Today’s blog post is authored by Jed Silversmith, a former federal prosecutor and member of the Washington State bar who recently joined Blank Rome in its Philadelphia office. Mr. Silversmith has applied to reactivate his Pennsylvania bar license and is awaiting approval of that application.
Last week, a federal jury in Miami found that Carl Zwerner had willfully failed to disclose his foreign bank account to the Treasury Department for calendar years 2004, 2005 and 2006. Zwerner now potentially owes the United States 150% of the value of his account plus an additional statutory assessment of 12% and interest. Zwerner’s account balance was roughly $1,500,000, resulting in a penalty of about $2,500,000. Another hearing is set in the case for June 6, 2014 where the district court will consider how it intends to compute a civil penalty. Zwerner will likely argue that this 150% penalty violates the Excessive Fines Clause of the Eighth Amendment to the U.S. Constitution.
By way of background, the Bank Secrecy Act requires that taxpayers who have an ownership interest in overseas bank accounts disclose those accounts to the Treasury Department. The disclosures are required to be made every year by June 30 on a reporting form commonly referred to as an “FBAR.” See 31 U.S.C. §§ 5314 & 5321. Taxpayers who willfully fail to disclose these overseas accounts face a maximum penalty which is the greater of $100,000 or 50% of the balance of the account (the “FBAR penalty”). Since the United States entered into a deferred prosecution agreement with UBS (the largest bank in Switzerland) in 2009, there has been an intense focus on identifying overseas accounts. To encourage taxpayers to disclose their accounts, the IRS has offered three amnesty programs called Offshore Voluntary Disclosure Initiatives (“OVDI”). Under the OVDI programs, taxpayers agreed to pay a penalty of between 20% and 27.5% of the balance of the account for one year plus back taxes and interest. In exchange for these payments, the taxpayer received amnesty from criminal prosecution and avoided other potential civil penalties that could be asserted.
Zwerner had an interest in an undeclared Swiss bank account since the 1960s. The account was held in the name of a Liechtenstein foundation. In 2009, Zwerner tried to enter one of the OVDI programs. However, his application was rejected. The IRS (under a delegation authority from the Treasury Department) subsequently assessed Zwerner a 50% penalty for each of the four years, resulting in a total penalty equal to twice the value of his account.
In a rare jury trial on this issue, Zwerner was found to have willfully failed to disclose his foreign bank account for three years. The jury found that his failure to report the account in 2007 was not willful. (Zwerner had read about one of the voluntary disclosure programs in May 2008, about one month before the due date for his 2007 FBAR reporting requirement.) The jury also made a special finding that he did not qualify for the OVDI program in 2009.
The district court has set a hearing for June 6, 2014 to examine post-trial issues. The next phase of the proceeding involves the district court determining the precise amount of the penalty and then entering a judgment. In SEC v. Lipson, Judge Posner explained that a defendant in a civil enforcement action had a right to a jury trial on liability, but that the district court had the ultimate responsibility to determine the amount of the civil penalty. 278 F.3d 656, 662 (7th Cir. 2002) (citing Tull v. United States, 481 U.S. 412, 425 (1987)). See also SEC v. Solow, 554 F. Supp. 2d 1356, 1367 (S.D. Fla. 2008) (“Accordingly, it was Mr. Solow’s constitutional right to have a jury determine his liability, with this Court thereafter determining the amount of penalty, if any.”).
These tiny ratios do not even include any understatement penalties that Zwerner may have paid (there was some discussion in the record that he paid a fraud penalty for at least one of the years at issue).
Furthermore, in this case, the United States filed suit pursuant to the Federal Claims Collection Act (the “FCCA”), 31 U.S.C. § 3701 et seq. Section 3716(e) of the FCCA permits the government to collect an additional 6% surcharge on unpaid administrative assessments annually. The government made an administrative determination against Zwerner two years ago. Thus, Zwerner’s penalty has ballooned by another 12%. In its summary judgment brief, the government notes that the statutory surcharge (for all four FBAR penalties) was $465,243. The government also collects interest on the debt as well. In this case, the amount of accrued interest (again on all four penalties) was about $130,000.
(1) whether the defendant falls into the class of persons at whom the … statute was principally directed; (2) other penalties authorized by the legislature (or the Sentencing Commission); and (3) the harm caused by the defendant.
United States v. Browne, 505 F.3d 1229 (11th Cir. 2007). See also United States v. Prochnow, 2006-2 Trade Cas. (CCH) ¶ 75408 (N.D. Ga. 2006) (applying Bajakajian in an FTC penalty case).
