Opinion
92939.
Decided July 14, 2008.
Girvin and Ferlazzo, P.C., By: Salvatore D. Ferlazzo, Esq., Albany, New York, for the Plaintiff.
Galvin and Morgan, By: M. Sheila Galvin, Esq., Delmar, New York, for the Defendants.
This action was commenced by the filing of a Summons and Complaint dated September 28, 2005. Defense counsel served an Answer with Counterclaims dated December 22, 2005. Plaintiff's counsel then served a Reply to the counterclaims dated January 5, 2006. By stipulation of the parties, the action was discontinued as against former defendant Theresa Herms, because she no longer has an ownership interest in the subject property. The matter came on for trial before the Court, sitting without a jury, for three one-week sessions: the week of November 5, 2007, the week of January 22, 2008, and the week of February 25, 2008. By Letter Order dated March 10, 2008, the Court dismissed the First, Second, Third, Fourth, Sixth and Seventh Counterclaims.
Plaintiff Town of Caroga ("Town") alleges that a structure being built by defendant Joseph Herms ("Herms") on property he owns on the shore of Canada Lake exceeds the scope of the building permit issued to Herms by the Town, as well as violating the Town of Caroga Zoning Ordinance ("Zoning Ordinance"). The Complaint asserts two causes of action. The First Cause of Action seeks injunctive relief preventing any further use of Herms's property "in violation of the of the provisions of the Town of Caroga's Zoning Ordinance" and directing Herms to abate the zoning violation by dismantling the structure to the extent necessary to make it compliant with the previously-issued building permit. The Second Cause of Action seeks imposition of a civil penalty pursuant to the Zoning Ordinance in the amount of $250.00 per week, commencing on June 3, 2000.
In addition to denying the bulk of the allegations in the Complaint, the Answer raises eleven affirmative defenses attacking elements of the Town's case, such as personal jurisdiction and standing, and asserting constitutional protections against self-incrimination and double jeopardy. The Answer also contains eight counterclaims against the Town. Those counterclaims which survived dismissal after in the March 10 Letter Order allege forms of malicious prosecution, for which Herms seeks compensatory and punitive damages.
The issues raised by the parties can be distilled to two basic questions: (1) Is the structure in question a "boathouse" as that term is defined by regulation, or is it a residence with room to park a boat beneath it? (2) Should the structure be dismantled or reduced to the scope of the permission granted in the building permit, or should Herms be allowed to complete it?
Both parties presented numerous witnesses over the course of this three-week trial. The Court allowed hundreds of documents into evidence. Some witnesses were more credible than others. The Court found the testimony of Mark Kane and John Kalpin extremely helpful in determining the ultimate issues. Herms testified over a three-day period, mostly under extensive direct examination by his attorney. While his testimony was at times less than credible, it provided insight into his mental state and answered to several of the key issues before the Court.
I. FACTUAL HISTORY
Herms is a native of Fulton County. He has a Bachelor of Science degree in Education from the State University of New York at Buffalo and a Master of Science degree in Education from Rochester Institute of Technology. After college, Herms moved to Naples, Florida, where he owned and operated several successful businesses, including a real estate firm. He served two terms on the Naples City Council and was the Vice Mayor for two years. He also drafted portions of the Naples City Charter. By his own testimony, Herms has extensive knowledge and experience with zoning codes, having constantly reviewed and referred to such codes while a member of the City Council in Naples, which is located in one of the fastest growing areas of the country.
On August 13, 1998, Herms signed a contract to purchase the lot on Canada Lake where the structure here in question is located. Canada Lake sits within the Town and also within the "blue line" boundary of the Adirondack Park. Herms added the following contingency language to the contract:
1. This agreement is subject to the buyer receiving a cost estimate on the septic system not to exceed $15,000 to know within 10 days of acceptance.
2. This is subject to APA town [sic] of Caroga building approval to construct new building on the original footprint of the Kane camp within 90 days.
The property Herms purchased had previously been the site of a camp owned by Ms. Mabel Kane, which sat on the shoreline and extended out over the water. The Kane camp was destroyed by fire in 1980.
On August 23, 1998, Herms submitted a "Jurisdictional Inquiry Form" to the Adirondack Park Agency ("APA"). On the form, he wrote, "Replacement of single family camp that burned in 1980." On a sketch showing the location of the proposed structure, which was attached to the form, Herms wrote, "Our proposed project is to rebuild a camp that burned in 1980 on the same site." The APA issued a Jurisdictional Determination letter dated October 26, 1998, which stated that the proposal "does not require a permit from this Agency." The reason for this, as stated in the letter, was the authority of the Town to administer its own, APA-approved, local land use plan.
In the early 1970's, the APA developed the Adirondack Park Land Use and Development Plan, which in 1973 was codified as amendments to the Adirondack Park Agency Act, (Executive Law §§ 800 et seq.) and to APA regulations. Under the Plan, the APA ceded its authority to administer such things as shoreline regulations to local municipalities which adopted land use plans found acceptable to the APA. In 1979, the Town adopted its Zoning Ordinance, which the APA accepted as a an approved local land use plan.
The Jurisdictional Determination letter sent to Herms therefore cautioned him to inquire about the requirements of the Town's land use plan before proceeding with his project and directed Herms to contact the Town "to insure that the subject property is in compliance with all applicable restrictions." At least three other paragraphs of the letter recommended that Herms contact the Town to receive "all necessary approvals."
At that time, the Town's Zoning Ordinance contained shoreline regulations, which are still in force today, including § 7.021(A)(2), which required that "all principal buildings and accessory structures in excess of 100 square feet" be set back a minimum of seventy-five feet from the "mean high-water mark" of the lake. The Kane camp, which sat directly on the shoreline, would violate the setback requirement. However, the Zoning Ordinance also contained Article 9, entitled "Legal Non-Conforming Uses and Structures," which permitted some uses and structures which, while not in conformity with the Zoning Ordinance, had been in existence prior to its enactment. In § 9.020, the Zoning Ordinance states, "If a non-conforming use is discontinued for a period of two (2) years, further use of the property shall conform to this ordinance or be subject to review by the Zoning Board of Appeals." In other words, a variance would be required.
