CITY OF OKOBOJI, IOWA, Plaintiff-Appellee, vs. OKOBOJI BARZ, INC., d/b/ a O'FARRELL SISTERS and LEO PARKS JR., Defendants-Appellants.
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IN THE COURT OF APPEALS OF IOWA
No. 7-258 / 06-0269
Filed May 23, 2007
CITY OF OKOBOJI, IOWA,
Plaintiff-Appellee,
vs.
OKOBOJI BARZ, INC., d/b/a O'FARRELL SISTERS
and LEO PARKS JR.,
Defendants-Appellants.
________________________________________________________________
Appeal from the Iowa District Court for Dickinson County, David A. Lester,
Judge.
The defendants appeal from the declaratory judgment order ruling that the
sale of alcoholic beverages was a distinct noncomforming use.
REVERSED
AND REMANDED WITH DIRECTIONS.
Phil C. Redenbaugh, Storm Lake, for appellant.
Michael Chozen of Chozen & Saunders, Spirit Lake, for appellee.
Heard by Mahan, P.J., and Eisenhauer and Baker, JJ.
2
BAKER, J.
The defendants appeal from the declaratory judgment order ruling that the
sale of alcoholic beverages was a distinct nonconforming use. We reverse and
remand with directions.
Background Facts and Proceedings.
The relevant facts are largely undisputed. Leo Parks Jr. is the sole owner
of Okoboji Barz, Inc., under which he operates the O’Farrell Sisters Restaurant.
Since 1958, the restaurant has been located on Lakeshore Drive in the City of
Okoboji and operated as a family restaurant. 1
The restaurant seats
approximately fifty people. It also has an area with five stools and a bar for
waiting customers. Up until 1994, patrons were able to buy alcoholic beverages
at the restaurant. The restaurant’s liquor license was allowed to expire in 1994
and was not renewed.
In 1972, the City adopted a new zoning ordinance.
At that time, the
property on which O’Farrell Sisters sits was zoned C-Commercial. In 1978, the
founding owner of the restaurant passed away.
Apparently out of concerns
about protecting the integrity of the existing residential areas around the
restaurant, the property was rezoned R-1 Single-Family Residential. Under the
zoning ordinance, restaurants, cocktail lounges, and taverns are not permitted.
In May 2004, Parks made an application to the City of Okoboji for a liquor
license for the O’Farrell Sisters Restaurant.
The city council denied the
application on the basis that the proposed sale of alcohol constituted an
expansion of a nonconforming use that had been discontinued for a period more
1
Parks purchased the restaurant in 2004.
3
than one year. 2 Parks appealed this denial to the Iowa Alcoholic Beverages
Division, which affirmed the City’s decision. However, the final decision also
noted that if Parks were to prevail on a then-ongoing zoning issue in the district
court, then the license should be issued.
Just prior to that final decision, in July 2004, the City of Okoboji had filed a
petition requesting that the district court issue an injunction prohibiting the
defendants, Okoboji Barz, Inc., d/b/a O’Farrell Sisters and Leo Parks Jr., from
operating a “bar or tavern” in the O’Farrell Sisters Restaurant. Later, the parties
amended their petition and answer in order to request declaratory rulings
concerning Parks’ ability to serve alcoholic beverages at the restaurant. After a
hearing on the matter, the court issued a ruling in which it concluded the sale of
alcoholic beverages at the restaurant would constitute the addition of a separate
nonconforming use under the City’s zoning ordinance. The essence of the ruling
was to preclude the restaurant from serving alcohol. Parks appeals.
Scope and Standards of Review.
The district court tried the request for declaratory judgment as an equity
action. Therefore, our review is de novo. Perkins v. Madison County Livestock &
Fair Ass'n, 613 N.W.2d 264, 267 (Iowa 2000). Under this review, we give weight
to the fact findings of the district court, especially as to the credibility of
witnesses, but we are not bound by them. Id.
2
The City’s zoning ordinance provides that once a nonconforming use within a
residentially zoned area is discontinued for a period of more than one year, that
nonconforming use terminates and subsequent use of that land must conform to current
zoning restrictions.
4
Final construction and interpretation of the zoning ordinance is a question
of law for this court to decide. See Good v. Iowa Civil Rights Comm'n, 368
N.W.2d 151, 155 (Iowa 1985). We construe zoning restrictions strictly in order to
favor the free use of property, and we will not extend such restrictions by
implication or interpretation.
Greenawalt v. Zoning Bd. of Adjustment of
Davenport, 345 N.W.2d 537, 545 (Iowa 1984). We also will not construe zoning
restrictions in such a way that they will be arbitrary or unreasonable and will
avoid an interpretation which would make them confiscatory. Jersild v. Sarcone,
260 Iowa 288, 293, 149 N.W.2d 179, 183 (1967).
Nonconforming Use.
The district court first declared that following the passage of the 1978
zoning amendment, by which the restaurant was rezoned to residential, the
restaurant became a legal, pre-existing nonconforming use under the City’s
zoning ordinance. A nonconforming use is a use that was lawful when a zoning
restriction was enacted and has continued to exist under a “grandfather” clause.
See Perkins v. Madison County Livestock & Fair Ass'n, 613 N.W.2d 264, 270
(Iowa 2000).
The City’s zoning ordinance provides that restaurants are not
permitted uses in its R-1 Residential zoned area.
Thus, we concur that, as
currently situated, the O’Farrell Sisters Restaurant is a legal nonconforming use.
However, property may lose its protection as a permissible nonconforming
use if the use of the property is enlarged or extended. City of Jewell Junction v.
