Investment Banker Sues Southampton Town Planning Board, Farmers Over Barn Denial

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A millionaire investment banker is suing the Southampton Town Planning Board, and its farmland-use advisory committee, for $20 million after members twice denied his request to build a barn on 40 acres of Bridgehampton farmland that he purchased for more than $15 million.

Cantor Fitzgerald CEO Howard Lutnick bought the Halsey Lane property in 2003 and has been using it largely as the backyard to his estate since that time, adding a baseball diamond and playground. At the opposite end of the fallow farmland is a small apple orchard, and Mr. Lutnick has said that he would like to start a small vineyard on his land.

In 2007, consultants for Mr. Lutnick sought permission to build a 11,200-square-foot barn on the property—and, on two separate occasions, were denied by the Planning Board. Board members, on the basis of the agricultural committee’s recommendation, said Mr. Lutnick could construct a 2,400-square-foot barn on his land but only if he first removes the baseball field and playground.

The lawsuit that attorneys for Mr. Lutnick filed in response stands out amid the parade of such legal challenges to other decisions made by the Planning Board in that it lists all seven members of the board, as well as the 17 members of the town’s Agricultural Advisory Committee, as defendants, individually. The suit, which seeks $20 million in damages, implies that the individual members of both boards should be held personally responsible for the losses incurred by the plaintiff and applicant.

“It’s not your run-of-the-mill Article 78,” Town Attorney Tiffany Scarlato said of the lawsuit, referring to the term for the typical suit that challenges a decision by a municipal regulatory board. “They are potentially alleging that there is some individual liability.”

But she was quick to point out that members of both boards, since they were serving in their official roles, would be indemnified against any legal damages sustained by the town. She also suggested that such a lawsuit was nothing more than a tactic to intimidate board members and perhaps influence them to change their minds on the barn application.

Ms. Scarlato also said the town will be handing over the defense of the case to an independent legal firm, Devitt Spellman Barrett in Smithtown.

The property in question is a reminder of Southampton Town’s earliest—and, apparently, least savvy—efforts at preserving farmland. An easement was placed over the 40 acres as part of the creation of a subdivision on another 39 acres that, at the time, belonged to Raymond Wesnofske. It was the first such easement the town ever sought as part of a subdivision development.

In the lawsuit, Mr. Lutnick’s attorneys argue that the covenants placed on the land, with the intention of keeping it mostly open, still permit a number of other possible uses, including the construction of a single-family house, recreational amenities, landscaped open spaces or agricultural uses—as well as any structures that might be appropriate to support them. As recently as 1996, both the Southampton Town Board and Planning Board appeared to have confirmed those potential uses, the suit claims, in connection with another application for development of the property that was never followed up on.

In decisions in 2001 and again in 2012, following a modification of the application for two smaller barns, the Planning Board and farmland committee gave the nod to a much smaller barn but said that the playground and ball field were inappropriate uses. They also ruled that the 3-acre apple orchard was not large enough to constitute the sort of commercial agricultural use that would justify the construction of a large barn.

The lawsuit, however, notes that the Planning Board permitted the construction of a 19,300-square-foot barn on a neighboring property that measures just 13 acres total.

Planning Board members contacted this week declined to discuss Mr. Lutnick’s application or the lawsuit, though all said this marks the first time that they’ve been personally listed as defendants in litigation.

“My first day on the Planning Board, going back to 1993, they told me to make sure I wore a jacket and tie, because there would be a reporter there who might want to take my picture,” Planning Board Chairman Dennis Finnerty recalled this week. “I showed up in my jacket and tie, and a guy came over to me and said, ‘Are you Dennis Finnerty?’ And when I said yes, he served me.

“I hadn’t even gotten into the board room for the first time, and I got sued,” he continued. “So, it’s part of the landscape. But it’s usually the board getting sued, not the individual members.”

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