Issuance of conditional use permit for nonconforming use does not usurp landowner’s nonconforming use rights

by Rachel Greifenkamp

Lorraine White, Trustee v. City of Elk River

(Minnesota Supreme Court, December 4, 2013)

Wapiti Park campground in the City of Elk River, Minnesota began operating in 1973, seven years prior to the City enacting a zoning ordinance that, at first, did not permit campgrounds in that location, then permitted them as conditional uses, then even later again removed campgrounds as either conditional or permitted uses. Wapiti Park applied for and was granted a conditional use permit in 1984 (during the period of time when they were allowed as conditional uses) even though it could have continued operating as a nonconforming use.  When Wapiti Park later violated the conditions of the conditional use permit the city revoked the permit and asserted that Wapiti Park was no longer authorized to operate the campground.  Wapiti Park sued the city.  The district court found in favor of Wapiti Park but the Court of Appeals reversed.  Wapiti Park appealed to the Minnesota Supreme Court.

One question addressed in this case is whether a landowner of a nonconforming use who voluntarily complies with a later-enacted zoning ordinance relinquishes the nonconforming-use status and the right to operate under that status in the future. This issue has been answered in opposite ways in other jurisdictions. The Minnesota Supreme Court concluded that a landowner does not surrender the right to continue a nonconforming use by obtaining a conditional use permit unless the landowner affirmatively waives the right to be treated as a nonconforming use.  Waiving a right in Minnesota requires knowledge of the right and an intent to waive the right. In this case, the City of Elk River had the burden of proving that Wapiti Park had both knowledge of their right to remain a nonconforming use and intended to waive the right when they applied for the conditional use permit.  Although Wapiti Park knew of its nonconforming use rights as a campground in 1984 when it applied for a conditional use permit, the city produced nothing for the record to indicate that Wapiti Park intended to waive or subordinate its rights to the city’s zoning regime.   The court concluded that the conditional use permit did not alter the Park’s status as a nonconforming use.

The second issue addressed was whether the city had authority to terminate the nonconforming use by revoking the conditional use permit. Minn. Stat. secs. 465.01 and 462.57 describe four circumstances under which a nonconforming use may be terminated.  They include eminent domain, discontinuance of the nonconforming use, destruction of the nonconforming use, and judicial determination that the use is a nuisance.  The Minnesota Supreme Court ruled that Wapiti Park may continue to operate the campground as a nonconforming use because these statutes do not include the revocation of a previously issued conditional use permit as a condition of termination, and none of the identified four circumstances applied to Wapiti Park.  Interestingly, the court identified a nonconforming use as “a constitutionally protected property right,” citing a Connecticut court case and not the Minnesota constitution in support of that proposition.

Abandonment of nonconforming use need not be established, but abandonment is evidence of discontinued use

by Gary Taylor

Moyer v. City of Des Moines Zoning Board of Adjustment
(Iowa Court of Appeals, May 29, 2013)

Don Moyer owns Hawkeye Motors, Inc. By 1997, Hawkeye Motors held title to multiple parcels of property on the corner of East 14th Street and Washington Avenue in Des Moines, including the lot located at 1433 East 14th Street (Lot 1433). Lot 1433 spans 20,500 square feet over two parcels and contains a 1652 square foot building originally built for auto repair.  From the time Hawkeye Motors purchased the property until 2006, the company either sold vehicles from Lot 1433 or leased the property to other tenants to sell or repair used cars. The lot was originally zoned as C-2, 2, which allowed used vehicle display. The city later rezoned Lot 1433 as C-1, a “neighborhood retail commercial district” that prohibits used vehicle display. On August 23, 2001, the city granted the property a legal nonconforming status for used auto sales and issued a certificate of occupancy to Hawkeye Motors to utilize the property as a “used automobile sales lot.”

