While you may be tempted to rush to court to seek justice, it is important to first exhaust all other avenues of appeals. If you fail to “exhaust administrative remedies” prior to commencing an action in court you may find yourself right back where you started.
In municipal and land use law, administrative remedies are most commonly available when the local city, town or village code provides an appeals process for decisions made by a municipal officer or board. For example, a local code may state a decision by the Architectural Review Board (“ARB”) is appealable to the Zoning Board of Appeals (“ZBA”). In that instance, a party who is aggrieved by a decision of the ARB cannot run straight to court to challenge the ARB’s decision. Rather, the party must first “exhaust administrative remedies” by appealing the decision to the ZBA. A similar situation is presented when a decision by a building inspector is appealable to the ZBA, including the grant or denial of a building permit.
The purpose behind the doctrine is to relieve burdens on the courts and allow the local agency to further develop a record before the court reviews the decision. Watergate II Apts. V. Buffalo Sewer Auth., 46 N.Y.2d 52, 57, 412 N.Y.S.2d 821, 824 (1978). However, there is a seldom applied exception to the exhaustion of administrative remedies rule called the “futility” exception that will allow an aggrieved party to proceed directly to court without exhausting administrative remedies. The exception is only applicable under extraordinary circumstances where a party can demonstrate that it would be futile to comply with the administrative exhaustion requirement.
In a recently decided case, Apache Oil Company, Inc. v. The Town of Bedford, West. Cty. Index No. 69314/17 (May 31, 2018, Everett, J. presiding), Keane & Beane successfully achieved a dismissal of the case on behalf of the Town of Bedford where the plaintiff attempted to rely on the futility exception after failing to exhaust its administrative remedies. In this case, Apache Oil was seeking to renovate and expand its existing non-conforming gasoline service station. The Building Inspector denied an application for a building permit for the expansion on the basis that Apache Oil needed a use variance from the ZBA. Apache Oil then submitted an application to the ZBAfor a use variance, which was later abandoned. In the meantime, Apache Oil revised its plans and discovered a ZBA Resolution from 1959 indicating that a use variance had allegedly been granted for the gasoline service station in 1959 which would allow the expansion to proceed.
Instead of presenting the revised plans and 1959 ZBA Resolution to the Building Inspector to determine whether a use variance was still required, Apache Oil proceeded directly to court seeking a declaratory judgment that no use variance was required due to the 1959 ZBA resolution. Apache Oil claimed it would be “futile” to bring its revised application back to the Building Inspector or the ZBA because supposedly the Building Inspector would inevitably deny the building permit and the ZBA would uphold that determination. The Westchester County Supreme Court aptly recognized that the futility exception applies only in extraordinary circumstances and no such circumstances were presented. Thus, Apache Oil is back where it started because it failed to exhaust its administrative remedies by first submitting an application to the Building Inspector and then appealing any adverse decision to the ZBA.
This case is a reminder that exhaustion of administrative remedies is a mandatory requirement and reliance on the futility exception will seldom be successful.
Should you have any questions regarding your land use, zoning and other real property issues, please contact Jennifer L. Gray, Esq.