Court Allows Takings Claim Based on Restrictive Covenant

Plaintiff Blue Island Development, LLC purchased a defunct oil storage facility in the Town of Hempstead with the intent of cleaning up the site and developing the property into 172 waterfront condominiums. The property was re-zoned to allow this, but Blue Island was made subject to a restrictive covenant that it had to sell all of the condominium units. This covenant was later modified to allow 17 properties to be retained as rental units, but Blue Island eventually requested it be allowed to keep up to 140 units as rental properties. This request was denied by the Town without justification, and so Blue Island brought suit to challenge the zoning action. After some procedural changes, Blue Island was granted summary judgment on a CPLR 3001 claim for declaratory judgment. The Town appealed.

On appeal, the Appellate Division found the restrictive covenant in appropriate on several grounds. First, it restricted Blue Island’s ability to rent the property rather than its ability to use the land itself. Second, the restriction on renting the property only applied to Blue Island, but not any subsequent owner, meaning it was ultimately of no benefit to the Town. Finally, the covenant allegedly denied Blue Island an economically viable use of the land. Given that the Town failed to offer any kind of evidence or justification for the restrictive covenant, the Appellate Division reversed and allowed the Takings claim to proceed.

The case was Blue Island Development, LLC v Town of Hempstead, 2015 WL 4744517 (NYAD 2015)


Judicial Review of Purely Legal Questions Absent Written Findings

Government bodies with an administrative or quasi-judicial function, such as zoning boards of appeal, must generally adopt written findings before courts will review their determinations. In cases where such findings are absent, it is quite common for courts to remand so that a written record can be developed. However, when reviewing questions of strictly legal interpretation, such as the terms of a Town Code or Zoning Code, it is possible for courts to review the statute’s language in the first instance. The reason is that for a strictly legal question, there is no requirement for the court to grant deference, much as an appellate court would engage in de novo review a trial court’s purely legal determinations. This position, adopted in Toys “R” Us v. Silva, 89 N.Y.2d 411 (1996), reversed the doctrine in Emmerling v. Town of Richmond Zoning Bd. Of Appeals, 67 A.D.3d 1467 (4th Dep’t 2009) that held a zoning board’s interpretation should be affirmed unless contrary to the “clear wording” of the zoning code.

 The implications of this are twofold. First, posing your issue as a purely legal question (when possible) provides an avenue for circumventing the strong deference zoning boards of appeal usually receive. Second, relying on legal questions can potentially speed up proceedings that lack a written record by avoiding the usual remand for further proceedings. That’s not to say this will always be an option; the fact remains that many such determinations are situation-specific. However, it is an option to keep in mind when possible.


Big Trouble with Big Cats

Today’s case is from all the way back in 2014, but it is simply too good to pass up when talking about home occupation. In this particular case, the petitioner was found to have an illegal home occupation due to his keeping of various exotic animals, including 3 tigers and 2 leopards. You read that correctly, tigers. As in “lions and tigers and bears, oh my.” To be specific, the petitioner was allegedly running a business in which he would display these animals to the public for a fee, essentially running an at-home zoo. Unsurprisingly, a Town Code enforcement officer took some issue with this.

The Mayfield Town Code defines a home occupation as “a businesses where the owner resides on the property and where the activities of the business are conducted inside the residence, a legally constructed accessory building, or at off-site locations.” Here, the petitioner had no employees, filed no business taxes, has no business insurance, and apparently did not charge people to view the animals, despite the business card he carried listing prices. On the other hand, the court ruled that the animal cages, which were built right into the ground on the petitioner’s property, qualified as legal “accessory buildings.” Based on the legality of the buildings and the remaining facts (or perhaps in spite of them), the court ruled the petitioner was operating a home occupation.

The question then became whether this use was grandfathered in before the enactment of the current zoning ordinance. As much as I’d like to say it was, based on the federal licenses the petitioner produced it was not, and the petitioner was compelled to end his home occupation. The real question is what happened to the big cats, but unfortunately the case doesn’t include that information. It still makes for quite the story though.

The case was Salton v Town of Mayfield Zoning Board of Appeals, WL 1316363 (NYAD 3 Dept. 2014). The opinion can be accessed at: http://decisions.courts.state.ny.us/ad3/decisions/2014/516523.pdf


Court Upholds Denial of Damages Claim for Delayed Building Permit

Appellants applied for a building permit in the Village of Farmingdale. After reviewing their application, the inspector for respondent informed the appellants that the permit would not be granted as aspects of their building plan failed to comply with the New York State building code. Addressing those concerns required the appellants to alter their plans, increasing costs and delaying the permit. Plaintiffs then sued respondents for their costs and damages caused by the delay. The Supreme Court granted summary judgment for the defendants, and the New York Appellate Division, Second Department affirmed.

