It looks like Formation Shelbourne – the private equity fund looking to build a 94-bed assisted living facility in Edgemont – shot itself in the foot with its latest Article 78 lawsuit and may therefore have some explaining to its investors to do.

The Zoning Board of Appeals tonight announced that upon advice of counsel, because of Shelbourne’s latest lawsuit – this one against the Town for having rescinded an environmental finding it made in favor of the project — it was adjourning continuation of Shelbourne’s hearing to obtain variances to allow it to build on a lot that’s less than the required minimum four acres and which is in an area zoned only for single family homes which is more than a mile from where such facilities are permitted in any event under the Town’s zoning code.

Eve Bunting-Smith, the chair of the ZBA, announced the board’s decision to adjourn the hearing at the start of tonight’s ZBA meeting, following an unusual meeting with ZBA counsel in executive session.  Her ruling took the audience by surprise.

The Shelbourne application was the first of nine cases on the agenda and Shelbourne was caught off guard by the announcement.  It’s attorney, Lino Sciaretta, objected to the ZBA not hearing the case, claiming Shelbourne had sued only the Town Board, not the ZBA – but Ms. Bunting-Smith made clear that the ZBA would hear the case, just  not while the litigation against the Town Board was pending.

In a show of good faith, the ZBA announced that the hearing would resume at its next meeting October 20, but whether or not the hearing actually goes forward on that date depends on whether the ZBA feels it can decide the case while the litigation is still pending.

Shelbourne sued the Town Board on August 18 claiming that the Town Board acted improperly when it rescinded a “negative declaration” that the Shelbourne project did not require any further study as to any environmental impact, including any such impact on homeowners in the Underhill Road corridor in Edgemont and on homeowners along Sprain Road and on Deer Hill Lane in the Ardsley School District.

The ZBA is apparently taking the position that unless and until Shelbourne’s latest lawsuit is resolved, it does not know whether the Town Board’s negative declaration should or should not be part of the administrative record before it.  Either it belongs in the record, as Shelbourne contends in its lawsuit, or it does not, because the Town Board rescinded it.

The end result is that if Shelbourne wants to pursue its latest lawsuit, it might not get a ruling on its variances for several more months, until the court rules on whether Shelbourne’s latest case can go forward and if so, whether Shelbourne has a valid claim.

Ironically, even if Shelbourne has a valid claim that the Town Board acted improperly in rescinding the negative declaration for political reasons, rather than, as New York requires, on the basis of new evidence or evidence it otherwise overlooked, because the ZBA is still considering whether to grant the variances it seeks, Shelbourne still hasn’t suffered any injury, without which it’s legal claim is premature.

Common sense therefore suggests that if Shelbourne wants a ruling  anytime soon on whether it is entitled to variances, it will have to drop its latest lawsuit.

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