               IN THE COURT OF APPEALS OF NORTH CAROLINA

                                  No. COA16-104

                                Filed: 7 March 2017

Bladen County, No. 14 CVS 526

NOEL THOMPSON, Petitioner,

              v.

TOWN OF WHITE LAKE, Respondent.


        Appeal by Petitioner from an order entered 14 May 2015 by Judge James

Gregory Bell in Bladen County Superior Court. Heard in the Court of Appeals 7 June

2016.


        Morningstar Law Group, by William J. Brian, Jr. and Jeffrey L. Roether, for
        Petitioner-Appellant.

        Hester, Grady & Hester, P.L.L.C., by H. Clifton Hester, for Respondent-
        Appellee.


        INMAN, Judge.


        This appeal arises from a zoning dispute.     Because the superior court

misapplied a de novo standard of review and entered new findings of fact contrary to

a municipal zoning board’s findings, the judgment must be reversed. Also, because

the appellee concedes that the record evidence did not support the municipal zoning

board’s only finding of fact supporting its decision, the board’s decision must be

reversed.
                         THOMPSON V. TOWN OF WHITE LAKE

                                    Opinion of the Court



      Noel Thompson (“Petitioner”) appeals from an order by the trial court affirming

a zoning decision by the Town of White Lake Board of Adjustment (the “Board”) that

stopped Petitioner from completing construction of a storage building in a residential

neighborhood.    Petitioner asserts the Board’s decision was not supported by

competent evidence and misinterpreted the local zoning ordinance. Petitioner also

contends the superior court applied the incorrect standard of review to the Board’s

decision. Respondent, the Town of White Lake (the “Town”), asserts that the superior

court applied the correct standard of review and that its judgment should be affirmed.

After careful review, we reverse the trial court’s judgment as well as the Board’s

decision.

                        Factual and Procedural History

      Petitioner is the owner of real property located at 1431 Highway 53 East (the

“Property”) in the Town of White Lake, North Carolina. The Property is zoned as an

R-1, residential zoning district.    The Town’s zoning ordinance (the “Ordinance”)

provides that a person may construct an accessory storage structure on residential

property by obtaining a zoning permit from the Town, which will be issued so long as

the structure conforms to the Ordinance and the construction conforms to the issued

permit.

      On 13 March 2014, Petitioner obtained a zoning permit (the “Permit”) from the

zoning inspector for the Town, Timothy Frush (the “Zoning Inspector”). The Permit



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                                   Opinion of the Court



allowed Petitioner to construct a 24’x40’ tan, metal storage building on her property

for residential purposes. The Permit further specified the Building would have four

doors, all facing away from the street. Petitioner proceeded to construct a building

(the “Building”) with eight doors, including four facing the street.

      In response to complaints about the Building under construction, the Zoning

Inspector investigated and found two deviations from the Permit: (1) the Building

had four doors on each side, and (2) the Building had a center dividing wall, which

created eight separate 10’x12’ units within the whole structure. On 7 April 2014, the

Zoning Inspector issued a stop work order (the “Stop Work Order”) for the

construction of the Building and on 16 April 2014 sent Petitioner a notice of intent to

revoke the Permit (the “Notice of Intent”).       In the Notice of Intent, the Zoning

Inspector cited three reasons that the Building violated the Ordinance:

                The accessory structure is a commercial structure and
                 is inconsistent with the R-1 zoning permit authorization
                 granted by the Town of White Lake. (Article V, 5-1.2)

                The permit recipient failed to develop or maintain the
                 property in accordance with the approved plans.
                 (Article V, 5-6.1)

                The accessory structure is not located behind the front
                 building line of the principle structure. (Article XII, 12-
                 7(A)[sic]

      Petitioner appealed the Stop Work Order and Notice of Intent to the Board.

After an open meeting which included testimony by the Zoning Inspector and



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                                   Opinion of the Court



Petitioner, the Board affirmed the Zoning Inspector’s decision on the first of the three

allegations: that “[t]he accessory structure is a commercial structure and is

inconsistent with the R-1 zoning permit authorization . . . .” The Board unanimously

voted that “[b]ased on the evidence provided, the allegation is: Valid.” The Board

rejected the Zoning Inspector’s other two allegations—that Petitioner “failed to

develop or maintain the property . . . in accordance with the approved plans” and that

“[t]he accessory structure is not located behind the front building line of the principle

structure.”     The Board voted unanimously that each of those grounds was

“[e]rroneous and not supported in fact or under the applicable provisions of the White

Lake Zoning Ordinance as alleged by the [Zoning Inspector].” The Board concluded

its decision with a comment that “the most serious violation (That the structure

would be used for commercial purposes[]) was valid and was sufficient to support the

action of revoking the permit.”