Herms spoke with the Town Code Enforcement Officer, Donald Walrath, who told Herms that since the Kane camp had burned some eighteen years previously, § 9.020 applied and Herms would need to seek a variance from the Zoning Board of Appeals ("ZBA") in order to rebuild on its prior footprint. There is an important distinction between APA regulations and those of the Town concerning reconstruction of a previously destroyed structure. In jurisdictions where the APA has not ceded regulatory authority, the rule is that a person can rebuild on the footprint of a structure destroyed by fire. In common parlance, the "right" to rebuild is "grand-fathered."
Herms testified at trial that he disagreed with Walrath as to the applicability of § 9.020. Nonetheless, Herms applied on August 24, 1998, for a variance to build a 35' x 50' structure. On September 21, 1998, the ZBA denied the variance request. On September 23, 1998, Walrath denied a building permit application by Herms, this time to build a 26' x 40' structure, because it was less than seventy-five feet from the lake shore. Herms appealed to the ZBA. At its October 8, 1998 meeting, the ZBA denied the application. Herms never appealed either of these ZBA decisions. On November 30, 1998, Herms closed on the purchase of the property without obtaining the local approvals upon which the purchase contract was conditioned.
In January of 1999, Herms, through his then attorney, Carmel J. Greco, wrote to Walrath regarding the ZBA's denial of the variance sought by Herms the previous year. Attorney Greco offered his interpretation of the Town's zoning ordinance and cited case law to argue that a variance was not needed to rebuild a structure on a pre-existing foundation. He requested that Walrath issue a building permit to Herms to enable him to construct a summer home on the foundation of the former Kane camp. That request was denied.
On May 25, 1999, Herms made another application for a permit to build a 26' x 40' structure, which was denied by Walrath. On June 7, 1999, Herms applied to the ZBA for a variance. A hearing on this variance application was scheduled for July 7, 1999. Prior to the hearing, however, sometime between June 15, 1999 and June 21, 1999, Herms began building the structure at issue, without a permit.
At the July 7, 1999 ZBA meeting, Herms appeared with his attorney. He described the proposed structure as including 1,300 square feet with a four-foot cantilever. Attorney Greco stated that since Herms was rebuilding a "summer home" on the same footprint as the Kane camp, no variance was needed. Greco argued that while § 9.020 of the Zoning Ordinance prohibited new uses, the "use" proposed by Herms would not change from that of the prior structure. The ZBA postponed decision until its July 19, 1999 meeting.
Herms continued construction on the site during this period, without a permit in place. On July 16, 1999, Code Enforcement Officer Walrath issued a Stop Work Order and an Order to Remedy Violation, because the structure was started without a building permit or a variance, which violated the Town's Local Law No. 2 of 1985.
On July 19, 1999, Herms's then wife, Theresa Herms, applied for a building permit to construct a 30' x 41' "boathouse" with a ten-foot cantilever. No plans or specifications were submitted with the application. Section 7.021(A)(2) of the Zoning Ordinance specifically excludes boathouses from the seventy-five foot shoreline setback requirement. Upon payment of the required fee, Walrath issued Building Permit No. 9967 for construction of a 30' x 41' boathouse.
During the evening of that same day, Herms appeared before the ZBA on his request for a variance to build a summer camp. The ZBA did not reach a conclusion, due to the lack of a quorum. At its meeting on July 31, 1999, the ZBA voted to deny the variance. On August 4, 1999, the ZBA issued a formal decision denying Herms's application for a variance on several grounds. Herms did not appeal this decision.
Mark Kane, a member of the Town Board, testified at trial that during the period when Herms was seeking permission for a variance, he approached Kane while Kane was having breakfast at a local cafÉ. Kane, a local contractor, testified that Herms said he had a project going on and that if Kane "helped him with the Town aspect of it, he would have a lot of work for me in the future." Herms denied this conversation.
On August 11 and 13, 1999, Walrath sent letters to Herms requesting that plans for the boathouse under construction be delivered to the Town by August 20, 1999, in order to prevent the Town from rescinding Building Permit #9967. On August 20, Herms submitted a sketch floor plan, which included language echoing the description of a "boathouse" from the 1998 opinion of the Appellate Division, Third Department, in Otto v. Adirondack Park Agency ( 252 AD2d 898). The sketch plan contained handwritten labels on several of its features, including: "Used for storage of boats and associated equipment" and "No kitchen or Bathroom facilities" and "Not designed or used for lodging or residency." At trial, Herms asserted that he had also submitted elevation drawings at the same time. Walrath testified that received only the floor plan.
Two former friends of Herms, Evelyn and John Kalpin, testified at trial that Herms had shown them plans for a summer home prior to his purchase of the subject property and discussed his plans to build it there. John Kalpin, a trained architect, also testified that Herms had borrowed an electric eraser from him. Herms had indicated to Kalpin his intention to erase interior lines from the plans for his summer home and re-submit them as plans for a boathouse. Kalpin testified that electric erasers are commonly used by architects to modify architectural plans, and that Herms had asked Kalpin to demonstrate the process. Kalpin recalled specifically that he observed Herms erase a room designation for "kitchen" or "bath" from a floor plan.
Mr. Kalpin also testified to an occasion when he had dinner with Herms at a local restaurant. During a span of several hours that evening, Herms told Kalpin the history of the "boathouse situation." Kalpin testified that Herms had stated in sum and substance that the "local yokels" were no match for the experience and capabilities Herms had gained from his efforts in Florida and that he would prevail in building a house on his property.
In the early Fall of 1999, Herms and the Town were sued in New York Supreme Court by three of Herms's neighbors on Canada Lake in an attempt to invalidate Building Permit #9967. The neighbors alleged that the structure being built by Herms was a camp and not a true boathouse. In an affidavit filed on behalf of the Town as part of that lawsuit, Code Enforcement Officer Walrath stated that the structure appeared at that time to be a boathouse, but that the Zoning Ordinance would be enforced and Herms would be restrained if the structure became more than a boathouse.
In that same action, Herms submitted an affidavit stating "The Adirondack Park Agency approved the building of a home, or a boathouse, on this property." Given the very careful language of the Jurisdictional Determination letter sent to Herms by the APA, this amounted to a knowing misstatement of the APA's position that no permit was required from the agency. Indeed, Herms testified at trial that he never sought approval for construction of a boathouse from the APA, thus admitting the misrepresentation.
In a Decision dated September 21, 1999, Justice Joseph M. Sise dismissed the neighbors' lawsuit. He noted that the plans for the Herms project did not include kitchen or bathroom facilities, and at that time, the structure appeared to included space for two boat slips on the "first floor" and space for storage on the second floor. Following this dismissal, construction continued.
