Opinion
No. 15–P–1331.
12-14-2016
ONE LEDGEMONT, LLC v. ZONING BOARD OF APPEALS OF LEXINGTON & another.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The defendants, 95 Hayden, LLC, and the zoning board of appeals of Lexington (board), appeal from a Land Court judgment annulling a decision of the board granting 95 Hayden's request for a special permit with site plan review, and related approvals, for the development of a new office building and associated improvements at Ledgemont Corporate Center (Center). The judge gave two alternative rationales for aning the board's decision: (1) 95 Hayden lacks an easement or other property interest entitling it to use land owned by the plaintiff, One Ledgemont, LLC, for fifteen parking spaces needed to comply with the development plan approved by Lexington town meeting; and (2) an additional eighteen parking spaces, above and beyond those specified in the development plan, are required to meet the needs of the project. On appeal, the defendants challenge both rationales. While we agree with the defendants that the second rationale is flawed because the judge lacked authority to require more parking spaces than were approved and required by town meeting, we affirm the judgment on the basis of the first rationale.
The board's brief on appeal argues separately with respect to its challenge to the judge's second rationale; the board adopts 95 Hayden's argument with respect to the judge's first rationale.
Background. We take the facts from the judge's findings and undisputed material in the record. The Center is a thirty-six acre research and office park in the town of Lexington. It comprises two lots, Parcel A and Parcel B, and a common road. The lot owners' rights and duties respecting the road are set out in a 1986 easement agreement filed in the Middlesex South District registry of deeds.
In 2008, Parcel A was owned by One Ledgemont, LLC, and Parcel B was owned by Two Ledgemont, LLC. Although the majority stakeholders of the two companies were distinct, both were managed and operated by the Beal Companies, a group of related entities that also held minority positions in One and Two Ledgemont. That year, under the Beal Companies' direction and management, One and Two Ledgemont began a joint project to construct a new building at the Center, to be known as Three Ledgemont. This building, which would have office space and research laboratories, was intended to add value to the Center as a whole.
In order to construct Three Ledgemont, it was necessary to obtain approval to change the Center's zoning from "CRO" (commercial regional office use in a commercial district) to "CD" (planned commercial development district). Under the town's zoning by-law (by-law), relatively few rules directly apply to applications for planned commercial development districts. Instead, the by-law outlines a process whereby detailed requirements for the particular site are established. The developer must submit a rezoning request in the form of a preliminary site development and use plan (PSDUP). The PSDUP then must be considered and approved by town meeting. Once approved, the terms of the PSDUP become incorporated by reference in the by-law, and no development may occur on the site except in conformity with the PSDUP. Before construction may begin, the developer must apply to the board for a special permit with site plan review. This necessitates the submittal of a definitive site development and use plan (DSDUP). If the DSDUP conforms substantially to the PSDUP, the board, acting within its power as the special permit granting authority, may grant the special permit.
In accordance with this process, the Beal Companies, One Ledgemont, and Two Ledgemont submitted an application requesting that the Center be rezoned; they filed a PSDUP in April, 2009, and, when town meeting approved it in May, 2009, its terms became incorporated by reference into the by-law. Pursuant to the PSDUP, Three Ledgemont would be situated entirely on Parcel B, then owned by Two Ledgemont. Three Ledgemont would have 415 new parking spaces, including fifteen to be built on Parcel A. It was understood that placing the fifteen parking spaces on Parcel A, owned by One Ledgemont, would require a recorded easement benefitting Parcel B, owned by Two Ledgemont. However, the developers elected to negotiate the details of the parking easement at some later date. As described by a Beal Companies senior vice president, the details of the easement were "something to worry about ... later."
The parties dispute whether a term in the PSDUP expressly required that a new easement be recorded in order for the parking spots to be located on Parcel A. The judge concluded that the PSDUP did so provide, but that was not the only basis for his finding that a recorded easement was contemplated by the parties. Whether or not the judge's reading of the PSDUP is correct, his finding that the parties intended there to be a formal, recorded easement, is amply supported by the trial testimony.
Progress stalled after the approval of the PSDUP. The Beal Companies had difficulty securing tenants for the new space, and, by 2012, all work on the project was suspended. At that time, Parcel B was encumbered by two mortgages, and the senior mortgage had reached maturity. Unable to negotiate acceptable refinancing terms, Two Ledgemont elected to default. The junior mortgagee accelerated maturity, foreclosed on Parcel B, and sold it at auction to a new entity, 95 Hayden, which was unrelated to the Beal Companies.
95 Hayden conducted due diligence prior to buying Parcel B. Among other things, it obtained copies of the PSDUP and the 1986 easement agreement; it understood the details of the stalled project; and it understood that it would need to obtain an easement from One Ledgemont, as the owner of Parcel A, to construct the fifteen parking spaces on that lot. Despite this understanding, 95 Hayden did not contact One Ledgemont about negotiating the terms of the easement. Rather, using the same firms involved in the original design, it prepared a DSDUP and applied to the board for its special permit with site plan review. One Ledgemont learned of 95 Hayden's intent to proceed only when, as an abutter to Parcel B, it received notice from the board of the forthcoming hearing on 95 Hayden's special permit application.
