In the Matter of Exeter Building Corp., et al., Appellants,v.Town of Newburgh, et al., Respondents.BriefN.Y.January 14, 2016To be Argued by: RICHARD B. GOLDEN (Time Requested: 30 Minutes) APL-2014-00308 Orange County Clerk’s Index No. 347/10 Appellate Division–Second Department Docket No. 2012-00615 Court of Appeals of the State of New York In the Matter of the Application of EXETER BUILDING CORP. and 17K NEWBURGH, LLC, Petitioners-Appellants, – against – TOWN OF NEWBURGH and DEREK BENEDICT, GEORGE WOOLSEY, GIL PIAQUADIO and BETTY GREEN, in their capacities as Town Board members; TOWN OF NEWBURGH PLANNING BOARD, TOWN OF NEWBURGH ZONING BOARD OF APPEALS (ZBA) and GRACE CARDONE, JOHN MCKELVEY, RUTH EATON, RONALD HUGHES, JR., JAMES MANLEY, JR., BRENDA DRAKE and MICHAEL P. MAHER, in their capacities and official capacities as ZBA members, and TILFORD STITELER, in his individual capacity and official capacity as Town Code Enforcement Officer, Respondents-Respondents. BRIEF FOR PETITIONERS-APPELLANTS RICHARD B. GOLDEN, ESQ. KELLY M. NAUGHTON, ESQ. BURKE, MIELE & GOLDEN, LLP Attorneys for Petitioners-Appellants 40 Matthews Street, Suite 209 P.O. Box 216 Goshen, New York 10924 Tel.: (845) 294-4080 Fax: (845) 294-7673 Dated Completed: February 17, 2015 i DISCLOSURE STATEMENT PURSUANT TO § 500.1(f) OF THE RULES OF THE COURT OF APPEALS Pursuant to § 500.1(f) of the Rules of the Court of Appeals, Plaintiffs Exeter Building Corporation and 17K Newburgh, LLC hereby advise the Court that these privately held corporations have no corporate parents or subsidiaries. Exeter Building Corporation and 17K Newburgh, LLC are affiliated with Arlington Chester, LLC and Arlington Building Corporation, also privately held corporations. ii TABLE OF CONTENTS Page DISCLOSURE STATEMENT PURSUANT TO § 500.1(f) OF THE RULES OF THE COURT OF APPEALS........................................................ i TABLE OF CONTENTS .......................................................................................... ii TABLE OF AUTHORITIES ................................................................................... iii STATEMENT OF JURISDICTION.......................................................................... v QUESTION PRESENTED ........................................................................................ 1 ARGUMENT ............................................................................................................. 2 THE DECISION OF THE COURT BELOW WRONGFULLY HELD THAT APPELLANT, ALTHOUGH GRANTED FINAL SUBDIVISION AND SITE PLAN APPROVAL, DID NOT VEST PROPERTY RIGHTS IN AN AUTHORIZED PLAN OF DEVELOPMENT, BUT ONLY VESTED RIGHTS IN DISCRETE PERMITS, A VIEW CHARACTERIZED BY THIS COURT AS ONE THAT WOULD RESULT IN “AN EXTENSIVE CHANGE IN THE LAW” OF COMMON LAW VESTED PROPERTY RIGHTS .................................................. 2 A. The Context of Common Law Vested Real Property Rights ................ 2 B. The Facts Underlying This Appeal ....................................................... 7 C. The Facts as Applied to This Court’s More Recent Common Law Vesting Decisions ........................................................................ 16 CONCLUSION ........................................................................................................ 23 iii TABLE OF AUTHORITIES Page(s) Cases: 440 East 102nd Street Corp. v. Murdock, 285 N.Y. 298 (1941) ........................................................................................ 4 Allen v. Adami, 39 N.Y.2d 275 (1976) ...................................................................................... 5 City of Buffalo v. Chadeayne, 134 N.Y. 163 (1892) ........................................................................................ 5 Ellington Constr. Corp. v. Zoning Board of Appeals of New Hempstead, 77 N.Y.2d 114 (1990) .............................................................................passim Exeter Building Corp. v. Town of Newburgh, 24 N.Y.3d 910 (2014) .................................................................................... 15 Exeter Building Corp. v. Town of Newburgh, 114 A.D.3d 774 (2014) ........................................................................ 1, 15, 17 Exeter Building Corp. v. Town of Newburgh, et al., 49 A.D.3d 731 (2d Dep’t), mot. for lv. to appeal denied, 10 N.Y.3d 716 (2008) ...................................................................... 8-9, 20, 22 Glacial Aggregates, LLC v. Town of Yorkshire, 14 N.Y.3d 127 (2010) ................................................................................ 6, 17 In re Quong Wo, 161 Cal. 220 (1911) ......................................................................................... 3 Lincoln Trust Co. v. Williams Bldg. Corp., 229 N.Y. 313 (1920) ................................................................................ 4, 5, 6 Monument Garage v. Levy, 266 N.Y. 339 (1935) ........................................................................................ 4 New York State Investing Co. v. Brady, 214 A.D. 592 (1st Dep’t 1925) ........................................................................ 5 People v. Ortenberg, 224 A.D. 87 (2d Dep’t 1928), aff’d, 250 N.Y. 598 (1929) ......................... 5-6 Railroad Co. v. Richmond, 96 U.S. 521 (1877) ........................................................................................... 