The neighbors appealed the Sise decision. On April 6, 2000, the Appellate Division, Third Department, affirmed. However, the basis for the appellate decision was not the substantive issue of whether Herms's structure conformed to the definition of a boathouse. Rather, the Appellate Division relied on the procedural matter of the neighbors' failure to exhaust their administrative remedies prior to bringing suit.
By June of 2000, the Town had a new Code Enforcement Officer, Richard Rubinstein. On June 3, 2000, Rubinstein issued the first of three Stop Work Orders related to the structure which was the subject of Building Permit #9967. Unfortunately, Rubinstein passed away prior to the trial of this matter. However, he had submitted an affidavit in a related matter prior to his death, which was received in evidence at the trial of this matter. In that affidavit, Rubinstein stated that he issued the Stop Work Order due to Herms's failure to comply with numerous requests to submit stamped blueprints in order to determine whether the structure was "consistent with what was authorized in July, 1999" and with fire and safety codes.
On July 19, 2000, Building Permit # 9967, the original (and only) building permit for the structure, expired by its own terms after twelve months had elapsed since its issuance. Herms neither appealed the Stop Work Order issued by Rubinstein nor requested another permit. Instead, Herms brought a motion before Justice Sise seeking to have the Town held in contempt of court for issuing the Stop Work Order. On November 13, 2000, Justice Sise denied the contempt application, because there was no mandate or direction in the earlier court order as to what the Town could or could not do with respect to the structure.
In 2001, Herms retained Attorney Ronald R. Schur, Jr., to request an "continuation" of the expired building permit. By letter dated February 12, 2001, Rubinstein denied that request and informed Attorney Schur that the Stop Work Order was still in effect, because the building exceeded the1,230 square feet that had been approved. Herms appealed to the ZBA.
On April 26, 2001, a hearing before the ZBA was held. Attorney Schur sought the "reissuing of the permit, which has expired." The APA also appeared at the hearing, through the Office of the Attorney General, and submitted a position letter stating that the structure could not be a boathouse. In a written decision dated May 1, 2001, the ZBA denied the continuation on the ground that an expired permit could not be continued (a new permit was required) and on the ground that misrepresentations had been made by Herms in obtaining Building Permit #9967.
Herms appealed the ZBA decision via CPLR Article 78 petition to Justice Sise. In a Decision and Judgment dated September 28, 2001, Justice Sise dismissed the petition, stating:
Thus, since petitioners' permit expired on July 19, 2000 and as they did not apply for a new permit, the ZBA's determination has a sound factual foundation. Moreover, there is nothing in the record to show that respondents prevented petitioners from completing the construction of the boathouse within the applicable 12 month period.
Herms did not appeal this decision. On June 25, 2002, Rubinstein issued a second Stop Work Order due to the expiration of Building Permit #9967.
On October 18, 2002, Herms filed a lawsuit in United States District Court against the APA; the Town of Caroga; the ZBA; the members of the Town Board, both individually and in their official capacities; Code Enforcement Officer Rubinstein, both individually and in his official capacity; Citizens for a Better Canada Lake, as an unincorporated association and its fifty-eight individual members; and Morris Evans, as a member of Citizens for a Better Canada Lake. The suit alleged that these entities and individuals had conspired to prevent Herms from completing his boathouse, had defamed him and had breached a contract with him (the building permit) by issuing StopWork orders. Herms sought $25,000,000.00 in damages. U.S. District Judge David N. Hurd later dismissed this suit.
On June 7, 2004, the Town issued the third and final Stop Work Order. On September 28, 2005, the Town commenced this action. The Court and the parties conducted a site inspection of the structure on June 15, 2006, during which photographs and videotape were taken. Those images were later entered into evidence at trial.
II. THE ENFORCEMENT ACTION
A. Preliminary Questions
1. Discovery Issues. Defense counsel spent considerable time at trial delineating problems encountered in obtaining discovery from the Town. There were dozens of Town Board meetings, Town Board work sessions and ZBA meetings, starting in 1998, which referenced the Herms "boathouse." Herms had great difficulties obtaining copies of the minutes from these meetings from the Town in a timely manner. Indeed, the delay of disclosure continued up to and throughout the course of trial. The Town's excuse for the late discovery was the multitude of locations where the materials were recorded or stored. While the extensive delay appears to have fed Herms's perception of a conspiracy against him, the information finally released simply had little or no impact on the determination of the issues presented in this case.
2. Affirmative Defenses. The Answer raises eleven affirmative defenses. While one of those defenses lack of personal jurisdiction was withdrawn by defense counsel, the remaining ten defenses assert either grounds for dismissal or bars to the Town's ability to bring this action in the first instance.
a. Failure to State a Cause of Action. The Answer alleges that the Complaint fails to set forth facts upon which the Town can "seek recovery for any perceived wrong," but instead contains only conclusory and unsupported allegations. While counsel never made this defense the subject of a CPLR 3211(a)(7) motion, an examination of the Complaint reveals allegations as to the status of the parties, the legal authority under which the Town is suing, the provisions of the Zoning Ordinance applicable to the Herms structure, the specific ways in which that structure violates the Zoning Ordinance, and two specific forms of relief sought by the Town. Not only are these allegations sufficient to enunciate causes of action under Town Law § 268 and the Zoning Ordinance, they have also been borne out by the proof offered at trial. This defense must, therefore, be dismissed.
b. No Delegation of Authority by APA. The Answer raises three separate defenses related to the core allegation that there has been no delegation of authority from the APA by which the Town would be allowed to bring this action. The Third Affirmative Defense asserts that the Town has neither pled nor proven that the APA delegated the necessary authority to the Town to bring this action. The Seventh Affirmative Defense asserts that due to the absence of such a delegation, the APA is a necessary party which the Town has failed to join. The Eighth Affirmative Defense asserts that in the absence of delegated authority from the APA, the Town lacks standing to bring this action.
