Curtiss-Wright Corp. v. Town of East Hampton

• Decision Date: 31 August 1981
• Docket Number: CURTISS-WRIGHT,No. 1,No. 4,4,1
• Citation: 442 N.Y.S.2d 125,82 A.D.2d 551
• Parties: CORPORATION, Appellant, v. TOWN OF EAST HAMPTON, Respondent. (Action) SEM REALTY CORP., Plaintiff, v. TOWN OF EAST HAMPTON, et al., Defendants. (Action) (and another title)
• Court: New York Supreme Court — Appellate Division

Page 125

442 N.Y.S.2d 125

82 A.D.2d 551

CURTISS-WRIGHT CORPORATION, Appellant, v. TOWN OF EAST HAMPTON, Respondent. (Action No. 4)

SEM REALTY CORP., Plaintiff, v. TOWN OF EAST HAMPTON, et al., Defendants. (Action No. 1)

(and another title)

Supreme Court, Appellate Division Second Department.

Aug. 31, 1981.

Farrell, Fritz, Caemmerer & Cleary, P. C., Williston Park (John M. Armentano, Samuel S. Tripp and Robert V. Guido, Williston Park, of counsel), for appellant.

Smith, Finkelstein, Lundberg, Crimmins & Yakaboski, Riverhead (Howard M. Finkelstein and Frank A. Isler, Riverhead, of counsel), for respondent.

Before LAZER, J. P., and MANGANO, COHALAN and MARGETT, JJ.

LAZER, Justice Presiding.

In this action, Curtiss-Wright Corporation seeks judgment declaring the unconstitutionality as applied to its property of two zoning amendments enacted by the Town Board of the Town of East Hampton which successively raised the minimum building lot requirement in the Montauk area from one-half acre to two acres. Following trial, Special Term rendered judgment declaring the current zoning classification valid, reasonable, constitutional and consonant with the town's comprehensive plan and not confiscatory. The appeals are from that judgment and from a further order, entered on January 23, 1980, by which Special Term struck its October 12, 1979 findings and conclusions and ordered that its decision of April 2, 1979 be established as the findings and conclusions of the court.

We believe affirmance is required.

In 1966 Curtiss-Wright purchased 1,357 acres of land (including an active sand and gravel mine) in the Montauk area, east of Hither Hills State Park. Subsequent conveyances between 1967 and 1972 ultimately reduced the number of acres in plaintiff's hands to 777, none of which front the ocean and all of which can be denominated as interior property. At the time of acquisition, the property lay in the Residence B single-family district in which minimum building lots of one-half acre are required. In 1968, the town planning board adopted as the official town plan a land use proposal known as the "Voorhis Plan," an action which was followed in 1972 by a massive rezoning which reclassified a great proportion of the 25,000 residentially zoned acres in the town, including those of the plaintiff, to Residence A district in which the building lot requirement is one acre. In 1974, plaintiff's land was included in a further amendment which rezoned some 12,000 acres to Residence AA, where two acres comprise the minimum lot.

In its complaint, Curtiss-Wright alleges that the amendments are: (1) confiscatory and deprive plaintiff of a reasonable return on the property; (2) irrational and without relationship to the problems they were allegedly designed to correct; and (3) not in accordance with the town's comprehensive plan and invalid because they are in violation of sections 261 and 263 of the Town Law.

It scarcely bears repetition to note that application of a zoning restriction to a particular property effects an unconstitutional taking if it does not substantially advance legitimate public interests or denies the owner any economically viable use of his land (Agins v. City of Tiburon, 447 U.S. 255, 100 S.Ct. 2138, 65 L.Ed.2d 106; see also, Penn Cent. Transp. Co. v. New York City, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631; Nectow v. City of Cambridge, 277 U.S. 183, 48 S.Ct. 447, 72 L.Ed. 842). Nevertheless, zoning ordinances, like other legislative acts, are clothed with a strong presumption of constitutionality (Kurzius, Inc. v. Incorporated Vil. of Upper Brookville, 51 N.Y.2d 338, 344, 434 N.Y.S.2d 180, 414 N.E.2d 680; Marcus Assoc. v. Town of Huntington, 45 N.Y.2d 501, 505, 410 N.Y.S.2d 546, 382 N.E.2d 1323; McGowan v. Cohalan, 41 N.Y.2d 434, 393 N.Y.S.2d 376, 361 N.E.2d 1025; Dauernheim, Inc. v. Town Bd. of Town of Hempstead, 33 N.Y.2d 468, 473, 354 N.Y.S.2d 909, 310 N.E.2d 516), and while the presumption may be rebutted, the challenger's burden is heavy indeed, for unconstitutionality must be demonstrated beyond a reasonable doubt (Kurzius, Inc. v. Incorporated Vil. of Upper Brookville, supra; Marcus Assoc. v. Town of Huntington, supra; Lighthouse Shores v. Town of Islip, 41 N.Y.2d 7, 390 N.Y.S.2d 827, 359 N.E.2d 337).

