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New York Real Estate Law ReporterColumns & DepartmentsLandlord Tenant LawLitigation

Development

By ssalkin
July 01, 2018

Developer Had No Vested Right to Subdivision

Matter of Bartz v. Village of Leroy Comment A developer who obtains subdivision approval can claim protection against subsequent enactment of a more restrictive zoning ordinance based either on state statutes or on a common law vested rights theory. The legislature has enacted three statutes providing developers with a two or three year exemption period after filing of the subdivision plat during which subsequent amendments to the zoning ordinance will not apply to the developer N.Y. Village Law §7-709 (McKinney); N.Y. City Law 83-a (McKinney); N.Y. Town Law §265-a (McKinney). Even if the developer does not start construction until after expiration of the statutory period, an owner who improves land pursuant to a subdivision approval acquires common law vested rights that insulate the developer from subsequently enacted zoning amendments unless the improvements would be equally useful under the new zoning requirements. A developer acquires common law vested rights when compliance with a new zoning ordinance would require the removal of physical improvements made pursuant to an approved pre-existing subdivision, rendering the improvements useless. In , 152 A.D.2d 365, 408 , 77 N.Y.2d 114, the developers acquired vested rights to complete the subdivision as the site improvements — including service lines to connect each lot, curb cuts for proposed driveways and sewer laterals — would need to be removed in order to comply with the new ordinance, which increased the minimum lot size, making many of the completed curb cuts and connections useless under the new ordinance. Similarly, in , 40 A.D.2d 1048, the Third Department held that a developer who had begun construction on foundations pursuant to an approved subdivision acquired vested rights when an amended ordinance increased minimum lot size, which would have made building on those foundations unlawful. Even if an amended ordinance would not require physical removal of a developer's improvements, the developer can acquire vested rights under the single integrated project theory if the developer can demonstrate that he made substantial expenditures or undertook substantial construction to an integrated project in reliance on the ability to complete the entire project. For instance, in , 14 A.D.2d 586, the court held that the owner was permitted to complete the subdivision when it was clear that the developer had made a significant investment in roadways, facilities and water works in reliance on the original approval of the entire subdivision, which permitted quarter-acre lots. The court held that landowner had acquired vested rights to complete the subdivision because it was clear that these improvements would have been laid out differently if the developer had known that it would be subject to a subsequent zoning amendment requiring one-half acre lots. By contrast, developers do not acquired vested rights when developer's improvements would remain equally useful or necessary under the amended zoning requirements. For instance, in , 226 A.D.2d 897, the Third Department held that construction of a 285-foot road with a cul-de-sac, along with installation of water and sewer systems, were improvements that were no more useful in a five-lot plat than the newly required three-lot plat, as the same improvements. As a result, developer acquired no vested rights to complete the five-lot subdivision. Similarly, in , 176 A.D.2d 1157, the developer acquired no vested rights to complete the remaining 12 units of a 30-unit subdivision, despite the construction of roadways and curbs, and the installation of utilities, signs, and fences, when those improvements were necessary for construction of the 18 homes built on the parcel before enactment of a more restrictive zoning ordinance.

TDR Provision Not Adequately Referred to County Planning Board

Matter of Calverton Manor LLC v. Town of Riverhead

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