The Complaint alleges, in paragraph 5, that the Town is acting pursuant to § 807 of the Adirondack Park Agency Act, under which the APA transferred authority to the Town "to administer both the Class B Regional Projects and the shoreline restrictions." Testimony at trial, including that of current Town Code Enforcement Officer Michael Heberer and APA Project Administrator Rita Quinn, and exhibits accepted into evidence in conjunction with that testimony, established this to be the case. As discussed above, the Zoning Ordinance was accepted by the APA as a local land use plan, thereby empowering the Town to administer and enforce the Zoning Ordinance (Executive Law §§ 807, 808). These defenses must be dismissed, as well. c. Concurrent Criminal and Civil Actions. The Answer also raises three defenses relating to a Town of Caroga Justice Court prosecution against Herms commenced prior to this action. The Fourth Affirmative Defense asserts that the Town failed to prove a violation of the Zoning Ordinance in the Justice Court case, a condition precedent to this action which should have been pled with particularity under CPLR 3015(a). The Fifth Affirmative Defense asserts that this action is barred by the protection against double jeopardy found in the Fifth Amendment to the United States Constitution. The Sixth Affirmative Defense asserts that this action should be dismissed as premature, pending the resolution of the charges lodged against Herms in Justice Court.
These defenses appear to be based upon a fundamental misunderstanding of law. Rule 3015(a) applies to actions based on contract, rather than statutes or ordinances, and places the burden of particularized pleading on a defendant denying the occurrence of a condition precedent, rather than on a plaintiff asserting the occurrence of such a condition. Also, it has been specifically held that a justice court criminal prosecution does not preclude a later civil action on double jeopardy grounds ( Town of Grafton v. Cox , 23 AD3d 906 ). Nor does it constitute an election of remedies (Town of Southampton v. Sendlewski, 156 AD2d 669; Town of Solon v. Clark, 97 AD2d 602). Indeed, a determination made in a justice court prosecution will not necessarily be given collateral estoppel effect in a later civil proceeding based on the same violation ( Vreeland v. Zoning Board of Appeals of the Village of Otisville, 175 AD2d 552). The presence, absence or outcome of the Justice Court action against Herms is thus immaterial to this action insofar as the Fourth and Fifth Affirmative Defenses are concerned. Also, as noted by the Town, the Justice Court action against Herms was ultimately withdrawn, rendering the Sixth Affirmative Defense moot. These defenses must be dismissed.
d. "Grand-fathering". The Ninth Affirmative Defense asserts that Herms should have been allowed to replace the prior Kane camp a pre-existing, non-conforming structure on its original footprint. Herms points to the APA Jurisdictional Determination letter, from which he derives his entitlement to build a camp in replacement of the Kane camp. Herms alleges that the Town, with knowledge of his entitlement, refused to permit the reconstruction of the Kane camp.
This defense appears to have been mislabeled. It is not so much a defense against the Town's enforcement of Building Permit #9967 and the Zoning Ordinance as it is a counterclaim against the Town for its refusal to grant a variance for construction of a camp. The several refusals of Herms's requests to reconstruct the Kane camp were separate and distinct actions by the Code Enforcement Officer and the Zoning Board of Appeal.
The APA Jurisdictional Determination letter sent to Herms in 1998 noted the prior enactment of the Adirondack Park Land Use and Development Plan, as well as the jurisdiction of the Town to administer its own land use plan for projects such as the structure at issue. As noted above, the letter stated at several points that Herms would need to contact the Town in order to determine whether his plan to replace the Kane camp would be permissible.
Zoning Ordinance § 9.020, with its two-year limitation on replacing a nonconforming use, is quoted above. At trial, Herms testified that he disagreed with Walrath as to its applicability. He nonetheless made multiple applications for a variance, the last of which was denied by the ZBA on August 4, 1999, upon four stated grounds, including "[t]he question of any grandfathering that may or may not exist." The proper avenue to challenge Walrath's application of the ordinance and the ZBA's denial of his requested variance was appeal to Supreme Court via a proceeding under CPLR Article 78, which must be commenced within thirty days of the decision being challenged (Town Law § 267-c). Since this defense is neither the appropriate vehicle for Herms's claim nor a timely interposition of it, the defense must be dismissed ( See, Town of Coeymans v. Malphrus, 160 AD2d 1178; Matter of Wolfram v. Abbey, 55 AD2d 700).
e. Lack of Authorization. In addition to the "grand-fathering" argument, the Ninth Affirmative Defense contains allegations that the Town Board never voted to authorize this lawsuit, rendering it an ultra vires act. At trial, the defense expanded upon that argument to assert that this action is a nullity, so that the Court lacks subject matter jurisdiction. The preponderance of the evidence shows, however, that this suit was authorized by the Town Board.
Four Town Board members testified at trial. While it was apparent that the passage of time had dimmed the memories of all four witnesses as to specific details of the history of this action, two of the board members, Ralph Palcovic and Stephen Barker, testified affirmatively that the Town Board had voted to proceed with this lawsuit prior to its commencement in September of 2005. While the other two board members were not able to recall a specific authorization vote prior to this action, there was no testimony that such a vote was never taken. Nor did any Town Board member testify that it was not their intention to bring this action to enforce the Zoning Ordinance.
Also admitted into evidence were copies of three Town Board resolutions. A resolution dated August 10, 2005, authorized a contract to hire counsel for the Town in this action, which both Mr. Palcovic and Mr. Barker testified was passed in furtherance of the Town Board's decision to initiate suit. A later resolution, dated June 13, 2007, ratified the Complaint and approved the release of Theresa Herms from her status as a defendant, since she no longer had an ownership interest in the subject property. Finally, a resolution dated December 28, 2007, was passed to "reaffirm" and ratify this action. That resolution references the initial authorization of this suit by Town Board resolution passed on July 9, 2005.
