North Dakota Supreme Court hears arguments in North Dakota Indoor RV Park takings and due-process appeal

The Supreme Court of North Dakota heard arguments in North Dakota Indoor RV Park LLC v. State of North Dakota (file no. 20240293), a dispute over whether the park’s lawsuit alleging an unconstitutional taking and due-process violations is ripe after the park withdrew an administrative hearing and lost its operating license.

At oral argument, counsel for the state told the court that the park “withdrew its hearing request, so we simply don't know what findings of fact and conclusions of law the agency would have reached,” and urged the court to dismiss the takings and state-law inverse-condemnation claims for lack of final agency action and for failure to exhaust administrative remedies. The state also argued that the two individual defendants are entitled to qualified immunity because the park’s complaint does not plead facts showing any clearly established constitutional violation.

The park’s counsel said the administrative process had been manipulated and that pursuing further administrative remedies would be futile. The park argued the alleged taking occurred when a state letter and subsequent events left the park without a license and exposed it to potential criminal enforcement. “Our position is that the taking never happened,” the state’s counsel replied, characterizing the record as containing a “blank space” where the agency never reached a substantive adjudication of the fire-safety issues.

Nut graf: The central legal dispute is procedural: whether the district court can hear the substantive takings and due-process claims when the administrative hearing that would have decided the underlying fire-safety and licensing questions was scheduled but later abandoned by the park. If the court finds there was no final agency action, that typically bars federal and state takings claims and requires dismissal until administrative remedies are exhausted. If the court finds finality or a futility exception to exhaustion, the claims may proceed.

During argument, justices focused on two main issues. First, whether the Department of Health’s nonrenewal/revocation process produced a final agency action ripe for judicial review. The state emphasized that an evidentiary hearing had been set for September 2021, that the park was allowed to operate while adjudication was pending, and that the park later withdrew its hearing request, leaving no agency decision on the merits to review. The park countered that the underlying fire-marshall abatement (referred to in the record as “deficiency 110”) had been repackaged in a 2020 inspection report and that the Department of Health lacked authority to resolve those fire-code determinations, making further administrative proceedings futile.

Second, the court addressed qualified immunity for the two individually named state employees. The state argued the immunity question should be resolved immediately because the complaint fails to allege facts showing a clearly established constitutional violation and that, on the pleadings, summary judgment denying immunity was erroneous. The park contended that factual disputes about the reasonableness and motives of the officials (including allegations that the fire marshal and DOH acted to circumvent other review processes) meant the immunity question depends on material facts and cannot be resolved on the current record.

Counsel for both sides cited North Dakota precedent and national authority. The state relied on the U.S. Supreme Court’s ripeness framework (citing Pacdell v. City and County of San Francisco as discussed at argument) and state cases including Hoglund v. Spathe (467 N.W.2d 692) to support agency authority to act on fire-safety issues alongside the fire marshal. The park relied on its pleadings, an expert report of Elliot Dudnick referenced in the record, and argued statutory and procedural constraints limited the park’s administrative and judicial-review options.

The transcript of the argument records disputed factual assertions about the administrative timeline: counsel for the state said there was an evidentiary hearing set for September 2021, that the department alleged multiple violations based on a 2020 fire marshal inspection (identified in the record as 10 fire-code violations, three building-code violations, and two regulation violations), and that the park’s withdrawal of the hearing request foreclosed an agency decision on the merits. The park contended that prior efforts to obtain judicial review of a fire-marshal abatement order had been remanded and left unresolved, and that repackaging that abatement as part of the DOH licensing determination deprived the park of its statutory review route under chapter 18-01.

The justices asked multiple questions about doctrine (ripeness, exhaustion, futility exceptions, and the proper appellate process for immunity questions), procedural posture (whether Rule 54(b) certification or supervisory writ practice applied), and the specific timing of when any alleged taking occurred. At the close of argument, the court stated the matter would be taken under advisement.

Ending: The court did not announce a ruling at the argument. The parties appeared before a panel that included Justice Daniel Crothers, Justice Lisa Fair McEvers, Justice Jared Tufty, Justice Douglas Barr, and Justice John Jensen. The court indicated it would issue an opinion later; no date was given in the hearing transcript.