New Hampshire Municipal Association
New Hampshire Municipal Association

Court Update

Property Owner’s Reliance on Municipal Officials’ Mistake Not Reasonable

Thomas v. Town of Hooksett
No. 2005-312, 7/20/2006

Richard Boisvert owned property in Hooksett that was the subject of an application to the planning board for site plan approval to develop a gas station and convenience store. The planning board approved the site plan, but the conservation commission challenged the decision. In Hooksett Conservation Commission v. Hooksett Zoning Board of Adjustment, 149 N.H. 63 (2003), the Supreme Court held that the conservation commission lacked standing to litigate the issue.

While that case was pending, the town amended its zoning ordinance to create a groundwater conservation district that restricted the location of new gas stations within the district and within 1000 feet of existing gas stations. Boisvert’s property was located within the groundwater conservation district and within 1000 feet of a gas station owned by the plaintiffs, Joseph and Cindy Thomas.

When Boisvert asked the town’s code enforcement officer and a planning official about the status of his approved site plan, they told him that if he received a building permit within a year of January 23, 2003 (the date of the Court’s decision in the conservation commission case) and began construction within six months after that, the site plan approval would not be rescinded. He received the building permit on January 5, 2004 and contracted with Cumberland Farms to start construction on a gas station and convenience store by June 30, 2004.

In a letter dated May 27, 2004, the town revoked Boisvert’s building permit because RSA 674:39 required “active and substantial development” within one year of issuance of the building permit in order to protect the property owner from zoning changes and because no building had occurred within that one-year period.

Boisvert appealed to the ZBA, claiming that he had relied on the code officer and planning official that he had six months from the issuance of the building permit to begin construction. The ZBA overturned the revocation of his building permit and granted him two variances from the restrictions on gas stations in the groundwater conservation district.

The Thomases appealed to the superior court, which reversed both ZBA decisions. Boisvert appealed the superior court’s decision to the Supreme Court. The Court held that the Thomases had standing in the case as “persons aggrieved” because of the proximity of their gas station property to Boisvert’s and because their property was also located in the groundwater conservation district.

Boisvert argued that the trial court should have upheld the ZBA’s reinstatement of his building permit based on the doctrine of municipal estoppel. As the Court explained, “The doctrine of municipal estoppel has been applied to municipalities to prevent unjust enrichment and to accord fairness to those who bargain with the agents of municipalities for the promises of the municipalities.”

To prove municipal estoppel, however, there must be “a false representation or concealment of material facts made with knowledge of those facts[,] the party to whom the misrepresentation was made must have been ignorant of the truth of the matter[,] the representation must have been made with the intention of inducing the other party to rely upon it [and] the other party must have been induced to rely upon the representation to his or her injury.”

The trial court found that the municipal officials’ representations to Boisvert “were not made with knowledge of the actual expiration of the permit, and were not made for the purpose of inducing Mr. Boisvert to act, and because Mr. Boisvert’s reliance on their representations was not reasonable.” In addition, the trial court found, there was no evidence that the information given to Boisvert was not given in good faith.

The Supreme Court agreed that Boisvert’s reliance on the town’s representations was not reasonable. Citing previous municipal estoppel cases, the Court explained that [r]eliance is not reasonable when the party asserting estoppel … knew or should have known that the … representation was improper, materially incorrect or misleading.”

The Court said that both Boisvert and Cumberland Farms should have been aware that the town’s officials were wrong when they said the building permit would be valid as long as construction began within six months of issuance. Under the version of RSA 674:39 in effect at that time, Boisvert had one year from the Court’s decision in the conservation commission case to begin active and substantial construction in order to secure protection from the groundwater conservation district zoning change. The date of the Court’s decision in the conservation commission case was the date upon which his site plan approval became effective.

The Court agreed with the lower court’s analysis that “[s]ince a statute squarely addressed the issue about which Boisvert was concerned, he was on notice that any representations by town officials to the contrary were materially incorrect, and therefore his reliance was not reasonable.”

RSA 674:39 was amended in 2004 to exempt approved subdivision and site plans from changes in regulations for four years provided active and substantial development has begun on the site within 12 months of approval or in accordance with the terms of approval. If the planning board fails to identify what is meant by “active and substantial development or building,” the approved plan automatically gets the four-year exemption.

Another issue in this case involved the granting of the variances to the groundwater conservation district regulations. The trial court found that Boisvert had not offered evidence that he met the Simplex unnecessary hardship standard required for the granting of a variance. It also said the “ZBA made no finding as to why a departure from the ordinance [was] justified.” The Supreme Court said the “ZBA’s decision to grant the variance amounted to an implicit finding by the board that the Simplex factors were met.” The Court said that specific findings of fact disclosed by the ZBA were helpful for judicial review, but “the absence of findings, at least where there is no request therefore, is not in and of itself error.”

The Court disagreed with the trial court that the ZBA was required to “set forth specific findings to support its decision to grant the variance,” and it held that the ZBA minutes reflected that the board “gave only cursory consideration to the variance issue because it had already decided to reinstate Boisvert’s building permit based on his municipal estoppel claim.”

Since it was unclear to the Court how the ZBA would have ruled on the variance requests had it denied Boisvert’s municipal estoppel claim, the Court vacated the rulings on the variance and remanded the case to the ZBA for further proceedings.

Please be advised that the foregoing case summary is based upon a Supreme Court slip opinion. Slip opinions are subject to change following motions for rehearing and/or motions for reconsideration. The Court may also modify the opinion without motion. The final version of the Court’s opinion is that which appears in the New Hampshire Reports.

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