|Legal Opinion: |
Text of Document: March 30, 2006
Let me address the memorandum from your associate, and the memorandum from you involving the rental property at issue, at the same time. For the purpose of 1–3, below, I will assume that the rental property falls within the protection of the nonconforming use law contained in Tennessee Code Annotated, § 13-7-208.
But before I do that, I want to suggest there might be a way to resolve this case without answering all those questions contained in those memoranda:
I may be missing something here, and probably am, because I have no idea of the history of the zoning of the property in question. Is it possible to determine if the City can win this case by going back to 1973 when Tennessee Code Annotated, § 13-7- 208 as adopted, for the purpose of determining whether the property was used as residential rental property at that time, and whether the use of the property as residential rental property was legal at that time? If under the zoning ordinance the residential rental of the property was illegal, that statute, even if it applies to residential rental property, will not make it’s for that purpose legal now.
Question 1: Non-use of the property as rental property for more than six months.
The time limitation in your City’s ordinance is six months.
Tennessee’s preexisting nonconforming use law [Tennessee Code Annotated, §13-7-208(b)] provides that:
(b) In the event that a zoning change occurs in any land area where such land area was not previously covered by any zoning restrictions of any governmental agency of this state or its political subdivisions, or where such land area is covered by zoning restraints of a governmental agency of this state or its political subdivisions, and such zoning restrictions differ from zoning restrictions imposed after the zoning change, then any industrial, commercial or business establishment in operation, permitted to operate under zoning regulations or exceptions thereto prior to the zoning change shall be allowed to continue in operation and be permitted; provided that no change in the use of the land is undertaken by such industry or business.
Subsections (c) and (d) respectively provide for the expansion and reconstruction of pre-existing non-conforming uses.
That statute was also amended in 2004 to include a 30 month limitation and important provisions governing how the 30 month limitation is applied [Subsection (g)].
In the recent cases of Boles v. City of Chattanooga, 892 S.W.2d 416 (Tenn. Ct. App. 1994) Custom Land Development, Inc. v. Town of Coopertown, 168 S.W.3d 764 (Tenn. Ct. App. 2005), the Court put its imprimatur on time limitations. That is true even though the outcomes were different, turning on the reason why the court refused to apply the time limitation in the former, and applied it in the latter. Custom Land Development mentioned the amendment of Tennessee Code Annotated , §13-7-208, in 2004, which added a 30 month limitation, as one of the reasons the decision in that case met the rational basis test, but declared that it did not apply to the case.
I am not sure what Custom Land Development does, if anything, for the City in light of the 30 month provision now contained in Tennessee Code Annotated, § 13-7- 208(g). In addition, under that provision, the city has the burden of proving abandonment of the nonconforming use. For that reason, the city’s 6 month time limitation may fail. It is not clear to me whether Custom Land Development thinks a time limitation of less than 30 months conflicts with state law in cases that arise after 2004, but it seems to me that the 30 month limitation does apply to those cases. Likewise, it appears to me that the intent of the property owner with respect to the question of whether he abandoned the nonconforming use is important, under both Boles and Custom Land Development.
The memorandum from your associate indicates to me that your City’s case arises after the 2004 amendment to Tennessee Code Annotated, § 13-7-208. It says that:
Plaintiff testified that the tenant who had been renting Property A moved out of the property ‘at the end of December 2003.’ Mr. B., Dep. P 9. He also testified that the water was turned on at the property on September 21, 2003. Id, p. 16. Thus, by plaintiffs’s own n admission, the property had not been rented for approximately nine (9) and one-half months prior to the alleged negligence of the City.
There must be an error in the memorandum as to the time frame. If the 9-1/2 month is being calculated from December, 2003 forward, the water must have been turned on September 21, 2004 (not 3). If that is so, the 30 month time limitation contained in Tennessee Code Annotated, § 13-7-208 applies to your City’s case.