The resolution of August 10, 2005, which was passed after the Town Board came out of executive session, does not specifically mention this lawsuit. The July 9, 2005 date referenced in the December 28, 2007 resolution appears to be an error, since there is no evidence that a Town Board meeting took place on that date. However, even assuming that the decision to initiate suit was made in executive session on August 10, 2005, but never formally included in the resolution to hire counsel, does not invalidate this action ( See, Town of Moriah v. Cole-Layer-Trumble Co., 200 AD2d 879). Given the testimony of the Town Board members and the presence of two resolutions formally ratifying this lawsuit, the record here shows that the Town Board authorized this suit prior to its commencement and complied substantially with the Town Law ( Id.; see also, JRP Old Riverhead Ltd. v. Town of Southampton , 44 AD3d 905 ; Town of Blooming Grove v Blooming Farms Joint Venture, 128 AD2d 772).
f. Laches. The Tenth Affirmative Defense asserts laches, alleging a failure by the Town to pursue any possible remedy it may have had. Aside from the fact that the record established at trial shows more than ample activity by the Town vis- a-vis the Herms project, "neither laches nor estoppel may prevent a municipality from enforcing its zoning laws" ( Lake Placid Village, Inc. v. Lake Placid Main Street Corp., 90 AD2d 873). This defense must be dismissed.
g. Res Judicata/Collateral Estoppel. Herms's Eleventh Affirmative Defense asserts that the issue of whether the structure at issue is a "boathouse" was fully litigated and finally decided by the Appellate Division, Third Department, in Hays v. Walrath ( 271 AD2d 744). This was the 1999 proceeding under CPLR Article 78 brought by Herms's Canada Lake neighbors to challenge the issuance of Building Permit #9967. As noted above, Justice Sise held in 1999 that the plans submitted by Herms fit within the definition of "boathouse" found in the Otto opinion and dismissed the petition. On appeal, the Appellate Division agreed with Justice Sise that the Article 78 proceeding should have been dismissed, but for a different reason. The appellate court held that the petitioners had failed to exhaust their administrative remedies prior to bringing the Article 78 proceeding, which precluded their ability to bring that proceeding in the first instance ( Hays v. Walrath, supra, at 745).
It is well-established in the law that a prior decision must be "on the merits" before it can be given res judicata effect, or it must finally determine the particular issue for which collateral estoppel is asserted ( See, e.g., White v. Frize , 35 AD3d 983 ; Dutcher v. Town of Shandaken, 97 AD2d 922). As noted by the Third Department in the Hays opinion, the failure by a petitioner to exhaust their administrative remedies forecloses their ability to raise an issue in court ( Hays v. Walrath, supra, at 745). A court dismissing an Article 78 petition on the basis of failure to exhaust administrative remedies therefore does not reach the merits of the case ( See, e.g., Fahey v. Axelrod, 171 AD2d 213). The Hays decision did not determine the questions raised in this case, so that it cannot have either res judicata or collateral estoppel effect here. This defense must be dismissed.
B. The Town's Claim
The First Cause of Action in the Complaint alleges that the structure being erected by Herms does not conform to Building Permit #9967 for two reasons. First, it does not conform to the definition of a boathouse. Second, it exceeds the 1,230 square feet of usable space permitted, and indeed, exceeds 1,250 square feet in size, making it a "principal building" which must comply with the seventy-five foot shoreline setback requirement of Zoning Ordinance § 7.021(A)(2).
1. The Structure Is Not A Boathouse. The building permit issued by the Town allowed the construction of a 30'x41' boathouse, ten feet of which would be cantilevered beyond piers anchored to two boulders which rise above the surface of Canada Lake. The Zoning Ordinance did not include a definition of the term "boathouse," so Code Enforcement Officer Walrath relied upon the definition found in the regulations of the APA, made applicable to this structure under the Adirondack Park Agency Act (Executive Law §§ 800, et seq.). The definition in place at the time Herms received Building Permit #9967 read as follows:
Boathouse means a structure with direct access to a navigable body of water (1) which is used for the storage of boats and associated equipment and (2) which does not have bathroom or kitchen facilities and is not designed or used for lodging or residency
( 9 NYCRR § 570.3(e)). The original definition was promulgated in 1979. In 1982, the definition was amended to read as it does in the quotation above. In 2002, it was amended again, to elaborate on what was meant by "designed for lodging or residency."
A point of clarification is in order at this point. Herms alleges in his Fifth Counterclaim that the Town has sought to use the 2002 definition in this action, even though it was not in effect at the time Building Permit #9967 was issued and is therefore inapplicable. Herms points specifically to paragraph 12 of the Complaint. However, that paragraph specifically alleges the boathouse definition in place prior to the effective date of the most recent amendment in May of 2002, and actually quotes the same language set forth above. The Complaint is therefore based on the definition in effect when Herms received Building Permit #9967. The evidence presented by the Town at trial was also focused on the definition quoted above. Herms was unable to offer credible proof that the Town used any definition other than that quoted above. The Fifth Counterclaim is therefore dismissed. More importantly, the proof shows that the structure does not fit within the pre-2002 definition.
a. No Direct Access to Navigable Water. The phrase "direct access to a navigable body of water" appears in all three versions of the APA definition of boathouse. Credible trial testimony by APA Project Administrator Quinn established that the consistent position of the APA has been that this phrase means that one must be able to drive a boat into the structure, get out of the boat and be inside the structure. Herms neither discredited nor rebutted that testimony.
The Walrath affidavit submitted in Hays v. Walrath ( supra) indicated that in September of 1999, the structure appeared to have slips for water craft. Walrath also testified at trial as to his observations leading to that affidavit, as part of which he marked certain photographs of the structure to show the "slips." While those photos show a space beneath the structure where one or more slips might be constructed, significant subsequent construction has made no provision for slips. There is no framing or other evidence of any intent to enclose the area of the structure which meets the water line; no stairs within the structure or other means of going between the upper floor from the water level; and no dock, decking or other provision for ingress and egress to and from a boat driven beneath the structure. Herms himself stated that the photograph used in Walrath's testimony did not show boat slips. What appeared to Walrath to be the beginnings of a structure at water lever was described by Herms as part of scaffolding used to hold workers building the upper level of the structure.
Even the elevation drawings asserted by Herms as having been submitted to Walrath along with the sketch floor plan on August 20, 1999, do not show any sort of structure at water level. What is depicted is a sketch of a boat sitting beneath a residential structure placed on piers over the waters of Canada Lake. Herms actually asserted at trial that he was unaware of any "direct access" requirement until the Town brought this proceeding. He further testified, "I'll be happy to put a hole in the floor and put a staircase down to it to try to make it legal with the Town . . . ."
Herms also attempted to deflect responsibility for the lack of direct access to water by complaining of changing legal interpretations by the Town and representations made by Walrath. The evidence developed at trial, however, did not support his assertions. The APA boathouse definition has always contained a direct access requirement. The definition was readily available to Herms in published regulations and in APA literature, and there is no evidence other than Herms's own self-serving testimony to support either of his claims. The record establishes that the structure lacks direct access to a body of navigable water, as that term is used by the APA. Herms admitted as much, as well as admitting that no such access was planned prior to this enforcement action.
b. Designed for Lodging or Residency. Quinn also gave extensive testimony as to the types of "residential amenities" which would indicate that a structure was designed for lodging or residency. While no single feature is absolutely determinative, each is an indicator. In fact, Quinn testified that the 2002 amendment to the APA's boathouse definition was designed to expand this portion of the definition by including specific examples of features which the APA had long considered to be indicators that a structure was designed or used for lodging or residency. This may explain Herms's mistaken perception that the Town was somehow improperly seeking to apply the later version of the definition to his structure.
