Krause v. Matanuska-Susitna Borough, et. al.

This case is primarily about statute of limitations issues and, to a smaller extent, remedies in relation to platting board decisions. Property owners obtained preliminary approval for a plat after agreeing to certain conditions regarding easements and rights-of-way. They submitted a final version of the plat that did not comply with the conditions, but the Platting Board accepted it for recording. The Krauses were affected by these changes and
met with the Borough Manager and Acting Planning Director to explain their grievances. On March 3, 2003 they received a letter from the Borough Manager stating that review of the platting action was closed. They appealed to the Borough Board of Adjustment and Appeals which on April 1, 2005 ruled that the Manager’s letter was not a decision from which it could properly hear an appeal. Krauses then appealed to the superior court which on March 12, 2007 ruled that only the Board of Adjustment and Appeals, not the Borough Manager, had authority to hear appeals of platting decisions. They did not appeal that ruling.

On April 25, 2007, the Krauses filed a separate complaint in superior court against the Borough and the individual property owners involved in the plat. The causes of action included failure to follow platting requirements, deprivation of constitutional rights to equal protection and due process, damages from the Borough and the property owners, and a decree returning to the status quo prior to the modification of the preliminary plat. the superior court dismissed the Krauses’ suit. The claim for damages from infringement of a constitutional right was not allowed since an alternative statutory remedy under AS 29.40.190.

The superior court ruled that the two year limitation of AS 09.10.070 for injury to the rights of another not arising on contract and not specifically provided otherwise barred the claims under the Borough ordinances and the claims against the other property owners for compensatory damages for injunctive relief. The one year limitation of As 09.10.090 prevented the Krauses from bring a claim for statutory penalties. The court denied the motion to amend the complaint to assert that the statute of limitations was tolled by their administrative appeal.

The Supreme Court affirmed the denial of damages for infringement of a constitutional right but reversed regarding the dismissal of constitutional claims for declaratory and injunctive relief holding that those actions are particularly appropriate with respect to unconstitutional statutes. It further held that the superior court applied the correct statutes of limitations but erred by not allowing the Krauses to amend their complaint to allege that the equitable tolling doctrine applied.

The equitable tolling doctrine applies when a plaintiff has more that one legal remedy available to him. The elements are (1) pursuit of the initial remedy gives defendant notice of plaintiff’s claim, (2) defendant’s ability to gather evidence is not prejudiced by the delay, and (3) plaintiff acted reasonably and in good faith. The statute is tolled only when the initial remedy is pursued in a judicial or quasi-judicial forum. The Court also held that the Krauses were entitled to present their claim that the doctrine of equitable estoppel was a defense to the statute of limitations based on alleged misrepresentations by the Borough.

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