3 iv Town of Orangetown v. Magee, 88 N.Y.2d 41 (1996) ...............................................................................passim Village of Carthage v. Frederick, 122 N.Y. 268 (1890) ........................................................................................ 4 Zahn v. Board of Public Works of Los Angeles, 195 Cal. 497 (1925), aff’d, 274 U.S. 325 (1927) ............................................ 3 Statutes & Other Authorities: CPLR Article 78 ....................................................................................................... 14 CPLR § 7803(3) ....................................................................................................... 14 New York Town Law § 265-a ................................................................................... 8 v STATEMENT OF JURISDICTION This Court has jurisdiction over this appeal pursuant to C.P.L.R. § 5602(a)(1)(i). This is an appeal from an order and judgment of the Appellate Division, Second Judicial Department, entered on February 13, 2014. The Appellate Division reversed the Findings of Fact, Conclusions of Law and Judgment of the Supreme Court, Orange County, entered on November 10, 2011 in Orange County, in favor of the Plaintiffs against the Defendant. Specifically, the Appellate Division reversed the trial court’s determination, and granted judgment in favor of the Defendants as follows: Further, the plaintiffs may not ground a claim of common-law vesting upon reliance on the limited permits that were issued to them * * * Accordingly, the ZBA’s determination should have been confirmed, and the Supreme Court should have declared that the plaintiffs do not have a vested right to develop the property under the R-3 zoning regulations. This Court has jurisdiction because the order and judgment of the Appellate Division, Second Judicial Department was a final determination of the action in accordance with C.P.L.R. § 5611. By order dated December 16, 2014, this Court granted Plaintiffs’ motion for leave to appeal. This Court has the jurisdiction to review the question raised as set forth below, because the issues underlying the question raised was preserved for this Court’s review. (See A. 15-16; 299-314; 849.) 1 QUESTION PRESENTED Question: Was it error for the Appellate Court below to reverse the Supreme Court judgment in favor of Appellant (granting it common law vested property rights), based on reasoning that Appellant only vested rights in discrete permits, rather than in its authorized plan, a view contrary to 90 years of consistent vesting jurisprudence, and one characterized by this Court in Ellington Constr. Corp. as a view that would result in “an extensive change in the law” of common law vested rights? Answer: Yes. The Appellate Division decision below (114 A.D.3d 774) is a radical departure from this Court’s holdings, and deprived Appellant of its common law vested rights. The Supreme Court properly found after an evidentiary hearing that Appellant satisfied the consistent common law vesting criteria of incurring substantial expenses to further a development, that resulted in substantial changes to the land, which would be rendered valueless if the project were not permitted to proceed, all pursuant to and in reliance on legally issued permits in furtherance of an approved subdivision and site plan. The Appellate Division’s holding is contrary to a long line of this Court’s common law vesting cases, including the more recent cases of Ellington Constr. Corp. v. Zoning Board of Appeals of New 2 Hempstead, 77 N.Y.2d 114 (1990), and Town of Orangetown v. Magee, 88 N.Y.2d 41 (1996). This case presents a matter of public importance because if the holding below were to remain, it would eviscerate the long-standing common law vesting doctrine, a doctrine critical to the constitutional property rights of New Yorkers. ARGUMENT THE DECISION OF THE COURT BELOW WRONGFULLY HELD THAT APPELLANT, ALTHOUGH GRANTED FINAL SUBDIVISION AND SITE PLAN APPROVAL, DID NOT VEST PROPERTY RIGHTS IN AN AUTHORIZED PLAN OF DEVELOPMENT, BUT ONLY VESTED RIGHTS IN DISCRETE PERMITS, A VIEW CHARACTERIZED BY THIS COURT AS ONE THAT WOULD RESULT IN “AN EXTENSIVE CHANGE IN THE LAW” OF COMMON LAW VESTED PROPERTY RIGHTS. A. The Context of Common Law Vested Real Property Rights. The common law vested property rights doctrine defines an accommodation between constitutionally permissible governmental zoning restrictions and constitutionally protected private property rights. It is a long-standing equitable doctrine that stands as a bulwark against local government overreaching. Although the ability of government to regulate the use of real property through comprehensive zoning restrictions is now well settled, it is a relatively recent development in the field of real property law. The common law of real property has long recognized the essential elements and principles of the use and alienation of real property. Included in such principles are the traditional use 3 limitations of restrictive covenants and the law of nuisance. Of more recent vintage is the government’s intrusion into this field by way of statutory zoning controls. Government regulation of the use of property on an ad hoc basis has existed for some time in this country. 