A legal battle between the Southern Pines Town Council and a car dealer went another round Tuesday in Moore County Superior Court.

Attorneys for Leith Automotive and the town argued over the meaning of a piece of correspondence sent to Leith by Joy Richard, a Southern Pines zoning officer, saying car dealerships were "permitted uses" in the town's General Business district.

While that is what it said, the two sides disagreed over what it meant.

Leith considers that letter as good as a building permit as far as locking the zoning in place for land it bought on U.S. 1 near Midland Road. Southern Pines says it is a note about zoning that the town can change at any time.

Leith owns and operates automobile dealerships throughout North Carolina and wanted to open four in Southern Pines.

In 2000, Leith began researching the possibility of developing an automobile park -- numerous car dealerships at a single location -- in Southern Pines. According to court documents, for a parcel of land to serve as an Auto Park, Leith needed at least 20 acres, with space for four dealerships, 1,200 feet of frontage on a major artery and zoning that would permit that use.

In March 2001, Leith entered into a contract to purchase a parcel near the intersection of U.S. 1 and Midland Road for $1.55 million, the U.S. Fourth Circuit Court of Appeals court found. Before actually closing the deal, Leith sought written determinations from the town that the property was zoned as General Business (GB), which permits automobile dealerships.

Since at least 1989, the town's Unified Development Ordinance has said that "motor vehicle and boat sales or rental or sales and service" are permitted in areas zoned GB.

The letter from Richards said, "This letter is to advise that a car dealership can be located in the General Business District as long as it can meet all zoning requirements, such as setbacks, landscaping, parking, etc."

On Nov. 30, 2001, the town provided Leith an additional written confirmation that an Auto Park would be in compliance with zoning ordinances. Based on that, Leith closed on the property in January 2002 for a total sale price of $1,553,904.

Leith's attorney, Robin Tatum Currin, argued that Richards' letter satisfied all that North Carolina law requires to establish a "vested right" for Leith to sell, rent and service cars on that property.

Susan K. Burkhart, who represents the town, contended it was little more than an explanation of zoning at the time Leith asked and that it did not amount to anything more than a clerk pointing out a section of the town's existing zoning rules.

Towns can change zoning at any time, and the only exception to that power is its limitation by a vested right obtained when certain conditions have been met. One of those conditions is when a building permit is issued. Changes in zoning don't affect that property once such a permit is issued.

A number of residents opposed construction of a car dealership on that site, which many of them consider to be the gateway to town.

Southern Pines, which had been working with Leith on meeting architectural and appearance standards, encountered a storm of protest from residents. A local lawyer, Bob Thompson -- whose mother was living in the Village Green development behind Leith's property -- petitioned the town to rezone it as Office Services (OS) instead of general business.

The council eventually did approve Leith's architectural compliance permit on Sept. 13, 2005, after taking six months to review it when most are approved within a month. A month later, on Oct. 11, 2005, the council unanimously voted to rezone Leith's property as Office Services (OS). Car dealers are not a permitted use under OS zoning.

Leith alleged that it had obtained vested rights in the property and that the rezoning violated those vested rights. That is what was at issue in the suit and countersuits that were heard in Carthage this week.

"Both parties agree that, if Leith possesses a vested right in the property as previously zoned, the new ordinance cannot be applied to Leith," the Fourth Circuit said. "As it currently stands, however, Leith sits in somewhat of a gray area on the edges of the vested rights doctrine under North Carolina law. Moreover, we remain ever mindful that 'land use questions . . . are the peculiar concern of local and state governments, and traditionally, federal courts have not interfered with state courts in the area of land-use policy.'"

Other issues, including damages sought in federal courts for denial of due process, will depend entirely on whether or not Leith had acquired vested rights when it got that letter about what was permitted in a General Business District.

It comes down to how courts construe that single piece of paper, one page in a five-inch-thick book of documents filed with the court by Leith's lawyers. The town's attorneys filed their own thick briefs.

Superior Court Judge James Webb did not rule Tuesday. He needed time to go over a great deal of material. Whatever Webb does decide, the matter will not end in Carthage. Attorneys for both sides said appeals will take this case to Raleigh.

Contact John Chappell at 783-5841 or by e-mail at jchappell@thepilot.com.