Moyer held a used car dealer’s license issued to Hawkeye by the Iowa Department of Transportation that included Lot 1433, but allowed the license on the lot to lapse in 2004. In January 2006, Moyer leased Lot 1433 to Diaz Tinting, Inc. The city issued Leonardo Diaz a certificate of zoning compliance, which on January 10, 2006, authorized “building reuse from used cars to detailing and tinting.” The certificate provides: “No change of use may be made at this location unless a new Certificate of Occupancy is granted for such use and no change in this building or land may be made without first consulting the Zoning Enforcement Office.” In March 2007, Hawkeye Motors sold Lot 1433 on contract to Don and Gloria Moyer (his wife) personally, and issued the deed to the couple in 2011. During a property inspection by the city in January 2009, the enforcement officer discovered cars were being sold and repaired on Lot 1433. The city notified the Moyers six days later, and again in May 2009, that this parcel lost its legal nonconforming use status and consequently the auto sales and repair activities were unauthorized. The Moyers did not appeal either determination.  An April 24, 2010 inspection of Lot 1433 found continued illegal auto repair, and the city again notified the Moyers of “illegal business operations….”  When the Diaz Tinting lease ended one year later Moyer asked the city for a letter to the DOT stating that Lot 1433 was properly zoned for displaying and selling used cars. The city denied Moyer’s request. Moyer appealed the city’s denial, but the zoning board of adjustment upheld the city’s refusal.  Moyer appealed.

The Iowa Court of Appeals made the following statements regarding nonconforming uses on its way to upholding the decision of the zoning board of adjustment:

  • Sometimes intent to abandon may be inferred from a failure to apply for a license to carry on the nonconforming use.  [The same may be inferred] from amending the licensed use of the property.
  • Because [the Des Moines Ordinance] sets a time frame for determining when discontinuation of a property’s former use triggers the loss of its nonconforming designation, the city need not prove the owner’s intent to abandon. But intent to abandon presupposes discontinued use. Therefore, while proof of intent is not necessary to establish abandonment, an inference of the owner’s intent to abandon is relevant to nonuse.

The court concluded that because Moyer was without a dealer’s license to sell vehicles on the property, and his tenants had a certificate permitting the property’s repurpose to detailing and tinting, the board of adjustment could properly infer discontinued use as a used car display lot for at least six months [required under the ordinance] between 2006 and 2009.  Moyer attempted to distinguish between his 2001 “Certificate of Occupancy” and Diaz’s 2006 “Certificate of Zoning Compliance,” arguing that the latter could not revoke the former, and therefore could not be used as evidence of abandonment; however, the Des Moines zoning officer explained that the purpose of the Certificate of Zoning Compliance is “to document the change in use mostly for office use.” Both forms read substantially the same, including the requirement that “this certificate must be posted in a conspicuous place on the premises.” The court found that the board was entitled to rely on the 2006 certificate as circumstantial evidence the property no longer served as a used car lot.

BZA cannot condition permit on removal of nonconforming billboards when all criteria for granting permit are met

by Gary Taylor

Curry Investment Co., et al. v. Kansas City Board of Zoning Adjustment
(Missouri Court of Appeals, Western District, May 7, 2013)

On May 20, 2011, MLB Holdings filed an application with the Kansas City Board of Zoning Adjustment (BZA) requesting a special use permit to operate a pawn shop in Kansas City, Missouri. The landowner, Curry Investment Company, agreed to lease its building and parking lot to MLB.  The property where the building and parking lot are located contains two nonconforming outdoor advertising signs, which Curry Investment leases to CBS Outdoor. The BZA held a hearing on July 12, 2011, concerning MLB’s application. The BZA staff submitted a report at the hearing that cited the requisite special use permit criteria, and concluded that “all of these criteria are met with the proposed application.” The report also stated:

In recent years staff has had a general policy that as property is redeveloped,3 any existing billboards that are on the site are removed within five years of the approval of the development. The City Plan Commission has affirmed that position several times, specifically in the last several months . . . . Staff believes as part of the approval process for a pawn shop that this development be held to the same standard as other developments within other areas of the City.

Curry Investment opposed any condition that required removal of the signs. Ultimately, the BZA approved the special use permit subject to  conditions, including removal of the outdoor advertising signs. Curry Investment and MLB requested a rehearing. The BZA held a hearing on the request for rehearing, and the BZA thereafter denied a rehearing.

Curry appealed the BZA decision to circuit court, which found that the BZA’s decision to require removal of the two outdoor advertising signs for special use permit approval for the pawnshop was not supported by substantial and competent evidence, was unrelated to any impact generated by the pawnshop use at the property, and exceeded the BZA’s authority. The BZA then filed a notice of appeal to the Missouri court of appeals.