1 However, comprehensive municipal zoning schemes only began to appear at the turn of the 20th Century. For example, in 1909 and 1910 Los Angeles established industrial and residential zoning districts,2 and later established a comprehensive zoning code, based upon a 1917 enabling act which provided, inter alia, that such zoning districts “shall give reasonable consideration, among other things, to the character of the district, its peculiar suitability for particular uses, the conservation of property values and the direction of building development in accord with a well-considered plan.”3 In New York, the first comprehensive zoning code was adopted by New York City in 1916, which was descriptively titled: “A Resolution Regulating and Limiting the Height and Bulk of Buildings Hereafter Erected, and Regulating and Determining the Area of Yards, Courts and Other Open Spaces, and Regulating and Restricting the Location of Trades and Industries, and the Location of Buildings Designed for Specified Uses and Establishing the Boundaries of Districts for the Said Purposes.” 1 See, e.g., Railroad Co. v. Richmond, 96 U.S. 521 (1877) (Restriction on the use of locomotives in a certain area of the City upheld). 2 In re Quong Wo, 161 Cal. 220 (1911). 3 Zahn v. Board of Public Works of Los Angeles, 195 Cal. 497 (1925), aff’d, 274 U.S. 325 (1927). 4 The legality of New York City’s comprehensive zoning act was passed upon by this Court in 1920 and found to be “a proper exercise of the police power” by New York City.4 The fact that zoning was permitted to exist by virtue of the “police power” of government gave the zoning power extreme breadth and flexibility. As noted earlier by the Court of Appeals:5 “As early as 1785, by the charter of the city of Hudson, the right to legislate in regard to the 'police' power was expressly conferred. (Laws of 1785, chap. 83, § 11.) This power was then well known to the common law, and, twenty years before, had been defined by Blackstone as 'the due regulation and domestic order of the Kingdom, whereby the individuals of the state, like members of a well-governed family, are bound to conform their general behavior to the rules of propriety, good neighborhood and good manners and to be decent, industrious and inoffensive in their respective stations.' (4 Black. Comm. 162.) Municipal corporations have exercised this power, eo nomine, for time out of mind by making regulations to preserve order, to promote freedom of communication and to facilitate the transaction of business in crowded communities.” However, because these new zoning powers necessarily tread on existing common law real property rights, it has long been the view of this Court that governments must be restrained from overreaching. In Monument Garage v. Levy, 266 N.Y. 339, 344 (1935) it was held that zoning “is in derogation of common law rights to the use of private property.” Its provisions should not be extended by implication. Similarly, in 440 East 102nd Street Corp. v. Murdock, 285 N.Y. 298, 304 (1941) it was held: “Zoning laws which curtail and limit uses of property 4 Lincoln Trust Co. v. Williams Bldg. Corp., 229 N.Y. 313, 317 (1920). 5 Village of Carthage v. Frederick, 122 N.Y. 268, 273 (1890). 5 confer no privilege upon property owners. Even though in case of necessity such laws are properly within the exercise of the police power, the whole and each and every of the parts must be given a strict construction since they are in derogation of common-law rights.” See also, Allen v. Adami, 39 N.Y.2d 275, 277 (1976). Indeed, the essential elements imbedded in the common law vesting doctrine even pre-date this Court’s judicial recognition of the propriety of comprehensive zoning under the police power in Lincoln Trust Co. v. Williams Bldg. Corp, 229 N.Y. 313 (1920). See, e.g., City of Buffalo v. Chadeayne, 134 N.Y. 163 (1892) (“As soon as he had entered upon the construction of the buildings, and incurred liabilities for the work and material, he had a property interest in them. In this right he was entitled to protection.”) (citations omitted). After this Court formally recognized the propriety of comprehensive zoning in Lincoln Trust, supra, the earliest zoning cases continued to recognize that the government’s zoning powers are subject to such vested private property rights, and the government could take no enforcement action inconsistent with such vested rights. See, New York State Investing Co. v. Brady, 214 A.D. 592, 600 (1st Dept. 1925) (“Under the circumstances, I think the answer must be that, having incurred these obligations before the [zoning] amendment, the original permit to use the premises for a gasoline filling station, for which use the corporation obtained the lease thereof, remained unaffected by the [zoning] amendment.” See also, People 6 v. Ortenberg, 224 A.D. 87, 90 (2d Dept. 1928), aff’d, 250 N.Y. 598 (1929) (Holding it improper to revoke a permit to construct six brick stores after a zoning amendment rendered business uses illegal for that property. “When a builder has gone so far under a lawful permit as not alone to enter upon various contracts but actually to make a substantial excavation on the land in reliance upon the permit when there is and can be no dispute about his intention, it would be a harsh rule not only to abrogate his contracts but also to say that he had not gone far enough in the work of construction to constitute a commencement of his work and so deprive him of the right to utilize his land in the lawful manner intended because some change of use had been thereafter promulgated.”). This bedrock principle of the common law, defining the accommodation between the government’s