The Herms structure includes insulated and sheet-rocked exterior walls; sheet-rocked interior partition walls forming interior rooms which, to the Court, fit the normal pattern for living, dining, kitchen and bath areas; a second floor with three additional rooms formed by sheet-rocked partition walls which, to the Court, fit the normal pattern for bedroom and perhaps closet areas; a 200-amp electrical service and a large circuit-breaker panel, extensive electrical wiring and electrical "boxes" for such fixtures such as outlets and light switches; telephone service; glass "patio" doors leading from what appears to be a main living/dining area to the deck; residential-style casement windows on both floors, including one configured as would typically be found above a kitchen sink; what appears to be a wall-mounted thermostat; and a gas or propane stove/fireplace with a fuel line and metal chimney installed in a permanent fashion through an exterior wall.
Upon inspection, the structure was found to contain many items which appeared either to be in use, or to be stored in contemplation of their use, in the structure as configured. These include kitchen cabinets in their shipping cartons; plumbing components; furniture and appliances, including a microwave oven, a mattress and box spring, a chest of drawers and an entertainment cabinet with a television and video disc player set up inside. All of these items are further indicators that the structure was designed, and apparently was or had been in use, as a camp residence.
The defense sought at trial to controvert the evidence offered by the Town. Some of the arguments offered by defense counsel, if taken piece-meal, show internal logic. However, they are rendered less plausible when taken in context. For example, the temporary storage of kitchen cabinets or plumbing components in a boathouse for later use in building an adjacent camp structure might make sense, even though Quinn testified that even temporary storage of items other than boats and boating equipment falls outside the definition of a boathouse. However, the factual context of this action greatly diminishes the plausibility of such an explanation.
There is no other structure under construction on Herms's property, nor has he applied for a permit to build one. Herms testified that he intended to build a camp behind the structure at issue and that he hired an engineer to develop plans for it. The deposition transcript of Steven Smith, the engineer hired by Herms, was admitted into evidence by stipulation. Smith's testimony confirmed that he had preliminary discussions with Herms as to the possibility of building a second structure, but noted that those discussions did not proceed beyond preliminary, free-hand pencil sketches. More telling was the fact that those discussions took place in the Fall of 2000, months after the Town Attorney wrote to Herms's then attorney in May of 2000 complaining of the presence of kitchen and bathroom fixtures in the structure. It was also after Smith himself observed plumbing components in the structure during an inspection in June of 2000. Herms offered no other significant evidence to corroborate his testimony that such a structure was actually contemplated.
Herms also characterized the second floor of the structure as "attic space" for storage only. Indeed, while "as-built" drawings produced by engineer Smith in 2000 included the presence of a "hatch" between the two floors, Herms testified that he had closed off the hatch, rendering the attic space inaccessible and unusable for living space. However, the sketch floor plan initially submitted to Walrath by Herms contained a depiction of a staircase in the same location later labeled "hatch" in the as-built drawings. While this might at first blush appear to be a mere coincidence, it takes on added meaning in the context Herms's later testimony:
If this Court or someone else decided that the nonconforming uses section of the town code would not apply and it was determined that I could have a home there, I certainly could some day put a staircase in and utilize some of that upstairs attic area for something and I don't know whether it would be a living space, living room, a kitchen, you know.
Herms also testified that the interior partitions on the second floor were load-bearing walls to support the weight of snow on the roof of the structure. However, that view was not supported by the testimony and exhibits in the record. Finally, while the defense argued that the large, arched casement windows in the upper floor could be used for attic ventilation, Herms's position that the upper floor is not accessible would make opening them virtually impossible.
At trial, the defense parsed the APA boathouse definition, as well as the various policy considerations used by the APA, and questioned the application of each component to Herms's structure. As noted above, some defense arguments made sense "in a vacuum." However, as testified by Quinn, no single feature is determinative. The clear preponderance of the evidence shows that this structure was initially designed, and was being constructed, as a camp residence. The Town therefore sustained its allegation to that effect. Herms's Eighth Counterclaim, which alleges that the Town applied "nonsensical" standards to arrive at this "farcical, if not delusional" allegation, must be dismissed.
2. Usable Square Feet. The building permit issued to Herms authorized construction of a 30'x41' structure, resulting in a total of 1,230 square feet of space. As noted above, however, the structure as built also has a second floor, which includes nearly 1,000 square feet of space. In addition, the structure includes over four hundred square feet of deck space. Testimony by Town personnel at trial, including Walrath and current Code Enforcement Officer Heberer, consistently established that decks are counted in calculating the "footprint" of a structure under the Zoning Ordinance. The structure thus exceeds the permit description by over 1,000 square feet.
3. Conclusion. The Town has established by a clear preponderance of the evidence that the structure at issue does not fit within the definition of a "boathouse." The Town has also established that the structure exceeds the 1,230 square feet for which Herms received a building permit, and indeed, includes more than 1,250 square feet (even without decks), making it a "Principal Building" as defined in § 2.050(A)(48) of the Zoning Ordinance. By virtue of its status as a Principal Building and its failure to come within the definition of a boathouse, the structure is subject to, and in violation of, the shoreline setback restriction found at § 7.021(A)(2) of the Zoning Ordinance. The evidence offered by Herms was insufficient to overcome the showing made by the Town.
C. Remedy
The Complaint seeks injunctive relief preventing further use of the Herms property in violation of the Zoning Ordinance and directing the modification of the structure to fit the description in Building Permit #9967. In its post-trial submission, the Town expands its request for injunctive relief to include the complete removal of the structure. The Town also seeks a civil penalty of $250.00 per week from June 3, 2000, the date of the initial Stop Work Order issued by Code Enforcement Officer Rubinstein.
1. Injunctive Relief. The Town's request for injunctive relief invokes the equitable jurisdiction of the Court ( See, e.g., Town of Esopus v. Fausto Simoes Assocs., 145 AD2d 840). The flexibility of equity jurisdiction, which seeks only a result which is just and allows a court to fashion relief appropriate to the facts, even if not demanded by a party, is limited principally by the "proportionate, prudential discretion" of the trial court ( State v. Barone, 74 NY2d 332, 336).
