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Thirty Year Old Site Plan Approval Does Not Create Vested Rights

The Appellate Division found that a site plan approval obtained in the early 1970’s did not create a vested right in the zoning that was subsequently amended, even though 204 of the 330 approved units were constructed and funds were expended on infrastructure that would have served the second phase of development. In the case of RC Enterprises v. Town of Patterson, the Appellate Division, Second Department found the petitioner, who had purchased the property in 1979 from the original developer of the first phase, had abandoned the plan to develop the second phase “as demonstrated by its failure to act over a period of decades.”

In concluding there were no vested rights, the Court restated the rule that in seeking to claim vested rights in a permit after zoning has changed there must be substantial expenditures and substantial construction under the original zoning. Therefore a landowner must demonstrate its actions were: “so substantial that the municipal action withdrawing the permit results in serious loss.” The Court found that although there was a contention that certain improvements for phase 1 of the development were built with extra capacity to serve phase 2, the improvements had been used for nearly 30 years to benefit phase 1 and in the case of a sewerage treatment plant there were additional improvements mandated after construction in order to just serve phase 1.

The rule in New York has long been that if enough work can be completed that may only be used under the proposed permit the rights in the existing zoning have vested. There is now a clear message that the project also has to be completed as vesting does not last forever.

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