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Town of Mendon allowed only one house on ten acres, plus recorded restriction

Town-Imposed Conservation Easement is an "Exaction" but not a "Taking"

Judge deems the "conservation restriction" to be a "negative easement"

By Carol W. LaGrasse
January 2003

Paul Smith was determined to fight for justice, but he did not realize that his lawsuit would be at the center of contentious debate over the nature and constitutionality of the imposition of conservation easements. His dispute with the Planning Board of the Town of Mendon, which is located near Rochester, New York, over the terms under which his single family house would be permitted has led to an important judicial ruling. On January 16, New York State Supreme Court Justice Robert J. Lunn in Monroe County ruled that the "conservation restriction" imposed on Mr. Smith's property was a "negative easement" and that the negative easement is an "exaction."

The reason that Mr. Smith is fighting is that the Town's imposed "conservation restriction" would have to be recorded in an official deed book at the county clerk's office to encumber his property perpetually.

Although Mr. Smith did not succeed in his ultimate goal that the court void the imposed "conservation restriction" and declare that the Town of Mendon had imposed an unconstitutional "taking" of his property, his attorney has announced that they are appealing the ruling, based on the foundation laid in the Supreme Court ruling.

"This case is very important because the exaction, which is the word that is used in the ruling, is a form of blackmail," said James E. Morgan, the attorney for Mr. Smith.

"The property is already protected by strict zoning and environmental protection overlay districts to which any property owners when purchasing should realize they are subject." Mr. Morgan, a property rights attorney based in Delmar declared, announcing the plan to appeal.

When he submitted his application for a house on his ten-acre parcel, Mr. Smith indicated that the rest of the property would be left undeveloped. This was in keeping with the location of the property in no less than four of Mendon's overlapping Environmental Protection Overlay Districts (EPOD's), Steep Slope EPOD #2, Water Course Protection EPOD #3, Wood Lot and Timber Harvesting EPOD #7 and Flood Damage Protection EPOD #8. While engaged in a "concept discussion" on January 9, 2002, the Planning Board proposed to Robert Keiffer, the professional engineer representing Mr. Smith, that the permit include a "conservation restriction," according to the record in the Monroe County Supreme Court decision.

Later, when the application for site plan approval was on the Planning Board's agenda, the discussion centered on the board's requirement that approval would be conditioned on Mr. Smith's granting a conservation restriction on the parts of the parcel that fall inside the EPOD's. Mr. Smith and his attorney debated with the board and its attorney whether the "conservation restrictions" were really an "easement" and whether there was really any need for formal restrictions.

On July 10, the Planning Board approved the application, but required that,

"A Conservation Restriction on any development within the mapped EPOD shall be filed in the Monroe County Clerk's Office, and the final Site Plan Map shall be amended to contain the Liber and Page number recording said restriction."

At that time, the Planning Board passed a resolution determining that the construction of Mr. Smith's single family home according to the site plan would not cause any significant adverse environmental impact because the "Conservation Restriction" on the EPOD portions of the site would "put subsequent buyers on notice that the property contains constraints which may limit development within these environmentally sensitive areas of the site."

The Town's imposition of the "conservation restriction" was an ironic recognition of the years of stewardship by Mr. Smith's family.

"The farm has been in my family for 46 years," Mr. Smith said recently. "We let the pasture grow up. The trees that I planted with my father became the forest in the area that the Town designated as the timber protection overlay district."

Mr. Smith thought that the four Conservation Protection Overlay Districts were enough of a burden to his property; he did not want to tie up his property forever with a conservation easement recorded in the County Clerk's Office. His recourse was to go to court. The first thing that he asked the judge to declare was that the "restriction" that the Planning Board told him to record was really a conservation easement.

