Articles Posted in Real Estate

The increasing relevance and importance of renewable energy projects in Rhode Island and nationwide have led to conflicts between companies proposing the development of green energy projects and the owners of property adjacent to such proposals. Solar and wind energy projects generally take up less space and disrupt less environmental, commercial, and residential activity than fossil fuel-based energy production. Although green projects are less disruptive than facilities dedicated to fossil fuel-based energy generation, this does not mean that Rhode Island property owners want these projects in their backyards. Solar and wind farms can be unsightly and reduce neighboring property values. At the same time, the construction of large-scale green energy projects can be extremely disruptive to the communities in which they are being built. A Rhode Island court recently addressed an appeal filed by a solar energy company in response to conditions placed upon their project by a municipal zoning board.

The appellant in the recently decided appeal is a company that has sought approval for a photovoltaic solar energy system (PSES) within an area of Hopkinton, RI, that is zoned for manufacturing. To obtain approval for the project, the appeal needed to apply for a Development Plan Review (DPR) to the municipal zoning board for evaluation and approval. As part of the application process, the zoning board held public hearings to discuss the proposal. Many residents of Hopkinton testified at the hearing in opposition to the project. Residents expressed concerns about the amount of vegetation that would be removed as part of the construction. Residents also objected to the construction occurring outside of weekday business hours. The zoning board eventually approved the project, albeit with conditions that no vegetation in certain areas could be removed or modified, and that construction could not occur after 5 pm or on weekends.

The energy company appealed the imposition of the conditions to a board of appeals, and ultimately to the Rhode Island Superior Court. The Court agreed that the legal reasoning used by the zoning board did not justify the imposition of the challenged conditions on the appellant. The Court found that the zoning board had no right to forbid the appellant from modifying or removing vegetation from the areas at issue. Additionally, the court ruled that the working-hours restrictions could not be legally imposed based on the controlling laws and regulations when the application was made. As a result of the Court’s ruling, the appellant will be permitted to complete their project without the conditions initially imposed by the zoning board.

Towns and Cities in Rhode Island often adopt zoning ordinances in an attempt to preserve or direct the character of the municipality. These ordinances may limit the number of occupants to a dwelling, the number of families permitted in a single building, or even the total square footage of a home. In response to the proliferation of students moving into towns adjacent to colleges and universities, some municipalities have attempted to pass ordinances that prevent multiple students (or unrelated tenants in general) from occupying the same house. The Rhode Island Superior Court recently addressed a claim filed against the town of Narragansett by a group of landlords who challenged such an ordinance.

The ordinance in question was passed by Narragansett last year in response to townspeople’s concerns about the increasing numbers of houses that were being rented to groups of students attending the University of Rhode Island’s nearby Kingston campus. Supporters of the ordinance took issue with students having boisterous parties that disrupted the quiet character of the town, as well as outside landlords’ purchasing of properties to rent to students as “unofficial dormitories,” which resulted in an exodus of long-term residents. The ordinance passed prohibited any residence in the town from being rented to four or more college students unless the owner of the residence also resided there.

A group of landlords, student advocates, and property owners who opposed the ordinance filed a suit in state court, challenging the legality of the ordinance, as well as the procedure that the town followed to get it passed. The plaintiffs challenged several aspects of the ordinance’s passage, arguing that the town council did not allow all members of the public who desired to comment on the ordinance the opportunity to be heard. Additionally, the plaintiffs argued that the town did not follow a statutory requirement for passing such ordinances, by failing to refer the ordinance to the town planning board for consideration before voting and passing the regulation.

The increasing popularity and practicality of green energy production are causing conflicts between energy producers and rural residents nationwide and in Rhode Island specifically. Non-renewable energy production has commonly played a role in rural American life, through fossil fuel extraction and refining. The production of power using wind and solar energy is a more recent arrival, and rural residents may not be pleased to be in the vicinity of such developments. Conflicts involving a recently proposed solar energy farm in the town of Exeter, Rhode Island ideally demonstrate this phenomenon. In a recently issued ruling, the Rhode Island Superior Court affirmed the town’s rejection of a solar farm project proposed by the plaintiff.

