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THE SUPREME COURT OF NEW HAMPSHIRE

___________________________

Rockingham

No. 99-527

THOMAS MORGENSTERN

v.

TOWN OF RYE

December 21, 2001

Gottesman and Hollis, P.A., of Nashua (Anna Barbara Hantz and Morgan A. Hollis on the brief, and Mr. Hollis orally), for the plaintiff.

Michael L. Donovan, of Concord, by brief and orally, for the defendant.

Devine, Millimet & Branch, P.A., of Manchester (Daniel E. Will on the brief) and New England Legal Foundation, of Boston, Massachusetts (Michael E. Malamut on the brief) for New England Legal Foundation, as amicus curiae.

Brock, C.J. The plaintiff, Thomas Morgenstern, appeals orders of the Superior Court (Murphy, J.) declaring section 601 of the Rye Zoning Ordinance valid on its face and as applied to his property. The plaintiff also appeals the court’s order upholding the Town of Rye Zoning Board of Adjustment’s (ZBA) decision not to hear his revised application for approval to build a house on his lot. The defendant, Town of Rye (town), cross-appeals, arguing that the plaintiff’s action should have been dismissed because the plaintiff failed to timely appeal adverse decisions of the ZBA. We vacate and remand.

In September 1992, the plaintiff purchased land in Rye for $20,000. Estimates were made that anywhere between twenty-seven and eighty percent of the parcel consisted of wetlands. The plaintiff’s lot is part of the Myrica-By-The-Sea residential subdivision plan that had been approved by the town in 1967 and recorded in the registry. At that time, the plaintiff’s lot complied with the town’s minimum square footage and frontage requirements for residential property. By 1971, all of the roads in the development had been accepted by the town at town meeting. By 1975, all but four of the twenty lots had either been developed or received building permits. In 1975, the town increased the required lot size and frontage, so that the current requirement for the plaintiff’s lot is 44,000 square feet with 150 feet of frontage. Thus, the plaintiff’s lot was rendered nonconforming as to minimum size and frontage.

In 1993, the plaintiff applied for a variance to build a single-family dwelling on the uplands portion of his lot pursuant to section 601 of the town’s zoning ordinance. Section 601, which governs construction on nonconforming lots and was adopted in 1985, provides:

In any district in which single family or two family dwellings are permitted, a dwelling and customary accessory buildings may be erected, as a variance obtained pursuant to Article VII, on any lot which was a lot of record on the effective date of this Ordinance, earlier variations thereof, or future amendments thereto, even though such lot fails to meet the district requirements for area or frontage or depth.

The ZBA held a hearing on the variance, and, based upon the five criteria for approving a variance, voted unanimously to deny the application. The plaintiff neither requested a rehearing nor appealed the decision. Instead, in December 1994, the plaintiff applied for a building permit rather than a variance, asserting that no variance was required because the parcel was a grandfathered nonconforming lot.

The building inspector denied the plaintiff’s application on the grounds that a use variance pursuant to section 601 was required and had been denied. The plaintiff appealed the building inspector’s decision, which was upheld by the ZBA in 1995. Although the plaintiff filed a timely request for rehearing, he did not appeal the subsequent denial of the request for rehearing. Instead, in January 1997, he filed a petition for a declaratory judgment in superior court asserting that section 601 was unconstitutional on its face and as applied to his property.

The town moved to dismiss the petition based upon the plaintiff’s failure to appeal the denial of his 1995 administrative appeal to the ZBA. The superior court denied the motion to dismiss. The town then moved for partial summary judgment. The superior court ruled that the variance requirement of section 601 was not unconstitutional on its face, but left open the issue of whether it violated due process as applied to the plaintiff’s property.

In 1998, while the declaratory judgment action was pending, the plaintiff filed a second variance application. The ZBA refused to consider it on the grounds that there was no material change from the first application. The plaintiff appealed to the superior court, where the action was consolidated with the declaratory judgment action. Following a bench trial, the superior court held that section 601 was not unconstitutional as applied to the plaintiff’s property, and that the ZBA’s decision not to consider the second application for a variance was reasonable.

