UNPUBLISHED

                    UNITED STATES COURT OF APPEALS
                        FOR THE FOURTH CIRCUIT


                             No. 04-1055



HALLE DEVELOPMENT, INCORPORATED,

                                               Plaintiff - Appellant,

           versus

ANNE ARUNDEL COUNTY, a Political Subdivision
of the State of Maryland; JANET OWENS,
Executive for Anne Arundel County; JOSEPH
RUTTER, Director of Planning and Zoning,

                                              Defendants - Appellees.


Appeal from the United States District Court for the District of
Maryland, at Baltimore.   William M. Nickerson, Senior District
Judge. (CA-03-1302-WMN)


Argued:   December 2, 2004                 Decided:   February 4, 2005


Before LUTTIG, MOTZ, and DUNCAN, Circuit Judges.


Affirmed by unpublished opinion. Judge Luttig wrote the opinion,
in which Judge Motz and Judge Duncan joined.


ARGUED: John R. Greiber, Jr., GREIBER & SCHEIBE, Millersville,
Maryland, for Appellant.    Hamilton F. Tyler, Senior Assistant
County Attorney, ANNE ARUNDEL COUNTY OFFICE OF LAW, Annapolis,
Maryland, for Appellees. ON BRIEF: Phillip F. Scheibe, GREIBER &
SCHEIBE, Millersville, Maryland, for Appellant. Linda M. Schuett,
County Attorney, ANNE ARUNDEL COUNTY OFFICE OF LAW, Annapolis,
Maryland, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).




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LUTTIG, Circuit Judge:

     Plaintiff-appellant Halle Development, Inc. (“Halle”) filed

suit under 42 U.S.C. § 1983 against defendant-appellee Anne Arundel

County, Maryland (“the County”) in the District of Maryland,

alleging that the County’s failure to grant impact fee credits in

exchange for a plat of Halle’s land violated Halle’s constitutional

rights.   The district court dismissed Halle’s suit as barred by

statute of limitations.   We affirm.



                                I.

     Halle is the developer of the Seven Oaks subdivision situated

in Anne Arundel County.   The development has been the subject of

dispute between Halle and the County since 1989, including five

prior lawsuits between the two parties.        The current dispute

focuses on a 16-acre “School Parcel” that Halle deeded to the

County in 1992 as part of a deal to procure a waiver of development

requirements under the County’s “Adequate Facilities” ordinance.

Halle claims that the County’s failure to provide “development fee

impact credits” in exchange for the School Parcel as well violated

Halle’s rights under the Takings Clause and the Equal Protection

Clause.

     Anne Arundel County has two relevant ordinances governing

subdivision   developments.    First,   the   “Adequate   Facilities”

ordinance provides:


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      [W]ithin two years following approval of a final
      subdivision plat, elementary and secondary schools in the
      service area of the proposed subdivision shall be
      adequate to accommodate the school population projected
      to be generated from the proposed subdivision.

Anne Arundel County Code, art. 26, § 2-416(b), J.A. 347.                    Second,

the   County    also    assesses      “development        impact   fees”    against

developers, to offset the costs of expanding public facilities to

accommodate the increased population of new developments.                      The

“Development Impact Fee” ordinance provides for credits against

such fees in exchange for conveyances of land to the County:

      Any conveyance of land or construction received and
      accepted by the County from a developer shall be credited
      against the development impact fees if the conveyance or
      construction meets the same needs as the development
      impact fee in providing expanded capacity beyond existing
      needs. If the developer wishes to receive credit against
      the amount of development impact fees due for such
      conveyance or construction, the developer shall enter
      into a fee agreement with the County. . . .

7-107(a), J.A. 350.

      In    1989,    after     negotiations,        the     County    waived   the

requirements of the Adequate Facilities ordinance in exchange for

Halle’s    payment     of    $4.7    million   to    the     County   for    school

facilities.     J.A. 140-41.        In addition, in a letter dated February

10, 1989, the County indicated that Halle had also agreed to

transfer the 16-acre School Parcel to the County.                  J.A. 132.   The

letter asserted that, in exchange for the School Parcel, Halle

agreed     to   receive      credit    against      separate       recreation-area

requirements for the Seven Oaks development. J.A. 132. The letter


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did not contemplate any waiver of development impact fees in

exchange   for   the   School   Parcel;      on   the   contrary,    the    letter

explicitly asserted that “[t]he developer will be responsible for

all impact fees in Seven Oaks.”         J.A. 132.

     In the early 1990s, Halle defaulted on the installments of its

$4.7 million commitment to the County, resulting in litigation in

state court.     Halle did not make any claim for development impact

fee credits in exchange for the School Parcel at that time.

Eventually, the parties reached a Settlement Agreement in 1992.

Under the terms of that agreement, Halle deeded the School Parcel

to the County.      J.A. 59.    The deed provided that “[t]he property

herein conveyed is reserved on said plat as a school site, but in

no event shall be used for any purpose other than a public

purpose.” J.A. 59. After Halle subsequently filed for bankruptcy,

Halle   and   the   County   entered    a    second     Settlement   Agreement,

approved by the bankruptcy court in 1993.                 J.A. 230.        In this

agreement, Halle acknowledged the transfer of the School Parcel to

the County and “irrevocably abandon[ed] any claim that the School

Site is an asset of Halle’s bankruptcy estate.”              J.A. 240.