power to enact zoning restrictions and long standing common law private property rights, has survived consistently throughout the 95 years of New York zoning jurisprudence since Lincoln Trust, supra, including the more recent common law vesting cases of this Court in Ellington Const. Corp. v. Zoning Bd. of Appeals of the Inc. Village of New Hempstead, 77 N.Y.2d 114 (1990), Town of Orangetown v. Magee, 88 N.Y.2d 41 (1996), and Glacial Aggregates, LLC v. Town of Yorkshire, 14 N.Y.3d 127 (2010). Rooted in constitutional protections and fundamental fairness, the vested rights doctrine recognizes the inequity of preventing a property owner, who acted 7 in reliance on an approval of a plan of development, from completing that development consistent with the approved plan. Diverging from this long-standing and consistent principle, the decision of the Appellate Court below will – if left standing – substantially alter the common law vesting landscape and violate constitutionally protected real property rights as they have long been understood. Indeed, this appeal provides this Court with an opportunity to strengthen the common law vesting doctrine by setting a new bright line test that vests the property rights of an owner at the time that an approval is secured from the authorizing municipal board. This would prevent what is now an unfortunate not uncommon practice of municipal overreaching, whereby after an approval has been painstakingly secured after much expense and extensive review by the authorizing municipal board consistent with existing zoning, the local legislative body is influenced by objectors to the project to quickly modify the applicable zoning to undo the owner’s property rights that ought to be vested upon the approval of its project. B. The Facts Underlying This Appeal. Since the beginning of 2002, Appellant Exeter Building Corp. (“Exeter”) has been seeking the approval from the Town of Newburgh to construct a 136-unit 8 town house development on property it purchased in 2000. (See A-812 to 826.)6 At the time of purchase, and virtually all the way throughout the lengthy and occasionally tortuous approval process, Exeter’s proposed use of its property conformed in all respects to Newburgh’s Zoning Code. After a lengthy approval process before the Town of Newburgh Planning Board (“Planning Board”) and the Town of Newburgh Town Board (“Town Board”), Exeter received a subdivision approval in October 2005 (filed in January 2006) and a conditional Final Site Plan approval on December 20, 2007. (A-6, 10 to 12, 83, 99, 275.) During the later stages of this review process, commencing in June 2005, the Town Board, reacting to complaints by surrounding landowners opposed to the project, worked feverishly to amend the Town’s zoning laws to prohibit Exeter’s project from going forward. (A-7 to 12.) On March 6, 2006, the Town Board succeeded in changing its zoning laws, thereby prohibiting the Exeter’s project from going forward as proposed. (A-12.) Exeter initiated a lawsuit against the Town Board to protect its property rights. (A- 107.) On appeal of that prior lawsuit, the Appellate Court below allowed Exeter to proceed with its 136-unit “Madison Green” project under the zoning in effect prior to the March 2006 rezone, under the New York State statutory vesting rule found in New York Town Law § 265-a. See Exeter Building Corp. v. Town of 6 Numbers in parenthesis preceded by “A.” refer to pages from the Appendix filed with this Court by Exeter. 9 Newburgh, et al., 49 A.D.3d 731, 733-34 (2d Dept.), mot. for lv. to appeal denied, 10 N.Y.3d 716 (2008). This decision gave Exeter a 10-month opportunity to obtain common law vested rights in the pre-rezone zoning prior to the expiration of the statutory three-year period on January 24, 2009. (A-13 to 14.) Before and during the three-year statutory period Exeter obtained permits and made substantial improvements and changes to the Madison Green property and made substantial expenditures in furtherance of the project, which would be rendered essentially valueless if the Exeter property were subject to the rezoning. (A-14 to 18.) As noted in the settled findings of fact after the evidentiary hearing in Supreme Court (id.), the following improvements and expenditures were accomplished by Exeter, and the valueless nature of such improvements and expenditures was determined: Obtained the required building permit and demolished an existing single-family residence on the property. Obtained the requisite building permit, demolished two water tanks and a concrete foundation pad owned by the Respondent Town that were located off of Exeter’s property; the demolition was required as a mandated quid pro quo by Respondent Town to obtain an extension of an improvement district, and was a mandated condition of final site plan approval. Obtained a building permit, and erected signs for the project. Obtained the requisite clearing and grading permit, and performed certain clearing and grading activities on the project site in accordance with their approved final site plan, including: 10 The excavation of 34,000 cubic yards of earth and soil, necessary to clear portions of the site (248,000 sq. feet) and bring the entirety of the planned roadways for the first phase of the approved project to sub-grade, and to establish pad sites for residences in phase one of the project as also approved by the Planning Board. Phase one of the project (59 