Steel Hill Development, Inc. v. Town of Sanbornton, Civ. No. 73-280.

• Decision Date: 25 June 1974
• Docket Number: Civ. No. 73-280.
• Citation: 392 F. Supp. 1144
• Parties: STEEL HILL DEVELOPMENT, INC. v. The TOWN OF SANBORNTON, a Municipal Corporation
• Court: U.S. District Court — District of New Hampshire

392 F. Supp. 1144

STEEL HILL DEVELOPMENT, INC. v. The TOWN OF SANBORNTON, a Municipal Corporation

Civ. No. 73-280.

United States District Court, D. New Hampshire.

June 25, 1974.

COPYRIGHT MATERIAL OMITTED

David J. Killkelley, Nighswander, Lord, Martin & Killkelley, Laconia, N. H., for plaintiff.

Peter V. Millham, Wescott, Millham & Dyer, Laconia, N. H., for defendant.

MEMORANDUM

PETTINE,^* Chief Judge.

The plaintiff herein challenges the zoning ordinances of defendant Town, alleging that said ordinance, as amended in 1971, violates plaintiff's constitutional rights under the Fifth and Fourteenth Amendments. I need not repeat in great detail the factual background to this case, since the identical parties were involved in a previous law suit challenging the constitutionality of the identical zoning amendments, and the bulk of the underlying factual web of the instant case is concisely developed in Steel Hill Development, Inc. v. Town of Sanbornton, 338 F.Supp. 301 (D.N.H.), aff'd 469 F.2d 956 (1st Cir. 1972). See also Judge Bownes' opinion denying defendant's motion to dismiss in the earlier case. Steel Hill Development, Inc. v. Town of Sanbornton, 335 F.Supp. 947 (D.N.H.1971). This series of cases will hereinafter be referred to collectively as "Steel Hill I", with citation to the relevant opinion where necessary. For the purposes of this motion, I need only reiterate a few of the essential facts established in the prior litigation.

The plaintiff corporation is the owner of approximately 500 acres of land acquired in 1969 and located within the Town of Sanbornton. Prior to March 9, 1971, the land owned by plaintiff (the "Steel Hill tract") was entirely within a zoning area requiring a minimum lot size of 35,000 square feet, or about three-fourths of an acre. On March 9, 1971, the defendant, by its Town Meeting, adopted amendments to the zoning ordinance. As a result of these amendments, approximately 70% of the Steel Hill tract is now within a zone requiring 6 acre minimum lot size and approximately 30% in an area zoned for 3 acre minimum lots. As a result of these zoning changes, plaintiff was unable to go forward with its proposed development of the Steel Hill tract, according to a "cluster" plan,¹ to subdivide the tract into 500 to 515 family units comprising a four-season recreation community.

On February 17, 1972, this Court entered judgment for defendant Town finding, on the facts before it, that the zoning amendments were not so arbitrary or unreasonable as to deprive the plaintiff of any rights guaranteed under the United States Constitution. 338 F. Supp. 301. That decision was affirmed, in an opinion written by Chief Judge Coffin, 469 F.2d 956 (1st Cir. 1972).

The instant Complaint was filed on November 9, 1973, alleging that subsequent to the decision in the First Circuit in "Steel Hill I", the plaintiff has altered its plan of development from a four-season recreation community to a mobile home development which allegedly "will fulfill the overwhelming public need in the region for economical housing for all segments of society". Plaintiff further alleges that the lot size restrictions incorporated into the zoning ordinance make a mobile home development subdivision prohibitive, that therefore the ordinance is exclusionary, arbitrary, discriminatory, and totally unrelated to the public health, safety, morals and general welfare of the Town. Based on the foregoing allegations, plaintiff claims the ordinance is violative of New Hampshire Revised Statutes Annotated (N.H.R.S.A.) 31:60, and the due process and equal protection clauses of the Fourteenth Amendment to the Constitution of the United States. Plaintiff seeks declaratory and injunctive relief; jurisdiction is alleged under 42 U.S.C. §§ 1983 and 1985.

Defendant has moved for judgment on the pleadings and for dismissal based on several grounds. A number of the grounds for said motion are identical to issues raised in a similar motion in "Steel Hill I", which motion was denied by Judge Bownes, 335 F. Supp. 947 (D.N.H.1971). As to these grounds, Judge Bownes' reasoning in the earlier case is dispositive, and I need not extensively retrace that legal analysis.²

As defendant admits in its memorandum, its motion is based primarily upon the theories of res judicata and collateral estoppel i. e., that the legality and constitutionality of the zoning ordinance of the Town of Sanbornton as it applies to plaintiff were previously decided in "Steel Hill I" as affirmed by the First Circuit. It is to this issue that the Court now addresses its attention.

