SILVERWING AT SANDPOINT, LLC, an Idaho limited liability company, Plaintiff-Respondent,
BONNER COUNTY, an Idaho municipal corporation, Defendant-Appellant.
from the District Court of the First Judicial District of the
State of Idaho, Bonner County. Hon. Richard Christensen,
district court's ruling on the County's Motion for
Judgment Notwithstanding the Verdict is reversed and
this case is remanded to the district court for
action consistent with this Opinion. The judgments in favor
of SilverWing are vacated. No attorney fees on
appeal are awarded to either party. Costs to appellant.
County Prosecutor's Office, Sandpoint, Murphey Law
Office, PLLC, Coeur d'Alene and Buchalter, a Professional
Corporation, Irvine, California, attorneys for appellant.
Paul J. Fraidenburgh argued.
Pursley, LLP, Boise and Anderson & Kreiger, LLP, Boston,
Massachusetts, attorneys for respondent. Debora K. Kristensen
Nature of the Case
appeal arises from a dispute grounded in promissory estoppel
between SilverWing at Sandpoint, LLC ("SilverWing")
and Appellant Bonner County (the "County").
SilverWing sought to develop a residential hangar and taxiway
adjacent to the Sandpoint Airport for residents who wished to
park their aircraft in their home garage. SilverWing alleged
that "[i]n 2007, the County provided to SilverWing an
ALP that reflected the existing location of the Airport's
runway, and made no mention or reference to any plans for the
runway to be moved. At the same time, the County promised
that there were no plans regarding changes to runway location
which would be incompatible with SilverWing's
the initial stages of engineering for the development, the
County informed SilverWing that it needed to move the taxiway
from where it was originally planned onto County-owned
airport property, to accord with the County's Airport
Layout Plan (ALP). SilverWing proceeded with its development
based on the County's assurances, and built a taxiway and
other infrastructure, including streets, to support its
development. Once the taxiway was built, SilverWing learned
that the placement of the taxiway was not approved by the
FAA. After several years of legal maneuvering, SilverWing
proceeded against the County in court, ultimately on a theory
of promissory estoppel.
trial, a jury returned a verdict in favor of SilverWing. The
County then filed a motion for judgment notwithstanding the
verdict ("JNOV"), which the district court denied.
The County now appeals, arguing: (1) the district court erred
in denying the County's JNOV on any of nine stated
grounds; (2) the district court erred in awarding SilverWing
attorney fees under Idaho Code section 12-120(3) for the
promissory estoppel claim; and (3) the County should be
awarded its attorney fees and costs incurred in the district
court and as a result of this appeal. We reverse the district
court's ruling on the JNOV and vacate its ruling
regarding attorney fees and remand this case to the district
court for action consistent with this Opinion. We decline to
award either party attorney fees in this case.
Factual and Procedural Background
case is about the development of a residential/hangar
combination property adjacent to the Sandpoint Airport (the
"Airport"). The Airport is a general aviation
airport owned and operated by the County. In April 2006, John
McKeown purchased 18.1 acres of land (the
"property") directly bordering the west side of the
Airport, and later conveyed the property to an entity formed
on October 25, 2006, that ultimately became SilverWing.
McKeown was the managing member of the LLC.
intended to design and construct a 45-unit Planned Unit
Development ("PUD") of hangar structures near the
Airport which included optional second-floor residences. As
planned, residents could taxi their airplanes directly
between the Airport runway and their hangar homes.
SilverWing's purchase included a perpetual "Taxi Way
Easement" (the "easement") from the County in
favor of SilverWing for access to the runway at an access
point in the middle of the runway or "mid-field."
Thus, from the outset, a crucial aspect of the development
was the ability for residents to have direct access in their
airplanes from their hangar homes to the Airport's
after SilverWing purchased the property, it hired an airport
design expert who developed an architectural design and site
plan for the PUD. The design included a parallel taxiway that
was intended to be constructed on the property, allowing
SilverWing residents to exit their residences/hangars in
their airplanes, making their way to the mid-field access
point on the Airport runway provided by the easement.
learning of SilverWing's purchase, in the summer of 2006,
the Airport Board, through its vice-chair Sol Pusey,
requested by email that SilverWing provide it with the plans
for the property and a construction schedule. Mr. Pusey also
informed SilverWing that the Board had been working with the
FAA about installation of a west-side taxiway. McKeown,
testifying on behalf of SilverWing, stated that he initially
knew nothing about the need to construct the west-side
taxiway in the location directed by the County.
also had email correspondence discussing the planned
development "all the time" with Jorge O'Leary,
who held a contract with the County to manage the Airport.