The government will argue that this is not solely a reporting violation. In Bajakajian, the Court found a constitutional violation because Bajakajian’s “money was the proceeds of legal activity and was to be used to repay a lawful debt. Whatever his other vices, respondent does not fit into the class of persons for whom the statute was principally designed: He is not a money launderer, a drug trafficker, or a tax evader.” Bajakajian, 524 U.S.at 338. In contrast, Zwerner was hiding his money from the IRS. The FBAR penalty was meant to reach individuals who hide their income from the IRS. He is likely among the class of individuals designed to be punished by this statute.
Because Congress is a representative body, its pronouncements regarding the appropriate range of fines for a crime represent the collective opinion of the American people as to what is and is not excessive. Given that excessiveness is a highly subjective judgment, the courts should be hesitant to substitute their opinion for that of the people.… Consequently, if the value of forfeited property is within the range of fines prescribed by Congress, a strong presumption arises that the forfeiture is constitutional.
United States v. 817 N.E. 29th Drive, 175 F.3d 1304 (11th Cir. 1999).
Here, the government can point to the Bank Secrecy Act itself. Congress prescribed that those who willfully fail to report the existence of a foreign account are liable for penalties of the greater of $100,000 or 50% of the balance in the account at the time of each violation. 31 U.S.C. § 5321(a)(5). In the same statute, Congress further prescribed a six-year period of limitations for assessing such penalties. 31 U.S.C. § 5321(b)(1). Thus, Congress contemplated a maximum fine of six 50% penalties. Zwerner was assessed only three 50% penalties.
In contrast, an analysis under the federal sentencing guidelines would yield a dramatically lower penalty. Although this is not a criminal case, such an argument may have some appeal. In 817 NE 29th Drive, the Eleventh Circuit remarked: “although we retain a duty under the Eighth Amendment independently to examine fines for excessiveness, a defendant would need to present a very compelling argument to persuade us to substitute our judgment for that of the United States Sentencing Commission.” Under the federal sentencing guidelines, the advisory penalty would be significantly less. Zwerner’s offense level would be calculated under U.S.S.G. §§ 2S1.3(a) & 2B1.1, which would yield an advisory guideline range of either 22 or 24 (depending on whether each year was treated as a separate offense under the grouping rules). Alternatively, if the court found that Zwerner’s primary motivation was to evade taxes, it would apply U.S.S.G. §§ 2S1.3(c) & 2T4.1. This would yield a guideline range of 14. The relevant fine range would be $10,000 to $100,000 (using the fraud tables) or $4,000 to $40,000 (using the tax tables). Given the circumstances of this case, a district court would likely apply the lower tax guideline at a sentencing hearing.
Zwerner’s best argument is simply one of proportionality. As noted above, the base penalty constitutes about 3% to 4% of the harm that he caused. Even that figure is overstated because Zwerner appears to have paid some understatement penalties directly to the IRS. Zwerner is also subject to the 6% annual statutory assessment under the FCCA. The total penalty simply does not bear any representation to the harm to the Treasury.
Moreover, Zwerner can point out that the IRS has, as a matter of course, apparently collected smaller penalties from pretty much every other similarly situated taxpayer. In the three OVDI programs, the Service has required that taxpayers pay only between 20% and 27.5% of the balance of their account in one year. In recent criminal cases, individuals who pleaded guilty also had to pay only 50% of the balance of the account(s) in one year. Zwerner’s penalty will be significantly higher than any of these individuals.
Zwerner does have some compelling arguments to ask the district court to mitigate his penalty. Given the focus of the IRS and the Department of Justice on FBAR penalties in general, and the novel posture of this case in particular, the district court’s decision will receive substantial attention.
This entry was posted in Civil Tax, FBAR, U.S. Department of Justice Tax Division by Matthew D. Lee. Bookmark the permalink.


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While the defendant's direct appeal was pending, the United States Supreme Court decided Crawford v. Washington, 541 U.S. 36 (2004). Interpreting this decision, the Supreme Judicial Court held in Commonwealth v. Verde, 444 Mass. 279 , 283-284 (2005), that certificates of drug analysis were not "testimonial statements" within the meaning of Crawford. In 2006, the defendant's direct appeal was denied. A later appeal from his pro se motion for new trial, filed in 2007, was denied in October, 2008. [Note 3] About a year later, in Melendez-Diaz v. Massachusetts, the Supreme Court held that such certificates are testimonial and trigger confrontation clause protections. Two months after the Supreme Court's Melendez-Diaz decision was issued, the defendant filed his second motion for a new trial, arguing for the first time that the admission of the certificates at his trial was error and adding that trial counsel and appellate counsel were ineffective for failing to raise this claim. The motion was denied and the defendant has again appealed.