In this case, the exercise of that discretion demands consideration of two additional tenets of equity. First, equitable relief must be practicable; a court of equity should not make a decree which cannot be enforced or which would require protracted, constant supervision ( See, 423 S. Salina St., Inc. v. City of Syracuse, 68 NY2d 474; 55 NY Jur 2d, Equity, §§ 33, 96). Second, a court exercising equity jurisdiction must balance the equities between the parties in order to determine what relief would be just ( See, e.g., Town of Thompson v. Braunstein, 247 AD2d 753; Town of Esopus v. Fausto Simoes Assocs., supra).
a. Practicability. A decree directing the reduction of the structure to fit within the parameters of Building Permit #9967 would be impracticable, precisely because it would be difficult to enforce and would require protracted, constant supervision. The history developed at trial shows that Herms has consistently harbored the single-minded intention to build a camp residence on his property. Indeed, if there is anything for which Herms can actually be commended, it is his dogged determination to see his plan through to reality.
Prior to purchasing the subject property, Herms told friends of his plan to build a camp and showed them plans for it. He then entered into a purchase contract with contingencies for the approvals needed to construct such a camp. Despite his none-too-subtle attempt to curry favor with Town Board member Mark Kane, Herms was denied a variance to build a camp. Undaunted, Herms closed on his purchase of the property without the necessary approvals. He even began construction without any sort of building permit. Given Herms's self-professed expertise in zoning and land use regulation, his decision to commence construction without approval or permit is telling.
Herms's application for a permit to build a boathouse did not include required plans. When pressed by Code Enforcement Officer Walrath supply plans, Herms altered the floor plan for his camp to remove partitions and room labels such as "kitchen" or "bath,"substituting descriptions which tracked the language the Otto decision. Herms accomplished this with the aid of an electric eraser borrowed from John Kalpin, whom Herms told of his plan to outlast the local authorities and build a residence on the property.
His statement to Kalpin has been borne out by his conduct. Through denials of his variance requests, through the Hays lawsuit, through multiple hearings of the ZBA, and through three Stop Work Orders, Herms has continued to build a structure which, as discussed above, does not come within the definition of a boathouse. This proceeding is the seventh time the Town has taken formal action to enforce compliance by Herms with the Zoning Ordinance. When added to the meetings, conversations, and correspondence in the record, the history of the Town's involvement with Herms spans nearly ten years. Not only has Herms steadfastly resisted the Town's efforts, he has twice brought legal actions against the Town and its officials.
This proceeding has been likewise contentious. In addition to challenging the allegations made by the Town, Herms interposed nine counterclaims alleging misconduct by Town officials and mistreatment at their hands. Certainly, Mr. Herms has the right to defend himself against the Town's action. However, there is a distinct difference between energetic defense and antagonism. As was the case with defense arguments that the structure at issue is a boathouse, the counterclaims asserted by the defense showed themselves to be implausible, crossing the line between valid criticism and ad hominem attack. The record developed here shows no factual basis for the accusations of "punitive" and "delusional" conduct leveled against the Town, which Herms alleges to be sufficiently outrageous to have inflicted upon him more than a million dollars' worth of damages.
The Court finds no indication in any of Herms's behavior, either prior to or during this proceeding, to indicate that he will cooperate in any way if ordered to reduce the structure to fit the description given in Building Permit #9967. Instead, such a decree would serve only to further prolong the Town's already protracted enforcement efforts.
b. Balancing of Equities. The balancing of equities in this case effectively boils down to weighing the public and private interests at stake. The Town of Caroga Zoning Ordinance states at § 1.030 that its purpose and objective is "to promote the health safety and general welfare of the community . . . ." All municipalities are charged with safeguarding the health, safety and welfare of their citizens, both in the enactment of zoning ordinances ( See, Mohawk Valley Ski Club, Inc. v. Town of Duanesburg, 304 AD2d 881) and in their application ( See, Pine Knolls Alliance Church v. Zoning Board of Appeals of the Town of Moreau , 5 NY3d 407 ). The Town thus has on its side of the balance of equities a strong public policy in favor of the enactment and enforcement of zoning laws ( Town of Thompson v. Braunstein, supra).
The Town's position is diminished somewhat by its prior lapse in enforcement. The testimony of Code Enforcement Officer Walrath, and the photos entered into evidence from his inspection of the structure in September of 1999, shows that Walrath failed to take enforcement action when, in the eyes of this Court, the Herms structure had already taken a form which went beyond both the definition of a boathouse and the dimensions of Building Permit #9967.
However, contrary to the defense argument at trial, the failure of Walrath and the Town to take action at that time, and indeed the position taken by the Town in Hays v. Walrath ( supra), do not prevent or imperil the Town's action in bringing this proceeding. Absent truly extraordinary circumstances amounting to manifest injustice, a municipality cannot be estopped from enforcing its lawful ordinances, even in the face of erroneous actions by its administrative employees ( Matter of Clear Channel Outdoor, Inc. v. Town Board of the Town of Windham , 9 AD3d 802 ; Lake Placid Village, Inc. v. Lake Placid Main Street Corp., supra; Matter of Wolfram v. Abbey, supra).
It appears to this Court that Walrath may have become so focused on the particular wording of the APA boathouse definition that he lost some perspective when observing what Herms was actually building. In turn, his viewpoint informed the position taken by the Town in the Hays case. However, Walrath also testified that his opinion changed by December of 1999. Herms himself asserted such a change when attempting to show that he was being misled by Town officials. In the end, however, the record here establishes that Herms knew he was not building a boathouse and never intended to build a boathouse. While Walrath's opinion in September of 1999 appears to this Court to have been erroneous, Herms was not prejudiced by his error. It certainly does not rise to the level of an extraordinary circumstance sufficient to defeat this action.
The equities in favor of Herms relate to his rights as the owner of the property at issue and the investment of time and money he has made there. Herms asserts that when he received Building Permit #9967 and invested substantial time and money in construction, he gained the "vested right" to complete the structure, which cannot be eroded by the Town ( See, Estate of Kadin v. Bennett, 163 AD2d 308). However, those interest are greatly diminished by the record of Herms's actions developed at trial. Unfortunately, his ambition appears to have superseded his judgment.
