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July/August 2018 Issue

Also in this issue: The End of Deference to Agency Interpretations of Law in Wisconsin     |     Court of Appeals Rules for City in Town’s Challenge to Annexation Ordinance     |     U.S. Supreme Court Decision Impacts Public Safety Union’s Dues Deductions     |     Court of Appeals Clears the Way for Badger Coulee Project

Wisconsin Supreme Court Extends Building Permit Rule to Land

In Golden Sands Dairy LLC v. Town of Saratoga, 2018 WI 61, 381 Wis.2d 704, 913 N.W.2d 118, the Wisconsin Supreme Court extended the bright-line “Building Permit Rule” to all land identified in a building permit application. This rule, upheld by the Supreme Court last year in McKee Family I, LLC v. City of Fitchburg, 2017 WI 34, provides that a property owner has a vested right to build a structure upon the filing of a building permit application that strictly conforms to all applicable zoning regulations in effect at the time of application. The Building Permit Rule’s effect is to remove the power of a municipality to prevent a planned use of property by changing its zoning code. The rule is an exception to the general policy that property owners “obtain no vested rights in a particular type of zoning solely through reliance on the zoning.” Wisconsin is in the minority of jurisdictions that vest rights prior to substantial construction and/or substantial expenditures by the applicant. 

In Golden Sands, a dairy owned or was under contract to purchase 6,388 acres of land in and around the Town of Saratoga. The dairy filed a building permit application for seven farm structures on a building site of 92 acres to be used for dairy cows. The application also identified by map and state permit submissions the entire 6,388 acres as used to support the operation. After the application was filed the Town of Saratoga enacted a zoning ordinance that prohibited the dairy’s proposed use. However, the Town issued a building permit after the dairy succeeded in a mandamus action. 

The dairy next brought a declaratory judgment action, asking the circuit court to declare that it may use all the land specifically identified in its building permit application for its operation. Neither party argued against the bright-line Building Permit Rule as affirmed in McKee. The circuit court held that by filing an application that specifically identified the parcels, the dairy had a vested right to use the land for agricultural purposes. The court of appeals reversed, holding that while the right to build a structure vests with a building permit application, the right to use the land only vests with open and obvious use under the nonconforming use doctrine. 

In this matter of first impression, the Wisconsin Supreme Court reversed the court of appeals. The majority held that the Building Permit Rule applies not only to structures but also to all land specifically identified in the building permit application. The majority went on to find that the dairy had sufficiently identified all 6,388 acres in its application to gain a vested right to use the land for its dairy operation. 

Quoting McKee, Justice Gableman, writing for the majority, emphasized that the bright-line Building Permit Rule “creates predictability for land owners, purchasers, developers, municipalities[,] and the courts” by identifying the exact date upon which rights vest—the date that the building permit application is filed. The Court rejected the court of appeals’ concern that an applicant may identify far more land than is necessary under a building permit application by noting that any unused land at the time the building permit expires may be subject to the zoning regulations that exist at the time of permit expiration. According to the Court, any other interpretation would render a building permit “nearly worthless” if the rights vested only to structures and not to the land “necessary to put the structures to their proper use.” 

In a dissent joined by Justice Ann Walsh Bradley, Justice Abrahamson concluded that the majority’s expansion “sacrifices” predictability and uniformity by requiring a case-by-case analysis of the applicant’s specificity regarding both a description of the property and the property’s proposed use. Specifically, the dissent was concerned that municipalities lack satisfactory guidance as to what materials or information will be sufficient to vest rights in an applicant. Without this guidance, the dissent worried that the majority opinion may actually serve to encourage developers to provide less, rather than more, information. 

Absent further clarification, the result of Golden Sands is that municipalities are left to determine whether a building permit application contains sufficiently specific information to vest a right in the applicant to use all land identified in the permit application. Each municipality will need to determine whether it will require applicants to submit additional detailed information with building permits, including maps, legal descriptions, state permits, or detailed descriptions of proposed uses and locations. 

— Jared Walker Smith

This newsletter is published and distributed for informational pur- poses only. It does not offer legal advice with respect to particular situations, and does not purport to be a complete treatment of the legal issues surrounding any topic. Because your situation may differ from those described in this Newsletter, you should not rely solely on this information in making legal decisions.

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