Permit Is No Guaranty — Developer Responsible for Compliance with Laws

The fact that a local government can revoke or otherwise refuse to be bound by a permit or other approval must be kept in mind with any development project. In some cases, developers have obtained permits based on carefully prepared plans, have commenced construction work, and have even completed work on a project only to have the issuing local governmental authority revoke a key permit. Bringing the work into compliance can require costly, time-consuming demolition and reconstruction work as well as other remedial measures that can jeopardize the developer's ability to complete the project.

A permit can be revoked not only for noncompliance with a building code but also for other nonconstruction reasons, including the failure of plans to comply with a zoning ordinance or a land use approval. Many jurisdictions have codes that allow them to revoke permits that were issued based on incorrect information or that result in work that endangers public safety, as determined by the city official. The general rule to keep in mind is that a permit is not permanent and is not a guaranty of compliance with all laws. The underlying public policy rationale is that local governments simply do not have the resources to act as virtual guarantors that construction work and development plans are 100 percent in compliance with all applicable laws, regulations, ordinances, approvals, and other requirements. Ultimately, that responsibility falls to the developer and property owner. Further, the local government's interest in protecting the health and safety of the public is considered to outweigh the burden that may be placed on an individual in connection with a single project.

The general rule for verbal approvals and representations received from local government officials is that such statements are not binding on the governmental entity and are not enforceable against it. This includes specific information or assurances you may receive from a staff person working the desk at the planning office and confirmations or approvals from an on-site building inspector. The public policy reasons supporting the rule are the same as noted above, having to do with avoiding placing an "unreasonable burden" on the local government.

As with many areas of the law, exceptions to the general rules exist, but the exceptions are narrow. Under tort law concepts, in some jurisdictions a local government can be held responsible for negligently approving plans, depending on the specific facts of the situation. Estoppel arguments are also sometimes raised, attempting to hold a local government to the approvals or representations it has made. An estoppel argument does not often prevail, in part because a local government is not bound by the acts of employees who exceed their authority. For example, a city employee does not have the authority to waive the requirements of a mandatory ordinance.

An owner or developer can do several things to avoid a permit revocation or other unenforceable approval. Do not rely on oral representations from building officials, planners, or other local governmental employees. Their statements are usually not binding. Confirm such representations by other appropriate means.

Rely on competent legal counsel and other consultants to help you determine whether work and plans are in compliance. A permit itself is not evidence of compliance and should not be interpreted as such.

Sometimes, after construction is underway, nearby property owners raise concerns that cause a local government to reexamine plans or construction work in connection with applicable ordinances and approvals. It is at that point that areas of noncompliance may first be identified. Notifying and communicating with neighbors as early as possible in the process can help identify and resolve issues to the mutual satisfaction of all, without undue delay and unnecessary expense.

Legal remedies against a local government in connection with a revoked permit are complex and can turn on whether or not a land use decision is involved. An experienced land use attorney can assist you in the timely assessment of both legal and practical alternatives.

This article is intended to inform the reader of general legal principles applicable to the subject area. It is not intended to provide legal advice regarding specific problems or circumstances. Readers should consult with competent counsel with regard to specific situations.

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