The BZA contended that its authority to require removal of nonconforming signs as a condition for a special use permit comes from its mandate to determine if a proposed special use complies with the standards of the Code, whether it is in the interest of the public convenience and will not have a significant adverse impact on the general welfare of the neighborhood or community, and whether it is compatible with the character of the surrounding area in terms of building scale and project design. The Court of Appeals disagreed.  The record reflected that the BZA staff examined all of the special use criteria set forth in the zoning code and concluded that “all of these criteria are met with the proposed application.” Therefore, the staff found the proposed pawn shop, in its proposed location: 1) to be in compliance with the standards of the Code, 2) to be in the interest of public convenience and to not have a significant adverse impact on the general welfare of the neighborhood or community, 3) to be compatible with the character of the surrounding area in terms of site planning and building scale and project design, 4) to be compatible with the character of the surrounding area in terms of operating characteristics, such as hours of operation, outdoor lighting, noise, and traffic generation, and 5) to not have a significant adverse impact on pedestrian safety or comfort. “While the BZA now contends otherwise on appeal, nothing in the record suggests that removal of the nonconforming outdoor advertising signs was related to any of the special use criteria set forth in the Code. To the contrary, the BZA staff stated that all of the special use criteria were met, but that sign removal was recommended based on a ‘general’ staff policy that as property is redeveloped, the removal of existing billboards is required….Once it was determined that the criteria for the special use permit were met, it was unreasonable to require removal of the nonconforming signs as a special use permit condition. While the BZA may want to foster a general policy that, as property is redeveloped, any existing billboards on a site are removed, where the BZA has proven no relation to sign removal with the special use criteria set forth in the zoning code, this policy is in contradiction to [the protection of] nonconforming signs.”

Council’s decision not to allow locking covers in lieu of fences around pools had rational basis

by Kaitlin Heinen and Gary Taylor

Gregory Frandsen, et al. v. City of North Oaks
(Minnesota Court of Appeals, February 19, 2013)

The City of North Oaks enacted an ordinance (§§ 150.055-.062) in 1989 that requires permits to build swimming pools and that swimming pools be enclosed by safety fences. Michael Johnson, James Rechtiene, and Gregory Frandsen (the appellants) own swimming pools not enclosed by fences, despite their permits being contingent upon compliance with the fencing requirement.  Instead all three have automatic locking pool covers. In April 2010, the City notified the appellants that they were in violation of the fencing requirement. The appellants asked the City to consider amending the ordinance so that it would allow automatic locking covers to serve as an alternative. The City agreed to suspend enforcement and research the alternative.

After forming subcommittees to research several alternatives, reviewing information from insurance companies, and hearing from citizens at public hearings the planning commission agreed to recommend to the city council that fences be required to enclose all pools built after 1989, that the back of a home could be used as one side of the enclosure, and that locking covers not be allowed as a substitute for the fencing requirement. At a December 2010 meeting, the city council voted in favor of the planning commission’s recommendation. The amended ordinance became effective in July 2011. So in April 2011, the City notified the appellants that they had until July 1 to comply with the amended ordinance. Appellants responded by bringing this suit against the City, alleging that the amended ordinance violates their equal protection rights and that the amended ordinance is arbitrary and capricious. The district court denied their appeal, so the appellants appealed to the Minnesota Court of Appeals.

The Minnesota Court of Appeals’ duty is to determine “whether the district court properly applied the law and whether there are genuine issues of material fact that preclude summary judgment.” The district court referred to the ordinance as one that “promote[s] the health, safety and general welfare of [the city’s] residents.” The Minnesota Court of Appeals agreed that the ordinance is a general safety ordinance.

By exempting pre-1989 pools from the ordinance, the appellants argued that their equal protection rights were violated. They argued that there is no rational reason for this exclusion when the purpose of the ordinance is to keep children from harm: “[W]hatever danger to children exists with respect to pools built after the effective date of the ordinance also exists with respect to pools built before the effective date of the ordinance.” Since the City’s pool safety-fence ordinance became effective in May 1989, building permits of pools prior to May 1989 were not conditioned to comply with this ordinance. But the appellants’ building permits were conditioned to comply with this ordinance because their pools were built after 1989. Therefore the appellants are not similarly situated to homeowners who built pools prior to 1989. In addition, “the practice of grandfathering non-conforming properties has been upheld in the face of equal-protection challenges since at least 1914.” The appellants failed to explain why grand-fathering is rational with respect to zoning ordinances, but irrational with respect to a general welfare ordinance, so the Minnesota Court of Appeals ruled that it was not a violation of equal protection for the City to treat its residents differently with respect to the law effective when their pools were built.

