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The Constitutionality of a Local Zoning Law Hinges on the Resolution of Three Threshold Questions

Posted in Declaratory Judgment, Emerson, Elizabeth, Municipal, Real estate, Suffolk, Summary Judgment

In a January 11, 2016, Commercial Division decision by Justice Emerson, the court decided three threshold issues that were presented by the parties on a motion in limine.

In 1994, Plaintiff Suffolk Asphalt Supply, Inc. (“Plaintiff”) acquired a parcel of real estate in the Village of Westhampton Beach that had been improved with an asphalt plant in 1945. Sometime in 1985, however, the Board of Trustees of the Village (“Defendant”) amended the Village zoning ordinance so that the use of the property as an asphalt plant became nonconforming. Nonetheless, Plaintiff continued to operate the nonconforming asphalt plant. In June 2000, Defendant enacted Local Law 10, which provided that Plaintiff’s right to operate and maintain the nonconforming asphalt plant would terminate within one year unless Plaintiff applied to the Village Zoning Board of Appeals (“ZBA”) for an extension of the termination date. Plaintiff did so, and the ZBA granted Plaintiff a five-year extension, the maximum extension permitted by Local Law 10.

Plaintiff thereafter commenced an Article 78 proceeding to review the ZBA’s determination. That petition was denied and the proceeding was dismissed. Plaintiff thereafter commenced an action for a judgment declaring Local Law 10 invalid and unconstitutional. The court denied both parties’ motions for summary judgment, finding that a question of fact existed as to whether the amortization period provided in Local Law 10 was reasonable. The parties then brought motions in limine asking the court to decide three threshold issues prior to trial: (1) which period of time the court should consider in evaluating the constitutionality of the amortization period prescribed by Local Law 10; (2) which factors should be considered in assessing the constitutionality of the amortization period; and (3) whether the amortization period includes the reasonable costs and expenses incurred by Plaintiff during litigation.

With regard to the first issue, Plaintiff argued that, in determining the reasonableness of the amortization period, the court’s inquiry should be confined to the five year period from the effective date of Local Law 10 (July 2000) to the termination of Plaintiff’s five-year extension (July 2005). Defendant, however, contended that since this is an as-applied challenge to the constitutionality of Local Law 10, the court should also consider the period of time after 2005 during which litigation had been pending. According to Defendant, the period of time from July 2005 to present effectively doubled the amortization period, thus giving Plaintiff sufficient opportunity to recoup its investment in the nonconforming asphalt plant.

The court agreed with Defendant, holding that an as-applied challenge, as opposed to a facial challenge, depends on the specific circumstances of Plaintiff’s particular case. Because Plaintiff had many more years than the drafters of Local Law 10 originally intended to recoup its investment in the nonconforming asphalt plant, the court held that it would consider the time period from 2000 to present in determining whether the Plaintiff has recouped its investment.

As to the second issue, Defendant argued that, in determining the constitutionality of Local Law 10 and the reasonableness of the amortization period, the court’s inquiry should be limited to whether Plaintiff has been able to recoup its investment in the nonconforming asphalt plant and that the court should not consider the value of the continued operation of the business. The court disagreed, holding that because the validity of an amortization period depends on its reasonableness, the court should consider a myriad of factors. These factors include, but are not limited to, the amount of money invested in the plant, the value of the buildings and equipment, and the cost of relocating the plant.

Finally, the court determined that Plaintiff’s reasonable litigation expenses are costs that should be considered in determining whether Plaintiff has suffered a substantial financial loss as a result of Local Law 10. Contrary to Defendant’s contentions, Plaintiff was not seeking to recover legal fees, but rather to include them as evidence of its investment in the nonconforming asphalt plant.   In the court’s view, Plaintiff would not have been able to stay in business had it not challenged Local Law 10 in court. Accordingly, the court held that it would allow Plaintiff to proffer evidence of reasonable litigation expenses at trial in order to ascertain its investment in the nonconforming asphalt plant.

Suffolk Asphalt Supply, Inc. v. Board of Trustees of the Vil. of Westhampton Beach, 2016 NY Slip Op 26005 [2016]