Res Judicata

It is basic to the law of judgments that if, subsequent to the entry of a particular judgment, events occur which alter the legal relations of the parties, the earlier judgment will not serve as a bar by estoppel to a redetermination of the issues in light of the changed circumstances. See International Shoe Machinery Corp. v. United Shoe Machinery Corp., 315 F.2d 449, 455 (1st Cir.), cert. denied, 375 U.S. 820, 84 S.Ct. 56, 11 L.Ed.2d 54 (1963); Atwood v. Rhode Island Hospital Trust Co., 34 F.2d 18, 23 (1st Cir. 1929), cert. denied 280 U.S. 600, 50 S.Ct. 81, 74 L.Ed. 646; Lasasso v. Lasasso, 1 N.J. 324, 63 A.2d 526 (1949); Restatement, Judgments, § 54, comment d at 214-15 (1942). See generally 46 Am.Jur.2d, Judgments, § 443 (1969); 50 C.J.S. Judgments § 712b (1947). The test is whether, in light of the change in circumstances, the issues now raised were decided in the earlier case. Phillips Exeter Academy v. Gleason, 103 N.H. 197, 168 A.2d 489 (1961). This doctrine is particularly relevant in the zoning field, in light of the New Hampshire Supreme Court's recent decision that a landowner's application seeking a permit for a use which materially differs in nature and degree from a use applied for in prior proceedings involving the same property is not barred under the doctrine of res judicata. Bois v. City of Manchester, 306 A. 2d 778 (N.H.1973). See National Land and Investment Company v. Kohn, 419 Pa. 504, 215 A.2d 597, 607-08 (1965). ("Every zoning case involves a different set of facts and circumstances in light of which the constitutionality of a zoning ordinance must be tested. Therefore, it is impossible for us to say that any minimum acreage requirement is unconstitutional per se.")

It is the opinion of this Court that the plaintiff's alteration of its plan of development for the Steel Hill tract, as alleged in the Complaint, is of such overriding significance that the judgment rendered in "Steel Hill I", based as it was on a totally distinct proposal for the use of plaintiff's property, cannot serve as conclusive on the legal issues raised herein, and that the instant action is not, therefore, precluded on the theory of res judicata.³ In reaching this conclusion, the Court takes particular note of the emphasis in the First Circuit's opinion in "Steel Hill I" on the "stop gap" nature of its qualified approval of the Town's zoning ordinance. It is highly significant that the proposed development therein involved was intended to create a demand for seasonal homes designed primarily for wealthy urbanites rather than serve to meet an already existing local need for first homes. In distinguishing such cases as National Land and Investment Co. v. Kohn, supra, and Appeal of Kit-Mar Builders, 439 Pa. 466, 268 A.2d 765 (1970), among other cases, Judge Coffin states:

". . . appellant here does not seek to satisfy an already existing demand for suburban expansion, but rather seeks to create a demand in Sanbornton on behalf of wealthy residents of Megalopolis who might be willing to invest heavily in time and money to gain their own haven in bucolic surroundings." 469 F.2d at 961.

Owing to this distinction between "zoning out" natural population growth as opposed to restricting "`visitors' who would own second homes", the Court stated that those cases dealing with alleged exclusionary zoning were not important to the inquiry then before it. 469 F.2d at 960.⁴ The overwhelming significance of plaintiff's change in its plan of development, at least for res judicata purposes, is further accentuated elsewhere in the First Circuit's opinion in "Steel Hill I":

"We cannot think that expansion of population, even a very substantial one, seasonal or permanent, is by itself a legitimate basis for permissible objection. Were we to adjudicate this as a restriction for all time, and were the evidence of pressure from land-deprived and land-seeking outsiders more real, we might well come to a different conclusion. Where there is a natural population growth it has to go somewhere, unwelcome as it may be, and in that case we do not think it should be channelled by the happenstance of what town gets its veto in first." 469 F.2d at 962.

Recognizing the uncertainty of the proper balance between ecological and population pressures, the Court held that the town's ordinance "may properly stand for the present as a legitimate stop-gap measure". Id. at 962.

In the case now before the Court, plaintiff alleges that its revised plan of development is aimed at satisfying the primary housing needs of the low and moderate income groups of the region.⁵ Through its offer of proof, plaintiff has presented to the Court several housing studies prepared by the Lakes Region Planning Commission, hereinafter, "LRPC", in which the Town of Sanbornton is an active member, which indicate that there is an actual shortage of suitable housing in the region for low and moderate income households.⁶ Of course, these studies may give rise to debate and, indeed defendant takes issue with certain conclusions drawn by these studies and their relationship to plaintiff's proposed plan of development. Yet, the ultimate resolution of these factual issues must await trial on the merits. For purposes of the instant motion, the Court is convinced that such evidence raises a genuine issue of material fact which was not in issue in ...