Unsurprisingly, the Supreme Court ruled that the defendants were immune from liability and dismissed for the plaintiffs failure to state a claim as a matter of law. As the decision of whether to grant a building permit is discretionary, and the inspector was clearly acting within the scope of his authority when deciding the permit should not be granted, plaintiffs had failed to state a claim for damages. On review, the Appellate Division not only upheld the Supreme Court’s grant of summary judgment, but found the plaintiff had improperly raised a complaint about the timeliness of the defendant’s motion for the first time on appeal.   

So what is the take away from this case? Having a building permit denied can cause all kinds of costs, from financial losses to delays in construction, but suing the inspector likely won’t get you very far. That is why when drawing up building plans, it is critical to be aware of the building code and ensure your plans are in complete compliance with its terms. If they are not, there will be very little recourse you can seek in the courts.

The case is Sharp v Incorporated Village of Farmingdale, 129 A.D. 3d 821 (NYAD 2 Dept. 2015)


To Show What You Know, Always Bring an Expert

Experts are important. Given the broad discretion that Zoning Boards are given in granting or denying special use permits, bringing an expert is a lot like bringing a gun to a knife fight: if your opponent has one and you don’t, you might not last long enough to regret it. To drive the point home, one need look no further than 7-Eleven, Inc. v. Incorporated Village of Mineola, where the failure of the concerned board and town members to provide an expert witness led to their concerns being dismissed.

The situation arose out of a proposal to build a 7-Eleven at 400 East Jericho Turnpike in Mineola. When the owners and 7-Eleven sought a special use permit, there was a contentious meeting in which Board members and residents expressed concerns about the proposal, citing the likely clientele, worsened traffic, and the impact on property values. To combat these concerns, 7-Eleven brought an expert witness to provide testimony addressing these concerns. Despite this testimony, the Board ruled against the special permit, and action challenged and later overturned as “arbitrary and capricious.” The court also took notice of the willingness by 7-Eleven to operate under certain restrictions regarding deliveries and the like. Thus even if the concerns of those opposed had merit, their failure to provide expert, informed testimony to that effect undermined their ability to attain their ends.  

Moral of the Story:  It never hurts to bring an expert, and odds are you’ll be glad you did

The case is 7-Eleven, Inc. v Incorporated Village of Mineola, 2015 WL 1915853 (N.Y. App. Div. 2015). The full decision can be found here http://www.courts.state.ny.us/reporter/3dseries/2015/2015_03544.htm


Court Voids Variance Finding Citing Insufficient “Dollars and Cents” Proof

The New York Appellate Division, Third Department recently addressed a case involving the evidentiary requirements associated with justifying a use variance. The lower court had found respondents, who operated an industrial manufacturing business as a non-conforming use, had expanded their facility in 2001 after a zoning code prohibited manufacturing uses in the property’s zone. On those grounds the court granted the petitioner’s request for an injunction against using the property for nonresidential purposes. Respondents then obtained a use variance determination from the Zoning Board of Appeals. That decision was challenged in an Article 78 proceeding and upheld, leading to the current appeal.

In reversing the Supreme Court’s decision, the Appellate Division zeroed in on the requirement that an applicant for a use variance show that the property cannot yield a reasonable return if used for any of the purposes the current zoning would permit. Specifically, applicants must show this through “dollars and cents” proof for each of the various permitted uses. In the present case, the court found that respondent’s conclusory statement that 10-20% of respondents revenue would be needed to provide an alternative to their expansion, and that doing so would put them “out of business,” was insufficient to satisfy the “dollars and cents” burden of proof required. The court accordingly ruled that the Zoning Board of Appeals should not have granted the variance, and reversed.