Our response to the defendant's argument is guided by Teague v. Lane, 489 U.S. 288 (1989), and Commonwealth v. Amirault, 424 Mass. 618 (1997). In the latter, the court wrote that, "[i]n deciding whether a new doctrine shall be applied retroactively, once the regular course of adjudication has been completed, the novelty of the doctrine ordinarily cuts against its retroactive application: we simply ask whether the process was correct and regular according to the rules in force at that time. . . . [N]ew rules should not apply retroactively 'unless they fall within either of two very limited exceptions' . . . lest every development in the law entail a wave of new trials of matters long since closed . . . ." Commonwealth v. Amirault, supra at 638, quoting from Commonwealth v. Bray, 407 Mass. 296 , 300 (1990).
[Note 1] Also known as Jose Alberto Rodriguez Torres.
[Note 2] The remaining arguments are meritless.
[Note 3] The United States Supreme Court granted certiorari in Melendez-Diaz v. Massachusetts in March, 2008. 557 U.S. 1256.
[Note 4] "[A] new rule is only applied 'if it places certain kinds of primary, private individual conduct beyond the power of the criminal law-making authority to proscribe' or addresses a procedure of 'fundamental fairness' which is 'implicit in the concept of ordered liberty' and 'without which the likelihood of an accurate conviction is seriously diminished.' " Commonwealth v. Amirault, supra at 638, quoting from Commonwealth v. Bray, supra at 300 (quotation and citation omitted). See Whorton v. Bockting, 549 U.S. 406, 416 (2007), quoting from Saffle v. Parks, 494 U.S. 484, 495 (1990) ("A new rule applies retroactively in a collateral proceeding only if  the rule is substantive or  the rule is a 'watershed rule of criminal procedure' implicating the fundamental fairness and accuracy of the criminal proceeding").
[Note 5] Whorton v. Bockting, supra at 421, held "that Crawford [v. Washington, 541 U.S. 36 (2004),] announced a 'new rule' of criminal procedure and that this rule does not fall within the Teague exception for watershed rules." We assume thus that Melendez-Diaz, which is based upon Crawford, is subject to the same interpretation. See Melendez-Diaz v. Massachusetts, 129 S. Ct. at 2542. Accord Larkin vs. Yates, U.S. Dist. Ct., No. CV09-2034-DSF, slip op. at 2 (C.D. Cal. July 9, 2009); United States vs. Alexander, U.S. Dist. Ct., Nos. 2:04-CR-71, 2:09-CV-294, slip op. at 5 (N.D. Ind. Jan. 25, 2010); Newsome vs. Superintendent, U.S. Dist. Ct., No. 3:09-CV-92, slip op. at 3 (N.D. Ind. Feb. 17, 2010); Galiana vs. McNeil, U.S. Dist. Ct., No. 08-20705-CIV, slip op. at 18 (S.D. Fla. July 5, 2010).
[Note 6] This case differs from Commonwealth v. Vasquez, 456 Mass. 350 (2010), in that Vasquez involved a case on direct review while Arnaut's is on collateral review.

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426. The general rule with respect to zoning ordinances is that because the ordinance explicitly enumerates uses permitted within each district, all other uses are necessarily prohibited. Foresight, Inc. v. Babl, No. 96-1964 (Wis. Ct. App. May 6, 1997.) (Publication recommended.) 5/30/97.
427. "A conditional use permit only allows a property owner 'to put his property to a use which the ordinance expressly permits when certain conditions are met.'" Foresight, Inc. v. Babl, No. 96-1964 (Wis. Ct. App. May 6, 1997) (quoting State ex rel. Skelly oil Co. v. Common Council, 58 Wis.2d 695, 700-01, 207 N.W.2d 585, 587 (1973)). Thus, a permit issued for a use not explicitly set forth in the zoning ordinances as either a permitted or conditional use is illegal per se and void. 5/30/97.