units) represented 43% of the entire development. The installation of a construction entrance to the project, including the placement of stone in accordance with the requirements of the New York State Department of Environmental Conservation. Full stormwater management improvements were accomplished in accordance with the approved final site plans, which included four storm water sediment ponds and underground storm drainage pipes necessarily installed and allowed under the Town Code. Prior to commencing clearing and grading activities, Exeter received the required approvals from New York State Department of Environmental Conservation and New York State Department of Transportation. Exeter also incurred substantial expenditures in furtherance of the project, including the expenditures necessary to accomplish the physical changes and modifications to the land. From the date of their site plan application until final site plan approval was granted on December 20, 2007, Exeter incurred the sum of $358,999 in engineering and review costs. From the granting of final site plan approval on December 20, 2007 and until January 24, 2009, the date of the expiration of the Town Law § 265-a statutory vesting protection granted to petitioners by the Appellate Court in 2008, Exeter incurred $181,780 in engineering and construction costs. The total amount of these two sums is $540,779. Further, the substantial changes and modifications to the land so accomplished by Exeter, and the substantial expenditures incurred by Exeter in connection with the project, are rendered essentially valueless if the new zoning of R-1 were to be applicable to the Exeter’s property and project. Specifically, the property as reconfigured by Exeter is appropriate for the density of multi-family development on a single lot as allowed by the prior R-3 zoning, but 11 not appropriate for the rezoned R-1 development of up to 25 single- family homes on 40,000 sq. ft. lots, specifically: The large pad sites prepared by Exeter to accommodate the large multi-family townhouse buildings are not appropriate for a maximum layout of 25 smaller single-family homes. The circular road pattern constructed by Exeter properly used the land surrounding, and in the middle of, that roadway for multi-family townhouse buildings. A single- family house in the center of that constructed roadway would essentially have four frontages; for single-family homes on 40,000 sq. foot lots buyers expect a traditional development, usually with a front and backyard only. A single-family development on a site of this size would not have a circular road pattern as constructed, but would have to have a new road pattern and design, with less curves, and possibly utilizing a cul-de-sac design, and with open culverts for drainage rather than drainage pipes that were part of the multi-family project. Also, the associated storm water basins installed and their locations would most likely change with a reconfigured roadway. The entire site would have to be re-surveyed for the new construction layout design, excepting only the outer boundaries of the property. The large area of the site necessarily cleared to accommodate the large multi-family townhouse buildings, and the corresponding impact of the necessary expansive utilities, has essentially no value in an R-1 development with no more than 25 single-family homes on a 28.9-acre site. In contrast to the R-3 zoning plan, a single-family home development in accordance with R-1 zoning would have less site clearing, and would be cleared in a manner that works more with, rather than against, the natural contours of the land. The site clearing performed by Exeter, necessary to accommodate the large central water and sewer systems – systems required by law for the townhouse development because the project involved more than 49 units – would be useless, as the R-1 zoning of no more than 25 single-family homes would utilize individual water 12 wells, and septic tanks, for each home. The entire drainage system designed and installed for the R- 3 multi-family townhouse development would have to be re-designed for the R-1 single-family zone because the amount of pervious area would be reduced significantly for the change from large multi-family townhouses to 25 single-family homes. The single-family home design would not require drainage where it has been installed, or to the extent that it has been installed, in accordance with petitioners’ R-3 development plan approved by respondents. (A-14 to 18.) Believing it had obtained common law vested property rights during the statutory three-year period, Exeter made an application to the Town Planning Board to, among other things, amend its Final Site Plan Approval to make some modifications to the arrangement of some of its buildings. (A-26.) On April 14, 2009, in a move that the Town Code Enforcement Officer described as “unprecedented,” but consistent with the Respondent Town’s focused efforts to statutorily undo Exeter’s hard-earned vested rights, the Town Attorney directed the Code Enforcement Officer to sign a letter concluding that Exeter’s statutory vesting period had expired, and that Exeter’s approved site plan was incompatible with the new rezone regulations, and could not proceed. (A-274, 745 to 751, 770 to 773.) The conclusion that the approved site plan was incompatible with the new rezone could not have been reached unless included within such a conclusion was a