      Petitioner appealed the Board’s decision to the Superior Court of Bladen

County, arguing, inter alia, that (1) the Zoning Inspector presented no competent

evidence to support the Board’s finding that the Building would be used for

commercial purposes, and (2) the Board erred as a matter of law by affirming the

Stop Work Order and Notice of Intent pursuant to Article V, 5-1.2 of the Ordinance.

      On 14 May 2015, the superior court entered an order affirming the Board’s

decision.     The superior court entered findings of fact including, inter alia, that



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                                   Opinion of the Court



although the Permit approved a building with only four exterior doors facing the

residential side of the structure and no internal dividing walls, “[t]he actual structure

. . . contained [eight] doors and [eight] separate rooms, each with a separate door.”

The superior court further found that

             the actual structure (a mini-storage building with [eight]
             separate compartments/rooms with [four] street-side
             doors) [was] not a permissible ‘Accessory Use’ structure
             incidental to a residential use as those terms are defined
             by the White Lake Zoning Ordinance. Furthermore, the
             [Building], as originally represented by the petitioner (a
             one-room storage building with [four] doors facing the
             residence), would have been a permissible ‘Accessory Use’
             structure as defined by the ordinance.

The superior court concluded that the deviation from a one-room structure with four

doors to an eight-room structure with eight doors sufficiently diverged from the

Permit to support the Stop Work Order and Notice of Intent. The superior court also

concluded the Building was not an “Accessory Use” structure incidental to the

primary residence, but rather was a “commercial use ‘structure’ as defined by the

ordinance and was not consistent with the R-1 residential use of the lot in question.”

The superior court did not cite any provision in the Ordinance defining a commercial

structure. The superior court affirmed the Board’s decision and remanded the matter

to the Board to determine a schedule for Petitioner’s compliance with the Permit.

      Petitioner timely appealed the superior court’s order.

                                        Analysis



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                            THOMPSON V. TOWN OF WHITE LAKE

                                       Opinion of the Court



       I. The Town’s Motion to Dismiss

       As an initial matter, we address the Town’s Motion to Dismiss Petitioner’s

appeal as interlocutory. The Town asserts the Notice of Intent was not an actual

revocation of the Permit, and because Petitioner asserted revocation as grounds for

her appeal, we should dismiss the appeal. We disagree.

       A party in a civil action has a right of appeal to this Court “[f]rom any final

judgment of a superior court[,] . . . [or f]rom any interlocutory order or judgment of a

superior court . . . that . . . [a]ffects a substantial right[.]” N.C. Gen. Stat. § 7A-27(b)

(2015).1 “A final judgment is one which disposes of the cause as to all the parties,

leaving nothing to be judicially determined between them in the trial court.” Veazey

v. City of Durham, 231 N.C. 357, 361-62, 57 S.E.2d 377, 381 (1950) (citations omitted).

“An order that completely decides the merits of an action therefore constitutes a final

judgment for purposes of appeal even when the trial court reserves for later

determination collateral issues such as attorney’s fees and costs.” Duncan v. Duncan,

366 N.C. 544, 546, 742 S.E.2d 799, 801 (2013). “An interlocutory order is one made

during the pendency of an action, which does not dispose of the case, but leaves it for

further action by the trial court in order to settle and determine the entire

controversy.” Veazey, 231 N.C. at 362, 57 S.E.2d at 381.




       1  N.C. Gen. Stat. § 7A-27 was amended in 2016; however, this amendment does not affect the
cited language.

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                         THOMPSON V. TOWN OF WHITE LAKE

                                   Opinion of the Court



      Here, the superior court fully resolved the merits of the parties’ dispute and

remanded the matter only for the Board to schedule Petitioner’s compliance with her

Permit. The superior court fully decided the issues in dispute: (1) whether the

Building complied with the Ordinance and (2) whether the Board was correct in

affirming the Stop Work Order and Notice of Intent. So while the revocation may not

have occurred yet, the superior court determined the Building’s non-compliance with

the Ordinance and the Board’s justification for affirming the notices and remanded

the matter for Board proceedings that would lead either to compliance by Petitioner

or revocation of the Permit with no further determination by the superior court. The

superior court also ordered Petitioner to pay court costs associated with the matter,

further indicating the finality of the judgment. The decision left nothing more to be

resolved in the superior court. Accordingly, we hold the superior court’s order was a

final order for the purposes of this appeal.

