Utah Supreme Court hears eleventh-hour arguments on the fight over the Cottonwood Mall development in Holladay

Lawyers clashed Friday before the Utah Supreme Court over whether one of Holladay’s zoning votes approving a huge development at the former Cottonwood Mall site should go before voters in November to be approved or rejected.

With key election deadlines bearing down, the justices scheduled special arguments Friday afternoon before a packed audience over whether the Holladay City Council’s change to a master plan for the 57-acre site near 4800 S. Highland Drive amounted to making new laws or applying existing ones.

That question is crucial. If the court decides the council was applying existing laws, the city’s decision clearing the $560 million high-density development is ineligible for a public vote. But if the justices say the city was making new laws, then voters can weigh in.

And in vigorous questioning Friday of attorneys on both sides, the five-member state Supreme Court appeared divided on just how broad those zoning rules on density and land use were and whether they applied beyond the mall site project.

After two hours of oral arguments and cross-examination, the justices took the case under advisement, though they’ve given previous signals that they would try to rule as early as next week.

Attorneys noted they would likely miss the Monday deadline for when mail-in ballots are sent overseas to military personnel but urged justices to decide the matter before Oct. 8, when ballots will be mailed to all other voters.

The legal fight stems from Holladay’s decision to reject a valid grass-roots initiative petition — arguing city officials acted administratively, relying on existing laws. Two organizers of a group behind the petition, Paul Baker and Stephen Stuart of Unite for Holladay, sued City Recorder Stephanie Carlson to have that decision overturned, arguing the vote had broad effects, making it more like a law.

Utah developers Ivory Homes and Woodbury Corp. have been working for nearly 18 months to get the project called Holladay Quarter approved. They, the Utah Home Builders Association, real estate groups and the Utah Property Rights Coalition have filed briefs saying a ruling in favor of a public vote would jeopardize other development projects across Utah.

Municipal leaders also fear a ruling overturning Holladay officials' vote could threaten other cities’ zoning actions, opening them to a steady stream of populist challenges at the ballot over everyday actions.

Unite for Holladay’s attorneys argued Friday the case centered on the last large piece of property left for development in Holladay and a sizable portion of the suburban city’s population had a vital stake.

Third District Judge Richard McKelvie ruled in early September that the City Council’s vote on a developer’s agreement with Ivory was administrative and confirmed that question was barred from the ballot. But the site master plan was broad in nature and created policy, making it legislative, McKelvie said.

Lawyers for Ivory and Holladay swiftly appealed.

Justices on Friday parsed fine distinctions in state land-use law on just how specifically Holladay actions were to be applied. Could another developer step in under the same plan, Associate Chief Justice Thomas Lee asked.

The justices’ questioning also touched repeatedly on the nature of a balance in state law between the power of the Legislature, which under the Utah Constitution grants cities and towns their powers, and state residents' power under the law to petition for a referendum for access to the ballot.

Justice Deno Himonas pushed back on legal arguments by Ivory’s attorney that the administrative vs. legislative question was rightly decided simply at the Legislature’s discretion. That argument, Himonas said at another point, threatened to erode cities’ powers under the Utah Constitution.