Posted On: February 18, 2010

N.Y. Court of Appeals Broadens Test For Vested Right to Non-Conforming Use

In a decision issued today, the New York Court of Appeals reversed the Appellate Division and found that a non-conforming mining operation had attained vested rights in that use. In Glacial Aggregates LLC v. Town of Yorkshire, the Court concluded that the expense of the permitting process, coupled with taking forty truck loads of material for testing, removal of timber and surveying a road and mining areas was sufficient to establish a vested right to the use and manifest an intent to mine the area.

At the time that the property owner began the process of obtaining a DEC permit for mining the Town had no zoning ordinance. It was only after the DEC permit was issued that the Town enacted zoning which prohibited the use. The property owner then claimed it had obtained vested rights to the non-conforming use. The trial court found in favor of the property owner and the Town appealed.

We previously reported on the decision of the Appellate Division in this case noting in an April 27, 2009 post that the court found these activities did not constitute actual mining but rather the “activities were performed merely in contemplation of mining.” Further, testimony at trial demonstrated that mining could not take place until certain additional work, including paving of a “haul road” were completed. As there was no proof that the property was actually being used for commercial mining, the court found the lower court erred in not issuing a directed verdict that the mining operation was not a legal non-conforming use.

In reversing the Appellate Division, the Court of Appeals noted both the nature of the situation in this case and the unique nature of mining and that little actually needed to be built for mining to take place. "When applying our vested-rights jurisprudence to the facts in this case, there are two significant considerations that must be kept in mind. First, the Town had no zoning laws when Glacial acquired the property in 1996 — or, for that matter, when Glacial applied for the DEC mining permit in 1996, or even when DEC issued Glacial a mining permit in 1999 (cf. Preble Aggregate, supra). Relatedly(sic), mining is a unique land use, which colors our analysis of vested rights and nonconforming use."

Perhaps most significantly, to our knowledge, for the first time the Court added the cost of permitting to the test of substantial expenditure in obtaining vested rights and further expanded the concept of vesting through a validly issued permit to include "unqualified permission." "Put another way, the issue is not whether Glacial gained a vested right by way of its DEC mining permit, but whether Glacial acquired a vested right by way of the unqualified Town permission it once enjoyed to mine its property. And when deciding whether a landowner has made substantial expenditures in reliance upon such local permission, we see no reason for the factfinder to disregard DEC permitting costs. Indeed, in light of the stringent requirements imposed by the Mined Land Reclamation Act, such costs frequently, if not invariably, run into the hundreds of thousands of dollars or more, and represent a significant portion of the investment necessary for a landowner to devote real property to quarrying."

While the current case involves mining, which the Court noted has unique elements, it will be interesting to see how broadly the Court applies these revised criteria in the future.

-Steven Silverberg