The appellants also argued, without explanation, that the amended ordinance was arbitrary and capricious because it allowed a wall of a building to serve as one side of the enclosure, which they argued increased the risk of harm to children. The appellants cited a unidentified report from “US Public Safety Commission” that supported the conclusion that a house should never be considered part of the fence. But the court could not verify the existence of a “US Public Safety Commission.” To the contrary, the U.S. Consumer Product Safety Commission report considered by the planning commission stated that “when a door opens directly onto the pool area, ‘the wall of the house is an important part of the pool barrier.'” Amending an ordinance is a legislative power in which the municipality has discretion as long as there is a rational basis for its decision. The court held that the City’s decision is rational because it is directly related to promoting prevention of trespassing children gaining access to pools. The City’s decision is not arbitrary as long as one valid reason exists.

Finally, the appellants contested the City’s decision to not allow pool covers as an alternative to the fence requirement. They pointed to evidence that showed that a pool cover is a safe and viable alternative to a fence. This evidence does not mandate that the City to allow pool covers as an alternative, however. The City researched the issue for more than six months and considered numerous resources before reaching a decision. The City expressed concern for pool covers’ susceptibility to mechanical failures, human errors, and enforcement issues. The decision to require fences and not allow locking covers as substitutes is a rational decision.

The Minnesota Court of Appeals affirmed the district court’s decision to deny the appellants’ claims.

The never-ending saga of Okoboji Barz (non-conforming use)

by Gary Taylor

City of Okoboji v. Leo Parks and Okoboji Barz, Inc.
(Iowa Supreme Court, April 26, 2013)

If you have attended one of my workshops you know that this ongoing dispute is one of my favorite discussion topics.  This is another case in the the efforts of the City of Okoboji to enforce zoning restrictions on properties owned by Okoboji Barz (Okoboji Boat Works, The Fish House Lounge, and Clucker’s Broasted Chicken), all located on the shore of West Lake Okoboji. The lakefront property is zoned residential, but has been historically operated as a marina pursuant to special-use permits allowing the preexisting nonconforming uses. In a series of previous cases (City of Okoboji v. Okoboji Barz, Inc., 717 N.W.2d 310, 315–16 (Iowa 2006);  City of Okoboji v. Iowa District Court, 744 N.W.2d 327, 332 (Iowa 2008)) the Iowa Supreme Court has held that while the use of the property as a marina is lawful under the special-use permits, the permits do not allow an expansion of the use to include on-premises consumption of alcohol with live entertainment, karaoke, hog roasts, and full-moon parties.

“Undeterred” (in the words of the Supreme Court), “the owner of the property sought to operate a bar on a structure called the Fish House Lounge, which, while generally moored to the marina’s ‘seawall,’ is capable of getting underway on the lake.” The Fish House Lounge has a class “D” liquor license obtained from the state, and not the City, based upon the state’s control of the lake bed. The City objected to the operation of the Fish House Lounge as contrary to the holdings of the Supreme in the previously-cited cases and sought declaratory and injunctive relief. The district court found that the Fish House Lounge cannot cruise the lake during winter months, has no regular cruise schedule, and is rarely seen cruising the lake. Patrons are asked to use the restroom facilities on the marina property. It offers live and recorded entertainment, hosts theme parties, karaoke, and other activities as late as midnight.  The district court concluded that the activities at the Fish House Lounge were the very activities prohibited by the Supreme Court in the previous cases, and entered an injunction prohibiting use of the marina property to “provide parking, access to or from, and supporting services, including bathroom facilities, to patrons of a boat, vessel, or structure on which alcohol is served or upon which entertainment, music, karaoke, abandon-ship parties, or howl-at-the-moon parties are provided.’ The injunction further prohibited the selling or serving of alcohol, wine, and beer on any boat or structure moored to or attached to the marina and on or from any boat or structure attached to a dock extending from the premises.  The property owner appealed.

The broad question before the Supreme Court was “whether our prior rulings can be avoided by moving the locus of prohibited activity onto a floating pontoon structure that is located above the state-owned lake bed and outside the geographic boundaries of the City, but which utilizes the upland marina property for ingress, egress, parking, and restroom facilities.” The property owner argued several points.  First, that the City cannot exercise its zoning authority over the Fish House Lounge because the Lounge is floating over the lake bed when it is moored to the marina’s seawall, and that this could only lead to one of two results: (1) The state owns the lake bed in its sovereign capacity, and under various statutes other state agencies – and not the City – are responsible for lake bed activities, or (2) the boundary line of the City is the mean high water mark of the lake, which the Fish House Lounge sits below when moored to the marina. Second, that the Fish House Lounge activities were merely accessory to the permitted use of operating a marina.

