Massachusetts Land Use Monitor

Massachusetts Land Use Monitor

Real-Time News & Commentary on Massachusetts Land Use & Real Estate Law

No Damages to Owner Whose Lot Is Unbuildable Due to Wetlands Regulations

Posted in Eminent Domain, Environmental, Regulatory Takings, Wetlands, Zoning

When the Conservation Commission refused to permit the construction of a house on her residential lot in a Falmouth subdivision, Janice Smyth decided to take action and sought damages for a regulatory taking of her land under the U.S. Constitution and the Massachusetts Declaration of Rights.  She was successful initially, recovering damages of $640,000.  But, in Smyth v. Conservation Commission of Falmouth, the Appeals Court reversed the lower court’s decision.

Smyth inherited the undeveloped lot from her parents, who had purchased it in 1975.  The fact that the family had incurred only minimal costs since that time appears to have been fatal to her claim.

In 2012, the Con. Comm. refused to grant Smyth several variances from the wetlands protection bylaw necessary to allow her to build a house.

Based on her appraiser’s testimony, a Superior Court jury awarded Smyth regulatory taking damages.

The Appeals Court reversed, first holding that there was no right to a jury trial on the complex question of whether a regulatory taking had occurred.  It then went on to address that question by considering the following factors.

First up was the economic impact of the regulation.  The Appeals Court accepted that the value of the lot dropped from $700,000 to $60,000 due to the wetlands regulations.  However, the Court pointed out case law that even substantial reductions in value did not require a conclusion that a regulatory taking had occurred.  It also relied on the fact that the land was worth more than the original purchase price of $49,000.  The Court also noted that the lot might be attractive to abutters, or for use as a park or a playground.  Of course, it did not explain who would want to place a park there, the impact of the wetlands regulations on a potential playground or why an abutter would want to purchase land that likely would remain open because its owner could not build.

Next, the Court considered the impact of the wetlands regulations on the investment-backed expectations of Smyth and her parents.  The Court made clear that it viewed a takings award as a windfall to Smyth given that the lot was now worth more than its purchase price and the nearly complete lack of spending on the lot by its owners over and above that price.

Lastly, the Appeals Court looked at the character of the governmental action.  In doing so, the Court relied on the rule that a reasonable government action that does not involve a total regulatory taking or an act akin to a physical invasion of the land typically does not require compensation.

Many landowners wish for some recourse for financial pain caused by government regulations.  Smyth’s refusal to find a regulatory taking even when stringent regulations prohibit construction of a home on a residential lot does little to offer them hope.

We will stay tuned to see if the Supreme Judicial Court reviews this decision.

Affordable Housing Covenants Have Protected Status in Foreclosures

Posted in Affordable Housing, Condominiums, Foreclosure, Restrictive Covenants

The Boston Redevelopment Authority d/b/a Boston Planning and Development Agency has the right to challenge a foreclosure that purportedly terminated a covenant restricting the use of property to affordable housing.

In allowing the BPDA’s suit to move forward, the Business Litigation Session of the Suffolk Superior Court recognized two truisms of Massachusetts foreclosure law. First, the foreclosing lender owes a duty of good faith and reasonable care to the borrower and holders of junior encumbrances or liens. If that duty is breached, the foreclosure sale could be invalid.

Second, foreclosure by the power of sale requires a public auction. If the buyer at the auction fails to close on the purchase, a foreclosing lender cannot simply transfer the property to itself. Typically, the lender should offer the property to the second highest bidder or conduct a second public auction.

In Boston Redevelopment Authority d/b/a Boston Planning and Development Agency v. Boston Private Bank and Trust Company, and Janet Blake, Trustee of 21 Warren Street Realty Trust, the case involved a residential condominium unit in Charlestown acquired by the owner under an affordable housing program administered by the BPDA. When the owner purchased the property, the deed included a covenant that (1) restricted ownership to a qualified individual of moderate income; (2) limited the sale price to a below-market price set by a formula; and (3) required the owner to occupy the unit as a principal residence.

The covenant provided the BPDA with the right to purchase the property upon notice of a pending foreclosure of the property. This protects affordable housing agencies by providing an opportunity to retain the property in the municipality’s affordable housing supply.

The covenant also provided that if the lender obtains title to the property by foreclosure or deed in lieu of foreclosure, the covenant terminates. This protects lenders from being saddled with affordable housing restrictions when a loan has gone bad and they need to take ownership of the property.

