Smith v. Town of Mendon

• Decision Date: 21 December 2004
• Citation: 4 N.Y.3d 1,822 N.E.2d 1214,789 N.Y.S.2d 696
• Parties: In the Matter of PAUL SMITH et al., Appellants, v. TOWN OF MENDON et al., Respondents.
• Court: New York Court of Appeals Court of Appeals

4 N.Y.3d 1

822 N.E.2d 1214

789 N.Y.S.2d 696

In the Matter of PAUL SMITH et al., Appellants, v. TOWN OF MENDON et al., Respondents.

Court of Appeals of the State of New York.

Argued November 17, 2004.

Decided December 21, 2004.

Galvin and Morgan, Delmar (James Morgan and Madeline Sheila Galvin of counsel), for appellants.

Chamberlain D'Amanda Oppenheimer & Greenfield, LLP, Rochester (George D. Marron and Sheldon W. Boyce of counsel), for respondents.

Eliot Spitzer, Attorney General, Albany (Caitlin J. Halligan, Daniel Smirlock, Peter H. Lehner, John J. Sipos and Susan L. Taylor of counsel), for State of New York, amicus curiae.

Community Rights Counsel, Washington, D.C. (Jason C. Rylander of counsel), for Association of Towns of the State of New York and others, amici curiae.

Chief Judge KAYE and Judges G.B. SMITH and CIPARICK concur with Judge ROSENBLATT; Judge READ dissents and votes to reverse in a separate opinion in which Judge R.S. SMITH concurs; Judge GRAFFEO dissents and votes to reverse in another opinion.

OPINION OF THE COURT

ROSENBLATT, J.

This appeal calls on us to determine whether a municipality commits an unconstitutional taking when it conditions site plan approval on the landowner's acceptance of a development restriction consistent with the municipality's preexisting conservation policy. We hold that it does not.

I.

Paul and Janet Smith own a 9.7 acre lot in the Town of Mendon. Situated along Honeyoe Creek, a protected waterway, the lot includes several environmentally sensitive parcels, falls within the creek's 100-year floodplain boundary and is located within 500 feet of a protected agricultural district. It also contains a woodlot and steep sloping areas susceptible to erosion. Several portions of the property sit within areas classified as environmental protection overlay districts (EPODs), pursuant to section 200-23 of the Mendon Town Code.

Four separate EPODs limit the Smiths' use of their property. The first, a "Steep Slope" EPOD, bars the construction of new buildings or structures, the clearing of any land area, the installation of sewage disposal systems, the discharge of stormwater and the placement of stormwater runoff systems, and filling, cutting or excavation operations within the designated district. Property owners may acquire development permits for projects within a Steep Slope EPOD if they can show that their proposed activities will not destabilize the soil, cause erosion or unnecessarily destroy ground cover. They must further demonstrate that there is no reasonable alternative for the proposed activity. The other three EPODs apply to sensitive lands bordering a major creek, an established wooded area and a floodplain. All contain comprehensive use restrictions similar to the Steep Slope EPOD. As a prerequisite for issuance of a development permit, all require specific showings that the proposed activity will not result in injuries to the covered, environmentally sensitive districts.

In December 2001, the Smiths applied to the Town Planning Board for site plan approval to construct a single-family home on the non-EPOD portion of their property. Following various proceedings, the Planning Board issued a final site plan approval in July 2002. The Board concluded that the Smiths' proposal was not likely to result in any adverse environmental impacts as long as no development occurred within the EPOD portions of the site. It conditioned final site plan approval on the Smiths' filing a conservation restriction on any development within the mapped EPODs and amending the final site plan map accordingly. Such action, the Planning Board stated, would "put subsequent buyers on notice that the property contains constraints which may limit development within these environmentally sensitive areas." The Board also determined that the restriction would provide the most meaningful and responsible means of protecting the EPODs.

The conservation restriction sought by the Town closely tracked the limitations set by the EPOD regulations. Under the restriction, which would run with the land and bind subsequent owners, the Smiths would be prohibited in the EPODs from "[c]onstruction, including, but not limited to structures, roads, bridges, drainage facilities, barns, sheds for animals and livestock and fences," the "[c]lear-cutting of trees or removal of vegetation or other ground cover," changing the "natural flow of a stream" or disturbing the stream bed, installing septic or other sewage treatment systems, and using motorized vehicles.