Cunningham, 439 N.W.2d 183, 186 (Iowa 1989). The supreme court has stated:
The prohibition against expanding or enlarging a nonconforming
use defends against the growth of a pre-existing aggravation. That
pre-existing aggravation, the nonconforming use, survives as a
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matter of grace. The public is not required to expand upon that
grace to its increasing aggravation.
Stan Moore Motors, Inc. v. Polk County Bd. of Adjustment, 209 N.W.2d 50, 53
(Iowa 1973). On the other hand, “an intensification of a nonconforming use is
permissible so long as the nature and character of the use is unchanged and
substantially the same facilities are used.” City of Central City v. Knowlton, 265
N.W.2d 749, 754 (Iowa 1978) (citation omitted).
An increase in business,
standing alone, does not constitute an illegal expansion of a nonconforming use.
Cunningham, 439 N.W.2d at 186. “Reasonable and normal accessory uses are
usually permitted in connection with nonconforming uses.” City of Okoboji v.
Okoboji Barz, Inc., 717 N.W.2d 310, 315 (Iowa 2006). The use made of the land
at the time the ordinance became effective is the standard we use to determine
whether there is an unlawful enlargement of a nonconforming use. Knowlton,
265 N.W.2d 749 at 754.
We next consider the court’s conclusion that by serving alcohol after a tenyear cessation of such sales the restaurant would thereby be engaging in a
“separate and distinct nonconforming commercial” use of the property. As a
result of this determination, the court further concluded that such an operation
would constitute an “unlawful expansion of a nonconforming use.” For reasons
that follow, we disagree with this conclusion.
The City’s zoning ordinance permits only single-family dwellings or
duplexes in an R-1, single-family residential district.
defines
the
terms
“cocktail
lounge/cabaret”,
The ordinance further
“nightclub”,
“tavern”,
and
“restaurant”. All of these four distinct uses are permitted in a C-Commercial
6
district, but not in an R-1 Single-Family Residential district. Our review of these
definitions leads us to disagree with the district court’s conclusion that an
alcoholic beverage-serving O’Farrell Sisters does not fall neatly into any of the
first three categories.
It would not become a cocktail lounge, night club, or
tavern, because although it would be serving alcohol, the restaurant would not be
“located in and accessory to” a separate business, “operated for the purpose of
supplying entertainment or music,” or “devoted primarily to the serving of
spirituous liquors . . . .“ O’Farrell Sisters Restaurant is a small family restaurant
and even with the ability to sell alcoholic beverages will remain a restaurant. 3
As a general principle, our supreme court has suggested that
“considerable latitude will be allowed a landowner in making changes in the
original noncomforming use if the changes are not substantial and do not impact
adversely on the neighborhood.” Cunningham 439 N.W.2d at 185. Furthermore,
“an increase in business alone does not constitute an illegal extension of a
nonconforming use.” Id.
In Cunningham, a residential facility that had at one time housed elderly
persons had moved toward the care of younger residents with records of mental
illness and who are potentially more aggressive. Id. The court held that such a
change did not alter the facility’s status as a legal nonconforming use. Id. at 186.
The court analogized that situation to a grocery store. It commented that when
a grocer or other merchant is storing and selling merchandise of
one type, his status as a nonconforming use should not be lost if he
changes to another type of merchandise so long as the impact of
the business on the neighborhood remains the same.
3
Restaurant is defined as “an establishment other than a boarding house where meals,
which are prepared therein, may be secured by the public.”
7
Id. Likewise, we believe similar reasoning applies in the present case. The
service of alcoholic beverages in this restaurant occurred for many years before
ceasing in 1994.
Serving such drinks in a restaurant setting is not unlike
choosing to add a different line of food or drink at a grocery store. There is
absolutely no indication the character of the O’Farrell Sisters Restaurant will in
any substantial way change by again serving alcoholic beverages. Indeed, the
district court found “adding the sale of alcoholic beverages at O’Farrell Sisters
would [not] have an adverse impact on the neighborhood or . . . result in any
changes to the structure of area actually used for the operation of the
restaurant . . . .” We believe that, under the City’s zoning ordinance, O’Farrell
Sisters will retain its essential status as a “restaurant.”
Moreover, upon our de novo review we conclude that by re-acquiring the
ability to serve alcoholic beverages from a small bar the nonconformity would not
be excessively intensified or that the nature and character of the use would
substantially change. Further, the sale of alcoholic beverages is not a change in
use that is substantially different from the use the restaurant had at the time of
the adoption of the zoning ordinance. Cf. City of Okoboji, 717 N.W.2d at 316.
Parks testified that he has no plan to turn the restaurant into a tavern or nightclub
if he is granted a liquor license. We agree with the district court’s finding that,
given the small size of the restaurant itself and the lot on which it sits, it is
unlikely that it could be transformed into a busy bar or tavern. The majority of the
space in the restaurant is devoted to restaurant seating, with only a small bar and
a few barstools for customers waiting for a table. Even with the ability to sell
8
alcoholic beverages, it remains a legal, nonconforming use. That use would not
be significantly expanded upon or changed merely by serving alcoholic
beverages.
Conclusion.
When the evidence in this case is examined, we believe that even with the
addition of liquor sales the O’Farrell Sisters Restaurant will retain its status as a
legal nonconforming use, i.e a restaurant. There was no evidence of a material
change in the structure or use itself, nor was there any substantial showing of an
adverse impact on the neighborhood. Accordingly, we reverse the trial court and
declare that the sale of liquor at the O’Farrell Sisters Restaurant is a legal
nonconforming use. We further remand and order that the City of Okoboji shall
issue a Class C liquor license to Okoboji Barz, Inc. for O’Farrell Sisters
Restaurant. By virtue of this ruling, we need not reach the spot zoning issue.
REVERSED AND REMANDED WITH DIRECTIONS.
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