Zoning – Municipal – Real Property – Nonconforming Use – Short-Term Rental – Ambiguous Ordinances

Although the respondent-Town had an enacted ordinance in 1984 to regulate “tourist homes and other temporary residences renting by the day or week” and amended the ordinance in 2000 to regulate rentals for “less than 28 consecutive days,” the Town expressly recognized the confusion caused by its ordinance when it enacted another amendment in 2019, which more clearly regulated short-term rentals. Given the ambiguity in the pre-2019 ordinance, we construe the ordinance in favor of the free use of real property, and we agree with the superior court that petitioner’s use of his property for short-term rentals is grandfathered as a nonconforming use under the 2019 ordinance.

We affirm the superior court’s order overturning the Town’s decision, which denied petitioner’s appeal of a final notice of violation (NOV) for operating a short-term rental property in violation of a town ordinance.

Section 1.620 of the Town’s 1984 Land Use Ordinance established the use category “Tourist homes and other temporary residences renting by the day or week” in the Town’s Table of Permissible Uses and restricted its use to non-residential zoning districts. The Town amended its Ordinances in 2000, establishing a short-term rental overlay district in multi-family residential districts and defining “short-term rental of a dwelling unit” as the “rental, lease, or use of an attached or detached residential dwelling unit that is less than 28 consecutive days,” without adding this newly defined use or eliminating the use “temporary residences renting by the day or week” from the Town’s Table of Permissible Uses.

In 2019, the Town enacted yet another amendment, setting out explicit goals including “1. To clearly define short-term rental so everyone understands what is and is not allowed; 2. To clearly identify where short-term rentals are permitted; . . . 10. To communicate transparently with 3rd party rental listing companies.”

It is apparent from the plain language of the 2019 amendment that a lack of clarity and transparency existed and was known to exist with respect to the Town’s regulation of short-term rentals between the 2000 amendment and the 2019 amendment.

We will not construe “short-term rentals,” as defined by the 2000 amendment, to be impliedly prohibited by cross-reference to a less definite, albeit related, land use category. In the event of doubts or ambiguity, zoning regulations are to be construed in favor of the free use of property.

The ambiguity present here flows from the Town’s ineffective attempt to simultaneously prohibit two distinct land uses, where only one use was lawfully prohibited by the Town’s Table of Permissible Uses—not from either land use category being independently and sufficiently ambiguous on its face. The superior court properly recognized that this ambiguity left the Town’s purported regulation of short-term rentals between 2000 and2019 in a state of uncertainty, which in turn, left the rights of landowners to the unguided discretion of the board of adjustment (BOA).

When the 2019 amendment took effect, replacing “temporary residences renting by the day or week” with the previously defined “short-term rental of a dwelling unit” in the Town’s Table of Permissible Uses, the Town achieved the goals of the 2019 amendment by properly regulating “short-term rentals of less than 28 days” for the first time. Accordingly, the superior court did not err by concluding the Town’s ordinances existing prior to 13 August 2019 did not properly regulate short-term rentals of less than 28 days.

Section 16-8.1 of the Town’s 1984 Land Use Ordinance provides in relevant part, “nonconforming situations that were otherwise lawful on the effective date of this chapter may be continued[.]”

Here, the effective date, within the meaning of § 16-8.1, is the date of the 2019 Amendment, 13 August 2019, as properly determined by the BOA. Petitioner was twice cited by the Town for violating the Town’s purported ban on short-term rentals, once before and once after the 2019 Amendment. The record is clear that the alleged violation in each instance was specific to the Town’s proscription against “short-term rentals of less than 28 days.” In neither instance did the Town cite petitioner for violating the Town’s regulation of “temporary residences renting by the day or week.” Accordingly, the question of whether petitioner’s property use violated the Town’s regulation of “temporary residences renting by the day or week” was neither a contested fact between the parties nor the standard applicable to this case.

Thus, the BOA erred and exceeded its quasi-judicial authority to determine contested facts upon applicable standards by mischaracterizing the nature of petitioner’s property use, implicating a land use category he was not cited for violating, to attain a particular outcome. By denying petitioner’s claim pursuant to the “otherwise lawful” provision of § 16-8.1 of the Town’s 1984 Land Use Ordinances—a standard not implicated by the NOV—the BOA erred and exceeded its quasi-judicial authority conferred by statute.

Therefore, the superior court properly concluded the BOA had erred by concluding petitioner’s short-term rental use was not “otherwise lawful” under the local ordinance through its improper reference to an inapplicable standard.

Affirmed.

Frazier v. Town of Blowing Rock (Lawyers Weekly No. 011-201-22, 18 pp.) (Jeffery Carpenter, J.) Appealed from Watauga County Superior Court (Gary Gavenus, J.) Bryan Martin for respondent; David Pokela for petitioner. 2022-NCCOA-782