The Supreme Court dispensed with all of these arguments.  Contrary to the owner’s arguments, the City did not claim the authority to zone over the lake bed; rather, it was asserting jurisdiction only over the upland real property, and the use of the real property for ingress and egress to the Fish House Lounge, to provide parking for patrons of the Fish House Lounge, and to provide restroom facilities for patrons of the Fish House Lounge is inconsistent with the preexisting nonconforming use of the property for marina operations.  In the 2006 case the Court held that activities similar to those conducted at the Fish House Lounge could not be considered “merely an accessory use to the operation of the marina.”

Prior to 1972 [when zoning was enacted], the property was used for operating marinas. The marinas were open between 8:00 a.m. and 5:00 p.m., with the gas dock occasionally staffed until 8:00 p.m. As the district court noted, there was no evidence that, prior to 1972 when the City enacted its zoning ordinance, the property was used to provide nearly permanent mooring for a liquor establishment, to provide restroom facilities for patrons of such an establishment, or to provide parking for such use. Since 2008, however, the marina property has been providing access to a floating bar that stays open at night…. While it is true that the main platform upon which liquor is sold and loud activities occur is above the lake bed, it is obvious the activities of the Fish House Lounge are inextricably intertwined with the use of the real property subject to the City’s zoning restrictions. The use of the property for ingress and egress, for restroom facilities, and for parking to a floating bar moored at the marina are not accessory uses to the valid, nonconforming use of the marina. These uses of the upland real estate are also in violation of section 2(B)(2) of article VII of the City’s zoning ordinance, which prohibits such lakeshore lots from being used for access to commercial activities.

The Supreme Court agreed that an injunction was appropriate to prevent the use of the marina to support the activities of the Fish House Lounge.  Providing access, parking, and restroom facilities has had an adverse impact on the residential character of the waterfront.  The Supreme Court refused to enjoin the the provision of or sale of liquor on boats when moored at the docks (versus those moored directly to the shoreline); noting, however, that “this distinction makes little difference as the City has shown entitlement to an injunction that prohibits using the upland to provide ingress, egress, parking, or restroom facilities to patrons of boats or similar vessels selling alcohol or engaging in bar-type activities while docked at the marina.”

 

 

 

Non-conforming use lawful only so long as it complies with original permit conditions

by Kaitlin Heinen

Lorraine M. White Trust, et al. v. City of Elk River
(Minnesota Court of Appeals, October 28, 2012)

The Lorraine M. White Trust owns the Wapiti Park Campgrounds, which is operated on 52 acres in the City of Elk River. In 1973 when the park opened, no zoning ordinance governed the use of the land. In 1983, the City made campgrounds a conditionally permitted use in the zoning district where Wapiti Park was located. In 1984, the City granted Wapiti Park a conditional use permit with 9 conditions. The City removed campgrounds as a conditionally permitted use in Wapiti Park’s zoning district in 1988, so Wapiti Park became a legal, nonconforming use instead. The one building on Wapiti Park property contained an office, laundry facilities, a restaurant, shower facilities, and served as a gathering place for campers. It was destroyed by a fire in 1999. Before attempting to rebuild it in 2000, the City required Wapiti Park to apply for an interim-use permit because the building was an accessory to the nonconforming campground, which did not change the terms of the primary conditional use permit. The City granted the interim-use permit, with the condition that it be valid for 10 years. When a building permit was granted afterwards, Wapiti Park rebuilt the building.

The interim-use permit expired in 2010, so Wapiti Park applied for a new one to continue using the building. The City inspected the campground and found that some people use the campground as permanent housing, even during the winter. In fact, some of the campsites included insulation, sheds, and porches. Several vehicles also had alterations such as piping connecting the vehicle to the sanitation system. The City concluded that this permanent use of the campground violated the conditions of the 1984 conditional use permit. The City gave Wapiti Park several months to comply with the 1984 conditions, but it failed to do so. As a result, the City proposed to deny the interim-use permit renewal and to revoke the 1984 conditional use permit. After three hearings, the City passed a resolution that revoked the permit in July of 2011 unless conditions were satisfied. After failing to meet this resolution’s conditions, the revocation of the 1984 conditional use permit became effective in December of 2011. Then Wapiti Park sued the City. The district court found the campground was a legal, nonconforming use, and that the city could not revoke the 1984 conditional permit to eliminate this use, and Wapiti Park was entitled to rebuild the 2000 building without a permit from the City.  The City then appealed to the Minnesota Court of Appeals.

