Opinion ID: 2347740
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Heading: Hillview Heights Section 2

Text: In May, 1968 Leroy Waycott and his wife, Noreen, purchased a 63-acre tract of land in Saco, Maine. Shortly thereafter, the Waycotts secured a preliminary survey of the property and hired an engineer to design and plan a residential development that would eventually accommodate 105 new homes. In July of the same year, Leroy Waycott submitted a preliminary plan of the proposed development, which he designated Hillview Heights, to the Saco Planning Board. Acting pursuant to the subdivision regulations of the municipality, the planning board, on August 6, 1968, granted a conditional approval of the preliminary plan of Hillview Heights then before the board. Subsequent to this conditional approval, Leroy Waycott divided Hillview Heights into two segments, one of 8 acres in area entitled Hillview Heights Section 1 (HH1), and the other named Hillview Heights Section 2 (HH2) which comprised 55 acres. Waycott obtained the planning board's final approval for HH1 and recorded the plan in the York County Registry of Deeds in September, 1968. The developer began constructing new homes on HH1 without delay. In contrast to Hillview Heights Section 1, Waycott proceeded to develop Hillview Heights Section 2 at a much slower pace. During the summer and fall of 1969, he cleared an unpaved road into HH2 for a length of 400 feet, installed a water main into the subdivision for an unspecified distance, and erected a utility pole on the border of the property. Waycott also installed water mains on HH1 of sufficient capacity to accommodate the homes that he anticipated building on HH2. He did not, however, initiate construction of new homes on Hillview Heights Section 2 prior to January 1, 1970, and, in fact, did not apply for and obtain the Saco Planning Board's final approval for that development until the spring of 1971. Prior thereto, on September 5, 1969 Leroy and Noreen Waycott had formed Saco Construction, Inc. pursuant to the laws of Maine. They sold their entire 63-acre tract of land to the corporation, which later carried out the development of Hillview Heights Section 2, completing in some instances, or initiating construction of, 37 new homes in HH2 by the time of the institution of this suit. The defendants contend that Hillview Heights Section 2 is exempt from the operation of the Site Location Law by virtue of 38 M.R.S.A. § 488 (Supp.1973). Section 488 provides, in pertinent part, that the Site Location Law shall not apply to any development in existence or in possession of applicable state or local licenses to operate or under construction on January 1, 1970, . .. In determining whether the Hillview Heights Section 2 project comes within the exempted developments enumerated in this section of the Site Location Law, we recognize that the statutory exemption provision should be strictly construed in favor of the defendants. See King Resources Company v. Environmental Improvement Commission, Me., 270 A.2d 863, 869 (1970).
The defendants' first argument is that Hillview Heights Section 1 and Hillview Heights Section 2 constitute a single development within the meaning of the Site Location Law. All parties to this controversy agree that HH1 is exempt from regulation under the statute, as that part of the development was unquestionably in existence, in possession of applicable licenses to operate, or under construction on January 1, 1970. The defendants contend that HH2 also must be viewed as exempt under section 488, because of its integrated connection with HH1. However, after hearing the evidence and passing upon the credibility of the witnesses and the persuasiveness vel non of the exhibits, the presiding Justice rejected the defendants' argument and held that Hillview Heights Sections 1 and 2 constituted separate and distinct developments. Such findings of fact at the trial level will be affirmed on appeal, unless shown to be clearly erroneous. See Boynton v. Adams, Me., 331 A.2d 370 (1975); Leighton v. Leighton, Me., 329 A.2d 164 (1974); McKenna v. Peddle Land Developments, Me., 229 A.2d 332 (1967); Rule 52(a), M.R.Civ.P. Tested against this standard, the defendants' argument is without merit. The fact that Leroy Waycott obtained the planning board's preliminary approval for the entire 63-acre tract indicates that he may originally have conceived of Hillview Heights as a single development. The trial Justice, however, was justified in concluding that, when Waycott later divided the tract into two separate segments and in 1968 obtained final planning board approval, and proceeded with the development, of only Hillview Heights Section 1, the original unitary concept of the development had been abandoned. In fact, application for final planning board approval of HH2 was not made until over two years later. We cannot say that the presiding Justice was clearly wrong in deciding from the totality of the evidence that Waycott chose to develop the property in two separate developments. We hold that Hillview Heights Section 2 is not exempt from the Site Location Law on the basis of a unitary development with Hillview Heights Section 1.
