Opinion
72550.
Decided April 25, 2008.
PETER SORGI, ESQ., New York 14221, For the Petitioners.
ANTHONY DiFILLIPPO, III, New York, For the Respondent.
DAVID SEEGER, ESQ., New York.
Petitioners purchased property in the Town of Yorkshire on August 20, 1996, intending to use the property for sand and gravel mining. At that time, the Town had no restrictions on mining. However, in October 1996, the Town enacted a moratorium on all mining activity. In September 1999, after a lengthy process, Glacial received a permit from DEC to mine sand and gravel on the property. In March 2000, the moratorium on mining was lifted and Glacial took some preliminary steps in the mining process. However, in June 2001, the Town adopted an ordinance banning all mining.
On March 22, 2005, Glacial submitted to the Town's code enforcement officer an application for a special use permit that would allow Glacial to operate a sand and gravel mine. Despite a Town Ordinance that required the code enforcement officer to forward the application to the Planning Board, the officer refused to do so. Glacial commenced an Article 78 proceeding to compel the code enforcement officer to comply with the Town's ordinance. The Town moved to dismiss and this court denied the motion ( Glacial Aggregates, LLC v. Zielonka, 7 Misc 3d 1019 [A], 801 NYS2d 234 [2005]). The Town's appeal was unsuccessful ( 34 AD3d 1299, 823 NYS2d 734 [4th Dept 2006]). The court understands that the application has now been forwarded to the Planning Board.
In March 2006, Glacial filed an application for a use variance pursuant to Town Law § 267-b (2). A public hearing was scheduled for June 7, 2006, but was converted to an informational meeting and the formal public hearing was held on January 31, 2007. In February, Glacial submitted an extensive set of materials to the Town relating to Glacial's expenditures and addressing concerns raised at the public hearing.
In April, the Zoning Board of Appeals (ZBA) denied the application for a use variance. The ZBA determined that Glacial could recover its investment by selling the property; that mining the property would substantially alter the neighborhood; and any hardship to Glacial was self-created. Petitioners then commenced the instant proceeding seeking to annul the ZBA's determination and compel the issuance of the permit. The ZBA argued that the issue was moot based on the results of another case involving the same parties. There are at least three pending actions relating to petitioners' efforts to mine their property. Petitioners have argued that they must "cover all their bases" because they believe they have been treated unfairly by the Town and its agents. In addition to the instant action, petitioners have continued with their application for a special use permit. Further, petitioners prevailed at a jury trial on a claim that they had acquired a "vested right" to mine the property and were awarded damages against the Town. It was this verdict the ZBA referred to in its mootness argument. Because the verdict is on appeal, the court rejected the mootness contention.
This court held that the ZBA's "findings" were deficient and remanded the case to the ZBA with a direction to make the required findings. The findings were filed with this court on December 15, 2007 and since then, the court has received memoranda from the parties.
Standard of Review
Town Law §§ 267-b (2) (a) and (b) authorize a zoning board of appeals to grant a use variance if the applicant for such a variance can demonstrate "unnecessary hardship". To meet that standard, the applicant must demonstrate that for any permitted use of the property:
(1) The applicant cannot realize a reasonable return . . . as
demonstrated by competent financial evidence;
(2) The alleged hardship . . . is unique . . .;
(3) The use variance, if granted, will not alter the essential character
of the neighborhood; and
(4) The alleged hardship was not self-created.
( Id.). The ZBA agreed that the hardship was unique to Petitioners but found against them on the other three issues.
A municipality has "wide discretion" when it considers an application for a use variance ( SoHo Alliance v. New York City Bd. of Standards and Appeals, 95 NY2d 437, 718 NYS2d 261; Fuhst v. Foley, 45 NY2d 441, 410 NYS2d 56). The Fourth Department has observed that where a ZBA determination "has a rational basis and is supported by substantial evidence, it is entitled to great deference and must be sustained" ( Welsh v. Town of Amherst Zoning Bd. of Appeals, 270 AD2d 844, 706 NYS2d 281 [4th Dept 2000]; see also May v. Town of Lafayette Zoning Bd. of Appeals, 48 AD3d 1427, 843 NYS2d 747 [4th Dept 2007]).