O'Leary confirmed with McKeown that O'Leary was the
Airport Manager, and he told McKeown not to "hesitate to
contact me directly on airport matters." Based on his
interaction with O'Leary, McKeown emailed a copy of the
initial site plan to O'Leary. McKeown testified further
that the response from the Airport Board and O'Leary
regarding SilverWing's plans was "[g]reat" and
that "everyone was very excited . . . everyone thought
it was a great design . . . . It was all really
positive." Based on the ongoing interactions among
McKeown, O'Leary and the Airport Board, McKeown also
requested that O'Leary send him a copy of the current
Airport Layout Plan on file with the FAA.
thereafter, in September 2006, O'Leary informed
McKeown through email that he had some
"urgency" in talking to McKeown because he had
information to convey that "could change
[SilverWing's] project layout and parameters [that would]
involve land swapping with the County." McKeown
responded by sending O'Leary an updated site plan in
which the taxiway continued to be located entirely on
then sent McKeown an electronic version of the ALP known as
"ALP Alternative 2(B)" ("ALP 2(B)"). In
this plan, the County intended that the taxiway be relocated
from SilverWing's site plan to a location on Airport
property, with all but 7.5 feet of the taxiway on Airport
property. In an email accompanying the transmission of ALP
2(B), O'Leary conveyed that the County was "looking
to buy 60 feet to the west from [its] property line that is
250 feet from the centerline of the runway. The west-side
taxiway will connect with the runway in the south."
McKeown testified that he was not sure what O'Leary was
referring to when he received the email, but that in
"actually put[ting] everything together," he
realized that the County was talking about developing a
west-side taxiway. That said, McKeown suggested that this
information did not concern him at that time because they
were in the early development phase of the project and the
details were still being worked out.
about the same time, SilverWing hired Clearwater Engineering
(Debbie Van Dyk) to engineer the development, including the
west parallel taxiway to connect the property to the Airport
runway. Clearwater also hired ES Engineering (Corrie
Esvelt-Siegford), an expert engineer relative to airports, to
perform additional engineering tasks related to FAA issues.
Esvelt-Siegford began her "due diligence" for
preliminary engineering by contacting the FAA to verify that
the ALP the engineers had received by email was the same ALP
the FAA was using. Esvelt-Siegford testified that the FAA
assured her that the "runway was not going to move"
and they could proceed with their design. The engineers then
requested that O'Leary provide them with an FAA approved
copy of the ALP for the Airport. Van Dyk went to the Airport
office and O'Leary provided her a hard copy of ALP 2(B),
stating "this is what you work from." A few days
later, O'Leary confirmed,
[w]e would allow you to build inside our property line so
that it aligns and conforms with where the taxiway should go
for its future full length. It would conform to FAA specs.
testified that "[i]t would have been a huge red
flag" if O'Leary would have told her that she needed
to wait for future approval of the ALP from the FAA. Given
O'Leary's assurances, SilverWing's engineers
relied on ALP 2(B) to site the parallel taxiway and to lay
out the development of the SilverWing site, with the taxiway
located as set forth on ALP 2(B), almost entirely on Airport
December 2006, McKeown met with the Airport Board, the
Airport Engineer, and O'Leary. McKeown took
SilverWing's final site plan with him to the meeting,
which showed that SilverWing had moved the taxiway to its new
location consistent with ALP 2(B). McKeown testified that
during the meeting the Board and O'Leary assured him that
the taxiway, as located on the new site plan, was in the
correct place. He added that by "correct," he meant
that the taxiway as shown on ALP 2(B) was approved by the
FAA, so that SilverWing could go forward with their
thereafter, McKeown took the same site plan to another
meeting with Bonner County Commissioner Lewis Rich, along
with the Airport Manager and the Airport Board to
"confirm exactly what [the County] wanted." McKeown
testified that Rich spoke with him at length about the
location of the taxiway as depicted on ALP 2(B). Rich
expressed no concerns with the location of the taxiway and
"actually thanked" McKeown for including the
taxiway in SilverWing's development. Rich gave his
commitment that placing the taxiway as shown on ALP 2(B) was
the way to proceed.
after the meeting, McKeown, O'Leary, and the County's
Engineer Mark Napier met at the Airport to discuss some
Airport equipment that needed to be moved as part of the
development. Napier brought a copy of ALP 2(B) and showed
McKeown where to move the equipment. The three men then
walked the area of the taxiway, and Napier confirmed the
location of the taxiway for the project. At no time during
the meeting at the Airport did either the County's
engineer or its Airport Manager suggest that the taxiway
should not be located as depicted on ALP 2(B).
January 2007, SilverWing formalized its intentions.