      II. The Superior Court’s Review

      A. Standard of Review

      “An appellate court’s review of the trial court’s zoning board determination is

limited to determining whether the superior court applied the correct standard of

review, and to determine whether the superior court correctly applied that standard.”

Overton v. Camden Cnty., 155 N.C. App. 391, 393-94, 574 S.E.2d 157, 160 (2002)

(citation omitted).



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                         THOMPSON V. TOWN OF WHITE LAKE

                                   Opinion of the Court



      When the superior court hears a decision from a board of adjustment, it “sits

as an appellate court, and not as a trier of facts[.]” Sun Suites Holdings, LLC v. Bd.

of Alderman of Town of Garner, 139 N.C. App. 269, 271, 533 S.E.2d 525, 527 (2000)

(quoting Tate Terrace Realty Investors, Inc. v. Currituck Cnty., 127 N.C. App. 212,

217, 488 S.E.2d 845, 848 (1997)).         The superior court’s review is limited to

determinations of whether:

             1) the [b]oard committed any errors in law; 2) the [b]oard
             followed lawful procedure; 3) the petitioner was afforded
             appropriate due process; 4) the [b]oard’s decision was
             supported by competent evidence in the whole record; and
             5) [whether] the [b]oard’s decision was arbitrary and
             capricious.

Overton, 155 N.C. App. at 393, 574 S.E.2d at 159 (alterations in original) (quoting

Capital Outdoor, Inc. v. Guilford Cnty. Bd. of Adjustment, 152 N.C. App. 474, 475,

567 S.E.2d at 441 (citation omitted)).

      The proper standard of review for the superior court “depends upon the

particular issues presented on appeal.” Amanini v. N.C. Dep’t of Human Res., N.C.

Special Care Ctr., 114 N.C. App. 668, 374, 443 S.E.2d 114, 118 (1994) (citation

omitted). “If a petitioner contends the [b]oard’s decision was based on an error of law,

‘de novo’ review is proper.” JWL Invs., Inc. v. Guilford Cnty. Bd. of Adjustment, 133

N.C. App. 426, 429, 515 S.E.2d 715, 717 (1999). “When the petitioner ‘questions (1)

whether the agency’s decision was supported by the evidence or (2) whether the

decision was arbitrary or capricious, then the reviewing court must apply the “whole


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                                    Opinion of the Court



record” test.’ ” ACT-UP Triangle v. Comm’n for Health Servs. of the State of N.C., 345

N.C. 699, 706, 483 S.E.2d 388, 392 (1997) (quoting In re Appeal by McCrary, 112 N.C.

App. 161, 165, 435 S.E.2d 359, 363 (1993)).

      “Under a de novo review, the superior court ‘consider[s] the matter anew[] and

freely substitute[es] its own judgment for the agency’s judgment.’ ” Mann Media Inc.

v. Randolph Cnty. Planning Bd., 356 N.C. 1, 13-14, 565 S.E.2d 9, 17 (2002)

(alterations in original) (quoting Sutton v. N.C. Dep’t. of Labor, 132 N.C. App. 387,

389, 511 S.E.2d 340, 341 (1999)). “The ‘whole record’ test requires the reviewing court

to examine all competent evidence (the ‘whole record’) in order to determine whether

the agency decision is supported by ‘substantial evidence.’ ” Amanini, 114 N.C. App.

at 674, 443 S.E.2d at 118 (citation omitted).         “[T]he ‘whole record’ test ‘gives a

reviewing court the capability to determine whether an administrative decision has

a rational basis in the evidence[,]’ ” Bennett v. Hertford Cnty. Bd. of Educ., 69 N.C.

App. 615, 618, 317 S.E.2d 912, 915 (quoting Overton v. Goldsboro City Bd. of Educ.,

304 N.C. 312, 322, 283 S.E.2d 495, 501 (1981)), but “does not allow the reviewing

court to replace the [b]oard’s judgment as between two reasonably conflicting views,

even though the court could justifiably have reached a different result had the matter

been before it de novo,” Thompson v. Wake Cnty. Bd. of Educ., 292 N.C. 406, 410, 233

S.E.2d 538, 541 (1977). “It is not the function of the reviewing court . . . to find facts,




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                                   Opinion of the Court



but instead, . . . to determine if the findings made by the [b]oard are supported by the

evidence.” JWL Invs., 133 N.C. App. at 429, 515 S.E.2d at 717 (citation omitted).