On this point, the memorandum claims that the property was not used as a rental unit for approximately 9-1/2 months prior to the alleged negligence of the city, that for that reason the use was extinguished. But, there is no indication in the memorandum that the property owner abandoned the use of the property as rental property. There could be a multitude of reasons why the property was not used as rental property for 9- 1/2 months.
Question 2: Effect of damage to property.
While it may be true that the city's negligence did not end the use of the property as rental property for the six months contained in the city's nonconforming use ordinance, if the property owner's claim of negligence is true, the property owner can claim the city's negligence as a reason why he did not abandon the use of the property as rental property for the period it was damaged
and being reconstructed. Under Tennessee Code Annotated, § 13-7-208(g)(2) the reconstructive period tolls the 30 month time limitation, provided building permits were secured within that period.
Question 3: Extent of damage.
The city claims that its ordinance does not allow reconstruction if it the nonconforming use is damaged more than 60% of its sales value immediately prior to damage. That provision of the ordinance plainly conflicts with the language of Tennessee Code Annotated, § 13-7-208 itself, which provides that:
No building permit or like permission for demolition, construction or landscaping shall be denied to an industry or business seeking to destroy and reconstruct facilities necessary to the continued conduct of the activities of that industry or business....
Nothing in that statute remotely suggests that even if the nonconforming use had burnt to the ground, or been swept entirely away in a flood, the property owner could not reconstruct the use. It is difficult for me to believe that the courts would appreciate the difference between the destruction of an industry or business by an act of God, and its destruction by the owner of the industry or business, for the purposes of the reconstruction of the industry or business.
Question 4: Is residential rental property a business within the meaning of Tennessee Code Annotated, § 13-7-208?
The answer to that question is not clear in Tennessee. As far as I can determine, the only cases on the application of that statute to residential property are unreported, and involve mobile homes in mobile home parks or courts.
In Clouse v. Cook, 1988 WL 34834 (Tenn), the City of Franklin annexed a mobile home court in 1969. At the time of the annexation, the city had an ordinance that permitted nonconforming uses to continue for 25 years. In 1985, the owners of the mobile home court sought to demolish and replace two of the 70 units in the court. The city argued that the mobile home court was not entitled to replace the units because the court was not an “industrial, commercial, or other business establishment,” and for that reason was not protected by Tennessee Code Annotated, § 13-7–208.
The Tennessee Supreme Court rejected the city’s claim, reasoning that:
Plaintiffs rent 70 units on a weekly basis in an area designated as a trailer court or trailer park. No rational person would have referred to the units that plaintiffs demolished as “single family residences,” or “residences,” of any character. This record is silent with respect to the number of units that are occupied by transients, or longer term tenants, but the units in the Battlefield Trailer court were referred to by the building inspector, and others as “mobile homes,” and in the majority opinion of the Court of Appeals as “mobile homes or house trailers.” The very nature of a trailer court or trailer park containing house trailers and mobile homes give rise to the assumption of transient occupancy as distinguished from residential occupancy....The bottom line is that the “occupants” of the units are more realistically classified as customers of a trailer court operation than occupants of “residences.” Defendants admit, and it is beyond question, that plaintiffs are engaged in a “business” in the operation of a trailer park....[At 3.]
The Court raised a telling point about the plaintiff’s argument: That “If plaintiff’s theory were correct, a single family residence rented or leased by the owner, would be classified as business property and could not be maintained in a residential zone.” [At 3.]
What the Court then said is instructive with respect to whether the trailer court would have been protected under What the Court then said is instructive with respect to whether the trailer court would have been protected under Tennessee Code Annotated, §13-7-208 if the trailers had been residences: “If the ‘use’ was residential at the date of annexation, the city could have and should have, under its ordinances, terminated the operation immediately.” [At 4.]
