SOUTHWEST MONTANA BUILDING INDUSTRY ASSOCIATION, et al., Plaintiff and Appellant,
THE CITY OF BOZEMAN, Respondent and Appellee.
Submitted on Briefs: March 7, 2018
FROM: District Court of the Eighteenth Judicial District, In
and For the County of Gallatin, Cause No. DV 99-71 Honorable
David Cybulski, Presiding Judge
Appellant: Arthur V. Wittich, Montana Law Company; Bozeman,
Appellee: J. Robert Planalp, Patrick C. Riley, Planalp,
Reida, Roots & Riley, P.C.; Bozeman, Montana
Southwest Montana Building Industry Association (SWMBIA)
appeals three orders of the Eighteenth Judicial District
Court, Gallatin County, which directed SWMBIA to transfer
funds from the Impact Fee Payer Class Refund Account (Refund
Account) to the City of Bozeman (Bozeman), to submit an
accounting of the Refund Account, and for contempt of court.
We restate the issues on appeal as follows:
1. Did the District Court exceed its authority when it
ordered SWMBIA to transfer the funds remaining in the Refund
Account to Bozeman?
2. Is the District Court's December 19, 2011 Order
regarding the transfer of the remaining Refund Account funds
3. Did the District Court err by not disposing of the
remaining Refund Account funds in accordance with M. R. Civ.
4. Did the District Court abuse its discretion when it
ordered SWMBIA to provide an accounting of the Refund
5. Can SWMBIA obtain relief from the District Court's
AND PROCEDURAL BACKGROUND
This case concerns the final disposition of approximately
$227, 000 remaining from a class action settlement. These
funds currently reside in the Refund Account, which the
District Court established and placed in SWMBIA's control
to provide refunds to certain individuals and business
entities who had paid "impact fees."
Pursuant to an ordinance adopted in 1996, Bozeman assessed
these impact fees against property owners within certain
"impact fee districts" for street, water,
wastewater, and fire protection. Bozeman collected the fees
as a precondition to obtaining permits for construction or
connecting to city services.
In 1998, Bozeman increased some of the impact fees, and a
citizens' group submitted an initiative petition to
further raise the fees for street, water, and wastewater.
Voters approved this initiative and the increases became
effective January 15, 1999.
On February 17, 1999, SWMBIA, a non-profit organization whose
members include businesses involved in residential and
commercial construction in Bozeman and the surrounding area,
sued for declaratory relief. SWMBIA alleged the impact fee
ordinances and their amendments were unconstitutional. SWMBIA
did not itself pay impact fees, but it represented the
interests of its members who had paid, and continued to pay,
them. Among other relief, SWMBIA requested class action
certification and a refund to the fee payers.
Over the next few years, SWMBIA amended its complaint and
joined additional plaintiffs. The District Court granted
SWMBIA's motion to certify the class, defining it as all
persons and entities who paid or will pay an impact fee due
to the 1996 ordinance or its amendments. The District Court
designated SWMBIA as the class representative and
SWMBIA's counsel, Arthur V. Wittich (Wittich), as class
After several years of litigation, the parties submitted a
proposed settlement agreement to the District Court. On April
15, 2005, the District Court entered a Consent Decree and
Judgment (Consent Decree) in which it declared Bozeman's
impact fee ordinances and their amendments, and all impact
fees assessed and collected thereto, were valid and
enforceable. Bozeman would pay the court $5, 000, 000, and
these funds would be used to distribute partial refunds to
the certified class and to pay Wittich as class counsel.
Bozeman would also temporarily reduce its impact fee rates
and employ a consultant to advise it on determining
appropriate rates for future impact fees.
After receiving $5, 000, 000 from Bozeman, the District Court
awarded Wittich attorney fees of $500, 000. The District
Court held all eligible class members who paid impact fees on
or after July 1, 2001, would receive a 10% refund out of the
settlement funds, "and those paying to the City under
general governing powers prior to July 1, 2001 shall receive
the balance of the lump sum payment as refunds." The
District Court transferred ...