The Court held that when a zoning board of adjustment denies a motion for rehearing and in that denial gives new grounds for denial of the original case, the aggrieved party is not required to file a second motion for rehearing before appealing the ZBA decision to the superior court.
In this case, the plaintiff owned a quarter-acre lot of record that pre-existed the zoning ordinance's two-acre minimum lot size and frontage and setback requirements. Because strict compliance with the setback requirements would limit any structure to eight feet in depth and 40 feet in width, McDonald sought an area variance. During the public hearing on her request, she told the ZBA that she had a septic system construction permit approved by the Department of Environmental Services.
The ZBA denied the variance request on the grounds that granting it would result in the diminution in value of surrounding property, would be contrary to the public interest, would not result in unnecessary hardship, would not do substantial justice and would be contrary to the spirit of the ordinance.
McDonald filed a motion for rehearing, which the ZBA denied, stating that because she did not submit the required “standard release form for protective well radii” with her variance application, the proposed septic system for the lot was “null and void.” The Court said the release form ruling “constituted an independent ground to deny the variance request and was not mentioned or discussed by the ZBA in its initial denial order.”
McDonald appealed to the superior court, claiming the ZBA violated her procedural due process rights by considering new issues in the denial of the motion for rehearing and by failing to give detailed reasons for its denial, that the denial was contrary to the evidence and the law and that denial of the area variance resulted in an unconstitutional taking of her property without just compensation because it deprived her of all economically beneficial use of the property.
In response to McDonald's appeal, the town filed a counterclaim for alleged zoning violations and asked the superior court to dismiss the appeal because McDonald failed to file a second motion for rehearing with the ZBA. The superior court dismissed the case, relying on Dziama v. City of Portsmouth, 140 N.H. 542 (1995) in which the Supreme Court held that “when a decision upon rehearing creates a new aggrievement or raises any new issues, even if the results remain the same, the aggrieved party must file a second motion for rehearing” to give the ZBA an opportunity to correct any error on the newly decided issues and give the superior court an opportunity to consider the new issues decided after the original rehearing motion.
The Court concluded, however, that “a literal reading of the rehearing and appeal statutes, RSA 677:2 and 677:4, leads to absurd results, which were not intended by the legislature.” In a case like McDonald's, the Court said, a literal reading of the statutes would require a party “to simultaneously pursue an appeal to the superior court from the initial variance denial once the rehearing request was rejected and a second motion for rehearing to challenge the issue that was newly raised by the ZBA in its decision denying the initial request for a rehearing.” To appeal the issue of the void septic system approval for failure to submit the required release form, the Court said, a literal reading of the statutes would require McDonald to file a second motion for rehearing. “Because the new ground was independently dispositive of her variance application, McDonald's failure to file a second motion would effectively preclude her from challenging the denial of her variance application,” the Court wrote.
The Court said this case was different from Dziama , the case upon which the superior court relied in dismissing McDonald's appeal. In that case, the ZBA denied a special exception application on procedural grounds. The ZBA granted the motion for rehearing and, following a public hearing, denied the application on its merits. The Court held that before the party could appeal the second denial, a second motion for rehearing had to be filed with the ZBA. In McDonald's case, however, the Court said, “the ZBA ruled on a new issue in its denial of the motion for rehearing.”
The Court said the statutory scheme governing rehearings and appeals “does not anticipate that a zoning board will render new findings or rulings in the denial of a rehearing motion.” The Court held that a second motion for rehearing is not required to preserve on appeal “any new issues, findings or rulings first raised by the ZBA in that denial order.” The Court said the superior court may, “at its discretion, stay the matter and remand to the ZBA for further hearing as necessary to resolve the appeal.”
The Court issued a strong suggestion to ZBAs about how to avoid circumstances similar to McDonald's. “A better practice for the ZBA to take when it identifies new grounds for its initial decision and intends to make new findings and rulings on them in response to a motion for rehearing would be for it to grant the rehearing motion without adding new grounds for denying the variance application. In keeping with Dziama , after the rehearing and new order the aggrieved party would then need to file a motion for rehearing on all issues ruled upon, at that time, to preserve them for appellate review.” The Court added that the superior court “may consider on appeal an issue not first set forth in a motion for rehearing under the ‘good cause' exception in RSA 677:3, I.”
The Court reversed the dismissal of McDonald's appeal and other claims and remanded the case to the superior court for further proceedings.