Decided: June 27, 2012
Jane Huggins, trading as SADISCO of Maryland, appealed the district court’s grant of summary judgment in favor of Prince George’s County and five County officials. In November 2001, SADISCO purchased a 99.7 acre parcel of land in the County, with the intention of operating a salvage automobile wholesaling business on the parcel. The Property directly abuts a portion of the Andrews Air Force Base, a designated superfund site by the Environmental Protection Agency, which requires priority remedial attention because of the presence of a dangerous accumulation of hazardous wastes. The purchas contract SADISCO signed acknowledged the condition of the property and that the purchaser would have no recourse against the Seller with respect to the environmental condition of the property. On December 20, 2011 SADISCO applied to the County for a use and occupancy permit, and three months later applied for a permit to temporarily house a construction trailer on the Property. On June 12, 2002, the County issued a permit for the trailer, but by the end of October 2002, the County had revoked all outstanding permits to SADISCO based upon violation of numerous County Code provisions, particularly performing grading work on the property without the proper permits and impermissibly operating its business out of the construction trailer.
SADISCO continued to operate its business on the property, and in May 2003, the County filed two petitions in Maryland state court for injunctive relief against SADISCO’s grading permit violations and zoning code violations. On September 2, 3002, SADISCO and the County entered into two consent orders for each petition for injunctive relief, providing that within 60 days SADISCO would obtain the required grading permit and within 90 days vacate the premises until a valid use and occupancy permit as well as a building permit for the trailers. The day before SADISCO signed the consent orders, its attorney sent a letter to a County attorney describing the standard practice of the county to work with property owners to resolve county code violations and to forbear from enforcement as long as the property owner was making good faith efforts to cure its violations. According to SADISCO, the letter memorialized an oral contract between SADISCO and the County that predates the consent orders. The County then granted SADISCO a series of extensions of the deadline for compliance with the consent orders, however on March 18, 2004 the county notified SADISCO of its intention to enforce the Zoning Consent Order as of March 28. At an April 27 meeting various County officials decided to padlock the gate onto SADISCO’s property the next day and allow access only to remove cars and perform other tasks that would bring SADISCO into compliance.
Almost three years later, on March 30, 2007, SADISCO filed the present action against the County and five officials, alleging: 1) violation of SADISCO’s substantive due process rights under the Due Process Clause; 2) violation of SADISCO’s substantive due process rights under the Maryland Declaration of Rights; 3) breach of contract; 4) tortious interference with economic relations; and 5) negligent misrepresentation. In February 2008 the district court dismissed Counts 2, 4, and 5 for failure to comply with the pre-suit notice requirements of the Local Government Tort Claims Act. Count 3 was dismissed as time barred as to a written contract, and proceeded with discovery as to two alleged oral contracts. On July 24, 2009, the district court granted the County summary judgment, dismissing the Officials in their individual capacities from the action on the basis of qualified immunity, as well as the remaining portion of Count 3. On November 9, 2010, the district court granted summary judgment to the county as to Count 1. On appeal, SADISCO challenged all of the district court’s rulings.
As to the breaches of two oral contracts, the district court held that no consideration in favor of the County existed to support a valid oral contract which predated the Consent Orders. The Court of Appeals upheld that determination, and further explained that the parol evidence rule barred the admission of an oral contract because such evidence directly contradicts the terms of the two subsequent written consent orders. As to Count 1, the district court held that SADISCO had not forecast sufficient evidence that it had a property interest protected by the Due Process Clause, as SADISCO did not hold a valid permit at the time the county locked its gates. The Court of Appeals agreed, further stating that even if SADISCO had been in possession of a valid permit, the County’s conduct did not rise to the level of arbitrary or conscience shocking. As to Counts 2, 4, and 5, the district court held that SADISCO failed to comply with the notice requirements of the LGTCA and failed to show good cause for its noncompliance. The LGTCA prohibits an action for unliquidated damages against a local government or its employees unless the plaintiff provides notice of the claim within 180 days after the injury. The doctrine of substantial compliance allows an exception where a plaintiff has sufficiently apprised local governments of their possible liability at a reasonable time thereafter to conduct an investigation. Furthermore, a suit can still proceed if a plaintiff is able to show good cause to waive the requirements and the defendant cannot affirmatively show that its defense has been prejudiced by a lack of required notice. The Court of Appeals held that the district court had not committed an abuse of discretion in finding that SADISCO had failed to comply with the notice requirements and failed to show good cause for their noncompliance.