      B. Discussion

      We now consider whether the superior court applied the appropriate standards

of review to the Board’s determination of the Notice of Intent and Stop Work Order,

and if so, whether the superior court applied the standards correctly. We start with

the issues presented to the superior court on appeal from the Board’s decision.

      In her petition for writ of certiorari to the superior court, Petitioner contended:

             28. The findings, inferences, conclusion and decisions of
             the Board that the storage building is a commercial
             structure inconsistent with the R-1 zoning permit
             authorization granted by the Town are not supported by
             substantial competent evidence in view of the entire record.

             29. The Board’s findings, inferences, conclusions and
             decisions were arbitrary and capricious.

             ...

             31. The Board’s decision violates N.C. Gen. Stat. § 160A-
             381 in that the Board failed to interpret the Ordinance in
             a manner that promotes the health, safety, morals and
             general welfare of the community.

Petitioner’s contentions implicate both de novo and whole record standards of review.

“ ‘[A] court may properly employ both standards of review in a specific case.’ ” Mann

Media, 356 N.C. at 15, 565 S.E.2d at 18 (quoting Sun Suites, 139 N.C. App. at 273,

533 S.E.2d at 528). “However, the standards are to be applied separately to discrete



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                          THOMPSON V. TOWN OF WHITE LAKE

                                       Opinion of the Court



issues, and the reviewing superior court must identify which standard(s) it applied

to which issues[.]” Id. (internal quotation marks and citations omitted). In this case,

whole record review applies to the Board’s findings and inferences and de novo review

applies to the Board’s conclusions of law and interpretation of the Ordinance.

       The superior court’s judgment described the standard of review as follows:

              Based upon the facts, the [c]ourt concludes that there are
              questions of law presented. The [c]ourt should apply a de
              novo standard of review to Board decisions involving
              application and interpretation of zoning ordinances.

But the superior court also made its own findings of facts based “[u]pon reviewing the

evidence and hearing argument of Counsel[.]” The superior court’s language and the

act of finding facts makes clear it applied a de novo standard to all issues in dispute,

including the Board’s findings and inferences. The superior court did not apply the

whole record standard to the Board’s findings as required by the issues presented by

Petitioner. Nor did the superior court acknowledge the distinction between the issues

of fact and issues of law before it.

       The Board’s decision was not a model of clarity for judicial review. Following

the recital of the issues before it, the Board’s decision states as follows: “Having heard

all of the evidence and arguments presented at this hearing, the Board made the

following FINDINGS OF FACT and drew the following CONCLUSIONS” and next

states: “There is substantial evidence in the record to show the following Facts and

Conclusions.”    With respect to the allegation on which it affirmed the Zoning


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                               THOMPSON V. TOWN OF WHITE LAKE

                                          Opinion of the Court



Inspector and denied Petitioner’s appeal, the Board’s decision indicates that its

members unanimously voted that “[b]ased on the evidence provided, the allegation

is: Valid.”

        Article II of the Ordinance, titled “Interpretations and Definitions,” does not

define the term “commercial structure” or the word “commercial.” It provides that

“[w]ords not defined in this Ordinance shall be given their ordinary and common

meaning.” Town of White Lake, N.C., Zoning Ordinance, Art. II, § 2-2.1 (2011). The

Town on appeal refers to the “finding” by the Board that “the structure would be used

for commercial purposes,” and comments that “the word ‘could’ was probably intended

by the Board.”2 In addition to the Town’s reference on appeal to this determination

as a finding of fact, before the Board, counsel for the Town and for Petitioner

addressed the dispute regarding the nature of the Building as an issue of fact.3

        In their deliberations on Petitioner’s appeal in open session, Board members

discussing the allegation that the Building was a commercial structure did not refer



        2 The record indicates, however, that Petitioner’s counsel urged Board members to consider
only the proven purpose for the Building rather than whether it “could” be used for commercial
purposes. The record indicates no effort by the Town to correct the Board’s word choice in its finding.
        3 Petitioner testified that her intended use of the Building was “strictly personal.” She testified

that she had no plans to rent the Building or any portion of it for storage by others. She acknowledged
that some of the items she planned to store in the Building were used in her vacation rental properties,
but also said the storage would include “some things I put in my own house.” The Town presented
hearsay evidence of several complaints the Zoning Inspector had received protesting the Building or
rental of storage units in Petitioner’s neighborhood. Petitioner’s counsel argued to the Board that “a
commercial structure is a structure that is used to make money,” and noted that no evidence had been
presented showing that Petitioner intended to make money from the Building. The Town’s counsel
argued to the Board that it needed to determine, inter alia, “[t]he specific use of which the building is
intended.”