The reason is connected with the date that Tennessee Code Annotated, § 13-7- 208 was effective. In the Court’s own words, the “Defendants assert that in the event the Court holds that plaintiff’s use is business or commercial, that Tennessee Code Annotated, § 13-7-208 is unavailable to plaintiffs because that legislative act was not in effect until 1973, subsequent to the annexation of plaintiff’s property.” [At 4] The defendant cited Rives v. City of Clarksville, 618 S.W.2d 502 (Tenn.App.1981) in support of that assertion.
It is said in Rives v. City of Clarksville, 618 S.W.2d 5023 (Tenn.Ct. App. 1981), that before the protection of Tennessee Code Annotated, section 13-7-208 can be claimed, two requirements must be met: (1) There must be zoning where there previously was none, or there must be a change in zoning restrictions; and (2) There must be permissive operation of a business prior to the change.
But in Clouse the Court pointed to the fact that in Rives, “Rive’s salvage yard was an illegal use prior to the effective date of T.C.A. § 13-7-208.” [At 4] That statute became effective in 1973, the annexation had occurred in 1964, and in 1967 ordinances were passed zoning part of the property residential and part commercial, “and from that date forward all of his property was non-conforming use.” [At 4] The city’s nonconforming use ordinance gave Rives two years to abate and remove his junkyard from the residential portions and five years to do the same as to the commercial portion. Both periods had expired and “Rive’s entire salvage yard operation was illegal when T.C.A. § 13-7-208 became effective. He could not therefore meet the requirements of the statute that there be a permissive operation of a business.” [At 4] In Clouse, continued the Court the plaintiffs had 25 years from 1969 or 1972 to abate and remove the trailer court under the Franklin ordinance, and thus met the prerequisites for the application of T.C.A. § 13-7-208.
The trailer court got its permit to reconstruct the units in question.
That case suggests that while a mobile home used as a single-family residence is not a single family residence for the purposes of a zoning ordinance defining that term, what we typically understand to be a “single family residence” (or perhaps a residence of any kind) is not
a business, within the meaning of Tennessee Code Annotated, § 13-07-208. ( The logic of that view escapes me, particularly in light of the great federal and other effort that has gone into eliminating the distinction between site-built homes and mobile homes).
In Parker v. Hamblen County Planning Commission, the city adopted zoning regulations in 1990, at which time the plaintiff had in place in an area zoned R-1 a mobile home park. In 1993 he placed an additional single-wide trailer on an existing mobile home park (He also attempted to place a mobile home on an adjoining piece of property, but that attempt does not appear to bear on your question). Article 4 of the city’s zoning ordinance said with regard to preexisting nonconforming uses that:
After the adoption of this zoning resolution and map, any new construction must be in conformance with this code. Existing structures will be allowed to remain as nonconforming uses except any new additions to nonconforming properties must be done in accordance with this code.
Under the zoning ordinance permitted uses in an R-1 area included “single family houses, duplexes, customary home occupations, day care centers and schools.” Uses not permitted in R-1 areas included all uses not allowed.
Without any reference to Tennessee Code Annotated, § 13-7-208, the Court simply declared that while the plaintiff was entitled to operate his existing mobile home park as an nonconforming use, he could not add a mobile home to it, reasoning that:
The only structure allowed within zone R-1 are single-family houses [court’s emphasis] and duplexes. A trailer, be it single-wide or double wide, is not a house. [Court’s emphasis]....[At 3]
In Bedford County v. Bialik, 2002 WL 3103983 (Tenn.Ct.App.), Bedford County adopted a zoning resolution in 1998. Prior to the adoption of that resolution, Bialik placed on the property mobile home units. He subsequently attempted to place four additional mobile homes on the same property. Bedford County sought to prevent only the additional mobile homes on the property. Bialik claimed a vested interest in the use of the property under Tennessee Code Annotated, § 13-7-208.
Bialik got nowhere with his argument because he could not show that the evidence at trial preponderated against the trial court’s finding that the placement of the four trailers violated the zoning ordinance. The reason, said the Court, was because the record did not include a transcript or statement of the evidence.
Sidney D. Hemsley
Senior Law Consultant