428. The U.S. Supreme Court held that the 1993 Religious Freedom Restoration Act (RFRA) which prohibits governments from burdening a person's exercise of religion, even if the burden results from a rule of general applicability, unless the government demonstrates that the burden is the least restrictive means of furthering a compelling governmental interest, is unconstitutional because Congress exceeded its constitutional powers in enacting it. Thus, a city's denial based on historic preservation provisions in its zoning ordinance of a church's request for a building permit to expand its parish could not be successfully challenged as a substantial burden on religion under RFRA. City of Boerne v. Flores, 65 U.S.L.W. 4612 (1997). 7/10/97.
429. Protest petition filed by owner of land separated from the parcel proposed to be rezoned by a 70 foot wide dedicated street right-of-way and a 450 foot four lane State highway is invalid since the protester's land is not "directly opposite" the parcel proposed to be rezoned and therefore is outside of the third protest area described in sec. 62.23(7)(d), Stats. (1/31/98).
431. In the companion cases of Vincent Z. by his Guardian, et al. v. Village of Greendale, City of Greenfield, State of Wisconsin and Wisconsin Dept. of Health & Family Services (U.S. Eastern District Case No. 96-C-1101) and Oconomowoc Residential Programs v. City of Greenfield and Village of Greendale (U.S. Eastern District Case No. 96-C-1112) (each decided on September 30, 1998) the federal district court found that the 2,500 foot community living arrangement spacing requirement under sec. 62.23(7)(i), Stats., has been preempted by the federal Americans with Disabilities Act of 1990, 42 U.S.C. secs.12101-12213 (ADA) and the Federal Fair Housing Amendment Act of 1988, 42 U.S.C. secs.3601-3631 (FFHA). 10/30/98.
432. Reviews and reconfirms previous legal opinion, Zoning 412, which concluded that under sec. 13.48(13), Stats., a county is subject to municipal zoning ordinances when locating and constructing a jail or a house of correction within the municipality. The attorney general has reached the same conclusion but for different reasons. See Informal Opinion of Wis. Att'y Gen. to Kenneth Bukowski, Brown County Corp. Counsel, OAG I-I-97 (January 8, 1997). 10/30/98.
433. Under State v. Kenosha County Board of Adjustment, 218 Wis.2d 396, 577 N.W.2d 813 (1998), a zoning board of appeals may grant an applicant a variance only if the applicant can demonstrate the existence of an unnecessary hardship by showing that in the absence of a variance, the applicant will have "no reasonable use" of his or her property. This legal comment also discusses State ex rel. Spinner v. Kenosha County Board of Adjustment where the court of appeals applied the "no reasonable use" test and reversed the board's granting of a variance. No. 97-2094 (Wis. Ct. App. Nov. 11, 1998) (publication recommended). 11/30/98.
434. Expansion or enlargement of a nonconforming use which changes the use invalidates not only the illegal change but the legal nonconforming use as well. Village of Menomonee Falls v. Preuss, Case No. 98-0384 (Ct. App. March 17, 1999) (publication recommended) citing Waukesha County v. Pewaukee Marina, Inc., 187 Wis.2d 18, 31, 522 N.W.2d 536, 542 (Ct. App. 1994).
435. The notice of claim provisions in sec. 893.80(1)(b), Wis. Stats., which prohibit an action from being brought or maintained against a municipality unless the municipality is provided with a claim containing the address of the claimant and an itemized statement of the relief sought, and the claim has been disallowed, do not apply to certiorari review of decisions made by county zoning boards of adjustment brought under sec. 59.694(10), Wis. Stats. Kapischke v. County of Walworth , Case No. 98-0796 (Ct. App. April 7, 1999) (publication recommended). 4/30/99.
436. The Telecommunications Act of 1996 allows local governments to regulate the placement of towers for personal wireless services as long as any decision to deny certain requests for locating such facilities within the community is in writing and supported by substantial evidence contained in a written record. In addition, local governments may not "unreasonably discriminate among providers of functionally equivalent services." See 47 U.S.C. sec. 332(c)(7)(B)(iii) and (B)(i)(I). In Aegerter v. City of Delafield, No. 98-2422 (7th Cir. April 19, 1999), the federal 7th Circuit Court of Appeals held that the City of Delafield complied with the Telecommunications Act when it denied Air Page Corp. permission to replace an existing telecommunications tower with a larger one on the same site within a residential zoning district. 4/30/99.
