“Unnecessary Hardship” Can Exist Even Where Merged Lot Is Substandard

In Appeal of Town of East Kingston (May 22, 2024 order), the New Hampshire Supreme Court affirmed a Housing Appeals Board (HAB) order reversing the East Kingston’s zoning board of adjustment’s (ZBA) denial of a variance involving the merger of two substandard lots.  The case is interesting because the merged lots still failed to satisfy dimensional requirements of the zoning ordinance, not an uncommon occurrence in New Hampshire.  (Although Appeal of Town of East Kingston is not a New Hampshire Supreme Court opinion and carries no precedential authority, it can provide guidance on how the Court might rule if presented with similar facts.)

The Properties

The applicants owned two adjacent lots. Brian Graham owned one lot, and Jades Trust, a limited liability company managed by Graham, owned the other.

The applicants sought to merge the two lots and construct a home. Neither lot contained a residence, but one lot contained a garage. The lots were created prior to the current size requirements and were located in a neighborhood of small, grandfathered lots. Nearly all of the nearby lots contained homes.

The proposed construction on the merged lot conflicted with several provisions of the town’s zoning ordinance:

1. Minimum lot size: The ordinance required a minimum lot size of 87,120 square feet, while the merged lot would total 21,580 square feet.

2. Frontage requirement: The ordinance required 200 feet of frontage, while the merged lot would have 152.13 feet.

3. Upland soils requirement: The ordinance required at least 32,670 square feet of upland soils, while the merged lot would have 11,599 square feet, with the remaining area containing wetlands.

4. Septic setback requirement: The ordinance required a 50-foot septic setback away from poorly drained soils, while the project’s proposed septic system would have a setback of 46 feet.

The applicants applied for variances from these four requirements, which the ZBA denied. They also applied for a fifth variance to construct a septic system near their property boundary, which the ZBA granted. Following a request for rehearing that was denied, the applicants appealed to the HAB.

The HAB reviewed the variance requests and reversed the ZBA’s decision, concluding the applicants had satisfied the variance criteria in RSA 674:33. The Town appealed the HAB’s decision to the Supreme Court.

“Unnecessary Hardship”

The Supreme Court determined the HAB correctly applied the unnecessary hardship test outlined in RSA 674:33, I(b)(1). The HAB did not rely solely on the presence of the garage as a special condition but rather on the fact the merged lot would be relatively undeveloped compared to surrounding properties. The lot was unique because it contained only a garage without a residence, making it distinct from other lots in the area, which generally had residential dwellings.

The court agreed with the HAB that applying the frontage requirement would not advance the ordinance's purpose of preventing overcrowding or ensuring safe access for emergency vehicles. The court noted that building a single-family residence on the merged parcel would not add significant congestion and would not alter the character of the area. The merger would reduce the number of lots and thus help reduce overcrowding. The court also agreed the proposed use was reasonable because residential use is permitted in the area, and the merger would reduce nonconformities and make the garage a legal accessory use.

For the lot size variance, the court concurred with the HAB’s reasoning that the purpose of the lot size requirement—to prevent unreasonable congestion and ensure sufficient area for septic systems and water wells—would not be advanced by strict application in this case. The merged lot’s larger size in an area of small lots would help reduce congestion, and the addition of one house would not unduly burden the area. The court supported the HAB’s determination that the proposed use was reasonable given the residential character of the neighborhood and the fact that the merger would make the garage a legal accessory use.

(Note: Justice Bassett dissented from one aspect of the decision.  He argued the merged lots would result in the construction of a new home and would, therefore, increase congestion.  For that reason, he concurred with the final ruling but felt the applicants failed to satisfy the unnecessary hardship test for the frontage and lot size variances.)

Spirit of the Ordinance and Public Interest

The Supreme Court addressed the "spirit of the ordinance" and "public interest" prongs together, agreeing with the HAB that granting the lot size and upland soils variances would neither alter the essential character of the locality nor threaten public health, safety, or welfare. The HAB found that this area was already densely developed with small residential lots, and an additional residence would not significantly change the character of the neighborhood.

The Town had argued additional residences would lead to overcrowding and health and safety concerns, especially regarding septic systems; however, the court noted these concerns were unsupported by evidence. One ZBA member, a septic designer, expressed concerns about adding more septage, but did not provide concrete evidence. In contrast, the applicants' septic designer provided detailed plans that were approved by the Department of Environmental Services, demonstrating the septic system met state and town requirements. The court agreed with the HAB that the unsupported concerns of ZBA members did not outweigh the evidence showing that the proposal would not harm public health or safety.

Substantial Justice

The Supreme Court agreed with the HAB's finding that granting the variances would result in substantial justice. The Court emphasized that any loss to the individual that is not outweighed by a gain to the general public constitutes an injustice. The Town argued the variances would pose significant health, welfare, and safety concerns, but the Court found no evidence to support these claims beyond unsubstantiated comments from ZBA members and neighbors.

The Court agreed the applicants would suffer significant loss if they could not develop their properties, as the proposed development was consistent with the residential character of the area. The Court concluded that the proposed development's consistency with the area's present use, combined with the lack of credible evidence showing a threat to public health, safety, or welfare, justified the HAB's determination that substantial justice would be served by granting the variances.

Remedy – Variance Granted

In summary, the Court affirmed the HAB's order to reverse the ZBA’s denial of the application.  In some zoning appeals, the court (whether superior or supreme) will remand a matter back to the ZBA with implicit or explicit instructions to gather additional information with which to render a decision.  Here, because a “sufficient factual record” existed to support the HAB and Supreme Court’s conclusions, the effect of the decision was to approve the variance.

A companion piece to this post, focusing on the merger of substandard lots, can be found here.

For assistance with variances, special exceptions, building permits, lot mergers, subdivisions and other regulatory matters concerning your real estate, please contact our office at (603) 856-8411 or at this link.