's nonconforming-use status. Respondents brought a motion for a temporary injunction, seeking to enjoin the city from interfering with use of the property as a group home serving seven to sixteen persons. Upon determining that all five Dahlberg factors favored respondents, the district court issued the temporary injunction. This appeal followed.
Absent a clear abuse of discretion, this court will not reverse the district court's decision to grant a temporary injunction. Carl Bolander & Sons Co. v. City of Minneapolis, 502 N.W.2d 203, 209 (Minn. 1993). Furthermore, this court views the facts alleged in the pleadings and affidavits in the light most favorable to the prevailing party. Pacific Equip. & Irrigation v. Toro Co., 519 N.W.2d 911, 914 (Minn. App. 1994), review denied (Minn. Sept. 16, 1994). "A district court's findings regarding entitlement to injunctive relief will not be set aside unless clearly erroneous." Upper Midwest Sales Co. v. Ecolab, Inc., 577 N.W.2d 236, 240 (Minn. App. 1998) (quotation omitted). In its determination to grant or deny a temporary injunction, a court must consider five Dahlberg factors. Dahlberg Bros., Inc. v. Ford Motor Co., 272 Minn. 264, 274-75, 137 N.W.2d 314, 321-22 (1965).
1. Relationship between the parties
The first Dahlberg factor considers the nature and background of the relationship between the parties before the dispute that gave rise to the request for relief. Upper Midwest Sales Co., 577 N.W.2d at 240. When Haefele acquired the property in 1985, the property had nonconforming-use status. Because of the nonconforming-use status, state law allows use of the property as a group home for seven to sixteen persons. The nonconforming zoning status continued undisturbed until the city's 1998 finding of abandonment.
The purpose of a temporary injunction is "to preserve the status quo until adjudication of the case on its merits." Miller v. Foley, 317 N.W.2d 710, 712 (Minn. 1982) (citing Pickerign v. Pasco Mktg., Inc., 303 Minn. 442, 444, 228 N.W.2d 562, 564 (1975)). The city complains that the temporary injunction allows for a new use altering the status quo. The city's argument is based on its position that Haefele in fact abandoned the nonconforming-use. Whether this is the case is the subject of the dispute. The temporary injunction preserves the status quo in that it allows respondents to continue to use the property's nonconforming status. The use of the property as a seven- to sixteen-person group home is not a new use altering the status quo.
The city asserts that the status quo should be appraised from the time the district court considered the issuance of the temporary injunction, and, at that time, the status quo was that the nonconforming-use status had been abandoned. The Minnesota Supreme Court has explained that:
The object of a temporary injunction is to maintain the matter in controversy in its existing condition until judgment so that the effect of the judgment shall not be impaired by the acts of the parties during the litigation.
Pickerign, 303 Minn. at 446, 228 N.W.2d at 565. Pickerign suggests that the proper date for appraising the status quo could be the date on which the dispute arose or the date on which legal action commenced. 303 Minn. at 446-47, 228 N.W.2d at 565-66. The city's assertion that the status quo must be evaluated from the date on which the injunction is considered is without legal support.
Regardless, even if the temporary injunction disturbed the status quo, we would affirm the temporary injunction nonetheless. A court "has the power to shape relief in a manner which protects the basic rights of the parties, even if in some cases it requires disturbing the status quo." North Star State Bank of Roseville v. North Star Bank Minnesota, 361 N.W.2d 889, 895 (Minn. App. 1985) (quotation omitted), review denied (Minn. Apr. 26, 1985). In North Star, this court determined the lower court did not abuse its discretion when fashioning relief that protected the parties' investments. Id. at 896. In this case, the district court issued the temporary injunction to protect respondents' investment in using the property as a group home for seven to sixteen residents.
2. Relative hardship
The second Dahlberg factor considers the harm to be suffered by the plaintiff if the temporary restraint is denied as compared to that inflicted on defendant if the injunction issues pending trial. Upper Midwest Sales Co., 577 N.W.2d at 240. The district court found that, if the group home project does not go forward, respondents could lose tens of thousands of dollars. The city argues that respondents failed to demonstrate any irreparable harm. See Cherne Indus., Inc. v. Grounds & Assoc's, Inc., 278 N.W.2d 81, 92 (Minn. 1979) (a showing of irreparable harm is required to prevent undue hardship). The city suggests that respondents would not suffer irreparable harm if they used the property as a group home for six residents. But Solid Foundations offered evidence that operating a home of only six persons is not economically feasible, and the city offered no evidence in rebuttal. The city did not offer any evidence of harm it would suffer in allowing the group home to operate.
3. Likelihood of success
The third Dahlberg factor considers the likelihood that the plaintiff will prevail on the merits. Upper Midwest Sales Co., 577 N.W.2d at 240-41. In this case, respondents seek to overturn a zoning decision. The Minnesota Supreme Court has stated:
The standard of review is the same for all zoning matters, namely, whether the zoning authority's action was reasonable * * * Is there a `reasonable basis' for the decision? or is the decision `unreasonable, arbitrary or capricious'? or is the decision `reasonably debatable'?
Swanson v. City of Bloomington, 421 N.W.2d 307, 311 (Minn. 1988) (citing Honn v. City of Coon Rapids, 313 N.W.2d 409, 417 (Minn. 1981)).
The city argues its decision had a reasonable basis because Haefele abandoned the nonconforming-use by not utilizing the property as a group home since 1994. "Abandonment ordinarily entails two factors: (1) intent to abandon, and (2) an overt act or failure to act indicating the owner no longer claims a right to the nonconforming use." County of Isanti v. Peterson, 469 N.W.2d 467, 470 (Minn. App. 1991) (quotation omitted). In this case, the district court found that Haefele had presented evidence that indicated he did not have the requisite intent to abandon. Accordingly, the district court found the likelihood of success on the merits was with the respondents.
The city points to two of Haefele's own actions as demonstrating an intent to abandon. First, Haefele listed the property for sale as a single-family residence in April 1997. Second, Haefele rented the home to a single individual. But Haefele has explained both of these facts. He listed the property in the single-family category of the multiple listing service because his realtor told him that group home facility operators searched that category for facility sites. As far as renting the property to a single individual, Haefele acknowledges that he rented the property to a caretaker for nominal rent while searching for a group home tenant or buyer. Viewing the facts in the light most favorable to respondents, the district court's finding that Haefele did not possess an intent to abandon is not clearly erroneous.
4. Public interest
The fourth Dahlberg factor considers the aspects of the fact situation, if any, that "permit or require consideration of public policy expressed" in the statute. Upper Midwest Sales Co., 577 N.W.2d at 241. The public policy expressed in Minn. Stat. § 462.357, subds. 7, 8 (1998), is that group homes are permitted uses in residential zones. Accordingly, the district court properly found that the temporary injunction promoted the public policy expressed in statute.
5. Administrative burdens
The fifth Dahlberg factor considers "the administrative burdens involved in judicial supervision and enforcement of the temporary decree." Upper Midwest Sales Co., 577 N.W.2d at 241. In this case, the district court stated that there is no administrative burden on issuance of the temporary injunction. The city argues that, since this factor is "essentially neutral," it should not count against the city. However, a finding of no administrative burden upon issuance of a temporary injunction favors the issuance of the temporary injunction.
In sum, the district court adequately addressed each of the five Dahlberg factors. The district court did not err in finding that each factor favored respondents. Accordingly, the issuance of the temporary injunction was not an abuse of discretion.
[*] Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.