The restriction also required the Smiths to maintain the "Restricted Area" in accordance with the terms of their grant and permitted the Town, upon 30 days' written notice, to enter the property to safeguard the environmentally sensitive parcels. The Smiths, their successors and their assigns, however, retained their rights to "full use and quiet enjoyment" of the EPODs. Critically, they retained the right to exclude others from the entirety of their 10-acre parcel.

The terms of the proposed "Grant of Conservation Restriction" mirrored the preexisting EPOD regulations, differing in only a few respects. First, the conservation restriction encumbered the servient property in perpetuity, whereas the Town could amend its EPOD ordinance. Under both the EPOD system and the conservation restriction, however, the Smiths could seek permission from the Town to conduct a proscribed activity in the environmentally sensitive parcels. Second, the conservation restriction afforded the Town greater enforcement power. Under the EPOD regime, the Town could only issue citations for violations, whereas with the conservation restriction, it could seek injunctive relief.

Rejecting the proposed conservation restriction, the Smiths commenced this hybrid declaratory judgment/CPLR article 78 proceeding, asserting that the restriction worked an unconstitutional taking.¹ The Town moved for an order dismissing or granting summary judgment against the Smiths' claims. Applying Dolan v City of Tigard (512 US 374 [1994]), Supreme Court concluded that, although the conservation restriction was an "exaction," it did not effect an unconstitutional taking. The Smiths appealed.

The Appellate Division determined that Supreme Court erred in characterizing the conservation restriction as an exaction. It affirmed, however, holding that, because the proposed conservation restriction bore a reasonable relationship to the Town's objective of preserving the environmentally sensitive EPODs, there was no taking entitling the Smiths to compensation (see 4 AD3d 859 [4th Dept 2004]). The Smiths appeal as of right from the Appellate Division order, and we now affirm.

II.

The Fifth Amendment to the United States Constitution provides "nor shall private property be taken for public use, without just compensation."² Historically, takings jurisprudence involved instances in which the government encroached upon or occupied real property for public use.³ Beginning with Pennsylvania Coal Co. v Mahon (260 US 393 [1922]), the Supreme Court recognized that, even if the government does not seize or occupy a property, a governmental regulation can work a taking if it "goes too far" (id. at 415).

In the years following Mahon, the Supreme Court offered "some, but not too specific, guidance to courts confronted with deciding whether a particular government action goes too far and effects a regulatory taking" (Palazzolo, 533 US at 617). The first and perhaps most critical factor in the Court's takings analyses became whether the regulation deprived landowners of "all economically viable use" of their property.⁴

If the contested regulation falls short of eliminating all economically viable uses of the encumbered property, the Court looks to several factors to determine whether a taking occurred, including "the regulation's economic effect on the landowner, the extent to which the regulation interferes with reasonable investment-backed expectations, and the character of the government action."⁵ In a different formulation of this third factor, the Supreme Court held in Agins v City of Tiburon (447 US 255, 260 [1980]) that the "application of a general zoning law to particular property effects a taking if the ordinance does not substantially advance legitimate state interests" (see also Bonnie Briar Syndicate v Town of Mamaroneck, 94 NY2d 96 [1999]

).⁶

Styling the conservation restriction an exaction, the Smiths argue that we should not review the Town's action under the Penn Central/Agins standard. We disagree. Exactions are defined as "land-use decisions conditioning approval of development on the dedication of property to public use" (City of Monterey v Del Monte Dunes at Monterey, Ltd., 526 US 687, 702 [1999] [emphasis added]). In a narrow, readily distinguishable class of cases, the Court has held such conditions unconstitutional.

In Nollan v California Coastal Commn. (483 US 825 [1987]), the Court considered whether conditioning a development permit on the property owners' transfer to the public of an easement across their beachfront violated the Takings Clause. The Court deemed the condition unconstitutional because it lacked an "essential nexus" (id. at 837) with the stated purpose of the underlying land-use restriction — "protecting the public's ability to see the beach, assisting the public in overcoming the `psychological barrier' to using the beach created by a developed shorefront, and preventing congestion on the public beaches" (id. at 835). Nevertheless, the Court noted that the government could have conditioned the grant of a development permit on restrictions that promoted the public's ability to see and psychologically access the beach, such as height limitations, width restrictions, and the like (id. at 836).

In Dolan v City of Tigard (512 US 374 [1994]), the Supreme Court added a second layer to the "essential nexus" test— "rough proportionality." In Dolan, the municipality...