Under Minnesota law, owner of destroyed nonconforming use must apply to rebuild within 180 days of destruction

by Victoria Heldt and Gary Taylor

Daniel S. Ortell v. City of Nowthen
(Minnesota Court of Appeals, April 2, 2012)

This case involves the rebuilding of a nonconforming structure in the City of Nowthen, Minnesota (City).  Under Minnesota Stat. §462.357 a nonconformity may continue

including through repair, replacement, restoration, maintenance, or improvement, but not including expansion, unless:
(2) any nonconforming use is destroyed . . . to the extent of greater than 50 percent of its estimated market value . . . and no building permit has been applied for within 180 days of when the property is damaged. In this case, a municipality may impose reasonable conditions upon a zoning or building permit in order to mitigate any newly created impact on adjacent property or water body.to exist until it is destroyed to the extent of greater than 50% of its value.  At that point, the owner must apply for a building permit within 180 days in order it rebuild.  If he does not apply for a permit, the nonconformity may not continue and “any subsequent use or occupancy must be a conforming one.

Daniel Ortell owned a home that was situated within the 150-foot setback from a county road and was therefore a nonconformity under the zoning code.  In September 2007 Ortell applied for and received a permit to replace his roof, siding, and windows.  In October 2007, a portion of the house was destroyed when roofers swung a boom into the frame and the house collapsed.  The county assessor concluded the house was destroyed by more than 50% of its value.  In November 2007 Ortell began to rebuild his house, but the city building inspector issued a stop-work order since this construction was outside the scope of the original building permit granted in September.  Ortell was provided with an application for a new building permit; however, he did not apply for a building permit at that time due to health problems.  Instead, in January 2010 Ortell applied for a variance to rebuild the house on the existing foundation.  The city council denied the request and the board of adjustment affirmed the denial.  Both parties moved for summary judgment in trial court.  The court concluded the city properly denied the request because Ortell did not demonstrate undue hardship.  However, the court also granted summary judgment to Ortell, stating that the City “improperly denied [respondent] the right to rebuild his destroyed property without a variance based on its determination that he had failed to apply for a permit within 180 days of the accident which destroyed his nonconforming home.”  On appeal, the issue facing the Court was whether the district court erred by concluding that, under Minn. Stat. §462.357, Ortell was entitled to rebuild his house despite not applying for a building permit within 180 days of destruction.

The appellate Court concluded that the statute is ambiguous.  It noted the competing interests between zoning laws (intended to control land use and development) and common law property rights.  Because of these competing interests, nonconformities are usually allowed to continue but not to expand.  The Court further noted that the legislative history of the statute in question shows a progression towards providing greater protection to property owners.  In 2004, the clause regarding a building permit was added under the condition that the permit be requested within 180 days of damage.  Previous to that amendment, no rebuilding was allowed if the nonconformity was damaged greater than 50% of its market value.  The Court further acknowledged that the statute clearly gives cities the right to regulate nonconformities.  It noted that the statute clearly gives a 180-day time limit in which to apply for a building permit.  If it didn’t, the first clause of the statute (which designates that a nonconformity ceases if it is discontinued for more than one year) would be rendered meaningless.  The district court reasoned that the sentence, “[i]n this case, a municipality may impose reasonable conditions . . .” would serve no purpose unless a property owner was permitted to restore a nonconformity.  The Court of Appeals, however, interpreted the phrase to attach to the action of a landowner applying for a building permit within 180 days.  “If a nonconforming property owner may apply at any time, without limit, for a building permit, the first clause of the subdivision, which states that a nonconformity ceases if it is discontinued for a period of more than one year, has no meaning.”  The Court of Appeals concluded that the statute shall be interpreted to permit a property owner to rebuild a nonconformity only if a permit is obtained within 180 days (and that a municipality may apply impose reasonable conditions on an approval of that permit).  The district court’s ruling was reversed.

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