determination that there was no common law vesting; for if there 13 was common law vesting the zoning compatibility would be measured from the old zoning, not the new rezone regulations. This determination also effectively revoked the then otherwise viable and continuing Clearing and Grading Permit that the Code Enforcement Officer had earlier issued. Based upon the April 14, 2009 letter, the Planning Board rejected Exeter’s application for an Amended Site Plan approval, effectively also terminating all of Exeter’s rights in his previously approved and filed subdivision, and its site plan approvals. (A-19, 104.) Exeter timely appealed the Code Enforcement Officer’s determination to the Town Zoning Board of Appeals (A-19, 106), which, after a public hearing, refused to address Exeter’s common law vesting claims, but instead resolved simply to deny the appeal based on its attorney’s letter advice to them that Exeter did not “satisfy all conditions attached to the resolution of site plan approval adopted by the planning board in December 2007.” (A-467, 506.) Thus, although there was adequate proof in the record, the Zoning Board of Appeals failed to address whether: (1) Exeter performed improvements to the property pursuant to permits legally issued by the Town, (2) Exeter effected substantial improvements to the property, and incurred substantial expenses, to further the development of the project, and (3) the new zoning would result in rendering Exeter’s improvements essentially valueless. (A-467, 506.) 14 Exeter then timely commenced a C.P.L.R. Article 78 proceeding (together with other causes of action not relevant to this appeal) challenging the actions of the Code Enforcement Officer and the Zoning Board of Appeals as “made in violation of lawful procedure, [] affected by an error of law [and] arbitrary and capricious . . . .” (CPLR § 7803(3)). (A-52 to 73.) After issue was joined, and objections in point of law raised by the Town, and responded to by Exeter, the Supreme Court ordered an evidentiary hearing to determine whether Exeter had achieved common law vesting by proof of facts regarding substantial modifications to the land, substantial expenditures, and the valueless of the modifications if the property were subject to the new zoning. (A-39 to 40.) As stated by the Supreme Court, the evidentiary hearing was necessary because the determination of the Town Zoning Board of Appeals “was based on an out of hand rejection of petitioners’ claim of common law vesting rights on the ground that petitioners had not satisfied all conditions attached to the site plan approval . . . .” (A-30.) After the evidentiary hearing the Supreme Court held, on June 1, 2011, that Exeter had “acquired common law vesting rights” because it “demonstrated a commitment to the purpose for which it was granted subdivision approval and [had] effected substantial changes to the real property, incurring substantial expenditures, which would be rendered essentially valueless if the municipal action of the zoning change were to be applied (see Town of Orangetown v. Magee, 88 15 NY2d 41[1996]).” (A-35, 37.) Supreme Court then directed Exeter “to settle findings of fact, conclusions of law and a judgment declaring the rights of the parties accordingly.” (A-37, 38.) The Supreme Court below issued its Order and Judgment on October 7, 2011, holding that Exeter acquired common law vested rights, which were “established by virtue of a demonstrated commitment by [Exeter] to the purpose for which [it was] granted subdivision and site plan approvals, and the associated permits issued by [the Town] to effectuate such approvals, all as evidenced by (a) the substantial work accomplished in furtherance of [its] subdivision and site plan approval during the shortened three-year statutory exemption period under Town Law § 265-a, (b) the substantial expenditures made in the furtherance of [its] subdivision and site plan approval, and (c) the essentially valueless nature of that work and those expenditures if the new R-1 zoning were to apply to [Exeter’s] property and project.” (A-24.) Subsequently, on appeal to the Appellate Court below, that Court reversed the trial court’s decision and declared that Exeter had obtained no vested right to develop its property under the prior zoning regulations, and directed the Supreme Court to dismiss the proceeding on the merits. Exeter Building Corp. v. Town of Newburgh, 114 A.D.3d 774 (2014). An application for leave to appeal was granted by this Court on December 16, 2014. Exeter Building Corp. v. Town of Newburgh, 24 N.Y.3d 910 (2014). 16 C. The Facts as Applied to This Court’s More Recent Common Law Vesting Decisions. Given the Supreme Court’s detailed findings of fact after a hearing, as outlined above, these facts must be viewed in the context of this Court’s more recent common law vesting cases, which are consistent with all prior common law vesting decisions. In Ellington Constr. Corp. v. Zoning Bd. of Appeals of Inc. Vil. of Hempstead, 77 N.Y.2d 114, 122 (1990) (citations omitted) this Court noted the historical backdrop to the vested rights doctrine: “The New York rule . . . has been that where a more restrictive zoning ordinance is enacted, an owner will be permitted to complete a structure or a development which an amendment has rendered nonconforming only where the owner has undertaken substantial construction and made substantial expenditures prior to the effective