Ben Lomond, Inc. v. Municipality of Anchorage

Ben Lomond, Inc. (plaintiff) applied to the city of Anchorage, Alaska (the city) (defendant) for building and demolition permits with respect to a group of apartment buildings. Ben Lomond submitted architectural plans proposing that Ben Lomond would renovate the 224 units in the apartment buildings into 280 units. However, the apartment site was zoned to allow only 234 units. The city building official was unaware of the zoning limit and issued the permits. Numerous complaints about Ben Lomond’s project were submitted to the city, and the city concluded that the zoning designation limited the project to 234 units. The city revoked Ben Lomond’s permits and informed Ben Lomond that Ben Lomond could appeal the decision to the zoning board, apply for a variance from the 234-apartment limit, or build the project with only 234 units. Ben Lomond chose not to appeal the revocation of the permits or seek a variance. Ben Lomond had bought the apartment property in a foreclosure sale, and it ultimately failed to pay the remainder of its purchase obligations and forfeited its right to purchase the apartments. Ben Lomond sued the city, seeking $3 million in damages based on the permit revocations. While the litigation was pending, the city purchased the apartment property and demolished the buildings to build a park. Ben Lomond moved for summary judgment in the litigation, alleging that the city had deprived Ben Lomond of its property without due process. The city cross-moved for partial summary judgment, alleging that it was immune to claims for damages under Alaska law. The court granted the city’s motion, and Ben Lomond appealed.