Conclusory findings of fact cannot support a ZBA determination; the ZBA must set forth how and in what manner granting the requested variance would be proper or improper ( Human Dev. Serv. of Port Chester, Inc. v. Zoning Bd. of Appeals of Vil. of Port Chester, 110 AD2d 135, 493 NYS2d 481 [2d Dept 1985], affd 67 NY2d 702, 499 NYS2d 927; Gabrielle Realty Corp. v. Bd. of Zoning Appeals of Vil. of Freeport , 24 AD3d 550 , 808 NYS2d 258 [2d Dept 2005]; Salierno v. Briggs, 141 AD2d 547, 529 NYS2d 155 [2d Dept 1988]; Margaritas v. Zoning Bd. of Appeals of Vil. of Flower Hill , 32 AD3d 855 , 821 NYS2d 611 [2d Dept 2006]). Further, it is not enough to simply restate the criteria in the statute ( see Leibring v. Planning Bd. of the Town of Newfane, 144 AD2d 903, 147 AD2d 984, 534 NYS2d 236 [4th Dept 1986]; Necker Pottick, Fox Run Woods Bldrs. Corp. v. Duncan, 251 AD2d 333, 673 NYS2d 740 [2d Dept 1998]. Finally, the ZBA's findings of fact must be supported by evidence in the record ( Kontagiannis v. Fritts, 131 AD2d 944, 516 NYS2df 536 [3d Dept 1987]; Witze v. Zoning Bd. of Appeals of Town of Berne, 256 AD2d 775, 681 NYS2d 634 [3d Dept 1998]).
The Second Department appears to have taken a somewhat different view in its more recent cases. In Halperin v. City of New Rochelle ( 24 AD2d 768, 769, 770, 809 NYS2d 98 [2d Dept 2005]), the court held that a "substantial evidence" question arises "only where a quasi-judicial evidentiary hearing has been held." The court noted that public hearings related to zoning issues are informational and not evidentiary or adversarial ( Id.). Therefore, those determinations are reviewed under the "arbitrary and capricious" standard rather than the "substantial evidence" standard ( Id.). Further, "the determination of a land use agency must be confirmed if it was rational and not arbitrary and capricious" ( Id. [internal quotations omitted]; accord Herman v. Inc. Vil. of Tivoli , 45 AD3d 767 , 846 NYS2d 316 [2d Dept 2007]; Rendely v. Town of Huntington, 44 AD2d864, 843 NYS2d 668 [2d Dept 2007]).
Thus, the Second Department specifically rejects the "substantial evidence" test in zoning cases while the Fourth Department includes it ("has a rational basis and is supported by substantial evidence") ( Welsh, 270 AD2d 844, 706 NYS2d 281 [4th Dept 20000]; May v. Town of Lafayette Zoning Bd. of Appeals , 43 AD3d 1427 , 843 NYS2d 747 [4th Dept 2007]; Lloyd v. Town of Greece Zoning Bd. of Appeals, 292 AD2d 818, 739 NYS2d 303 [4th Dept 2002]; but see Conway v. Town of Irondequoit Zoning Bd. of Appeals , 38 AD3d 1279 , 831 NYS2d 818 [4th Dept 2007] ["review limited to whether the determination was illegal, arbitrary or an abuse of discretion"]. This court, of course, is bound by Fourth Department decisions if the Departments differ.