The defendants maintain that, even if viewed as a separate development, Hillview Heights Section 2 was in existence on January 1, 1970 and within the statutory exemption provided in section 488 of the Site Location Law. In King Resources Co. v. Environmental Improvement Commission, supra, we said that an existing development parallels an existing use and should mean the utilization of the premises so that they may be known in the neighborhood as being employed for a given purpose. Id. at 869. Applying this concept to the present case, we find that Hillview Heights Section 2 could not possibly have been known in the area as being employed for residential purposes on January 1, 1970. Aside from the clearing of an unpaved road and some minor utility work, HH2 existed essentially in an undeveloped state and was merely contemplated as a residential development on that date. As we stated in King Resources, a mere contemplated or intended use is insufficient to give rise to an existing development within the meaning of section 488. Id. at 869.
Also exempt from the Site Location Law are developments in possession of applicable state or local licenses to operate on January 1, 1970. The defendants concede that HH2 did not possess the Saco Planning Board's final approval, as required by the subdivision regulations of the municipality, until May, 1971. They argue, however, that the planning board gave its preliminary approval subject to certain conditions to the original Hillview Heights area in 1968, and that, once these conditions were satisfied prior to January 1, 1970, the defendants as developers of Hillview Heights Section 2 became entitled to the planning board's final approval as a matter of law. The defendants apparently contend that this alleged right to planning board approval relates back to the original preliminary approval. We disagree. The defendants' argument ignores the plain wording of the exemption. The exemption applies to developments in possession of applicable licenses to operate, not to those that merely have a right to receive the licenses. Therefore, even if Hillview Heights Section 2 was legally entitled to final planning board approval prior to January 1, 1970, it did not possess the license until well after that date, and is not entitled to the exemption on the reference basis.
The defendants' final claim to exemption under section 488 in relation to Hillview Heights Section 2 is that the development was under construction on January 1, 1970. In enacting this particular statutory provision, the Legislature neglected to qualify the extent of activity required for a development to be under construction. We believe, however, that a developer must expend a substantial amount of money or effort towards the completion of a development before the project is entitled to an exemption. The test of substantiality, moreover, involves an assessment of the amount of money or effort expended in relation to the amount required to complete the development. Aries Development Co. v. California Coastal Zone Cons. Com'n, 48 Cal.App.3d 534, 122 Cal.Rptr. 315 (1975); Gosselin v. City of Nashua, 114 N.H. 447, 321 A.2d 593 (1974); Edelbeck v. Town of Theresa, 57 Wis.2d 172, 203 N.W.2d 694 (1973); Hempstead v. Lynne, 32 Misc.2d 312, 222 N.Y.S.2d 526 (1961). In the present case, the president of Saco Construction, Inc. testified that the ultimate development costs of Hillview Heights Section 2 would be between $1,500,000 and $4,000,000. The record fails to reveal the amount of money expended for the road and utility work which had occurred on HH2 as of January 1, 1970. We believe, however, that the money spent on these minor construction efforts was clearly insubstantial in relation to the anticipated costs of the residential development. The defendants assert, however, that the extent of construction involved in the present proceedings is similar to that of the recent case of State v. R. D. Realty Corp., Me., 349 A.2d 201 (1975). In that case, a developer cleared five miles of rough roads and constructed a cottage and a small airplane landing strip on a residential subdivision. We held in R. D. Realty that these development efforts constituted sufficient construction to warrant an exemption under § 488. Assuming that the level of construction achieved in Hillview Heights Section 2 on January 1, 1970 is equal to that of R. D. Realty, we, nevertheless, believe that the facts of that case are not controlling. The developer in R. D. Realty intended merely to sell vacant lots to the public. In contrast, the developer in the present case embarked upon a much more costly undertaking: the construction of approximately 80 homes equipped with utilities and paved roads. Saco Construction, Inc. would accordingly have to expend a greater construction effort than the subdivider in R. D. Realty before Hillview Heights Section 2 could be considered to be under construction within the meaning of the Site Location Law. We hold, therefore, that Hillview Heights Section 2 is not exempt from regulation under the Site Location Law, and that there was no error in the ruling of the Superior Court Justice to that effect.