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                             THOMPSON V. TOWN OF WHITE LAKE

                                        Opinion of the Court



to the scope or meaning of the Ordinance. Before voting commenced, one member

commented that “if you vote that it’s valid which means that means [sic] you are

supporting what the zoning officer has said in his letter that the accessory structure

is a commercial structure and is inconsistent with R1 zoning permit authorized.”

Each member voted that the allegation was valid. While the language of the Board’s

decision was not clear, considered in the context of the record, the determination that

the Building is a commercial structure arose from the Board members’ consideration

of evidence presented and inferences drawn from the evidence.4 As such, it required

a whole record review by the superior court, and the superior court was prohibited

from substituting its findings for the findings of the Board.

       The parties agree that the Board’s only factual justification to affirm the Stop

Work Order and the Notice of Intent—“That the structure would be used for

commercial purposes”—was not supported by the evidence. The Town concedes on

appeal that “there is no evidence of the Petitioner’s intended use for commercial

purposes.” But the Town seeks to classify the Board’s decision and subsequently the

superior court’s decision regarding the character of the building as an issue of law

requiring a de novo review. This argument is inconsistent with the record and the

language of the Board’s decision.


       4 Likewise, the Board’s determination that the Zoning Inspector’s other two allegations were
erroneous arose at least in part from findings of fact by the Board. Neither Petitioner, who prevailed
on those issues before the Board, nor the Town appealed those determinations. They were therefore
not subject to review by the superior court and are not subject to review by this Court.

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                         THOMPSON V. TOWN OF WHITE LAKE

                                   Opinion of the Court



      The Town asserts that the Board’s finding that “[t]he accessory structure is a

commercial structure and is inconsistent with the R-1 zoning permit authorization

granted by the Town of White Lake” supports the superior court’s application of a de

novo review because consistency with the R-1 zoning permit requires an

interpretation of the Ordinance, i.e., an issue of law. This argument is refuted by the

record of the Board’s determination that the evidence presented did not support the

Zoning Inspector’s allegation that “[t]he permit recipient failed to develop or maintain

the property . . . in accordance with the approved plans.” The Board affirmed the

Stop Work Order and Notice of Intent based solely on the allegation that the Building

would be used “for commercial purposes.” The superior court may not substitute its

own justification for that of the Board with regard to findings and inferences from the

evidence where a challenge is based upon whether substantial evidence exists to

support the Board’s decision. Thompson, 292 N.C. at 410, 233 S.E.2d at 541. The

superior court, in finding that the Building was constructed inconsistent with the

Permit, contradicted the Board’s finding that such allegation was erroneous and

substituted an alternative basis to affirm the Stop Work Order and Notice of Intent.

      Ordinarily when a superior court applies the wrong standard of review to a

municipal board decision, this Court vacates the superior court judgment and

remands for proper application of the correct standard. See Sutton, 132 N.C. App. at

389, 511 S.E.2d at 342. But we need not do so in this case because the Town, in its



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                         THOMPSON V. TOWN OF WHITE LAKE

                                  Opinion of the Court



brief before this Court, concedes that the Board’s factual finding necessary for the

decision challenged on appeal was not supported by the evidence. In the interest of

judicial economy, we conclude remand to the superior court is unnecessary. See Mann

Media, 356 N.C. at 15-16, 565 S.E.2d at 18-19; Sun Suites, 139 N.C. App. at 274, 533

S.E.2d at 528-29.

                                    Conclusion

      Because the superior court applied the wrong standard of review and entered

its own findings inconsistent with the Board’s findings, and because the parties agree

the evidence did not support the Board’s determination that the Building would be

used for commercial purposes, we reverse both the superior court’s decision and the

Board’s decision.

      REVERSED.

      Judges BRYANT and TYSON concur.




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