On appeal to this court, the plaintiff argues that section 601 is unconstitutional on its face and as applied, and that the superior court erred when it upheld the ZBA’s decision that: (1) the resubmitted plan was not materially different from the prior plan; and (2) no future application for a single family dwelling would ever be sufficiently materially different as to warrant ZBA review. The town cross-appeals, arguing that the plaintiff’s failure to appeal the 1993 and 1995 ZBA decisions bars his petition for declaratory judgment because it arises from the same factual transactions as the 1993 and 1995 decisions.

We will affirm the trial court’s factual findings unless they are unsupported by the evidence, see Carrier v. McLlarky, 141 N.H. 738, 740 (1997), and will affirm the trial court’s legal rulings unless they are erroneous as a matter of law. See Fleet Bank-N.H. v. Chain Const. Corp., 138 N.H. 136, 139 (1993).

We address first the town’s argument that because the plaintiff failed to appeal the ZBA’s 1993 and 1995 decisions pursuant to RSA 677:4, the decisions are final decisions, and his constitutional claims are barred by the doctrine of res judicata.

A party may appeal an adverse zoning action by way of a statutory appeal, declaratory judgment, or an equitable proceeding. Caspersen v. Town of Lyme, 139 N.H. 637, 640 (1995). A facial challenge to a zoning ordinance may be initiated by way of a statutory appeal or declaratory judgment. Id. A challenge to a zoning ordinance as applied to a particular property may be initiated by way of a statutory appeal, declaratory judgment or equitable proceeding. Id. A plaintiff who chooses to initiate a declaratory judgment action to challenge the validity of a zoning ordinance may do so after the expiration of the appeal period in RSA 677:4. See Blue Jay Realty Trust v. City of Franklin, 132 N.H. 502, 509 (1989).

In support of a contrary rule, the town cites Shepherd v. Town of Westmoreland, 130 N.H. 542 (1988), and Town of Auburn v. McEvoy, 131 N.H. 383 (1988). Both cases are distinguishable from the case at bar. Shepherd involved the res judicata effect of a superior court decision in an appeal from the ZBA. Shepherd, 130 N.H. at 543. There we held that the plaintiff should have raised constitutional and inverse condemnation claims when she appealed the ZBA’s decision to the superior court. Id. at 545. Thus, where an applicant directly appeals from the zoning decision to superior court, the doctrine of res judicata requires that all claims that could be raised, be raised therein, or be barred. In the present case, because the plaintiff did not appeal the 1993 and 1995 decisions of the ZBA, its constitutional attack on the ordinance is not barred by res judicata.

McEvoy specifically left open the question of whether a planning board decision should be accorded res judicata status. McEvoy, 131 N.H. at 385. That question was answered a year later in Blue Jay Realty, where we reasoned that because a collateral attack raises questions of law suited to judicial rather than administrative treatment, collateral attacks on zoning enactments are not foreclosed by a failure to directly appeal a decision of the application of the challenged ordinance to a particular piece of property. Blue Jay Realty, 132 N.H. at 509-10.

Having concluded that the plaintiff’s claims are not barred by res judicata, we now consider the plaintiff’s argument that the variance requirement contained in section 601 is unconstitutional on its face. Zoning ordinances are presumed to be valid, and the challengers bear the burden of proving them unlawful. See Town of Nottingham v. Harvey, 120 N.H. 889, 892 (1980). A zoning ordinance will not be declared unconstitutional absent proof that its provisions are arbitrary and unreasonable and have no substantial relationship to the health, safety, morals or general welfare of the community. See Buskey v. Town of Hanover, 133 N.H. 318, 323 (1990).

Generally speaking, a property owner has no right to the continued existence of any particular zoning classification of his property, because all property is held in subordination to the police power of the municipality. R.A. Vachon & Sons, Inc. v. City of Concord, 112 N.H. 107, 110 (1972). Special problems arise, however, when zoning regulations increase frontage and area requirements and landowners are left with substandard lots. Strict and literal enforcement of stringent regulations regarding lot size would make some such lots useless to their owners and to the community, and would destroy the value of such lots, making strict application of the ordinance confiscatory. Id. at 113; 2 R. Anderson, American Law of Zoning