The owner died, and her estate defaulted on the loan. The bank notified the BPDA that it intended to foreclose, and the BPDA did not exercise its right to buy the property. The BPDA does not typically purchase properties in this context. At the foreclosure auction, the bank signed a memorandum of sale with the highest bidder. But the winning bidder walked away from the deal when he realized the property was being sold subject to the affordable housing restrictions in the covenant.

The bank then conveyed to the property to itself, which the bank claimed terminated the covenant. A few weeks later, the bank conveyed the property to another person allegedly affiliated with the original highest bidder free and clear of the covenant.

The BPDA cried foul and filed suit to void the sale and reestablish the covenant. But the bank’s counsel moved to dismiss the litigation by using the old “you snooze, you lose” argument: since the BPDA failed to buy the property prior to the foreclosure, the covenant is dead and the BPDA’s rights have lapsed.

However, the Superior Court held that the affordable housing covenant held by the BPDA is an encumbrance, thereby requiring the lender to exercise the power of sale with a “duty of good faith and reasonable care” to the BPDA. The Superior Court concluded that if the bank’s actions to take title to the property were specifically designed to terminate the covenant, such actions could constitute a breach of duty and taint the foreclosure. This determination will be the subject of additional court proceedings.

The Great Salisbury Billboard Race

Posted in Police Power, Special Permits, Zoning

A Massachusetts regulation stating that no two digital billboards may be erected within 1,000 feet of one another set up a race between competing billboard companies that owned abutting land.

Although the final approval for a billboard must come from the Commonwealth’s Department of Transportation Office of Outdoor Advertising (OOA), an applicant must first receive local zoning board approval before filing its OOA application.  Clear Channel and Northvision both had special permit applications for their billboards pending before the Salisbury Zoning Board of Appeals simultaneously.  That ZBA denied the application of the former, clearing the way for the latter’s billboard.   Clear Channel Outdoor, Inc. v. ZBA of Salisbury, decided earlier this week, considered the plaintiff’s appeal of the denial of its special permit and of the grant of Northvision’s special permit.

The case came before the Appeals Court in an unusual posture in that the ZBA admitted that it

had no proper basis to deny Clear Channel’s application for a special permit and urg[ed] that judgment be entered against itself.  The board conceded that Hunt and Henderson, the two board members who had voted to deny Clear Channel’s special permit application, had considered factors that were irrelevant to the zoning scheme and that ‘would not withstand  judicial scrutiny.’

More specifically, during discovery Henderson and Hunt had each testified that they believed that the choice between the two competing billboards should be up to the local authority, not the State entity and that, to accomplish this end, they voted against Clear Channel, choosing Northvision because its application was filed first and not based on the merits of the application.  In addition, Comcast had alleged that Henderson is employed by a company also owned by the owner of Northvision and that Hunt is a first cousin once removed of the trustee of the owner of the property on which Northvision’s proposed billboard was to be erected.

The Appeals Court revisited some well settled principles, but with a different point of view than in the usual case. For example, although business competition typically does not create standing to challenge a zoning board’s decision, here Clear Channel was an abutter granted presumptive standing, which it was ultimately found to have because “[i]mpacts on use and enjoyment of one’s own property are clearly interests protected by the zoning bylaw.”

Further, board members’ mental processes and the reasons for their votes are typically off limits in a zoning appeal.  However, given the admissions made by the ZBA, Clear Channel was entitled to explore the ZBA’s reasons for granting Northvision’s application in order to demonstrate that the board improperly injected into its decision criteria not found in the enabling act.  The Appeals Court also noted that, even if the record reveals that a desired special permit could be lawfully granted by a board because the applicant’s evidence satisfied the statutory and regulatory criteria, the board retains discretionary authority to deny the permit.  As a result, the ZBA’s reasons for granting Northvision’s special permit were relevant to the challenge.

By carefully parsing these principles of zoning law the Appeals Court was able to reach the result that fairness plainly required.

More Beach Rights Litigation

Posted in Easements, Registered Land, Subdivision Control, Waterfront Property

In a satisfying win for Rackemann, the Appeals Court today upheld a Land Court decision that inland lot owners hold no easement rights over our clients’ waterfront property.

Loiselle v. Hickey concerns a large subdivision in Dennis with a number of ways leading to Cape Cod Bay.  An earlier case between many of the same parties established that the inland lot owners had easement rights in all of those ways.  In Loiselle, many of the same the inland lot owners argued that they also had the right to use the private beach between those ways for recreational purposes.

The Appeals Court rejected that claim.  While the decision does not break new legal ground, it does serve as a helpful review of the basic legal principles governing waterfront land.

The Appeals Court first relied on the well settled rule that the owner of land adjacent to the sea is presumed to own to the lesser of the low water mark or 1,650 feet below the high water mark.  Only by expressly excluding the land below the high water mark can a deed sever title to the flats (the beach between the low and high water marks) from title to the upland above the high water mark.