Reasonable Return
A landowner seeking a use variance must demonstrate by dollars and cents proof his or her inability to realize a reasonable return on their investment if the property were put to one of the permissible uses under the zoning regulations ( Vil. Bd. of Vil. of Fayetteville v. Jarrold, 53 NY2d 254, 440 NYS2d 908; Welsh v. Town of Amherst Zoning Bd. of Appeals, 270 AD2d 844, 706 NYS2d 281 [4th Dept 2000]; Brewer v. Zoning Bd. of Appeals of Town of Canandaigua, 236 AD2d 875, 653 NYS2d 888 [4th Dept 1997]). In support of its application, petitioners submitted a detailed 30-plus page report from Edmunds Enterprises which concluded that any permissible use of the property would result in a negative return. No financial evidence was submitted in opposition to the Edmunds report.
Nonetheless, the ZBA concluded that the Edmunds report was "insufficient". The Board also found that petitioners failed to demonstrate the return they could realize if the property was put to a permitted use or a specially permitted use. Finally, the Board concluded that petitioners could recover their investment by selling the property.
However, the ZBA makes no attempt to support those conclusions factually or reference them to any supporting evidence in the record. The only evidence before the ZBA was that petitioners would lose money if the property was used as anything other than a mine. In Center Square Assn., Inc. v. City of Albany Zoning Bd. of Appeals ( 19 AD3d 968 , 798 NYS2d 756 [3d Dept 2005]), the court concluded that the board was reasonable in crediting the applicants' financial information over the information from people opposed to the application ( see also Sullivan v. City of Albany Zoning Bd. of Appeals , 20 AD3d 665 , 798 NYS2d 200 [3d Dept 2005]). Here, however, the ZBA simply disagreed with petitioners' financial analysis without any opposing evidence.
The ZBA determination lacks a rational basis and is not supported by any evidence, much less substantial evidence ( see Citizens Sav. Bank v. Bd. of Zoning Appeals of Vil. of Lansing, 224 AD2d 797, 638 NYS2d 179 [3d Dept 1996] [uncontested reports demonstrated that petitioners would lose money if variance not granted]; Park Hill Residents' Assn., Inc. v. Cianciulli, 234 AD2d 464, 651 NYS2d 159 [2d Dept 1996] [record devoid of dollars and cents evidence resulted in no rational basis for zoning board's finding]; Catholic Charities of Diocese of Ogdensburg v. Zoning Bd. of Appeals of City of Watertown, 175 AD2d 617, 572 NYS2d 553 [4th Dept 1991]; Commco, Inc. v. Amelkin, 109 AD2d 794, 486 NYS2d 305 [2d Dept 1985]).
Self-Created Hardship
When a buyer purchases property that is already subject to zoning requirements, and then applies for a use variance to circumvent the restrictions, any hardship from the zoning is considered to be self-created ( see Miller Family Ltd. Partnership v. Trotta , 23 AD3d 389 , 806 NYS2d 74 [2d Dept 2005]; Friends of Lake Mahopac v. Zoning Bd. of Appeals of Town of Carmel , 15 AD3d 401 , 790 NYS2d 470 [2d Dept 2005]; Diana v. City of Amsterdam Zoning Bd. of Appeals, 243 AD2d 939, 664 NYS2d 634 [3d Dept 1997]; Aiello v. Saladino, 132 AD2d 1002, 518 NYS2d 287 [4th Dept 1987]; Mt. Lyell Enter., Inc. v. DeRooy, 159 AD2d 1015, 552 NYS2d 728 [4th Dept 1990]). However, when a buyer acquires the property prior to the enactment of the zoning restrictions, the hardship is not self-created ( see Sullivan v. City of Albany Zoning Bd. of Appeals , 20 AD3d 665 , 798 NYS2d 200 [3d Dept 2005]; Citizens Savings Bank v. Bd. of Zoning Appeals of Vil. of Lansing, 238 AD2d 874, 657 NYS2d 108 [3d Dept 1997]; Family of Woodstock, Inc. v. Auerbach, 225 AD2d 854, 638 NYS2d 825 [3d Dept 1996]; Lim-Kim v. Zoning Bd. of Appeals of Vil. of Irvington, 185 AD2d 346, 586 NYS2d 633 [2d Dept 1992]; Zamiara v. Cutri, 132 AD2d 993, 518 NYS2d 255 [4th Dept 1987]).
