- Apex is asking the North Carolina Court of Appeals to reject class-action status in a lawsuit challenging the recreation fee the town charges to developers.
- A trial judge granted class-action status in April 2024. Developer Empire Contractors challenged a $64,000 fee charged for its 20-unit development.
- Class-action status would allow other developers to recover fees from the town if the plaintiff wins the case.
Apex officials are asking North Carolina’s second-highest court to reject a class action in a lawsuit challenging recreation fees the town charges developers. A trial judge granted the suit class-action status last April.
Plaintiff Empire Contractors filed suit in March 2023, challenging Apex’s requirement of a $64,000 payment in lieu of dedicating land for recreation in its 20-lot, 3.5-acre development.
Apex argues in a brief filed Monday that a state law permitted the town to charge the fee.
“To prove that a recreation fee-in-lieu paid as a condition of subdivision approval was unlawful, Plaintiff must show that the fee-in-lieu was beyond the scope of the enabling statute, which includes ‘implied powers … essential to the exercise of those which are expressly conferred,’” Apex’s lawyers wrote.
“It is undisputed that the enabling statute allows Apex to adopt a regulation that ‘… provide[s] for payment of funds to be used to acquire or develop recreation areas serving residents of the development or subdivision or more than one subdivision or development within the immediate area,’” Apex’s brief continued. “The statute contains only one express restriction on the use of the funds by cities: that they ‘shall be used only for the acquisition or development of recreation, park, or open space sites.’”
“Apex has additional authority by local act that allows the Town to ‘us[e] a formula based upon a charge per dwelling unit of the development or subdivision without reference to property tax value,’ so long as the ‘the collection, maintenance, and use of such funds are otherwise consistent with G.S. 160A-372’ and the fee-in-lieu does not ‘exceed the fair market value of the land area that would have otherwise been required to be dedicated,’” Apex’s lawyers wrote.
Beyond the specifics of Empire Contractors’ lawsuit, Apex argues that Superior Court Judge Gale Adams was wrong to conclude that this case could cover other developers,
“The impact of each development will differ based upon many factors, including the number and type of dwelling units, the resources already available in the area of Town where the development is located, or whether the development increases the population of an existing area of Town or extends its boundaries,” Apex’s lawyers wrote. “In another example, the amenities built into the development by the developer may have the potential to mitigate its impact. Analysis of the impact of the development will also require fact-specific discovery and proof for each putative class member. This inquiry is ad hoc and fact- intensive. It is not susceptible to common proof, and the trial court erred in finding that it was a common issue of law or fact shared among the class.”
“There is a common nucleus of operative facts among all class members that underlie each of these issues,” Adams wrote in the order granting the lawsuit class-action status. “Plaintiff’s claim is typical of all other class members as it relates to the general theories of liability set forth in the common issues. The Court concludes that a ‘class’ exists in this action and that common issues of law and fact predominate over any individual issues.”