date of the amendment. The doctrine of vested rights has generally been described as an application of the constitutionally based common-law rule protecting nonconforming uses. But the doctrine is also said to have been grounded on principles of equitable estoppel. Whether rooted in equity or the common law, the operation and effect of the vested rights doctrine is the same and it has been applied alike to a single building or a subdivision.” Town of Orangetown v. Magee 88 N.Y.2d 41 (1996) followed soon thereafter and is frequently cited for guidance in determining whether vested rights have been established, as it succinctly summarized the vesting rights doctrine. In Magee, this Court held that vested rights in pre-rezone zoning are established if, “pursuant to a legally issued permit” the owner “demonstrates a commitment to the purpose for which the permit was granted” by (1) “effecting substantial changes . . 17 . to further the development,” (2) “incurring substantial expenses to further the development,” and (3) the owner’s actions in furtherance of the permit granted “must be so substantial that the municipal action [in rezoning the property] results in serious loss rendering the improvements essentially valueless.” Town of Orangetown v. Magee, 88 N.Y.2d at 47-48 (citations omitted) (emphasis added). Glacial Aggregates LLC, Town of Yorkshire, 14 N.Y.3d 127, 136 (2010) also repeated the test as requiring “substantial changes and incurring substantial expenses to further the development.” (Emphasis added). The Supreme Court’s findings clearly detail the substantial changes to the land and the substantial expenses incurred by Exeter to further the development that was set out in its approved subdivision and site plan, and which are now rendered essentially valueless if the project were to be subject to the new more restrictive re-zoning. Exeter fits squarely within the long-standing test to qualify for common law vested rights. The Appellate Court decision below (114 A.D.3d 774) denied Exeter its common law vested rights because it refused to give credit to Exeter for its efforts to further its approved development, and instead focused on what could be accomplished by the specific permits that were issued at that time. “[Exeter] may not ground a claim of common-law vesting upon reliance on the limited permits that were issues to [it]. None of those permits – which authorized demolition of the single-family house and the water tanks, erection of a sign, and regrading and clearing – either 18 singly or together amounted to the Town’s approval of Madison Green. Thus, [Exeter’s] expenditures and construction in reliance on those limited permits could not satisfy the prerequisite for common- law vesting of the right to construct the entire project. At most, the limited permits authorized [Exeter] to complete the work described in the permits themselves . . . .” 114 A.D.3d at 780-781. The common law vesting doctrine is not, and never was, limited to whatever specific permits were authorized at any particular time. It has always been a test focused on whether, by dint of legally valid permits, there were substantial changes made and substantial expenses incurred to further the development which it was legally permitted to pursue. Indeed, the theory of the Appellate Court below is belied by the facts and holding of Ellington Constr. Corp. v. Zoning Board of Appeals of New Hempstead, 77 N.Y.2d 114 (1990). In Ellington, the property owner developed its first phase of the project under one or more building permits. Two years later the then property owner applied for a new building permit for the second phase of his project. The Court of Appeals held that it was entitled to common law vesting to complete the second phase of the project development (for which it had no valid permits), based on the first phase improvements that were performed under the first phase building permits. Under the theory of the Appellate Court below, Ellington would have been decided differently because the property owner would not have vested under the common law as it had not previously obtained a building permit for its phase two work prior to the end of the statutory vesting period. 19 The legal theory posited by the Appellate Court below is identical to that posed by the Village ZBA in the Ellington case, and which was soundly rejected by the Court of Appeals: “Respondent Zoning Board of Appeals contends that, under the statute, in order to achieve freedom from the amended ordinance for any uncompleted lot, a developer must have actually completed the lot or obtained a building permit for it.” Id. at 123. The Court of Appeals appropriately noted that such a view “would produce an extensive change in the law.” Id. The Court of Appeals in Ellington focused not on the extent of the work authorized by any particular building permit as the relevant inquiry, but on whether the developer “manifest[ed] a commitment to the execution of the [authorized] plan through completing improvements and incurring expenditures in connection therewith, during the [statutory] exemption period, sufficient to constitute vesting under common-law rule.” Id. at 125 (emphasis added). Here, it is undisputed that Exeter performed all of its work in furtherance of the “execution of [its authorized subdivision and final site] plan.” Id. It is not a proper inquiry to focus on which work was performed under which permit, but whether there