Filed September 25, 2007

Reversed; motion to strike denied

Randall, Judge

Emily E. Duke, Grant D. Fairbairn, and Robert J. Shainess, Fredrikson & Byron, P.A., 200 South Sixth Street, Suite 4000, Minneapolis, MN 55402 (for relator)

John J. Choi, Saint Paul City Attorney, Rachel A. Gunderson, Assistant City Attorney, 400 City Hall and Court House, 15 West Kellogg Boulevard, Saint Paul, MN 55102 (for respondent)

Considered and decided by Randall, Presiding Judge; Halbrooks, Judge; and Parker, Judge.*

U N P U B L I S H E D O P I N I O N

RANDALL, Judge

On appeal from a revocation of his mobile food vehicle license, relator Jose Ponce argues: (1) the city acted arbitrarily and capriciously by basing its decision to revoke his license on an erroneous interpretation of city and state law; and (2) the city violated relator’s due-process rights by revoking his license without providing sufficient notice of the grounds for revocation. We reverse.

FACTS

In September 2002, relator obtained a mobile food vehicle license from the City of Saint Paul (city) that permitted him to sell food from his open-air trailer on any public street within the city. For a short time thereafter, relator sold Mexican food at special events from the trailer under the business name “Mi Pueblito.” Relator had intended to open a restaurant on property he owned, but when the building occupying the premises was destroyed by a fire, relator decided to operate Mi Pueblito from the trailer, which was parked on the vacant lot, until he could afford to construct a new building.

The city notified relator that city zoning ordinances in the B-3 business district where his lot was located required that he obtain a conditional use permit (CUP) to operate an outdoor commercial business from a fixed location. Relator applied for and received a two-year CUP from the city planning commission that permitted him to conduct business from the trailer while it was positioned on his lot until December 31, 2005. Relator proceeded to operate within the conditions of the CUP. Two years later, with the expiration of the CUP looming, the city informed relator that he must apply for a new CUP or remove the trailer from the premises. Relator heeded the warning and applied for a new CUP. While reviewing relator’s renewal application, the city’s License Inspection and Environmental Protection (LIEP) staff learned of a state law that it “interpreted” as prohibiting “mobile food units” from being located in the same location for more than 21 days (21-day requirement). Because it believed the issuance of a CUP allowing relator to position the trailer in a fixed location for more than 21 days would conflict with state law, LIEP informed relator that it would recommend to the planning commission that his application be denied. LIEP pointed out to relator that it might be in his best interests to withdraw his application for a CUP because, if he did so, he would be entitled to a refund of the application fee. Relator withdrew the application to avoid losing the application fee, but continued to operate his business from the trailer on the lot.

On February 17, 2006, the city’s zoning inspector sent relator a final enforcement notice demanding that he remove his trailer from the lot by February 26, 2007. Relator did not comply with the inspector’s order. On March 1, 2006, LIEP informed relator that it had recommended revocation of his mobile food vehicle license because he was operating without a conditional use permit.

Relator requested and received a hearing before an administrative law judge (ALJ). At the hearing, the city offered testimony that the zoning ordinances for the B-3 business district did not permit an outdoor commercial business to operate without a conditional use permit. The 21-day requirement was discussed in conjunction with the zoning issue, but the city did not present it as an independent basis for revoking the license. After the hearing, the ALJ issued formal findings and recommended that the city council revoke relator’s mobile food vehicle license because his operation of the business from a trailer on private property violated the conditions of his license and contravened a city zoning law that prohibited outdoor commercial businesses from operating without a conditional use permit.

A city council hearing on the matter followed, and the council voted to adopt the ALJ’s findings and formally revoked relator’s mobile food vehicle license. At the hearing, the city argued that revocation of relator’s license was proper because he was operating without a CUP. Council members spent the duration of the hearing discussing the 21-day requirement. One member opined that the council had “no choice but to adopt the [ALJ’s findings and recommendation] because that’s what the law is. . . . This is a state law that we need to come into compliance with.” Another member also indicated that his “hands were tied” by the 21-day requirement.

On September 8, 2006, the city sent relator a notice of license revocation which stated that his license had been revoked based on the ALJ’s determination that he had operated without a valid CUP and because he had violated “the conditions of the Mobile Food Vehicle License which does not permit operation at a single location for more than 21 days.” This certiorari appeal followed.