Minn. Stat. Section 462.537 governs nonconforming uses of property and states in part: “Except as otherwise provided by law, any nonconformity, including the lawful use or occupation of land or premises existing at the time of the adoption of an additional control under this chapter, may be continued, including through repair, replacement, restoration, maintenance, or improvement, but not including expansion . . . ” The City alleged that because Wapiti Park was no longer in compliance with the 1984 conditional use permit in 2010, the use was no longer “lawful” under Section 462.537, The Minnesota Court of Appeals agreed. The Court interpreted this statute to protect a nonconforming use if it was lawful at the time it became nonconforming. At the time of the 1988 amendment to the zoning ordinance, the use of the property as a campground was only lawful because of the 1984 conditional use permit. Thus Wapiti Park is only entitled to Section 462.537’s protections if it remained in compliance with the permit that made it lawful. The Minnesota Court of Appeals concluded that Wapiti Park’s conditional use permit was still in effect because a conditional use permit does not cease to exist when the use becomes nonconforming. Instead the nonconforming use is defined by the conditions in the conditional use permit, and any use outside of these permit parameters may be considered an unlawful expansion of the nonconforming use. Conditional-use permits are perpetual, and “shall remain in effect as long as the conditions agreed upon are observed.”

The Minnesota Court of Appeals concluded that the 1984 conditional-use permit was still in effect even after the campground became nonconforming, and the City properly revoked the permit when it determined that the campground was no longer in compliance with the permit conditions. The 1984 conditional-use permit did not expire when Wapiti Park became a nonconforming use in 1988. Rather, the permit remained in effect, and the campground’s nonconforming use of the property was only lawful so long as it complied with the permit conditions. And the City was entitled to revoke the 1984 conditional-use permit when Wapiti Park continued to violate the conditions of the 1984 conditional-use permit. Thus the district court ruling was reversed.

Decision to approve expansion of nonconforming use supported by evidence; nearby property owner lacked standing to challenge

by Kaitlin Heinen

Daniel E. Stuckman, Sr. & Jr. v. Kosciusko County Board of Zoning Appeals
(Indiana Court of Appeals, September 25, 2012)

Ned and Bertha Stuckman purchased Lots A through K of the Lake Papakeechie Subdivision Number 2 in the 1950’s, and opened an automobile salvage yard on Lots E through K. In 1975, a Kosciusko County Zoning Ordinance took effect, and Ned and Bertha’s land was zoned residential; however, the automobile salvage yard constituted a lawful, nonconforming use so Ned and Bertha continued its operation. In the early 1980’s, Ned and Bertha cleared brush from Lots A through D and began stacking vehicles in that area. The Board investigated complaints by area residents, and the Indiana Court of Appeals eventually concluded that Ned, Bertha, and Gary (their son) had unlawfully expanded the automobile salvage yard to Lots A through D and ordered them to cease all salvage yard operations until they complied with certain restrictions.

In February 1988, Ned, Bertha, Gary, the Papakeechie Protective Association, and the Board of Zoning Appeals entered into a written Agreement, which provided that Papakeechie would join with Ned, Bertha, and Gary to file an application for an exception for modification of a preexisting, nonconforming use on Lots A through G. The Agreement placed restrictions, limitations, and covenants on the use of the property. For example, Ned, Bertha, and Gary agreed to construct a buffer mound near the edge of Koher Road. Ned, Bertha, and Gary also agreed to plant pine trees on the buffer mound to provide additional screening. All salvage yard activities were to be conducted to the east or north of the buffer mound, and vehicles were to be stacked so as not to be visible from Koher Road. In addition, Ned, Bertha, and Gary agreed to not install a sign indicating the existence of a salvage yard, except as necessary to meet state requirements. Following this Agreement, Gary filed the request for an exception for modification of a preexisting, nonconforming use, which was approved by the BZA. After Ned and Bertha died, Gary inherited Lots A through G, and his brother, Daniel Sr., inherited Lots H through K. Gary continued to operate the salvage yard on his lots, and Daniel Sr. operated Stuckman Sanitation on his lots, and with his son Daniel Jr., he also owned and operated Northern Indiana Recycling, LLC and Stuckman & Son Trucking on these lots as well. In 2008, Daniel Sr. filed a request for an exception for modification of a preexisting, nonconforming use, seeking approval for the construction of three new buildings, the installation of a scale, and the relocation of driving areas on his lots. The BZA approved these modifications.

