The Sarpals sought and obtained approval to build a pool shed in their yard from the city of North Oaks. Later, the city ordered the Sarpals to move the shed, saying that it was improperly placed in part on property over which the city had an easement. (This, by the way, was no portable hut. In fact, it had a poured concrete foundation). The city sued the Sarpals. The Sarpals won the case at the trial court, prevailed at the Court of Appeals, which agreed that the city was “equitably estopped” from arguing the Sarpals’ structure violated city ordinances, but the Sarpals lost before the Minnesota Supreme Court.
The Minnesota Supreme Court concluded that the issue of “equitable estoppel” rested on the exercise of the trial court’s sound discretion but then concluded that the trial court had abused its discretion because the government “made a mistake” but did not engage in “wrongful conduct” sufficient to justify equitable estoppel.
The district court found that the City acted wrongfully when it provided the Sarpals with inaccurate documentation, failed to competently review the building permit application, failed to place the Sarpals on notice of the error, and ultimately approved the application to construct the shed. Importantly, the court did not find, and the record does not suggest, that any of these actions by the City constitutes anything other than a simple mistake.