High Court Denies Whitefish’s Request for Mediation in ‘Doughnut’ Lawsuit

By Beacon Staff

WHITEFISH – The Montana Supreme Court denied the city of Whitefish’s request for mediation with Flathead County in the ongoing battle for jurisdiction of the two-mile planning “doughnut,” which girds the city’s outer edge and for years has been the focus of intense controversy and litigation.

Following a state district court ruling in July that returned planning authority to Flathead County – a decision the city of Whitefish appealed – the final determination of who retains control of the planning doughnut remains up to the high court, which could take a year or more to issue a ruling, according to attorneys and city officials.

Two months after filing its appeal, the city of Whitefish asked the Supreme Court to send the dispute to mediation, writing in a motion that the “process may help the parties avoid the additional legal expense and emotional cost of an appeal.”

In their Sept. 17 order, court justices denied the motion, ruling that mediation is an inappropriate remedy because the plaintiffs and appellees in the lawsuit, which was filed about two years ago by four Whitefish-area residents, object to it.

Mediation was previously, though unsuccessfully, attempted at the District Court level.

The basis of Whitefish’s latest appeal is a July 8 ruling by Flathead District Judge David Ortley, who struck down a 2011 citizens’ referendum that shifted full jurisdictional authority of the doughnut to Whitefish.

The ruling returned jurisdiction of the planning doughnut to the county; however, because the issue is so divided, a judgment in either party’s favor essentially guaranteed an appeal to the state Supreme Court.

The turf war is far from settled, and the council’s appeal to the high court this summer was just the latest twist in a contentious issue that has driven a planning and zoning debate in Whitefish for over a decade.

Plaintiffs argue that thousands of property owners in the doughnut hang in legal limbo due to the jurisdictional gray area, while the city wishes to apply its own unique set of land-use and zoning policies to preserve the integrity of Whitefish.

The lawsuit challenged the validity of a citizen-initiated referendum passed by Whitefish voters in November 2011. That referendum struck down a 2010 “interlocal” planning agreement designed as a compromise between city and county officials.

Following passage of the referendum, area residents Lyle Phillips, Anne Dee Reno, Ben Whitten and former Whitefish Councilor Turner Askew filed a lawsuit against the city asking Ortley to declare the referendum illegal and void. The plaintiffs argued the county should maintain authority because the 2010 agreement was an administrative, rather than legislative, act, and was therefore not subject to referendum.

Ortley sided with the plaintiffs, granting summary judgment and declaring the referendum invalid.

In opposing the request for mediation, Kalispell attorney Duncan Scott, who represents the four Whitefish-area residents in the lawsuit, argued that it is not legally possible to settle the case through mediation.

“We think the only way now to resolve this dispute is for the Montana Supreme Court to uphold Judge Ortley’s decision that the County now is free to assume Doughnut jurisdiction,” Scott wrote in an email.

Proponents of mediation believed that compromise is achievable.

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