In January 2010, Gary filed a request for an exception to expand the salvage yard as a nonconforming use. The BZA held a hearing in February 2010, where Gary submitted plans of his proposed changes, which included the removal of several mobile homes along the highway, the relocation of the buffer mound, the installation of a new location sign, and the construction of three new buildings to move the operations indoors to control the noise and dust. Following the hearing, the BZA unanimously approved the modification of the nonconforming use. In March 2010, the Daniel Stuckmans filed a petition for Writ of Certiorari, seeking judicial review of the BZA’s decision. They alleged that their businesses would be damaged by the approval of Gary’s plan. Gary died during the proceedings, so his estate was substituted as a party in March 2011. The trial court held a hearing in July 2011, where the Stuckmans argued that the BZA did not apply the appropriate section of the zoning ordinance. Zoning Ordinance Section 5.5 gives the BZA power to authorize changes of lawful nonconforming uses. However, the BZA  reviewed a checklist from Section 5.4 of the zoning ordinance, which applies to exceptions. In September 2011, the trial court concluded that Daniel Jr. lacked standing to contest the BZA’s decision because he was not an adjacent property owner and that the BZA’s decision required additional findings of fact, so it remanded the case to the BZA . In December 2011, the BZA found that the modification of the preexisting, nonconforming use complied with the Agreement and Section 5.5 of the Zoning Ordinance. The BZA also found no evidence that the proposed changes would adversely affect the neighborhood properties. Rather, the BZA noted that Gary’s changes would constitute a significant improvement to the neighborhood and be of benefit to adjoining neighbors, so his application for modification was approved. The trial court confirmed the BZA’s findings and conclusions, so Daniel Sr. and Jr. appealed.

The Indiana Court of Appeals affirmed the trial court’s ruling that Daniel Jr. did not have standing to contest the BZA’s decision. With regard to the challenge by Daniel Jr., the court stated that he does not own property adjacent to Gary’s, and he presented no evidence at the hearing to indicate an adverse effect on his property.

The court also affirmed that the BZA did not err in granting Gary’s request for an exception to modify and change the preexisting, nonconforming use of his property. The court determined that the error committed by the BZA in applying the wrong section of the zoning ordinance was remedied when the case was remanded by the trial court to the BZA for further findings of fact to support their decision. On remand, the BZA explained that although it had inadvertently used a checklist for an exception, Gary’s petition was clearly to modify a preexisting, nonconforming use and at no time were board members confused. The BZA further found that pursuant to Section 5.5 of the Ordinance, there was no evidence presented, which indicated that the proposed modifications would adversely affect the neighborhood properties. The Indiana Court of Appeals ruled that these findings were supported by substantial evidence.

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.

Legal non-conforming use still subject to junk and nuisance ordinances

by Victoria Heldt

Soo Township v. Lorenzo Pezzolesi
(Michigan Court of Appeals, October 25, 2011)

Lorenzo Pezzolesi purchased a piece of property in Soo Township in 1987 when the property was zoned commercial.  He began using it as a junk/salvage yard soon after that.  In 2001, the property was zoned residential and Soo Township passed a nuisance ordinance and a junkyard ordinance.

Subsequently, the Township filed a complaint against Pezzolessi claiming that he was in violation of the ordinances, that the property wasn’t zoned to be a junkyard, and that he did not have a license to operate a junkyard.  The Township’s Supervisor testified that the junkyard did not even classify as “commercial” since no commercial signs were up, the entrance was blocked on a regular basis, and no evidence of commercial activity existed.  Pezzolesi argued that his operation was a salvage yard, not a junkyard.  He claimed to have made sales two weeks prior to the trial and, when asked about employees, he responded that he called “Peter, Joe, and Bob” on the weekends when they were free.  He was unable to provide the last names of his helpers.  The trial court ruled in favor of Pezzolesi.  It found that his salvage yard constituted a commercial operation on property that was zoned commercial at the time of purchase.  The property was rezoned residential after the establishment of the salvage yard; therefore the salvage yard was a legal nonconforming use not subject to the license requirement in the zoning ordinance.  The trial court also found that Pezzolesi was not subject to the nuisance ordinance for the same reason.