The Appeals Court then turned to another well established rule:  when a deed or certificate of title describes land as running by a body of water (for example, “by the waters of Cape Cod Bay”), there is no severance and title is conveyed to the low water mark.

The Appeals Court next observed that the developers had created separate beach lots elsewhere in the subdivision.  In contrast, the Hickeys’ lot and nearby shorefront lots are shown on the subdivision plan as extending to the water, with no intervening lot.  Relying on these facts and principles, the Appeals Court concluded that the original subdivision developers had not retained any part of the defendants’ subdivision lots in order to grant beach easements to the inland lot owners.  Instead, the Hickeys and other waterfront defendants own the flats.

Other cases finding implicit beach rights involve deeds or certificates of title that provide expressly for access to the beach and a right to use the beach for recreational activities.  Here, although the certificates of title of many of the inland lot owners’ reference rights to use the ways to the water, none reference a right to use the beach.  As a result, the Appeals Court held that inland lot owners hold no rights to use the privately owned beach between the ways.

Beach access is valuable, both financially and emotionally, and it is virtually guaranteed that beach access will continue to be the subject of litigation.  The Loiselle decision should provide guidance to future parties.

The Trouble With Trees

Posted in Miscellaneous, Uncategorized

Unable to leave well enough alone, the Supreme Judicial Court used a series of wooden puns in deciding not to change the longstanding rule that a landowner cannot hold a neighbor responsible for damage caused by that neighbor’s healthy tree.  Shiel v. Rowell addressed Shiel’s nuisance and trespass claims that algae on her roof was caused by the Rowells’ overhanging tree.

The traditional Massachusetts rule allows Shiel to protect herself by cutting back encroaching trees, up to the property line.  The Court declined to ‘”uproot precedent,” because it is a clear rule that assigns responsibility and thereby minimizes legal costs and legal disputes between neighbors “who merely have an axe to grind,” and it also avoids burdening the courts with additional litigation.

As it did a few years ago in Taylor v. Martha’s Vineyard Land Bank Commission, the Court showed that it was open-minded enough to reconsider longstanding precedent, but ultimately decided against changing a rule that still makes sense.

 

Private Parties Cannot Enforce Public Rights to Access Tidelands

Posted in Easements, Legislation, Waterfront Property

Massachusetts is unusual in that an owner of waterfront property typically holds title to the low water mark.  However, the area between the low and the high water marks normally remains subject to the rights of the public to fish, fowl (hunt birds) and navigate.

The landowner cannot interfere with those so-called “public trust” rights without the benefit of special legislation or a license to do so issued by the Department of Environmental Protection (the “Department”) pursuant to Chapter 91 of the Massachusetts General Laws.  In most instances, Chapter 91 licenses contain language requiring some type of public access to the tidelands or former tidelands.  And Massachusetts courts have been zealous in protecting public trust rights.

Yesterday’s Appeals Court decision in Commercial Wharf East Condominium Assoc. v. Boston Boat Basin, LLC addressed who has the right to enforce public trust rights.

Boston Boat leased a marina on Commercial Wharf in Boston that is subject to a variety of restrictions on its use.  These restrictions were set out in an access easement, a zoning variance and permit and a settlement agreement between the plaintiff condominium association and prior owners of the marina land that prohibits a series of uses, such as booze cruises, weddings and bar mitzvahs.   Boston Boat argued that that these restrictions were void because they were inconsistent with the Chapter 91 license that, in substance, required that Boston Boat permit 24 hour public access on its wharf to the extent permitted by the access easement.

The Appeals Court never reached the substantive issue.  Instead, it torpedoed Boston Boat’s claim before it could get underway, holding that “Boston Boat had no authority in the first place to seek judicial enforcement of public trust rights in private litigation.”

The Appeals Court relied on case law that states emphatically that only the Legislature, or an entity to which the Legislature has delegated authority expressly, may act to further public trust rights.  By Chapter 91, the Legislature had delegated this authority to the Department.  In contrast, the Legislature had not delegated authority to enforce public trust rights to either Boston Boat or the Land Court, where the case had been filed.

Because of the Department’s “special role” in the area of public trust rights, it alone had the authority “to determine whether Boston Boat is currently using the locus in accordance with the license and, if not, how best to proceed in order to vindicate public rights.”

This case is yet further proof that you don’t need to sail off the map to enter dangerous territory marked, “Here be dragons.”  In Massachusetts, you can encounter legal dragons once you hit the high water mark.