SilverWing had to submit two forms to the FAA for approval of
its development; however, it was instructed to submit such
forms to the County through the Airport manager, and the
County would forward the forms to the FAA. SilverWing sent
the County its plans, which included ALP 2(B) as an
attachment, through FAA Form 7480 (Notice of Landing Area
Proposal) and FAA Form 7460 (Notice of Proposed Construction
and Alteration). SilverWing's engineers, O'Leary and
Napier, exchanged emails with comments about the forms, which
were incorporated into SilverWing's final submission. The
County, as Airport sponsor, submitted SilverWing's plans
to the FAA on February 14, 2007. A few days later, the
Sandpoint Planning Commission approved SilverWing's PUD
and the City of Sandpoint later followed suit. On April 30,
2007, the FAA responded to the County, noting that it had
reviewed SilverWing's Form 7480 and said that the FAA had
"no objection to its construction, provided that the
taxiway design standards meet FAA [requirements as to]
Airport Design." Shortly thereafter the FAA approved
SilverWing's Form 7460 for construction of its project.
in September 2007, SilverWing began significant work on the
1, 098-foot taxiway, mainly on Airport property consistent
with ALP 2(B). SilverWing paid $851, 120.00 in construction
costs, although this amount was in dispute. Building the
taxiway on Airport property led to increased costs for
SilverWing because of the heightened requirements for
SilverWing already had runway access rights under its
easement, SilverWing decided to negotiate a Through the Fence
Airport Access Agreement ("TTFA"), in part to help
share the costs associated with Airport access. The TTFA
granted SilverWing, in exchange for a yearly access fee, a
perpetual right to access the Airport's runway from its
property in private aircraft. The Airport Board adopted the
TTFA by unanimous vote and Lewis Rich executed the TTFA on
behalf of the County, which included an acknowledgement that
SilverWing was constructing 44 residential airplane hangars.
County also sent the partially executed TTFA to the FAA for
review. On May 3, 2007, the FAA responded that it considered
residential use adjacent to a public airport an incompatible
land use and encouraged the Airport to ensure through the
TTFA that access not be provided to hangars with residences.
The FAA never approved the TTFA. Even so, one week later the
County sent McKeown two copies of the TTFA along with a cover
letter stating: "Enclosed are two copies of the revised
through-the-fence agreement that the Commissioners signed
reflecting the changes made by the Airport Advisory Board.
Please return one copy to us. The other copy if [sic] for you
to retain for your records." The County did not inform
SilverWing that the FAA had not approved the TTFA. On June 6,
2007, SilverWing executed the TTFA as requested and returned
one copy to the County.
December 2008, the FAA placed the Airport in
"non-compliance" status because the County had: (1)
on May 25, 2000, before SilverWing's ownership, granted
an easement without FAA approval; (2) entered into the TTFA
with SilverWing allowing "through-the-fence" access
to the runway; and (3) allowed numerous private property
owners mid-field access to the runway. The non-compliance
status was to remain in place for three years, or until the
Airport achieved compliance regarding: (1) the County
entering into the TTFA with SilverWing without FAA approval
and (2) the existence of mid-field runway access points
throughout the Airport. To resolve the compliance issues, the
County implemented a Corrective Action Plan
was designed to remedy the FAA's concerns by: (1)
pursuing all avenues to extinguish the perpetual nature of
SilverWing's TTFA easement; and (2) pursuing an amendment
to the SilverWing TTFA to require access only through the end
of the runway. The County's plan announced that
"midfield access is unacceptable from a safety
the County's position, on March 25, 2009, the FAA
notified the County that SilverWing's taxiway had not
been constructed based on an "approved ALP." The
FAA also stated that if "the taxiway was constructed in
the incorrect location, then SilverWing needed to have a plan
to relocate the taxiway, when the runway is shifted."
McKeown testified that this was the first time he was made
aware of the fact that ALP 2(B) had not been approved by the
FAA, but SilverWing continued to rely on the County's
assurances that the taxiway would not have to be torn out and
March 2009 to 2011, SilverWing continued work on the
development, while representatives from SilverWing and the
County worked with the FAA to bring the Airport back into
compliance. In March 2011, an FAA interim policy which
allowed existing residential developments with
through-the-fence access went into effect. On October 11,
2011, the County approved an amended ALP which would require
moving both the runway and taxiway 60 feet to the west, with
the County to buy a portion of SilverWing's development.
McKeown testified that the amended ALP "ripped up all of
my front lots, it ripped up all my taxiways, interior, and it
ripped up the taxiway I built on behalf of the County."
The amended ALP was approved by the FAA on October 24, 2011.
The following December, the County submitted an amended CAP
to the FAA which included the approved, amended ALP.
2012, Congress enacted the FAA Modernization and Reform Act,
which rescinded the previous prohibition on residential
through-the-fence access agreements, rendering
SilverWing's TTFA compliant with FAA standards. Pub. L.
112-95 § 136, 126 Stat. 23-24 (amending 49 U.S.C. §
11, 2012, SilverWing initiated this matter by filing a
complaint, which contained three claims against the County:
(1) breach of covenant of good faith and fair dealing; (2)
taking without compensation - inverse condemnation pursuant
to 42 U.S.C. section 1983; and (3) violation of equal
protection pursuant to 42 U.S.C. section 1983. The case began
in Bonner County, but the County removed it to the U.S.
District Court for the District of Idaho on June 6, 2012, due
to the federal claims. ...