Petitioners purchased this property on August 20, 1996 for over $500,000. The Town did not enact its moratorium on mining until two months after petitioners acquired the property. Thus, the hardship was not self-created; Glacial did not buy the property at a time when there was a restriction on mining.
The Town also contends that petitioners could have begun mining during the period between March 13, 2000 and June 25, 2001, when the moratorium on mining was lifted and because they did not, their inaction caused the hardship to be self-created. Petitioners claim that they took steps during this period in furtherance of their project and that respondent's argument ignores the realities of mining and the time involved in beginning a project like the one at issue. They also contend that they removed 40 truckloads of material during this time. Further, petitioners argue that a jury has already decided this issue.
The court agrees with petitioners and finds at least two flaws with respondent's contention: (1) it ignores the fact that a jury ruled against the Town on this issue at a trial; and (2) it ignores years of expenditures by petitioners and focuses only on the narrow window of time when the moratorium was lifted. At the 2007 trial, a jury found that Glacial had "vested rights" to mine on their property and awarded damages against the Town. Part of that verdict was a finding that petitioners had commenced mining on the property between March 13, 2000 and June 25, 2001.
Res judicata, or claim preclusion, bars future actions between the same parties on the same cause of action ( Parker v. Blauvelt Vol. Fire Co., 93 NY2d 343, 690 NYS2d 478; Zayatz v. Collins , 48 AD3d 1287 , 851 NYS2d 797 [4th Dept 2008]). More applicable here is the doctrine of collateral estoppel, which precludes a party from relitigating an issue which has already been decided against the party ( Matter of Juan C. v. Cortines, 89 NY2d 659, 657 NYS2d 581; Kaufman v. Eli Lilly Co., 65 NY2d 449, 492 NYS2d 584).
The doctrines of res judicata and collateral estoppel can also give preclusive effect to the quasi-judicial determinations of administrative agencies ( Ryan v. New York Tel. Co., 62 NY2d 494, 478 NYS2d 823; Yoonessi v. State, 289 AD2d 998, 735 NYS2d 900 [4th Dept 2001]). In Ryan, collateral estoppel precluded the petitioner from commencing an action after an administrative determination had been made following a full hearing. This principle has also been applied to municipal zoning boards ( Town of Walkill vs. Lachman, 27 AD3d 724, 813 NYS2d 157 [2d Dept 2006]; Sam v. Metro-North Commuter R.R., 287 AD2d 378, 731 NYS2d 459 [1st Dept 2001]; Palm Mgt. Corp. v. Goldstein , 29 AD3d 801 , 815 NYS2d 670 [2d Dept 2006]; Korbel v. Zoning Bd. of Appeals of Town of Houcin , 28 AD3d 888 , 814 NYS2d 301 [3d Dept 2006]) or anyone in privity with them ( Buechel v. Bain, 97 NY2d 295, 740 NYS2d 252; Benedictine Hosp. v. Glessing, 47 AD3d 1884, 850 NYS2d 291 [3d Dept 2008]; A to Z Assoc. v. Cooper, 215 AD2d 161, 626 NYS2d 143 [1st Dept 1995]; Kempf v. Town of Esopus, 92 AD2d 1076, 461 NYS2d 915 [3d Dept 1983]).
