Posted by: Patricia Salkin | October 31, 2019

NY Appellate Court Finds No Taking and No Vested Rights in Challenge to Rezoning and Finds Rezoning Consistent with Comprehensive Plan

This post was authored by Beth Gazes ’20 Touro Law Center and it originally appeared in the Touro Law Center Land Use Institute Digest (September 2019)
The Second Department recently affirmed, in part, and reversed, in part, a decision by the New York State Supreme Court, Suffolk County, where at issue were, among other things, whether the rezoning of eighty acres of land intended for senior citizen housing prior to a re-zoning was: (1) arbitrary; (2) a regulatory taking; (3) in contravention of any vested rights of the property owner; and (4) illegal spot zoning. The Plaintiff land owner brought the action subsequent to a re-zoning of the property by the Town of Southold (the “Town”). As a result of the rezoning, the subject property was rezoned to R-80 Low Density from a partial Hamlet Density and Limited Business District. The restriction from partial Hamlet Density and partial Limited Business to a full R-80 Low Density restriction resulted in a significant reduction of permissible development as originally planned to just 17 single-family homes. As originally zoned, the subject property would have allowed approximately two (2) acres of commercial structures in addition to nearly 100 multi-family units.
Primarily, the Court upheld the lower court’s holdings that the owner neither established vested rights in the development nor suffered from a taking as a consequence of the re-zoning. As for the vested rights asserted by the Plaintiff, the Court affirmed that, since there was a lack of construction or other substantial expenditures made towards the development effort, the investment was not substantial enough as to render the improvements valueless. Thus, there were no vested rights upon which the Plaintiff may rely. As for the Plaintiff’s claim that the re-zoning resulted in a regulatory taking, the Court affirmed that the Plaintiffs’ loss did not result in a taking reasoning that the analysis turns not simply on a reduction of the property’s value, as purported by the Plaintiff. The Plaintiff could not prevail since it was not shown that the newly imposed regulations destroyed nearly all of the economic value of the property. The Court further reasoned that, since the new zoning restriction still permitted residential development, the Plaintiff did not show that the property is incapable of yielding any reasonable return under the newly permitted uses.
Reversing in further support of the Town, the Court held that the Town’s acts were not arbitrary and that the rezoning was consistent with the Town’s land use plan. By referencing the Town’s land use plan, the Court reasoned that the rezoning was not arbitrary nor was it inconsistent. According to the Court, the property’s situs among certain wetlands and parks was a re-affirmance that the Town’s rezoning was consistent with its effort to maintain the rural characteristic of the land as called for by the comprehensive land use study. As for the holding by the lower court that the Plaintiffs raised a triable issue of fact over the intent and motives of the Town, the Court reversed, citing Udell v. Haas, 21 N.Y.2d 463 (1968), which states that when re-zoning is effectuated in conformity to a community’s comprehensive plan, the motives of local officials are not placed in issue.
 Finally, as to whether the Town engaged in illegal spot zoning, the Court upheld the New York State Supreme Court decision that none had occurred, though reasoned not on the law controlling spot zoning, but instead on the standards of reverse spot zoning, which examines whether “[t]he plaintiffs’ property was not arbitrarily singled out for different, less favorable treatment than neighboring properties in a manner that was inconsistent with a well-considered land-use plan” (citing Nicholson v. Inc. Village of Garden City, 112 A.D.3d 893 (2 Dept. 2013).
Greenport Grp., LLC v. Town Bd. of Town of Southold, 167 A.D.3d 575 (2nd Dept 2018), lv. denied, No. 2019-348, 2019 WL 2623972 (N.Y. June 27, 2019)

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