The Town of Mendon conceded that the "Conservation Restriction" required by the Planning Board is actually a conservation easement, as set forth in the State's Environmental Conservation Law, Article 49-0303(1). Citing the 1975 New York ruling Huggins v. Castle Estates, Inc., Judge Lunn also held that, "The restriction may also be characterized as a negative easement since 'it is one which restrains a landowner from making certain use of his land which he might otherwise have lawfully done but for that restriction.'"

Judge Lunn held, "Petitioners are entitled to a declaratory judgment that the 'Conservation Restriction' required by the Planning Board as a condition to final site plan approval is both a conservation easement and a form of negative easement."

A Mixed Bag

However, Mr. Smith did not do so well in his request that the court vacate the condition requiring the conservation restriction as arbitrary, capricious and improper or in his request that the court declare an unconstitutional taking of his property. The judge fell back on the old saw that, "The reviewing court should not disturb the Planning Board's determination absent illegality, irrationality, or an abuse of discretion, nor should the court substitute its judgment for that of the Board," citing the case of Thomas v. Brookings.

The court's logic from that point forward is at times hard to understand. The judge declared that it was not arbitrary, capricious or illegal to require the conservation restriction or easement on that portion of the property contained within the mapped EPOD's because the town code authorized the Planning Board to require the conservation restriction be recorded in the County Clerk's Office on these occasions and because the proposed restriction has no terms that are more restrictive than those in the local law. The court ruled that because the town had addressed the impacts of construction adjacent to the environmentally sensitive areas and determined that the conservation easement was the most meaningful and responsible way to address the potential impacts, the requirement was not arbitrary or capricious. It cited an Appellate Division, Second Department ruling in Grogan v. Zoning Board of Appeals of the Town of East Hampton in 1995 where the easement was seen as a permissible supplement to the legislative means to ensure preservation of the area.

However, in granting the Town's argument that it had not imposed an unconstitutional taking of Mr. Smith's property, Judge Lunn disagreed with the Town's contention that the conservation restriction was not an "exaction." He cited the 1999 U.S. Supreme Court decision in City of Monterey v. Del Monte Dunes for the definition of an exaction as a land use decision "conditioning approval of development on the dedication of property to public use." Judge Lunn wrote:

"Here, while the conservation easement specifically excluded any right of the public to enter petitioners' property, a substantial portion of the property was restricted from development thereby promoting the public use of preserving and protecting the sensitive environmental nature of the land. It is therefore an exaction."

But Judge Lunn concluded that the application of the two-part test in the 1994 U.S. Supreme Court ruling of Dolan v. City of Tigard to Mr. Smith's property did not result in a taking. First, Judge Lunn concluded that "there is a clear essential nexus between the conservation easement and the legitimate town interest of protecting sensitive environmental areas within its borders."

But this is a misreading of Dolan, which requires that the exaction must have a nexus with the impact of the project on legitimate state interests. Mr. Smith's project was not shown to impact the protected areas. The court also failed to keep in mind the U.S. Supreme Court holding under Lucas v. South Carolina Coastal Commission that a mere recitation of a purpose in legislation does not prove that a taking has not occurred.

The Town's exaction of the conservation easement fails the first Dolan test for another reason. Overlooked in Judge Lunn's ruling is the fact that none of Mr. Smith's site plan is within any of the environmental overlay districts. There is no nexus of the exaction of the conservation easement with the impact of the project on legitimate state interests related to the overlay districts because there is no impact on the districts.

The second test under Dolan is that requiring rough proportionality of the exaction to the impact of the project on legitimate state interests. The court did not address this test although it indicated that it would, by stating, in a rather inaccurate paraphrase of Dolan, "Secondly, there must be a 'rough proportionality' between the degree of the exaction and the environmental impacts of the proposed development."

Finally, the court held that since Mr. Smith had stipulated in his application that he would not be doing any development on his property beyond that for the single-family dwelling (e.g., he would preserving the property anyway), the imposition of the conservation easement is not a "taking" of his property. But how can this be correct, when the existence of conditions in a permit is less permanent than a recorded conservation easement perpetually encumbering the title to property?

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