While the discussion of practicability above focused on Herms's persistent opposition to the Town's efforts, it also contains evidence of his willingness to skirt authority. He began construction without a permit. He submitted plans showing one building layout and then went about constructing something else. He attempted to influence a public official to help him with the promise of business in the future. As part of the proceedings in Hays matter, he submitted an affidavit in which he misrepresented the nature of the APA Jurisdictional Determination letter as having approved the building of a home or boathouse on his property.
Herms's trial testimony showed an equal willingness to skirt the truth in order to portray himself as the innocent victim of the incompetence and corruption of Town officials. For example, Herms persisted throughout trial in alleging that the violations being asserted by the Town were not his fault, but instead were the result of his innocent reliance on misrepresentations by Code Enforcement Officer Walrath. In addition to his testimony that Walrath misled him as to the direct access requirement discussed above, Herms took several opportunities, often over objection, to assert that Walrath had indicated on more than one occasion that he "could almost guarantee a variance" so that Herms could build the camp he wanted. Given his self-avowed experience and expertise in the area of zoning and government approvals, the claim that Herms based his decision to proceed with construction of a camp on an alleged oral "almost guarantee" certainly lacked credibility and bordered on disingenuous.
Another topic discussed above the question of direct access to navigable water yielded testimony by Herms that he had never heard of the direct access requirement in the APA boathouse definition until the advent of this action. Yet, when pressed by counsel for the Town as to whether he simply parroted the language from the Otto opinion when preparing the sketch floor plan he submitted, Herms insisted that the language on the sketch plan came from the APA regulation itself. As shown in the quotation of that regulation above, however, the direct access requirement is found in the very same, single-sentence boathouse definition containing the language about boat storage and lodging.
At times, Herms's attempts to craft his testimony to defeat an argument advanced by the Town actually exposed other questionable conduct. In asserting that the upper level of the structure was attic storage and not living space, Herms testified that he had closed off the hatch between the floors to eliminate access to the upper level. However, engineer Smith testified in deposition that when he inspected the structure in June of 2000, he gained access to the upper level through the hatch. The first Stop Work Order was issued on June 3, 2000, meaning that when Herms closed off the hatch some time after Smith's inspection, he did so in violation of the Stop Work Order. It is also worth noting that the closed-off hatch obstructed the view of the upper level to anyone else inspecting the structure, including the Court and the parties when visiting the structure in 2006.
As noted above, individual arguments advanced by the defense, when viewed in a vacuum, appear to make valid points. However, when the entire history of this case is viewed, a pattern of conduct by Herms emerges which bespeaks artifice and even guile. His conduct and testimony show that Herms obtained Building Permit #9967 through misrepresentation of his intentions. Herms never intended to build a boathouse, but instead used the building permit to further his desire to build a camp in violation of the Zoning Ordinance. No vested rights are gained through an improperly issued permit used to build a structure that violates zoning laws ( Lamar Advertising of Penn, LLC v. Pitman , 9 AD3d 734 ). Any equities to be weighed in Herms's favor have been effectively eliminated by his conduct. c. Conclusion. Since the Town has established its claim for enforcement and Herms has failed to offer proof sufficient to defeat or ameliorate the violations alleged, the equitable remedy of injunction is available. However, the tenets of equity preclude the use of an injunction to reduce the scope of the Herms structure to that described in Building Permit #9967. The appropriate injunctive remedy is, therefore, to direct the complete removal of the structure and enjoin any future attempts to replicate it. Indeed, the effective enforcement of the Town of Caroga Zoning Ordinance, especially in the face of Herms's nearly complete disregard for the ordinance and his apparent disdain for the Town's duty to enforce it, compels such a result.
2. Civil Penalties. The Town's claim for civil penalties of $250.00 for each week that Herms has been in violation of the Zoning Ordinance is stated as a separate cause of action in the Complaint. The request for relief is not, however, stated in the alternative. Town of Caroga Zoning Ordinance § 13.020 specifically provides that an action for injunctive relief may be brought in addition to imposition of civil penalties. Such a provision is valid under the Town Law (Town Law § 135(1); see, Town of Solon v. Clark, supra).
However, a less formal notion of "equity" must be applied here, as well. The passage of time since Herms was first served with a Stop Work Order has caused the full amount of the civil penalties sought by the Town to exceed $104,000.00. Some of that elapsed time, however, can be attributed to the actions, or more accurately, the inaction of the Town in providing discovery materials requested by Herms. Irrespective of the ultimate relevance of these materials, the Town's slow response played a part in causing the pendency of this action to stretch over two years. Also, the severity of the injunctive penalty to be invoked against Herms blunts the effectiveness of a civil penalty. Herms will sacrifice the entire structure and, absent salvage value, the money invested to build it, which in the eyes of the Court is in itself a substantial penalty.
Therefore, it is hereby
ORDERED, ADJUDGED AND DECREED, as follows:
a. Defendant shall abate the violation of the Town of Caroga Zoning Ordinance established herein by dismantling the structure which is the subject of this action, completely and in accordance with all applicable laws, rules and regulations;
b. Defendant shall remove from the subject property all of the contents of the said structure and all of the materials of which it is composed, and shall dispose of same, all in accordance with applicable laws, rules and regulations;
c. Defendant shall commence such dismantling and removal within sixty (60) days of service upon his counsel of this Decision, Order and Judgment, with notice of its entry, and shall accomplish the complete removal of the structure within six months of such date;
d. Defendant shall bear all costs associated with such removal and disposal;
e. Defendant shall pay to Plaintiff a civil penalty in the amount of $50,000.00; and it is further
ORDERED, ADJUDGED AND DECREED, that Defendant be, and hereby is permanently enjoined from building or placing any structure on the subject property that is not fully compliant with the Town of Caroga Zoning Ordinance and for which all applicable permits have been duly obtained; and it is further
ORDERED, that Plaintiff is awarded the costs and disbursements of this action.
THE FOREGOING CONSTITUTES A DECISION, ORDER AND JUDGMENT OF THE COURT. THE ATTORNEY FOR THE PLAINTIFF SHALL ENTER THIS ORIGINAL DECISION, ORDER AND JUDGMENT AND PROVIDE A COPY THEREOF, WITH PROOF OF ITS ENTRY, TO THE OPPOSING ATTORNEY(S) OR PRO SE LITIGANT(S), AS THE CASE MAY BE.