Can’t Get There From Here?

Posted in Waterfront Property

In the just-decided Maslow v. O’Connor, the Appeals Court addressed rights in a Gloucester subdivision road.  Since Gloucester is a seaside community, naturally the case concerns water access.

The defendants own the residential lots abutting the waterfront end of Rackliffe Street, which is an old and private subdivision road that, before 1925, ended at the mean high water mark of Wonson’s Cove.  Under the Derelict Fee Statute, those defendants also own to the center-line of that Street next to their lots.  However, longstanding case law makes clear that the plaintiffs, who own inland lots along Rackliffe Street, have the right to use that Road all the way to its waterfront end.  In addition, under legislation intended to encourage waterfront development dating back to the early days of Massachusetts (the Colonial Ordinance of 1641-1647), all members of the public have the right to use tidelands between mean high and mean low tide for purposes of fishing, fowling and navigation.

In 1925, the owners of the waterfront end of Rackliffe Street were granted a license pursuant to Chapter 91 of the Massachusetts General Laws to fill the tidelands and build a seawall.  A grassy strip and ramp leading down to the intertidal area are now located on the fill owned by the defendants in what would be the extension of Rackliffe Street.  The question in the case was whether the plaintiffs had the right to cross that grassy strip and to use the ramp to reach the water.

Relying principally on the terms of the license itself, the Appeals Court concluded that the plaintiffs did have the right to reach the water.  That license contains two conditions.  Most importantly, it provides that nothing in it “shall be so construed as to impair the legal rights of any person.”  This language is a paraphrase of language in G.L. c. 91, section 17.   The other condition prohibited any “building or other structure” on the fill within the lines of Rackliffe Street “extended southerly to the water.”

Because, as abutters of the Street, the plaintiffs had the right to use the disputed areas to reach the water in order to exercise their Colonial Ordinance rights, the Appeals Court concluded that “under the 1925 license, any fill placed in tidelands at the end of Rackliffe could not and did not cut off those abutter rights, as such would have violated the ‘no impairment’ clause.”

The license’s prohibition against buildings in the road as extended to the water reinforced that the license intended that the right of plaintiffs’ predecessors to access the tidelands at the end of Rackliffe Street before the 1925 license “remains today ….”

Maslow is yet another reminder that owning waterfront property or property located in a private subdivision can present legal issues that other landowners do not face.

When Is It Too Late to Force a Neighbor to Cure a Zoning Violation?

Posted in Nonconforming Use, Police Power, Subdivision Control, Zoning

Section 7 of Chapter 40A contains a statute of limitations for actions by individuals and municipalities to compel the removal, alteration, or relocation of any structure due to a zoning violation.  In Bruno v. Zoning Board of Appeals of Tisbury, the Appeals Court considered when the statute of limitations commences based on a zoning violation arising from an ANR (Approval Not Required) subdivision of land.

The Goethals owned a large lot with a single family home and guesthouse.  In 2001, the local planning board endorsed the Goethals’ plan to subdivide that lot into two parcels and, for a time, the Goethals retained both Lots.   Their guesthouse was on Lot 1 and a single family home was on Lot 2.  Lot 1 is about 12,000 square feet, whereas zoning requires a minimum lot size of 25,000 square feet for a single family home.

In August 2005, the Goethals sold Lot 2 to the Brunos.  The Goethals retained Lot 1, later improved the guest house on that Lot (allegedly in violation of zoning) and rented it out as a vacation home.   The Appeals Court agreed that, since at least 2005, there has been a single family residential use of Lot 1.

The case arose from the Brunos’ attempt to compel the Zoning Board of Appeals to order the removal of the Goethals’ house or, in the alternative, to obtain an injunction against all uses of that house–which “would inevitably require the eventual removal of the structure all the same.”  The ten-year statute of limitations in Section 7 applies to actions intended “to compel the removal, alteration, or relocation of any structure” on the basis of a zoning violation (a six-year statute of limitations applies to actions concerning structures authorized by a building permit and being used in accordance with that permit or the use authorized by a building permit).

The issue was whether the ten-year statute of limitations began to run in 2001, as a result of the ANR endorsement that created the undersized lot, or in 2005, when the Goethals conveyed Lot 1.  In adopting the later date, the Appeals Court relied on the rule that, when adjacent nonconforming lots are held in common ownership, they are normally merged and treated as a single lot for zoning purposes.  So, when taken together, “Lots 1 and 2 formed a single conforming lot under the Goethals’ common ownership.”  That land remained a single conforming lot for zoning purposes until the 2005 conveyance.  Before that time, the Tisbury zoning enforcement officer could not have pursued an enforcement action against the Goethals.  Therefore, the statute of limitations did not start to run until they conveyed Lot 1 in 2005 and Lot 2 became nonconforming.