According to the facts discussed in the appellate opinion, the plaintiff in the recently decided case is an energy development company that intended to build a solar energy project on 32 acres of land they own in the town of Exeter. Under local zoning and building ordinances, the plaintiff sought approval for the plan from the Town of Exeter Planning Board for the project. While negotiating compliance with the applicable regulations, several issues arose that the plaintiff was asked to address before seeking final approval for the project. These issues included the road access to the project, compliance with drainage and grading requirements, the environmental impact of the project, as well as the effects on neighboring property owners’ use and enjoyment of their own property.

The plaintiff attempted to address all of the issues presented by the Planning board and submitted their application. The Board found that the plaintiff had not sufficiently addressed all of the issues, and the board could not approve the project. The plaintiff appealed the ruling first to the zoning board of review, and ultimately to the State Superior Court, where it was rejected both times. The court ultimately ruled that the plaintiff failed to meet six requirements that were mandatory for the project to go forward. Notably, the plaintiff did not demonstrate that the proposal was environmentally safe, legally accessible, or consistent with the town’s comprehensive plan. As a result of these findings, the plaintiff will be unable to resume the development of their plan.

The law concerning business organizations in Rhode Island and nationwide can be a complicated topic. There are several forms of businesses that people can participate in, including sole proprietorships, partnerships, corporations, LLCs, as well as others. Complicating matters further, several business organizations, with different owners and members, can be behind what appears to be a single business. The Rhode Island Superior Court recently issued a judgment in a case between two former friends concerning the structure and decisions of various business entities that were formed in relation to a proposed restaurant.

According to the facts discussed in the appellate opinion, the plaintiff in the recently decided case is a woman who practices law as an attorney involving complicated business transactions. The defendants are a married couple who sought to construct and operate a restaurant near Westerly, Rhode Island. The parties were social friends, and when approached by the defendants about offering a loan or investment in the restaurant, the plaintiff agreed to invest approximately $120,000 in the venture. In exchange for her investment, the plaintiff was granted a 14% interest in an LLC that was formed to manage the real estate holdings for the restaurant, as well as a $20,000 promissory note.

According to the contract that accompanied the investment, the plaintiff was not granted any ownership interest in the restaurant itself, which was controlled by another corporation that was owned and managed exclusively by the defendants. After entering into the agreements, the defendants managed and used the plaintiff’s investment in the business. Later, the plaintiff sued the defendants over decisions made concerning the operation of the restaurant and the assets of the corporation that controlled the restaurant. The plaintiff sought substantial judgments for fraud and breach of fiduciary duty against the defendants.

Property owners who desire to construct residential or commercial projects in the state must obtain permits for construction that satisfy the zoning and planning requirements of the municipality where the proposed construction will occur. Municipal zoning boards set regulations for the types of permitted construction that can occur on any piece of property. These regulations allow property owners to easily determine if a proposed use will be acceptable to the zoning board. Noncompliant construction projects may still be approved with the issuance of a “variance” by the zoning board, which will permit the proposed construction if a majority of the zoning board members agree that certain conditions have been met to issue the variance. The Rhode Island Supreme Court recently issued a decision that affirmed a variance issued by the zoning board despite objections from neighboring property owners.

The appellees in the recently decided case are property owners who sought to build their retirement home on their property in Gloucester, Rhode Island. The property had abnormal dimensions and abutted protected wetlands. The zoning regulations in place for the town would have prevented the appellees from constructing the home they desired, so they applied for a dimensional variance. The appellees’ proposal would place their home 17 feet closer to their neighbor’s house than generally permitted under the regulations. The neighbors objected to the appellees’ proposal, and the zoning board held an evidentiary hearing to determine whether to approve the variance. The zoning board determined that the appellees’ proposal met all of the standards for approval, and was the least relief necessary to achieve the appellees’ goals. As a result of these findings, the board approved the appellees’ plan.