was authorized work performed in furtherance of an approved plan sufficient to satisfy the common law vesting standards. Exeter has clearly performed such work in a manner that satisfied the common law vesting standards as found in the detailed Findings of 20 Fact and Conclusions of Law of the Supreme Court below that were the result of an evidentiary hearing. (A-5 to 27.) Further, and consistent with the Ellington case, the Appellate Court below specifically held in an earlier 2008 decision that Exeter’s statutory vesting period was not a vesting in any particular permit, or sequence of permits, but that Exeter “has a vested right to develop the real property in accordance with the prior zoning regulations . . . .” Exeter Building Corp. v. Town of Newburgh, 49 A.D.3d 731, 732 (2d Dept.), lv. to appeal denied, 10 N.Y.3d 716 (2008). Exeter followed the holding of the Appellate Court, acting in accordance with its authorized permits from the Code Enforcement Officer, and, as the Supreme Court found, during the time period from January 2006 to January 2009 it effected substantial changes and incurred substantial expenses to further the development. Respondent Town does not challenge the fact that Exeter has accomplished substantial changes to the land, and has incurred substantial expenditures, all in accordance with validly issued permits, and further that such modifications to the land would be valueless under the rezone. Exeter earned the Supreme Court’s holding that it has achieved common law vesting. The Appellate Court’s reasoning also wrongly posits that there was no Town approval of Exeter’s project. Exeter received a final subdivision approval, and a final site plan approval with conditions, from the Town Planning Board; conditions 21 that had to be completed prior to moving through various other aspects of the project. (A-275 to 287.) For example, one of the conditions was that Exeter had to comply with “all of the conditions imposed by the Town Board as part of its approval of the extension of existing sewer and water districts.” (A-279.) One of those referenced conditions was the “[r]emoval of the two existing water storage tanks [owned by the Town] located adjacent to [and outside of Exeter’s property].” (A-368.) Thus, Exeter was required to remove those water tanks as part of its final site plan approval, and it did so pursuant to a valid building permit it secured from the Building Inspector. (A-557.) It was an integral part of the site plan as approved, and Exeter was required to remove the tanks in order to satisfy a condition of its approval in furtherance of its planned development of the property. Exeter also secured its Clearing and Grading permit for the sole purpose of performing work that was required to be performed in accordance with its final site plan approval. (A-374 to 375.) Importantly, this Clearing and Grading Permit was directly tied and restricted to that work allowed under the final site plan approval for Exeter’s project. It authorized more than 30,000 cubic yards of excavation, and more than 30,000 cubic yards of filling, and clearing and grading, all of which had to be in conformance with the final approved site plan for its project. (A-374-375.) Exeter was specifically working on this site plan work in order to obtain common law vesting during its period of statutory vesting granted by the Appellate Court in 22 Exeter Building Corp. v. Town of Newburgh, 49 A.D.3d 731 (2d Dept.), lv. to appeal denied, 10 N.Y.3d 716 (2008). In Ellington, Magee and other common law vesting cases, this Court has properly focused not on the extent of the work authorized by any particular building permit as the relevant inquiry (as did the Appellate Court below), but on whether the developer “manifest[ed] a commitment to the execution of the [authorized] plan through completing improvements and incurring expenditures in connection therewith, during the [statutory] exemption period, sufficient to constitute vesting under common-law rules.” Ellington, supra 77 N.Y.2d at 125. Here, Exeter performed all of its work in the execution of its authorized subdivision and final site plan. Final site plans routinely have conditions that require certain activities to be performed in the future. These conditions do not signal an inchoate approval, but a final approval with certain requirements. It was these requirements of the approved plan that Exeter was required to, and did, secure the necessary Town permits to accomplish. The common law vesting doctrine focuses not on which work was performed under which permit, but whether there was authorized work performed in furtherance of an approved plan sufficient to satisfy the common law vesting standards. Reversing the Appellate Court’s holding below, and re-instating the decision of the Supreme Court would, once again, bring continuity to the common law vesting doctrine in New York. CONCLUSION For all of the foregoing reasons, we respectfully request that this Court issue an Order reversing the Second Department's Decision and reinstating the Judgment of the Supreme Court granting Appellants their common law vested rights, together with any such further relief as the Court deems just and equitable. Dated: February 17, 2015 Goshen, New York Bur e, Miele & Golden, LLP Attorneys for Petitioners-Appellants Exeter Building Corp. and 17K Newburgh, LLC 40 Matthews Street, Suite 209 P.O. Box216 Goshen, New York 10924 (845) 294-4080