Under Section 7, the Brunos had until August 2015 to file and record their action.  In light of a dispute regarding whether the purported recording of the action in April 2015 was proper, the Appeals Court remanded the case to the Land Court.  The Appeals Court left unresolved whether the statute of limitations clock starts ticking on the date of the deed creating the nonconformity or the date of its recording.

This case provides a useful reminder that the doctrine of merger may complicate a zoning analysis, including with respect to the critical question of whether the statute of limitations bars a zoning enforcement action.

Governor Baker Proposes Zoning Changes to Promote More Housing

Posted in Affordable Housing, Zoning

Governor Baker recently announced a proposal to change state zoning laws to make it easier to build more housing units state-wide. The Governor’s goal is to add 135,000 housing units by 2025. To do so, he has introduced legislation that will allow municipalities to adopt certain changes to local zoning by a majority vote, instead of by super majority, as currently required by state law. The zoning changes include relaxing dimensional, density and parking requirements, as well as adopting smart growth and starter home zoning districts. The proposed legislation would also promote accessory dwelling units and the transfer of development rights to allow cluster developments.

While the Governor’s proposal makes sense, it falls far short of the more comprehensive, and controversial, zoning reform proposals considered by the legislature over the past decade or so. The current zoning laws have been in effect since the Gerald Ford administration and are woefully out of date and serve as a serious barrier to the construction of much needed affordable housing in Massachusetts.  Without comprehensive zoning reform, which includes measures streamlining the permitting process and preventing frivolous appeals of approvals, it is hard to see how the Governor’s proposal will create enough housing to move the needle. Let’s hope the Governor’s proposal serves as the impetus for the legislature to adopt meaningful changes to current zoning laws that allow for quicker approvals and more flexibility and certainty to make meaningful increases to the state’s housing inventory.

Newton Drone Ordinance Struck Down, but Significant Questions Remain

Posted in Eminent Domain, Policy

As drone sales in the United States continue to grow, the legal issues they present are likely to induce new attempts to regulate drone flights at the state and local level.  As the legal framework allowing drones to fly within our communities develops, the resulting laws will impact the ability of local communities to control drone use within their borders and restrict landowners’ property rights.  As shown by Newton’s recent foray into municipal drone regulation, the role local communities can play in this legal framework remains unclear.

The recent federal District Court decision in Singer v. Newton[1] held that Newton’s 2016 drone ordinance was preempted by federal legislation directing the Federal Aviation Administration to incorporate drones into the national airspace.  However, the decision did not consider important questions concerning drone use and private property rights, which remain a stumbling block in the development of drone laws across the country.

Among other things, Newton’s ordinance banned drone flights over private property below 400 feet without the express consent of landowners beneath the flight path and banned drone flights over city property without Newton’s prior permission.  The 400-foot limit is significant because the Federal Aviation Administration limits drones to a 400-foot altitude to avoid interference with commercial air traffic.  Therefore, Newton’s ordinance effectively banned drone flights without permission from landowners beneath the flight path.

Newton resident and drone enthusiast Michael Singer sued, arguing that the federal government has exclusive jurisdiction over the national airspace and, as a result, municipal attempts to regulate drones were prohibited.  The District Court agreed, saying Newton’s ordinance “thwarts” Congress’s objective to integrate drones into the national airspace.  According to the decision’s rationale, the ordinance essentially fails because it did not allow any drone flights below 400 feet without prior permission from landowners.

However, neither the District Court, Singer, nor Newton considered the possibility that landowners already have an inherent right to prevent drone use above their properties.  In the 1946 case United States v. Causby, the Supreme Court said a landowner owns at least as much of the space above the ground as he or she can use in connection with the land, and that landowners have the power to prevent intrusions into the airspace above their property that would subtract from the landowner’s full enjoyment of the property.[2]  The Singer decision, however, fails to consider the extent to which any federal, state, or local rule that would require landowners to permit drone flights over their property could impact the use and enjoyment of land and thus constitute a taking for which the landowner must be compensated.

While the Singer decision voids Newton’s drone ordinance, it seems unlikely this decision will deter municipalities from attempting to regulate drone use within their borders.  Whether due to privacy, noise, or safety concerns, as the use of drones continues to increase, local governments and landowners will increasingly seek to limit access to the skies.

[1] Singer v. Newton, D. Mass., No. CV 17-10071-WGY (Sept. 21, 2017)

[2] 328 U.S. 256, 264-65 (1946)