The neighbors appealed the zoning board decision to the Superior Court, arguing that the zoning board failed to consider other proposed construction plans for the property that would better serve the neighbors’ interests. The high court addressed the neighbor’s arguments, finding that the zoning board did not err in granting the appellee’s variance request. Notably, the Court found that the zoning board relied on sufficient evidence in approving the variance, and did not abuse its discretion in granting the variance. As a result of the Court’s ruling, the appellees will be permitted to construct their home.

The State of Rhode Island and the municipality existing within the state have passed laws and regulations to support residential and commercial development that supports the political leaders’ vision for the state. To encourage the development of “traditional, New-England style” villages, municipalities have passed ordinances that incentivize developers to construct and maintain mixed-use developments that include residential housing, community infrastructure, as well as commercially zoned units to support the needs of the residents who live nearby. These developments are sometimes known as “compact village developments,” or CVDs. Existing property owners may not desire mixed-use development in their neighborhood, as 20th Century suburban development does not always exist in harmony with more modern, mixed-use proposals. The Rhode Island Supreme Court recently ruled against a property owner who had been trying to oppose the development of a CVD near his property.

According to the facts discussed in the appellate opinion, the plaintiff has been a property owner near an existing golf course since before the CVD proposal was submitted. A developer submitted plans for a CVD development that would include residential and commercial properties, as well as a renovation of the golf course clubhouse building. Under the applicable municipal ordinances, a CVD development must include “an appropriate proportion of residential to non-residential uses” to be approved. The plaintiff challenged the development plan. The plaintiff’s position was that the renovated clubhouse as well as the proposed commercial development created an inappropriate proportion of commercial to residential properties in the plan.

The plaintiff’s objection to the plan was rejected by the town, and he appealed the decision to the Rhode Island Supreme Court. In evaluating the plaintiff’s claims, the court determined that the improvements on the golf course clubhouse were separate and distinct from the additional new commercial development anticipated in the plans. The court found that the square footage of the clubhouse renovation should not be considered “commercial space” for purposes of the proportion analysis. Based on this determination, the court found no error in the town’s decision to deny the plaintiff’s objection to the project. Without a further appeal and legal action, the plaintiff will be unable to stop the development of the CVD he had challenged.

Trespassing, or physically inhabiting a property without the consent of the owner, can be both a civil and criminal offense in Rhode Island. There are some interesting exceptions to this rule, one of which is the law of adverse possession. Adverse possession, as applied to real estate, is a legal doctrine that allows a trespasser who openly possesses property for an extended period to take legal title to the property. Although the law of adverse possession has its roots in Old Common Law, the Rhode Island Legislature has codified the right, and it remains the law in Rhode Island.

The most publicized and intriguing stories of adverse possession often include squatters. A squatter is a person who moves into an abandoned property and lives there as if it were their own. Under Rhode Island law, a person who openly and notoriously possesses property for a period of ten years may seek title to the property under the law of adverse possession. In evaluating an adverse possession claim of a residential dwelling, a court may consider whether the petitioner maintained and improved the property while residing there. Squatters who live in a property for 10 years, maintain and improve the property, and follow the proper procedures can gain legal ownership of the home.

Practically speaking, Rhode Island’s adverse possession law is more commonly used in resolving property line disputes between neighboring property owners. If a fence in between two pieces of property is not in the correct place, one of the neighbors is a victim of trespass. If the aggrieved neighbor does not pursue action to correct the trespass after ten years, the trespassing neighbor may be entitled to officially change the land ownership records and take legal title to the strip of their neighbor’s property on their side of the fence. New owners of a home may not even realize that the fences are in the wrong place, and allow the ten years to pass unintentionally.

The programs established by the federal and state government in response to the economic and public health effects of the Covid-19 pandemic had significant effects on Rhode Island property owners and landlords. Policies like the residential eviction moratorium placed restrictions on the rights of property owners. Other policies, such as Rhode Island’s rental assistance program, helped both tenants and property owners to stay afloat economically during the pandemic.