D E C I S I O N

A city has “wide discretion in dealing with matters of local importance.” Arcadia Dev. Corp. v. City of Bloomington, 267 Minn. 221, 225, 125 N.W.2d 846, 850 (1964). Certiorari review is limited to “questions affecting the jurisdiction of the board, the regularity of its proceedings, and, as to merits of the controversy, whether the order or determination in a particular case was arbitrary, oppressive, unreasonable, fraudulent, under an erroneous theory of law, or without any evidence to support it.” Dietz v. Dodge County, 487 N.W.2d 237, 239 (Minn. 1992). If the city counsel has “furnished any legal and substantial basis for the action taken,” its decision will be upheld. Senior v. City of Edina, 547 N.W.2d 411, 416 (Minn. App. 1996).

Relator and the city do not agree on the basis for the city council’s ruling. Relator claims that the revocation of his mobile food vehicle license resulted from his alleged violation of the so-called state 21-day requirement under Minn. Stat. § 157.15, subd. 9 (2006). Conversely, the city contends that the basis for termination of the license was relator’s continued operation of the food business from his trailer without a valid CUP. After reviewing the record, we conclude that the basis for the decision is the state 21-day rule. Even if we were to assume that the revocation resulted simply from relator’s failure to obtain a CUP, we cannot accept the city’s argument because the city induced relator to withdraw his application for a CUP.

The ALJ’s findings indicate that LIEP believed relator’s application would be denied and recommended that he withdraw his application to receive a refund of the application fee. Relator heeded their “suggestion.” The city now argues that his license was revoked, not because of the 21-day requirement, but because he never successfully filed for a CUP. The city is estopped from making that argument because relator relied to his detriment on the city’s advice.

From our review of the record, it appears that the city council did discuss revocation on the basis that relator failed to apply for a CUP. But it is also easily evident that the city council’s interpretation of Minn. Stat. § 157.15, subd. 9, played a substantial part in the decision. At the public hearing, the city council discussed at length whether the statute was applicable to relator’s license. Prior to the hearing, relator was unaware that the statute would have any bearing on the city council’s decision.

Relator is entitled to due process because he has a property interest in his mobile food vehicle license. See, e.g., Bird v. Dep’t of Pub. Safety, 375 N.W.2d 36, 42 (Minn. App. 1985) (finding property interest in automobile dealer’s license); Staeheli v. City of St. Paul, 732 N.W.2d 298, 304 (Minn. App. 2007) (determining that a Truth-in-Sale-of-Housing license was a property interest); Kleven v. Comm’r of Pub. Safety, 399 N.W.2d 153, 156 (Minn. App. 1987) (concluding that a driver’s license is a propertyinterest). Due process entitles relator to notice and an opportunity to be heard before relator can be divested of his license. Comm’r of Natural Res. v. Nicollet County Pub. Water/Wetlands Hearings Unit, 633 N.W.2d 25, 29 (Minn. App. 2001), review denied (Minn. Nov. 13, 2001). Without proper notice, relator could not anticipate potential grounds for revocation or prepare a defense. Due process demands that relator have the opportunity to challenge whether the statute is controlling.

Relator further claims that Minn. Stat. § 157.15, subd. 9, does not prohibit the city from issuing him a CUP. More specifically, he argues that the statute is a definition, not a prohibition; the statute merely differentiates mobile food units from restaurants. We take no position on whether relator should successfully be granted a CUP. We are simply reversing the revocation and allowing him to operate from the vacant lot until he has had the opportunity to legitimately apply for a CUP. Relator must apply for a CUP from the city within 60 days of the release of this opinion. We take the step of placing a reasonable deadline on the application period because if we only reversed the revocation, relator could find himself in a “favored no man’s land” where he had his license and would never have to apply for a CUP if one was required. But we do reinstate his license on a temporary basis until his application for a CUP is processed.

The city has also moved to strike portions of relator’s appendix to his brief because they are not included in the record. We have examined these documents and it appears that they were not a part of the record before the ALJ or the city council. They pertain to relator’s arguments involving Minn. Stat. § 157.15, subd. 9. As discussed above, we decline to reach the issue of whether Minn. Stat. § 157.15, subd. 9, supersedes and controls an ordinance of the City of St. Paul. That issue is for the City of St. Paul, and relator is free to continue his argument that he is not in violation of the St. Paul City ordinance and that the state statute does not apply to him. Thus, we have not relied on the disputed documents in reaching our decision and we deny the motion to strike, as it is moot.

Reversed; motion to strike denied.

* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.