The Township appealed, first arguing that the defendant abandoned his right to a nonconforming use when he ceased operating a “commercial” business.  The Court denied this argument, noting that the act of abandonment required “an act or omission on the part of the owner or holder which clearly manifests his voluntary decision to abandon.”  The Court found no such action.  Next, the Township argued that the Pezzolesi’s property was subject to the nuisance ordinance and the junkyard ordinance.  On this issue, the Court agreed.  It distinguished between a zoning ordinance and a regulatory ordinance in that “zoning ordinances regulate land uses, while regulatory ordinances regulate activities.”  It cited a previous case in which it ruled that “a regulatory ordinance can be imposed on a prior nonconforming user, but a zoning ordinance cannot.”  It found that in this case, the junkyard ordinance and the nuisance ordinance constituted regulatory ordinances since they governed people’s behavior regarding the operation of junkyards.  Similarly, the nuisance ordinance “address activity or conditions that could apply to any property, regardless of its location.”  Therefore, the ordinances applied to Pezzolesi’s junkyard/salvage operation.

The Court remanded the decision to the lower court to take further evidence and hear arguments on whether Pezzolesi’s operation in fact violated either of the regulatory ordinances.

Nonconforming use not allowed to be rebuilt/reestablished on different parcel

by Melanie Thwing

Coon Creek Sportsman’s Club v. Town of Beloit
(Wisconsin Court of Appeals, March 31, 2011)

In January 2007 Michael Toubl and James Bryden (club owners) applied for a conditional use permit (CUP) for Coon Creek Sportman’s Club which would operate as a bird hunting reserve in Beloit, Wisconsin. The CUP was authorized in July 2007 to operate the reserve and to use a clubhouse as a legal nonconforming structure that existed on one of the parcels. However, in September the building was destroyed in a fire.

The board renewed the CUP on April 7, 2008. The reference to a clubhouse was not removed from the renewed permit. On May 14, 2008 the club owners signed the CUP and agreed to abide by its terms. During this time the club owners applied for a building permit to construct a new building on a different parcel of land. The application listed the building as “ag building.” The application was approved and the permit stated “agricultural use only.”

Several months later the Town supervisors learned the new building was being used as a clubhouse. A letter was sent to the club owners to cease using the building as a clubhouse but they continued to. In April 2009 they applied for an amendment to the CUP to allow the new building to be used as the clubhouse. The planning commission tabled the application waiting for the submission of a site plan but none was submitted.

In January 2010 at a public hearing the board voted to revoke the CUP, concluding that the club owners had violated the conditions. The club owners filed a motion in circuit court seeking a permanent injunction claiming the board’s decision was arbitrary.

The circuit court ruled in favor of the club owners, stating that the board acted arbitrarily because (1) both CUPs referred to the “clubhouse,” (2) the renewed CUP was effective in May 2008, (3) the building permit was renewed before the CUP was renewed, and (4) the only structure on the property in May 2008 was the building described in the building permit.  The circuit court determined that the Town, “intended in the issuing of a conditional use permit that the [new] building would be used at least in part as a clubhouse. Otherwise that provision in the conditional use permit would be meaningless.” The circuit court granted the club owners’ injunction.

The Town appealed to the Wisconsin Court of Appeals arguing that it acted reasonably in revoking the CUP.  The Court of appeals found error in the final three conclusions of the circuit court.    First, the circuit court found that the renewed CUP was not effective until May. However, the CUP states that it became effective in April, regardless of the date the club owners signed and agreed. Because of this the courts finding that the building permit was issued before the CUP is erroneous, and no building existed in May 2008.

The renewed CUP permits revocation for any violation of the permit, and is subject to the general conditions of the Town of Beloit Code of Ordinances. The Town argues that the new building is not a legal nonconforming use. The club owners argue that the building is a legal nonconforming use because “the old building was a legal nonconforming structure and they are using the new building in the same manner.” Further they argue that the reference to a clubhouse in the renewed permit means the new building even if it is not a legal nonconforming use.

Wisconsin Stat. § 60.61(5m) states that if a nonconforming use is destroyed by fire it may be rebuilt if it is, “restored to the size,… location, and use that it had immediately before the damage or destruction occurred…”

The Town of Beloit, General Zoning Ordinances § 2.17D.4 states, “If a nonconforming structure is moved for any reason for any distance whatever, it shall therafter conform to the regulations for the district in which it is located after it is moved.” Under the plain language of the statute and ordinance the new building is not a legal nonconforming structure.

The club owners argue that the CUP allows the new building to be used as a clubhouse also fails. Again, the CUP was renewed on April 7, 2008 and the building permit was not filed until April 21, 2008. There is no evidence that the board knew when it issued the CUP the club owners intended to build in a different location. There is no reason to infer that the board intended the new building to be the clubhouse.

Finally, the building permit says the building is for an “ag building,” and is intended for agricultural use only. The renewed CUP does not allow for the club owners to use the new building as a clubhouse, and therefore they violated the CUP. The decision is reversed.

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