Following that notice, and desiring time to negotiate the terms of the easement, One Ledgemont sought to continue the hearing date. 95 Hayden and the board both declined, and, on November 8, 2012, the board voted to approve the special permit. One Ledgemont timely appealed to the Land Court, claiming that 95 Hayden lacked adequate property rights to build parking spaces on Parcel A. 95 Hayden counterclaimed, arguing, inter alia, that One Ledgemont was estopped from refusing it permission to build and use the parking spots, and requesting an order of specific performance. Following trial, the judge aned the special permit for two reasons: first, because 95 Hayden lacked the necessary property rights to build the requisite fifteen parking spaces on Parcel A, and second, because expert testimony established that the project actually needed 433 parking spaces—eighteen more than were specified in the PSDUP. This appeal followed.
Discussion. 1. Parking easement. Even though an easement was contemplated, no written, recorded easement exists allowing 95 Hayden to build and use parking spaces on Parcel A. In such a situation, the Statute of Frauds ordinarily would control the result. See G.L. c. 259, § 1. 95 Hayden attempts to overcome this obstacle on a theory of equitable estoppel, claiming that it reasonably relied to its detriment on One Ledgemont's representations to 95 Hayden's predecessor in interest, Two Ledgemont, that fifteen parking spaces near the Three Ledgemont entrance could be located on Parcel A. See Nessralla v. Peck, 403 Mass. 757, 761 (1989) (detrimental reliance may estop party from pleading Statute of Frauds as a defense). See also Hurtubise v. McPherson, 80 Mass.App.Ct. 186, 188–189 (2011).
Equitable estoppel requires (1) a representation, or conduct amounting to a representation, intended to induce reliance, (2) an act or omission made in reasonable reliance upon that representation, and (3) resulting detriment. Bongaards v. Millen, 440 Mass. 10, 15 (2003). Here, the trial judge found that One Ledgemont's conduct toward Two Ledgemont, in the course of a joint venture designed to improve the value of the Center as a whole, amounted to representations intended to induce reliance. However, the trial judge went on to find that these representations did not give rise to an estoppel, because 95 Hayden had actual knowledge of facts that made its reliance unreasonable. Compare Weston Forest & Trail Assn. v. Fishman, 66 Mass.App.Ct. 654, 660–661 (2006) (reliance unreasonable where party had duty to inquire further based on actual knowledge of certain facts).
We assume without deciding that, as the judge concluded, 95 Hayden may step into the shoes of Two Ledgemont for the purposes of asserting reliance. See Nickerson v. Massachusetts Title Ins. Co., 178 Mass. 308, 312–313 (1901).
We reject 95 Hayden's challenge to this finding. Whether an estoppel was proved was a question of fact. See Simon v. Simon, 35 Mass.App.Ct. 705, 712 (1994). Unless shown to be clearly erroneous, a judge's finding of fact will not be disturbed. See Mass.R.Civ.P. 52(a), as amended, 423 Mass. 1402 (1996); White v. Hartigan, 464 Mass. 400, 414 (2013). Here, the finding was well supported by the evidence and was not clearly erroneous. Even before purchasing Parcel B at the foreclosure auction, 95 Hayden knew that a written, recorded easement would be needed in order to build parking spaces on Parcel A. Prior to the purchase, 95 Hayden obtained a copy of the PSDUP, which showed that fifteen parking spaces would have to be placed on Parcel A. It also found the 1986 easement agreement between the lot owners. That agreement reflected the fact that the Center comprised two distinct lots owned by different entities and, therefore, formal easements were necessary, especially in the event that the lot owners no longer shared mutual interests.
95 Hayden's reliance also was unreasonable for another reason; as the trial judge found, the material terms of the easement had never been negotiated. Left undetermined were the amount of consideration to be paid for the easement; the allocation of maintenance, upkeep, and insurance obligations; and the allocation of liability risks. Where such essential terms had been left open for future negotiation, the trial judge was warranted in finding that 95 Hayden had not reasonably relied on representations made by One Ledgemont to Two Ledgemont. Cf. Lambert v. Fleet Natl. Bank, 449 Mass. 119, 125 (2007) (even if binding, contract terms may be too indefinite to be enforced).
2. Number of parking spaces. In order to provide guidance to the parties going forward, we comment upon the judge's alternative rationale. Although town meeting approved a PSDUP requiring 415 parking spaces, the judge credited the opinion of One Ledgemont's traffic expert that 433 spaces were necessary, and cited this deficiency as an alternative basis for aning the special permit. We agree with 95 Hayden and the town that the judge lacked the authority to annul the special permit on this basis.
The terms of the PSDUP, upon approval by town meeting, became part of the zoning by-law. Town meeting approved a requirement of 415 spaces, and it did so bearing in mind the town's policy of discouraging single-occupant vehicles and promoting carpooling, public transportation, and van services. Consistent with this policy, the PSDUP included a traffic and transportation demand management plan, the purpose of which was to reduce the number of vehicles travelling to and from the site. Among other things, the plan contemplated that there would be bicycle storage racks, preferred parking for van pools, and other features that bore on the number of parking spots required.
The exercise of legislative power by town meeting carries with it a strong presumption of validity. See Durand v. IDC Bellingham, LLC, 440 Mass. 45, 50–51 (2003). A by-law may be overturned only if its enactment violated State law or exceeded constitutional limitations, or if it was an "arbitrary or unreasonable exercise of police power having no substantial relationship to the public health, safety, or general welfare." Id. at 52. The trial judge made no such determinations and had no basis to vary the amount of parking required under the PSDUP.
We therefore affirm the judgment solely on the ground that 95 Hayden lacks the necessary property interest to build fifteen parking spots on Parcel A, as required by the PSDUP approved by town meeting, and incorporated into the zoning by-law.
Judgment affirmed.