Here, the issue of whether Glacial had engaged in mining on the property during the period when the Town had no ordinance banning mining was presented to a jury and decided against the Town. Since the Town and the ZBA are in privity, and the Town had a full and fair opportunity to contest the finding, the court believes the jury finding is binding on the ZBA ( see D'Arata v. New York Cent. Mut. Fire Ins. Co., 76 NY2d 659, 563 NYS2d 24; Palm Mgmt. Corp. v. Goldstein , 29 AD3d 801 , 815 NYS2d 670 [2d Dept 2006]; Timm v. Van Buskirk , 17 AD3d 686 , 793 NYS2d 520 [2d Dept 2005]; Korbel v. Zoning Bd. of Appeals of Town of Houcin, 28 AD3d 888, 814 NYS2d 301 [3d Dept 2006]; Jensen v. Zoning Bd. of Appeals of Vil. of Old Westbury, 130 AD2d 549, 515 NYS2d 283 [2d Dept 1987]).
These cases all dealt with determinations by an administrative agency that were deemed res judicata or collateral estoppel in a later trial. Here, the situation is reversed; a jury returned a verdict and the ZBA finding came later. The argument for collateral estoppel appears stronger in this case: a jury decided the issue after a trial and the ZBA later made a contrary finding.
Were the court to reach the merit of whether petitioners' hardship was self-created, I would find that it was not. Glacial purchased the property before the Town had enacted any restrictions on mining. Glacial continued its application for a DEC mining permit, which it received three years after it had purchased the property and after having spent many more thousands of dollars. During the period the moratorium on mining was lifted, Glacial continued to develop and prepare the property and trucked out 40 truckloads of material for testing. Thus, the court finds no support in the record for the ZBA's finding that the hardship to petitioners was self-created.
Character of the Neighborhood
The ZBA determined that the proposed mine would "alter the essential character of the neighborhood by increasing noise, site specific traffic, aesthetics of our countryside, increasing runoff and disturbing the water table and groundwater." The ZBA further noted that area residents expressed concerns about truck traffic, noise, vibration, destruction of forested land, destruction of wildlife habitat and the destruction of the [residents'] ability to enjoy their homes and land. The ZBA also referenced that Yorkshire was primarily a farming community and that petitioners had admitted that area wells would be affected by the mine. A number of area residents also spoke against the project.
Petitioners adamantly deny that wells would be affected or that they made any such admission. They also note that none of the 77 findings made by the ZBA references a single document in the administrative record. Petitioners also contend that many of the findings on this point are simply false: for example, no runoff would occur; the evidence showed that all mining activity would occur at least 2,000 feet from any existing dwellings; only 125 of petitioners' 330 acres would be impacted by the project; no mining activity would be visible from any existing residence; all mine-related traffic would utilize a haul road that connects the mine to Route 16; Route 16 could easily handle the peak volume of 22 trucks per hour; this traffic would largely replace other traffic coming from the gravel mines south of the Town; and the DEC's own environmental impact statement concluded that the mine would have no significant impact on the area.
Certainly, some of the ZBA's findings are suspect and lack support in the record. Further, it has long been held that a zoning board cannot base a decision on general community opposition to the project ( Ifrah v. Utschig, 98 NY2d 304, 746 NYS2d 667; Matter of Twin County Recycling Corp. v. Yevoli, 90 NY2d 1000, 665 NYS2d 627; Halperin v. City of New Rochelle, 24 AD3d 746, 809 NYS2d 98 [2d Dept 2005]). Therefore, the question is whether, after dismissing community opposition and any unsupported findings, there is enough evidence in the record to support the ZBA's finding on this issue.
"Substantial evidence" does not appear to be a particularly high standard. The Court of Appeals holds that, in reviewing zoning determinations, "courts consider substantial evidence' only to determine whether the record contains sufficient evidence to support the rationality of the Board's determination" ( Sasso v. Osgood, 86 NY2d 374, 384 fn 2, 6343 NYS2d 259 [1995]; accord 550 Halstead Corp. v. Zoning Bd. of Appeals , 1 NY3d 561 , 772 NYS2d 249; PMS Assets, Ltd. v. Zoning Bd. of Appeals of Vil. of Pleasantville, 98 NY2d 683, 746 NYS2d 440).
