Legal nonconforming use extinguished by evidence of no business income for 12 months

by Melanie Thwing

Wilderness Waters v. Oneida County Board of Adjustment
(Wisconsin Court of Appeals, February 15, 2011)

Until 2006 Roger Van Prooien owned and operated Sunset Resort on Bear Lake in Oneida County, WI. The resort has existed as a legal nonconforming use since the 1950s.  Business began to taper off around 2000, so much so that during 2006 the visitors log only showed eight reservations.  Furthermore, in 2006 no sales tax was collected, and the tax records show that there was no income earned.

Wilderness Waters purchased the resort in December 2006 and did an extensive clean up of the property.  After restoring the property Wilderness Waters applied to the Oneida County Planning and Zoning Committee to convert the resort into condominiums. The Bear Lake Protection and Rehabilitation District opposed the application under Oneida County Zoning and Shoreline Protection Ordinance Art. 10, § 9.99 (C)(2). This ordinance  says that any legal nonconforming use that has been discontinued for twelve straight months looses its legal nonconforming status.

Wilderness Waters failed to present any competent evidence to the Committee of continued operation in 2006, use and the application was denied. This decision was appealed to the Board and an evidentiary hearing was held. Wilderness Waters presented affidavits from individuals who supposedly stayed at the resort in 2006, along with the visitors log; however, a public accountant brought evidence that the tax records showed no business income, no operating expenses, and no deductions for wages, depreciation, or advertising that year. The Board found that the resort had not been in use during 2006 and there for lost its status as a legal preexisting use.

Wilderness Waters then appealed to the circuit court for certiorari review under Wis. Stat.  § 59.694(10). The circuit court affirmed the Board’s decision. Wilderness Waters then appeals to the Wisconsin Court of Appeals arguing that the Board failed to provide rationale for its decision.

In this case the Board is given the benefit of the doubt by the courts. The task of the Court of Appeals is to find whether there is substantial evidence to support the Board’s decision. In the hearing minutes the Board was clear that they were persuaded by lack of income on the tax filings.  Further, the lack of reportable income along with no state sales tax return suggested the income was either under-reported or a non-operating business. The lack of income suggests that no guests paid to stay at the resort. Also, the affidavits provided by Wilderness Waters mentioned no specific dates, and were all from members of the same family. The Court of Appeals affirmed the Board’s decision.

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