Agenda - Planning Commission - 06/04/2015

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Zoning Bulletin May 10, 2015 Volume 9 1 Issue 9 WECA appealed. The Court of Appeals afiled the BZA's determina- tion that the sale of prepared food was encompassed in the grocery use. However, the court held that it was improper for the C of 0 to peimit the expansion of the nonconforming grocery to the rest of the building. The court remanded the matter to the BZA. On remand, FoBoGro argued that WECA's challenge of FoBoGro's C of 0 should be denied because FoBoGro had made large expenditures in reliance on the C of 0. The BZA dismissed WECA's appeal, finding that FoBoGro had a meritorious equitable estoppel defense. DECISION: Judgment of court of appeals affirmed. The District of Columbia Court of Appeals held that the BZA had properly dismissed WECA's challenge to FoBoGro's C of 0 because FoBoGro had a meritorious equitable estoppel defense. In so holding, the court explained that in order for FoBoGro to make out a case of estoppel, it had to show: (1) that it acted in good faith; (2) on af- firmative acts of the Zoning Administrator (i.e., the issuance of the C of 0); and (3) made expensive and permanent improvements in reliance thereon. Additionally, the court said FoBoGro would have to show that the equities strongly favored it in any injury to the public that would flow from the nonenforcement of the zoning law (i.e., no revocation of the C of 0) must be minimal and outweighed by the injury estoppel would avoid (i.e., revo- cation of the C of 0). Here, the BZA had found that the requirements of the equitable estoppel were satisfied, and the court agreed: (1) the Zoning Administrator's 2008 C of 0 permitted the entire building to be used for the operation of a grocery; (2) FoBoGro proceeded reasonably and in good faith, having no reason to believe the 2008 C of 0 impermissibly expanded the nonconfoiuiing grocery use; (3) FoBoGro relied on the 2008 C of 0 by spending "consider- able sums" to 'purchase the grocery business, lease the building, enter into various contracts, renovate the building, and incur other business expenses; and (4) the equities favored FoBoGro because of its good faith and objectively reasonable reliance on the 2008 C of 0, and because the BZA found "no evidence" that the neighborhood would be harmed by the continued operation of "a grocery store that has been a neighborhood institution for over 60 years." WECA had argued that FoBoGro "could not have relied justifiably or reasonably" on the 2008 C of 0 when it incurred the bulk of its renovation expenses, because it did so after WECA commenced its attack on the C of 0 in August 2009. The court rejected that argument, finding that FoBoGro relied on the 2008 C of 0 to its considerable financial detriment.in ways other than renovation expenses, well before it learned of WECA's chal- lenge to the legality of its C of 0. For example, FoBoGro purchased the grocery business and entered into a lease of the building. Although these were not "expensive and permanent improvements" made in reliance on the erroneously issued C of 0, the court found those expenditures and reli- ance could "equally support an estoppel." © 2015 Thomson Reuters 9