In Sundial Asphalt Co., Inc. v. Dark ( 294 AD2d 585, 742 NYS2d 891 [2d Dept 2002]), the court (applying the substantial evidence test) found that a use variance to operate a concrete crusher was properly denied, in part because it would adversely impact the surrounding neighborhood. In Elwood Prop., Inc. v. Bohrer ( 216 AD2d 562, 628 NYS2d 799 [2d Dept 1995]), a nursing home would have adversely impacted a residential area. In Mazurkiewicz v. Levine ( 159 AD2d 892, 553 NYS2d 227 [3d Dept 1990]), the denial of a use variance to a delicatessen owner, that would have permitted an off-premises eating area, was deemed proper because it would have increased traffic and parking and would detract from the neighbhood's residential character. In Greenbaum v. Bd. of Estimate of City of New York ( 148 AD2d 92, 544 NYS2d 4 [1st Dept 1989]), an airline warehouse would have substantially altered the residential area in which it was proposed to be located. In Collins v. Carusone ( 126 AD2d 847, 510 NYS2d 917 [3d Dept 1987]), a use variance was properly denied, in part because the proposed cleaning facility would alter the essential character of the neighborhood.
On the other side of this issue are cases finding that the variance would not alter the character of the neighborhood. In Sunrise Plaza Assoc., L.P. v. Town Bd. of Town of Babylon ( 250 AD2d 690, 673 NYS2d 165 [2d Dept 1998]), the addition of some parking spaces did not alter the character of the neighborhood. In Citizens Sav. Bank v. Bd. of Zoning Appeals of Vil. of Lansing ( 224 AD2d 797, 638 NYS2d 179 [3d Dept 1996]), the use of an office for a computer consulting firm rather than a restaurant would not alter the neighborhood.In LaDirot Assoc. v. Smith ( 169 AD2d 896, 564 NYS2d 620 [3d Dept 1992]), a kennel that could barely be seen from the road did not alter the character of the neighborhood ( see also Rothenberg v. Bd. of Zoning Appeals of Town of Smithtown, 232 AD2d 568, 648 NYS2d 679 [2d Dept 1996]; Welsh v. Town of Amherst Zoning Bd. of Appeals, 270 AD2d 844, 706 NYS2d 281 [4th Dept 2000]; Sheeley v. Levine, 147 AD2d 871, 538 NYS2d 93 [3d Dept 1989]; Kontogiannis v. Fritts, 131 AD2d 944, 516 NYS2d 537 [3d Dept 1987]).
It appears to the court that variances that are relatively minor are much more likely to have little effect on the character of the neighborhood. Here, we are talking about a three hundred plus acre site, of which at least 125 acres will be used for mining, large pieces of equipment that must be used to mine gravel, a peak of 22 trucks per hour traveling to or from this site, and all the attendant noise and congestion that goes along with such a facility. These facts go well beyond the facts in the cited cases and this court is unable to conclude that the Town was wrong in finding that petitioners had not demonstrated that the gravel mine would not alter the general character of the neighborhood.
Conclusion
In order to be entitled to a use variance, the applicant must meet the four criteria set forth in Town Law § 267-b (2) (b). The failure to meet any one of the requirements allows a ZBA to deny the application for a special use permit ( Carrier v. Town of Palmyra Zoning Bd. of Appeals , 30 AD3d 1036 , 816 NYS2d 647 [4th Dept 2006], lv denied 8 NY2d 807, 834 NYS2d 88; Stamm v. Bd. of Zoning Appeals of Town of Greece, 283 AD2d 995, 723 NYS2d 737 [4th Dept 2001]; Kontgiannis v. Fritts, 131 AD2d 944, 516 NYS2d 536 [3d Dept 1987]; Collins v. Carusone, 126 AD2d 847, 510 NYS2d 917 [3d Dept 1987]). While the court believes that petitioners met three of the four requirements, that is not enough. Accordingly, pursuant to CPLR 7806, judgment should be entered dismissing the petition on the merits. Dated: Little Valley, New York