15 Langsford Owner LLC v. Town of Kennebunkport

2024 ME 79
Supreme Judicial Court of Maine·Decided December 19, 2024·No. Yor-23-265·Published

Opinion

MAINE SUPREME JUDICIAL COURT Reporter of Decisions Decision: 2024 ME 79 Docket: Yor-23-265 Argued: March 7, 2024 Decided: December 19, 2024

Panel: STANFILL, C.J., and MEAD and HORTON, JJ., and HJELM and HUMPHREY, A.R.JJ.

15 LANGSFORD OWNER LLC

v.

TOWN OF KENNEBUNKPORT

HORTON, J.

[¶1] The Town of Kennebunkport appeals from a judgment of the Superior Court (York County, Mulhern, J.) vacating the Town’s denial of applications by 15 Langsford Owner LLC (15 Langsford) for licenses under the Town’s Short-Term Rental Ordinance (STRO). In enacting the STRO, the Town did not include any provision allowing an appeal from the denial of a license application, see Kennebunkport, Me., Code ch. 129 (current through June 6, 2022), so we must determine whether the denial of 15 Langsford’s applications is subject to direct review under Rule 80B of the Maine Rules of Civil Procedure, which ordinarily provides the “exclusive process” for judicial review of municipal permitting and licensing decisions, Gorham v. Androscoggin Cnty., 2011 ME 63, ¶ 22, 21 A.3d 115. We conclude both that the

Town’s decision is reviewable pursuant to Rule 80B and that 15 Langsford was entitled to the permits based on the undisputed facts and the terms of the STRO. We therefore affirm the judgment of the Superior Court.

I. BACKGROUND

[¶2] “The following facts are drawn from the Superior Court’s decision and are supported by the record.” Hurricane Island Found. v. Town of Vinalhaven, 2023 ME 33, ¶ 2, 295 A.3d 147. Between December 2020 and June 2021, 15 Langsford acquired eleven condominium units in Kennebunkport. Units one through nine are contained within a single structure, and units ten and eleven each occupy a freestanding structure. Each unit has one or more bedrooms, a kitchen, a living area, and at least one bathroom. Before 15 Langsford acquired the units, the freestanding units received Town approval as residential single-family dwellings and the structure containing units one through nine was approved as a legally nonconforming residential multiplex dwelling under the Town’s Land Use Ordinance (LUO).1 See Kennebunkport, Me., Code §§ 240-2.2, -4.10, -7.11 (Nov. 6, 2018). The units were governed by a Declaration of Condominium,

1The multiplex is legally nonconforming because it contains nine residential dwelling units despite the LUO’s limitation of multiplex dwellings to eight units. Kennebunkport, Me., Code § 240-7.11(A) (Nov. 6, 2018).

which required that they be used for “residential purposes” and prohibited rentals “for transient or hotel purposes.”

[¶3] In April 2021, 15 Langsford began renting the units exclusively for occupancy for periods of less than thirty consecutive days. At that time, the Town did not regulate short-term rentals of residential property. The units were offered for rent on the website of 15 Langsford’s parent company, which manages and operates the units and other resort properties in Kennebunkport. The parent company’s website, which describes the parent company as offering “the best inns, resorts, and hotels in Kennebunkport,” acts as a booking platform for 15 Langsford’s units and the parent company’s other properties. In addition to using a shared platform to book reservations at the units, short-term rental guests at the units receive access to amenities offered by the parent company at its other properties.

[¶4] Also in April 2021, the Town contacted 15 Langsford, stating that it believed that 15 Langsford was violating the LUO and the Declaration of Condominium by using the units for transient rentals. The Town explained in May 2021 that it viewed the rentals as “part of a larger commercial hospitality enterprise” operating without Planning Board approval required by the LUO. Without issuing a formal notice of violation, the Town recommended that

15 Langsford seek Planning Board approval pursuant to the LUO for use of the units as a “commercial lodging use” and comply with the Declaration of Condominium prohibition on transient rentals.

[¶5] In response, on June 15, 2021, 15 Langsford amended the Declaration of Condominium to eliminate the prohibition on transient rentals and applied for Planning Board approval for use of the units as a hotel.

[¶6] Also in June 2021, the Town began regulating short-term rentals through a licensing ordinance to “require the disclosure and licensing of short-term rentals operated within the Town of Kennebunkport,” impose “modest performance standards,” and limit the number of short-term rentals in the Town. Kennebunkport, Me., Code § 129-1. Under the STRO, “[l]egally existing residential dwelling units may be used as short-term rentals upon the issuance of a short-term rental license,” but certain “lodging establishment uses,” including uses for hotels and inns, are not eligible for STRO licenses. Id. § 129-2(A), (C). The STRO lacks any provision for appeals of decisions denying STRO licenses.2

[¶7] In November 2021, 15 Langsford contacted the Town’s code enforcement officer (CEO) about obtaining short-term rental licenses for its

2 The ordinance provides a right of appeal only from the suspension or revocation of a STRO license. See Kennebunkport, Me., Code § 129-8(D) (current through June 6, 2022).

units under the STRO. The CEO reiterated the Town’s position that 15 Langsford was using the units as a hotel or inn and, therefore, 15 Langsford would not be eligible to receive short-term rental licenses. Nonetheless, 15 Langsford submitted an application for a short-term rental license for each of its eleven units. It also withdrew its application for Planning Board approval for use of the units as a hotel.

[¶8] On May 12, 2022, the CEO issued letters denying each of the eleven applications because the units were not “[l]egally existing residential dwelling units” eligible to receive short-term rental licenses. Id. § 129-2(A). The CEO’s letters reasoned that 15 Langsford had operated, advertised, and managed the units as “a commercial lodging establishment (e.g., an inn) under the unified management, control, and/or ownership of a hospitality business,” without Planning Board approval, “in violation of Town ordinances.”

[¶9] On June 7, 2022, 15 Langsford filed complaints in the Superior Court pursuant to Rule 80B and the Uniform Declaratory Judgments Act, 14 M.R.S. §§ 5951-5963 (2024), seeking review of the CEO’s denial of the license applications.3 The court (Douglas, J.) consolidated the appeals and, following

3 15 Langsford’s request for declaratory relief and, in part, its request for Rule 80B relief focused

on alleged constitutional infirmities regarding the STRO. 15 Langsford’s facial challenges were dismissed, and the Superior Court concluded that its as-applied challenges lacked merit. 15 Langsford argues these constitutional issues only as alternative grounds to affirm the judgment.

oral arguments, the court (Mulhern, J.) entered a judgment on June 13, 2023, concluding that the CEO erred as a matter of law by determining that units rented by 15 Langsford were not “[l]egally existing residential dwelling units” within the meaning of section 129-2 of the STRO. Citing Rule 80B, the Superior Court vacated the decision of the CEO denying 15 Langsford’s applications for short-term rental licenses, and the Town timely appealed to us. See M.R. Civ. P. 80B(n); M.R. App. P. 2B(c)(1).

II. DISCUSSION

[¶10] We first explain the basis for the trial court’s jurisdiction to consider the Town’s petition and then review 15 Langsford’s eligibility for the short-term rental licenses. A. The Basis for the Superior Court’s Jurisdiction

[¶11] We begin by identifying and examining the jurisdictional issues presented by the anomalous absence of a provision in the STRO that would allow an appeal from the denial of a license application.

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15 Langsford Owner LLC v. Town of Kennebunkport, 2024 ME 79 (Me. 2024).

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