As the pandemic appears to have stabilized to an endemic stage and some policymakers tire of active government responses to pandemic-related economic troubles, many of these programs have expired and will not be renewed. Rhode Island’s rental assistance program was closed out earlier in the summer. With the program’s termination, some renters and landlords were left in troublesome situations. A local news report was recently published explaining the effects of the program’s expiration on Rhode Island residents.

According to the facts discussed in the recently published article, the Rhode Island rental assistance program helped over 30,000 families to pay past-due rent and future obligations. On average, each family received about $6500 toward their rent. Although this program was designed to help renters, it was also very beneficial to landlords. Because there was an eviction moratorium in effect while the program was active, the only rent received by many landlords was thanks to the program.

As development increases throughout Rhode Island, and the density of commercial and other development increases, conflicts and disputes can arise over access to businesses and parking. To ensure that existing buildings can maintain public access after new construction, municipalities, property owners and developers will issue easements to existing property owners, guaranteeing the use of the land for access and parking. Easements are supposed to be spelled out clearly and unambiguously in any contract that establishes an easement. In practice, this is not always the case. The Rhode Island Supreme Court recently addressed a conflict between parties over an easement that was not spelled out clearly and unambiguously.

The plaintiff in the recently decided case is a tenant and operator of a medical facility that borders a development owned by the defendant in North Smithfield, RI. Until last year, the plaintiff’s property was accessible from two sides, and the plaintiff believed that they owned easements guaranteeing the two accesses to their facility. The defendant, who had recently purchased the property from another owner, didn’t want the plaintiff’s patients using one the access from the defendant’s property, and they constructed a median to block the access.

The plaintiff sues the defendant in state court, attempting to enforce a 2005 easement that would guarantee the plaintiff access to their business from the defendant’s property. The defendant responded that the 2005 easement did not prevent them from constructing the median. The defendant maintained that the plaintiff’s property was still accessible through the other entrance and that they had the right to build the median. After reviewing the contracts and evaluating the case, the court ruled that the easement language contained in the initial contracts was too unclear to render judgment at this time. Because the language of the easement is ambiguous, and the intent of the pirates cannot be presently ascertained with existing evidence, the case will need to proceed to trial before either party gets the relief they desire.

Public utilities such as water, power and sewer service are necessary for economic development and are commonly operated by municipal authorities. In some instances, a privately constructed and owned piece of utility infrastructure may be used by a municipality, although the owner of the property/equipment should be compensated for allowing the government to use the infrastructure. The Rhode Island Supreme Court recently permitted a full jury verdict of over $1 million to be awarded to the owner of a sewer system that the defendant town had been pumping sewage into without the plaintiff’s consent.

The plaintiff in the recently decided case is a company that constructed and operates a housing development in the town of Johnston, Rhode Island. The development, which was constructed in the 1970s included a sewage pipeline that would pump sewage from the residences up a hill and into the municipal sewer line. The plaintiff’s sewer line initially worked properly without issue, but as the development of the surrounding area progressed, the sewage pump repeatedly had problems. After investigating, the plaintiffs realized that the town of Johnston had been using their private sewer line and pump to move sewage from other developments. The plaintiff sued the town in state court, alleging that the town’s use of the plaintiff’s sewer lines was causing the maintenance issues, and resulted in over $1 million in damages.

After a 5-day jury trial, the plaintiff was awarded a judgment of over $1 million for the losses that they suffered as a result of the defendant’s unauthorized use of their sewage line. In a post-judgment motion, the trial court reduced the award to $100,000 based on a statutory limit to damages obtained against a government agency performing a public function. The plaintiff appealed the reduction to the Rhode Island Supreme Court, arguing that the operation of a municipal sewage line is generally a private, not a public function and that the $100,00 damage cap should not apply. The high court agreed with the plaintiff, finding that the design of a sewer system is a public function, but the operation of such a system is private. As a result of this ruling, the plaintiff will be entitled to the full jury award plus interest.