Loreto Development Co. v. Village of Chardon

Loreto Development Co. (Loreto) (plaintiff) owned an 85-acre parcel of land in the village of Chardon (defendant). Most of the land was residentially zoned, but 23 acres were zoned C-1, which allowed local retail business if approved by the Chardon Board of Zoning Appeals (the board). A local retail business was defined to include retail and service establishments that employed fewer than 10 people if the floor area of the establishment was less than 10,000 square feet. The stated purpose of C-1 zoning was to prevent traffic congestion, excessive noise, and other objectionable influences to preserve the small-town character of that section of Chardon. However, Chardon admitted that restricting an establishment’s number of employees did not advance this goal. Loreto applied for a conditional-use permit to construct a 98,000-square-foot Wal-Mart store with roughly 100 employees. Chardon denied Loreto’s application, and Loreto appealed in Ohio state court, alleging that the local-retail-business restrictions on number of employees and square footage were unconstitutional. Loreto also filed a declaratory-judgment action requesting that the court construe the zoning ordinance with respect to the denial of the conditional-use permit for the proposed Wal-Mart store. Evidence before the trial court indicated that Loreto could profitably develop its property within the existing zoning restrictions. The court consolidated the actions and found that the zoning ordinance was unconstitutional. The court ordered Chardon to grant Loreto a conditional-use permit to build the Wal-Mart store, and Chardon appealed to the Ohio Court of Appeals.