Gazza v. New York State Dept. of Environmental Conservation

• Decision Date: 14 October 1993
• Citation: 159 Misc.2d 591,605 N.Y.S.2d 642
• Parties: In the Matter of the Application of Joseph F. GAZZA, Petitioner, For a Judgment under Article 78 of the Civil Practice Law and Rules v. NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION, Respondent.
• Court: New York Supreme Court

Page 642

605 N.Y.S.2d 642

159 Misc.2d 591

In the Matter of the Application of Joseph F. GAZZA, Petitioner For a Judgment under Article 78 of the Civil Practice Law and Rules v. NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION, Respondent.

Supreme Court, Suffolk County IAS, Part 26.

Oct. 14, 1993.

Esseks, Hefter & Angel by Stephen R. Angel, Riverhead, for petitioner.

Robert Abrams, Atty. Gen. by Maria Semidei-Otero, Asst. Atty. Gen., New York City, for respondent.

MICHAEL F. MULLEN, Justice.

This is a proceeding brought pursuant to CPLR Article 78, and section 25-0404 of the Environmental Conservation Law, to review a determination by the Commissioner of Department of Environmental Conservation ("DEC") dated January 16, 1992, which denied an application by petitioner Joseph F. Gazza for a Tidal Wetlands Permit to build a single-family home located in the Village of Quogue, Town of Southampton, in Suffolk County.

Petitioner does not contend the determination was not supported by substantial evidence. He contends it amounts to a "taking" of his property without compensation. In that regard, and pursuant to a prior order of this Court dated July 21, 1992, the matter was set down for a hearing, which has now been concluded. The hearing played out before this Court over several months, beginning in the end of March and finishing in the middle of June, 1993.

At the hearing, petitioner's witnesses included himself and six (6) others: an engineer, a surveyor, a marine operator, a dock builder, a real estate appraiser, and an attorney who specializes in zoning matters. For its part, respondent DEC called an engineer, a zoning attorney, a real estate appraiser, and an adjoining landowner.

The property in question is located on the north side of Dune Road, in the Village of Quogue. It is in an A-2 residential district, which requires a minimum lot of 43,500 square feet. The property is in excess of 47,000 square feet, and fronts on the Quogue Canal. Approximately 65% of the parcel has been inventoried as tidal wetlands.

The thrust of petitioner's energies has been to show that without the permit, he cannot build on his property, i.e., he cannot economically use his property. And, if that is so, he argues, there has been a regulatory taking (citing, Lucas v. South Carolina Coastal Council, 505 U.S. ----, 112 S.Ct. 2886, 120 L.Ed.2d 798). He also argues that the suggested "uses" which the Commissioner would "permit," e.g., the construction of a parking area, single catwalk and single dock of 20 feet and shed for storage, etc., would never be approved by local officials.

As noted in de St. Aubin v. Flacke, 68 N.Y.2d 66, 76, 505 N.Y.S.2d 859, 496 N.E.2d 879:

"A landowner who claims that land regulation has effected a taking of his property bears the heavy burden of overcoming the presumption of constitutionality that attaches to the regulation and of proving every element of his claim beyond a reasonable doubt."

To be successful, the landowner must establish that the regulation so restricts his property that he is precluded from using it for any purpose for which it is reasonably adapted. Stated another way, he must show by "dollars and cents" evidence that under no use permitted by the regulation would the property be capable of producing a reasonable return, i.e., that the economic value, or all but a bare residue of the economic value, has been destroyed (see, de St. Aubin v. Flacke, supra, at 79, 505 N.Y.S.2d 859, 496 N.E.2d 879; Spears v. Berle, 48 N.Y.2d 254, 263, 422 N.Y.S.2d 636, 397 N.E.2d 1304; Matter of Kransteuber v. Scheyer, 176 A.D.2d 724, 727, 574 N.Y.S.2d 968, affd. 80 N.Y.2d 783, 587 N.Y.S.2d 272, 599 N.E.2d 676; Matter of Licari v. Scheyer, 193 A.D.2d 604, 597 N.Y.S.2d 165).

At bar, probably the most significant testimony at the hearing was supplied by the petitioner himself, Joseph Gazza. He is an attorney and experienced land developer. In the fall of 1989, he purchased the property for $100,000, and 90% of that amount went directly to the Internal Revenue Service to satisfy a lien.

The circumstances here show beyond cavil that the price the petitioner paid reflected that the property was "burdened" by State and local regulations. As the Second Department recognized in a slightly different context in Berwick v. State of New York, 107 A.D.2d 79, 84, 486 N.Y.S.2d 260:

"... the law follows the realities of the marketplace, which are that a knowledgeable buyer would adjust his purchase price to offset the cost in time and money of applying for a permit and challenging its denial in court as confiscatory. Certainly, a knowledgeable buyer would not pay claimants the full unrestricted residential values of their properties on the day of taking, when the wetlands restrictions were still legally in effect. He would pay only the value of the property as so restricted, plus some increment representing its enhanced value at such future time when he is successful in nullifying the wetlands restrictions in court."

To further illustrate this point, there was evidence at the hearing to show that petitioner was successful on several occasions in having his real estate taxes on the property reduced. His argument to the assessor was essentially that the "property...