Case Notes

Out-of-possession commercial tenants may not be entitled to equitable relief for improvements to the property were made by a third party. In Baygold Assoc., Inc. v. Congregation Yetev Lev Monsey, Inc., 19 N.Y.3d 223, the Court of Appeals denied equitable relief to a tenant who had no made improvements, even though tenant's first sublessee had made $1,000,000 in improvements to the premises. Although the court emphasized that only the subtenant had made improvements, the court also focused on the fact that the improvements had been made more than 20 years earlier, and were "too attenuated" from tenant's subsequent failure to exercise the lease renewal option.

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Neighbor Has Standing to Seek Damages for Violation of Zoning Ordinance

In a homeowner's action against neighboring operator of a stone and landscaping supply business, business owner appealed from the New York Supreme Court's denial of its motion for summary judgment on homeowner's claims for nuisance and violation of the town's zoning law. The Appellate Division modified to dismiss the claim for punitive damages, but otherwise affirmed, holding that homeowner's allegations raised question of fact on both of his claims. Delvecchio v. Collins, 178 A.D.3d 1336 (AppDiv, Third Dept.) (Opinion by Pritzker, J.)

Homeowner built his home between 2000 and 2003. In 2001, the neighbor received site plan approval and a use variance to operate a stone and landscaping supply business on his adjacent three-acre parcel. In 2015, homeowner brought this action alleging that in 2005, the neighbor expanded the operation of his business causing excessive dust and noise. The neighbor claimed that the expansion constituted a private nuisance and violated the zoning ordinance because neighbor had expanded the business beyond the area permitted by the use variance. Homeowner also sought punitive damages. The Supreme Court denied neighbors' motion to dismiss.

In modifying, the Appellate Division held that the nuisance claim was necessarily fact intensive. Moreover, the submissions established that the neighbor knew or should have known that his operations could impact neighboring landowners. As a result, the Supreme Court properly denied neighbor's summary judgment motion. The court did hold, however, that Supreme Court erred in failing to dismiss the punitive damages claim because there was no allegation that the neighbor had acted with malice in creating the nuisance. The court then turned to the claim for violation of the zoning laws. The court first emphasized that private property owners who suffer special damages may recover damages and injunctive relief to vindicate their interest in enforcement of a zoning ordinance. In this case, the court held that there was a material question of fact about whether the plot plan created a size restriction on the neighbor's business. As a result, Supreme Court properly denied neighbor's summary judgment motion on homeowner's claim for a zoning violation.

Analysis

Town Law §268(2), but not Village Law §7-714 or General City Law, confers standing on any three aggrieved resident taxpayers to institute an action to enforce a zoning ordinance "in like manner as" town officials, if a town refuses to enforce the ordinance.

The common law affords individual property owners standing to seek to enjoin zoning ordinance violations if they can establish: 1) that plaintiffs would sustain "special damages" different from those of the general community; and 2) that the asserted injuries were within the "zone of interest" contemplated by the ordinance at issue. See, e.g., Town of N. Elba v. Grimditch, 131 AD3d 150 [3d Dept 2015]; Gershon v. Cunningham, 135 A.D.3d 816 [2d Dept 2016] (both cases recently affirming the two requisites as the standard for a private plaintiff to bring a common law injunction action to enjoin zoning law violations). To prove special damages, a property owner must generally show a reduction in property value as a result of the landowner's violation of the ordinance. So, for instance, in Wheeler v. Del Duca, 151 A.D.3d 1005, the court upheld dismissal of neighbor's claim that landowner was violating the applicable ordinance because neighbor had "failed to show that there was a depreciation of the character of the immediate neighborhood, or a depreciation in the value of her premises." Even if the landowner can show special damages, landowner lacks standing to challenge the violation if the damages amount only to business competition, which falls outside the "     zone of interest" protected by the ordinance. For instance, in Cord Meyer Dev. Co. v. Bell Bay Drugs, Inc., 20 NY2d 211, the Court of Appeals held that a zoning-compliant pharmacy lacked standing to enjoin a nearby pharmacy operating in a district that prohibited commercial uses.

Courts will find a presumption of injury sufficient to establish "special damages" when a plaintiff can demonstrate close proximity to a neighbor's zoning ordinance violation, though the threshold of distance triggering the presumption remains an open question. In Zupa v. Paradise Point Ass'n, Inc., 22 AD3d 843 the Second Department held that defendant landowner's violative operation of a marina physically abutting plaintiff neighbor's property gave rise to an inference of damages, even without proof of actual injury. Similarly, In Town of N. Elba, the Third Department held that the presumption conferred standing on homeowners seeking to enjoin construction of a boathouse, in violation of zoning ordinances, on immediately adjacent land.

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Stewart E. Sterk, Mack Professor of Law at Benjamin Cardozo School of Law, is the Editor-in-Chief of Commercial Leasing Law & Strategy's LJN sibling New York Real Estate Law Reporter.