Will a Proposed Project Lower Neighboring Property Values? Ignore the Special Exception Criteria at Your Peril
Two homeowners had begun building a second-story addition before anyone asked the one question that mattered under the town’s zoning ordinance: would the project lower neighboring property values? In Appeal of Murray, the New Hampshire Supreme Court held that silence on a special exception criterion can undo a zoning approval - even after construction is underway.
Background
A couple (Applicants) owned a small seasonal cottage on a Hampstead lake. Their lot was non-conforming because it was undersized and lacked sufficient frontage.
Under the Hampstead Zoning Ordinance, that non-conformity meant the Applicants could not simply enlarge the cottage. They needed a special exception from the Town of Hampstead Zoning Board of Adjustment (ZBA).
Obtaining a special exception required proof of two things: that the alteration or enlargement stayed within the spirit and intent of the ordinance, and that it would produce "no diminution of surrounding property values in the view of the Board."
Applicants applied to remodel and add a second story, a change that would raise the structure by ten feet. After a hearing, the ZBA granted the special exception.
The ZBA’s decision did not include the specific written findings of fact that RSA 676:3 requires. It recited only that the request “met the requirements” of the ordinance.
An abutter (Abutter) lived across the road. She requested a rehearing, arguing the addition would block her lake view and lower her property value.
While the rehearing request was pending, Applicants partially completed the planned renovations. The ZBA then denied a rehearing, and Abutter appealed to the Housing Appeals Board (HAB).
The Housing Appeals Board
As an appellate body, the HAB must uphold a ZBA’s decision unless it finds an error of law or concludes, on the balance of probabilities, that the decision is unreasonable. The appealing party carries the burden, and the ZBA’s factual findings stand as “prima facie” lawful and reasonable. (“Prima facie” means the HAB initially accepts the ZBA’s factual findings as valid and reasonable unless the appealing party proves otherwise.)
After a hearing, the HAB dismissed the appeal and left the special exception in place.
Abutter appealed to the New Hampshire Supreme Court.
The New Hampshire Supreme Court
The Supreme Court reversed because, in a special exception case, the applicant - not the abutter, and not the board - must prove every criterion the zoning ordinance sets.
Applicants therefore had to prove two things: that the addition fit the spirit and intent of the ordinance, and that it would not diminish surrounding property values.
They proved neither. Applicants described the reasons for the project and the construction plans, yet offered no evidence on property values and never even mentioned the special exception criteria.
Abutter did the opposite. She quoted the criteria, introduced photographs of her lake view, and testified that the project would diminish her property value. Yet she also introduced no evidence or expert report on whether and by how much the project would reduce her property value. Applicants offered nothing in rebuttal.
On appeal, Applicants tried a creative argument. They claimed the phrase “in the view of the Board” handed the ZBA broad discretion and narrowed the standard of review to whether the board acted unreasonably or capriciously.
The Court rejected that reading. Far from loosening the standard, the phrase requires the ZBA to make a specific finding that surrounding property values will not fall. Without evidence, the board had no basis for that finding, implicit or otherwise.
The Court also refused to treat Abutter’s own photographs as Applicants’ proof. On this record, pictures of a lake view did not establish that the project would produce no diminution in surrounding property values, and the burden never shifted to Abutter to disprove her own case.
Because the record contained no evidence that the addition would cause no diminution in surrounding property values, the ZBA’s special exception approval was unreasonable and could not stand. The Court reversed the HAB and remanded with instructions to reverse the ZBA, leaving Applicants with a partially built addition and no valid approval.
Key takeaway
A New Hampshire special exception applicant who says nothing about a required criterion can lose even against a thin opposing record. The burden does not shift to the abutter to disprove the applicant’s case, and the ZBA cannot supply the applicant’s missing proof. Discretionary-sounding language like “in the view of the Board” demands an affirmative finding; it does not lower the applicant’s burden.
Appeal of Murray, 2026 N.H. 26.
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