The case is Nemeth v Village of Hancock Zoning Board of Appeals, 2015 WL 1565749 (NYAD 3 Dept. 4/9/2015). The full text of the decision can be found at http://www.courts.state.ny.us/ad3/


“Written Request” Not Satisfied By Oral Request Being Recorded in Town Board Meeting Minutes

There are times when the letter of the law overwhelms the spirit of the law, and today’s case is one of those times. Plaintiffs brought an action seeking enforcement of the Town of Rutland Code, which requires “the minimum setback distance of a communications tower from all property lines shall be equal to 100% of the height of the communications tower.” When defendant sought to build a 370-foot radio tower, Plaintiffs brought the current suit alleging the defendant’s property was insufficiently large to support it under the setback requirement. Seems straightforward, doesn’t it? Based on a simple factual determination, the defendant is either clearly in the wrong or clearly in the right. Unfortunately, the court never made that determination due to a procedural quirk.

Under Town Law §268(2), the town may “institute any appropriate action or proceedings” to prevent or restrain the violation of its zoning laws. It further provides that “upon the failure or refusal of the proper local officer, board or body of the town to institute any such appropriate action or proceeding for a period of ten days after written request by a resident taxpayer of the town so to proceed, any three taxpayers of the town residing in the district wherein such violation exists, who are jointly or severally aggrieved by such violation, may institute such appropriate action or proceeding...”  In the case of the plaintiffs, however, that written notice was never filed. Instead, plaintiffs orally made the request at the town meeting, wherein their words were recorded in the town minutes. The court ruled that this failed to satisfy the requirements and granted defendants summary judgment.

It’s an unfortunate turn for the plaintiffs, as the purpose of the written requirement was likely to give the Board notice and formalize the process, both of which were accomplished by making the request at the Board Meeting. It just goes to show the importance of checking the language of a statute carefully before proceeding, as you never know what unfortunate bit of fine print could ruin an otherwise valid action.

The case is Smith v. Stephens Media Group-Watertown, LLC, 125 A.D.3d 1370 (N. Y. App. Div. 2015)


NY Appellate Court Does Mitzvah and Allows Mikvah

Good news for the Jewish population of the Town of Mamakating, as the Appellate Division, Third Department greenlights construction of a new mikvah. Petitioners had purchased a property used as a day spa with the intent of converting it into a mikvah, a Jewish ritual bath and precursor to a synagogue in observant communities. The Town Building Inspector had approved the use as consistent with the Town Zoning Code definition of a “neighborhood place of worship,” but that determination was overturned by the Town’s Zoning Board of Appeals after it was challenged by respondents Michael Hassler and Beverly Martin. Petitioner then commenced an unsuccessful Article 78 proceeding to annul the ZBA’s decision, before appealing to the Appellate Division.

In deciding that a mikvah was consistent with the requirements of a “neighborhood place of worship”, the court looked to the ordinary meaning of “neighborhood place of worship.” What they found was a relatively broad definition that included any “building or location set aside for any form of religious devotion, ritual, or service showing reverence, especially for a divine being or supernatural power.” What it did not include was the ZBA’s requirement of “communal worship.” The court accordingly overturned the ZBA’s determination and greenlighted the petitioners proposed development plan.

The case was Winterton Properties, LLC v Town of Mamakating Zoning Board of Appeals, 2015 WL 6181319 (NYAD 3 Dept. 10/22/2015)


Winds of Change: Court Reverses on Special Use Permit for Wind Turbines

The construction of wind turbines is often a controversial topic, pitting those seeking cleaner sources of energy against property owners who consider the structures an eyesore. Today’s case is just such a situation, as appellant is challenging a decision by the Town of Richmond Planning Board approving of a special use permit for wind turbines. The Board’s decision, which had been reversed by the lower court, was based on eight conditions enumerated in the land use ordinance, each of which required detailed findings to be made. Only two of findings related to those conditions were being contested and were under the Court’s consideration: (1) ensuring that the size, location, and use of the turbines would not interrupt the orderly development of the district and (2) that the use would not impair property values.

Reviewing the Board’s decision, the Court took note of the impact the turbines would have on the aesthetics of the area as seen from the nearby properties, considering the turbines can be up to 500 feet tall based on the orientation of the blades. Yet as the Board pointed out in its defense, the area already has a large number of high-transmission lines which affect the view, and a study the Board commissioned showed there would be no adverse effects on the owner’s ability to use their properties based on the turbines’ construction. Thus the court held that given the substantial evidence justifying the Board’s decision to grant the special use permit, it would not substitute its judgment for that of the Board, thereby reversing the lower court and upholding the Board’s decision.

The case is Frigault v Town of Richmond Planning Board, 2015 WL 2401337 (NYAD 3 Dept. 2015). The full decision can be found here: http://law.justia.com/cases/new-york/appellate-division-third-department/2015/518840.html

 



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