     In 2000, Halle filed parallel complaints in state and federal

court alleging that the County had unconstitutionally exacted the

School Parcel.      The state case was dismissed, and the federal case

was subsequently dismissed on grounds of res judicata.                See Halle

Development, Inc. v. Anne Arundel County, 

(Md. 2002);


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J.A. 295.    Neither of these lawsuits addressed the issue of

development impact fees.

     In November 2002, the County transferred the School Parcel to

the Anne Arundel County Board of Education, the legal entity

authorized to construct a school on the parcel.      J.A. 66.     Halle

then filed the current case in the district court under 42 U.S.C.

§ 1983, alleging that the County’s exaction of the School Parcel

without providing development impact fee credits violated the

Takings Clause and the Equal Protection Clause.        J.A. 18.    The

district court dismissed the complaint as barred by the relevant

statute of limitations, and in the alternative, as barred by res

judicata.   J.A. 346-53.   Halle appealed.



                                 II.

     The district court’s dismissal of the complaint on a Rule

12(b)(6) motion is reviewed de novo.     Brooks v. City of Winston-

Salem, 

, 181 (4th Cir. 1996).     Dismissal is appropriate

where “it appears to a certainty that the plaintiff would be

entitled to no relief under any state of facts which could be

proved in support of his claim.”   

under 42 U.S.C. § 1983 is subject to the

applicable state statute of limitations.     Sattler v. Johnson, 

, 226 n.3 (4th Cir. 1988).         Here, Maryland’s general

statute of limitations provides that “[a] civil action at law shall


                                 -6-
be filed within three years from the date it accrues.”     Md. Code

Ann., Cts. & Jud. Proc. § 5-101.   The time of accrual of a section

1983 action is governed by federal law, and the claim accrues when

the affected party knew or should have known of the injury that is

the basis of the action.     National Advertising Co. v. City of

Raleigh, 

, 1161-62 (4th Cir. 1991).

     In this case, the injury alleged in Halle’s complaint is the

denial of development fee impact credits to compensate for Halle’s

transfer of the School Parcel to the County.     J.A. 17-18.   Thus,

Halle knew or should have known of this alleged injury when Halle

received notice that the County did not intend to provide impact

fee credits in exchange for the School Parcel.     And it was clear

from the plain terms of the County’s letter of February 10, 1989,

that the County had no such intention:

     You propose to contribute $4,700,000.00 based upon the
     current dwelling unit breakdown to construct school
     facilities for 1299 students. . . . This payment is in
     addition to any impact fee that would be charged by the
     County . . . . You have also agreed to donate [the School
     Parcel] to the County if 9 ½ acres of the school site are
     used as a credit toward recreation demands in Seven Oaks
     . . . .

     Based on the aforementioned information, this Office will
     grant a waiver to [the Adequate Facilities ordinance]
     subject to the following conditions: . . .

     The developer will be responsible for all impact fees in
     Seven Oaks in addition to the financial commitment set
     forth in the “School Agreement.”

J.A. 132 (emphases added). Therefore, in February 1989, Halle knew

or should have known that the County did not intend to award any

                               -7-
impact fee credits in exchange for the School Parcel.                       Halle’s

cause of action premised on the denial of fee credits thus accrued

at that time, and is now barred by Maryland’s three-year statute of

limitations.

     Moreover, as the district court found, the terms of the 1993

bankruptcy Settlement Agreement indicate that Halle had no further

expectation of impact fees in connection with the School Parcel.

See J.A. 352 (“The Court finds that the terms of the 1993 Agreement

demonstrate that Halle had irrevocably abandoned any claim to the

school parcel.”); J.A. 240 (“Halle and [its creditor] hereby

acknowledge the transfer to the County of the [School Parcel] . .

. and hereby irrevocably abandon any claim that the School Site is

an asset of Halle’s bankruptcy estate.”). Again, because the terms

of this Agreement contemplate no further compensation to Halle for

the School Parcel, they confirm that Halle should have known that

the County had no intention of providing fee credits under the

original 1989 deal or thereafter.

     On appeal, Halle argues principally that its constitutional

claims    did    not   accrue   until   November    2002,      when   the    County

transferred the School Parcel to the Board of Education, which is

the only legal entity empowered to construct a school thereon. But

Halle    cites   no    authority   to   suggest    that   it    could   not   have

requested development fee impact credits from the County when Halle

agreed to the original transfer deal in 1989 and the County


                                        -8-
indicated that no impact fee credits would be forthcoming.             The

impact fee credit ordinance does not indefinitely forestall a

developer from seeking impact fee credits until the County finally

disposes of the transferred parcel to an end-user; on the contrary,

the ordinance apparently allows the developer to negotiate a fee

agreement with the County at the time of transfer.             See Anne

Arundel County Code, art. 24, § 7-107(a), J.A. 350.            Halle has

provided no reason to believe that such negotiations could not have

taken place when the original transfer deal was executed in 1989,

at the time when the County made clear its intention not to provide

impact fee credits.

     Halle   also   contends   that   the   district   court   erred    by

addressing the affirmative defense of statute of limitations in

ruling on the County’s Rule 12(b)(6) motion.      But this argument is

without merit, because dismissal is appropriate where, as here,

“the face of the complaint clearly reveals the existence of a

meritorious affirmative defense.”       

.



                               CONCLUSION

     Because Halle’s cause of action is barred by the statute of

limitations, the judgment of the district court is affirmed.

                                                                AFFIRMED




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