The owner who attacks a zoning ordinance as violative of the Fifth Amendment on the ground that its economic impact amounts to confiscation "must show more than that the current zoning classification has caused a significant diminution of value, or that a substantially higher value could be obtained if an alternate use is permitted. Rather, the proper test is whether the owner can presently receive a reasonable return on his property" (McGowan v. Cohalan, supra, p. 436, 393 N.Y.S.2d 376, 361 N.E.2d 1025; Loretto v. Teleprompter Manhattan CATV Corp., 53 N.Y.2d 124, 440 N.Y.S.2d 843, 423 N.E.2d 320). Such an owner must establish affirmatively that the regulation eliminates all reasonable return (Penn Cent. Transp. Co. v. City of New York, 42 N.Y.2d 324, 397 N.Y.S.2d 914, 366 N.E.2d 1271; Williams v. Town of Oyster Bay, 32 N.Y.2d 78, 343 N.Y.S.2d 118, 295 N.E.2d 788; Mary Chess, Inc. v. City of Glen Cove, 18 N.Y.2d 205, 273 N.Y.S.2d 46, 219 N.E.2d 406), and this must be accomplished by "dollars and cents" proof (Matter of Village Bd. of Vil. of Fayetteville v. Jarrold, 53 N.Y.2d 254, 440 N.Y.S.2d 908, 423 N.E.2d 385; Spears v. Berle, 48 N.Y.2d 254, 422 N.Y.S.2d 636, 397 N.E.2d 1304; Matter of National Merritt v. Weist, 41 N.Y.2d 438, 393 N.Y.S.2d 379, 361 N.E.2d 1028). To establish de facto confiscation, evidence of the market value of the property at the time of acquisition as well as the value of the property as presently zoned is required (H.J.E. Real Estate v. Town of Hempstead, 55 A.D.2d 927, 390 N.Y.S.2d 636; see Matter of Village Bd. of Vil. of Fayetteville v. Jarrold, supra).

Here, Curtiss-Wright offered some evidence of acquisition cost--if not of acquisition value--but the primary focus of its challenge was upon the projected cost of subdivision and development of one or two acre lots. The confiscation argument was thus predicated on evidence that the development and sale of lots under either of the two zoning amendments was economically unfeasible because the cost of houses suitable for large lots plus the cost of development of such lots would result in a price far in excess of what the Montauk area market could bear. What plaintiff made no effort to prove, however, was the current value of the property or that it could not produce a reasonable return if marketed as a single tract under current zoning. The fact that plaintiff's experts could perceive no potentiality of a demand for one or two acre building lots if developed on plaintiff's property, did not compensate for the failure to establish an inability to sell the tract as a unit--particularly since several sales of substantial tracts had occurred in the Montauk area not long before the trial. The history of Long Island development reflects proof positive that land well beyond the pale of immediate subdivision or building construction can be sold and resold with significant return to investors. That its tract was quite large in size did not serve to insulate Curtiss-Wright from the general requirement that an aggrieved owner prove that its property cannot be sold as zoned (see Williams v. Town of Oyster Bay, 32 N.Y.2d 78, 343 N.Y.S.2d 118, 295 N.E.2d 788, supra; Matter of Forrest v. Evershed, 7 N.Y.2d 256, 196 N.Y.S.2d 958, 164 N.E.2d 841) or that such a sale will not produce a reasonable return. As we have noted, the test of constitutionality of zoning restrictions is not whether a substantially higher value can be obtained under less restrictive regulations (see McGowan v. Cohalan, 41 N.Y.2d 434, 393 N.Y.S.2d 376, 361 N.E.2d 1025, supra) but whether no reasonable return can be obtained from the property under the existing regulations. If Curtiss-Wright's acreage can be disposed of with adequate profit as a single parcel, the fact that a greater return might be obtained by subdivision or development is immaterial. Therefore, plaintiff's economic impact claim founders because it has not been established that the zoning regulations preclude a reasonable return on its property.

Furthermore, we find the assault on the feasibility of subdivision development under current zoning to be seriously flawed. Experts testifying for both sides substantially agreed that the demand for property in Montauk is quite limited, regardless of zoning classification. At the time of trial, there were approximately 1,300 vacant lots of less than one-half acre available for development in the Montauk area and most of those were much more marketable than Curtiss-Wright lots would be because of proximity to the ocean and other amenities. At the existing rate of only 100 sales of such lots per year, the exhaustion of this inventory appears long deferred and it is thus apparent that the demand for interior lots such as those that plaintiff might offer will be concomitantly delayed as long as more desirably located lots remain in good supply. Zoning, then, is one source of plaintiff's problem in obtaining a return through subdivision of its land, but for the moment, at...