437. In City of Monterey v. Del Monte Dunes at Monterey, Ltd., 67 U.S.L.W. 4345 (U.S. May 24, 1999), the U.S. Supreme Court indicated that a federal court is precluded from entertaining a takings claim under 42 U.S.C. sec. 1983 "unless or until the complaining landowner has been denied an adequate postdeprivation remedy." Since landowners in Wisconsin may bring an action for inverse condemnation under sec. 32.10, Wis. Stats., to seek just compensation for a temporary regulatory taking, local governments need not fear the prospect of facing takings claims brought by landowners under 42 U.S.C. sec. 1983. 5/31/99.
proportionality test of Dolan v. City of Tigard, 512 U.S. 374 (1994), is limited to land use decisions conditioning approval of development on the dedication of land to the public use and does not apply to regulatory takings cases. 5/31/99.
439. Where a zoning ordinance provides that the plan commission is authorized to grant conditional use permits, the common council has no authority to negate the plan commission's granting of a conditional use permit and cannot set aside the actions of the plan commission by merely disapproving certain portions of the minutes of the plan commission's meeting. 7/21/99.
440. The 1999-2000 State Budget Act, 1999 Wisconsin Act 9, which generally took effect on October 29, 1999, significantly modified the make-up of municipal plan commissions. Under Act 9, all seven members of the plan commission are to be appointed by the mayor (or village president in villages) and the mayor (village president) may choose the commission's presiding officer. In addition, Act 9 provides that the mayor (village president) may appoint himself or herself and other municipal elected or appointed officials to the plan commission. However, the commission must have at least three citizen members who are not municipal officials. See sec. 62.23(1)(a), Stats. 11/30/99.
441. Summarizes the significant changes to land use planning laws made by the 1999-2000 State Budget Act, 1999 Wisconsin Act 9, including the new definition of "comprehensive plan" and the requirement that beginning on January 1, 2010, any municipal program or action that "affects land use" (e.g., annexation, subdivision regulations and zoning ordinances) must be "consistent with" the municipality's comprehensive plan. Sec. 66.0295, Stats. 11/30//99.
442. Concludes that a city may properly impose, as a condition of granting a restaurant applicant a conditional use permit, a requirement that the restaurant close at a certain hour short of bar time, such as 10:00 p.m. Such a restriction would be enforceable even if the restaurant were to eventually obtain a liquor license since nothing in ch. 125, Stats., precludes the city from exercising its zoning authority in this fashion. Indeed, sec. 125.10(3), Stats., expressly provides that ch. 125 "does not affect the power of municipalities to enact or enforce zoning regulations." 1/6/00.
443. The Wisconsin Court of Appeals issued a decision voiding a zoning change adopted by the Milwaukee Common Council after concluding that the council committee which had approved the zoning change had not given the class 2 notice required by sec. 62.23(7)(d), Wis. Stats., before it had held a hearing on the proposed change. The court reached this conclusion even though a different committee had held a properly noticed public hearing on an identical proposed zoning change but had failed to take action on the legislative item. Oliveira v. City of Milwaukee, No. 98-2474 (Wis. Ct. App. Feb. 8, 2000. (Recommended for publication in the official reports.). 2/29/00.
444. Reviews under what circumstances common-law concepts of due process and fair play require an impartial decision-maker in zoning decisions. Discusses the leading Wisconsin case on the issue of impartial decision-making in the context of zoning, Marris v. City of Cedarburg, 176 Wis. 2d. 842 (1993), and examines the legislative/adjudicative distinction in zoning. 3/31/00.
445. A governing body member who serves on the plan commission is disqualified from participating in a quasi-judicial zoning decision that comes before the governing body if the member voted on the matter when it was before the plan commission. However, a governing body member in the same circumstances would not be precluded from voting on a legislative matter, such as a rezoning, since the requirement of an impartial decision-maker does not apply to legislative zoning decisions. 3/31/00.
446. Concludes that village board's practice of holding a public hearing whenever a group home facility applies for an exception from the 2,500 foot spacing requirement or the 1% of population limit on the number of group homes within a community under sec. 62.23(7)(i)1 and 2, Stats., is legal and an appropriate way for the board to gather information to help it decide whether the request constitutes a reasonable accommodation and should be granted. Discusses Oconomowoc Residential Programs, Inc. v. City of Greenfield, 23 F. Supp.2d 941 (E.D. Wis. 1998). 7/31/00.
447. Reviews Willow Creek Ranch, LLC v. Town of Shelby, 224 Wis.2d 269, 592 N.W.2d 15 (2000), a zoning case in which the Wisconsin Supreme Court held: (1) DNR licensing of game bird farms does not preempt local zoning regulations applicable to such farms; (2) determination of zoning classifications, changes in zoning districts and zoning ordinance enforcement are discretionary matters and thus municipalities are immune from liability for such decisions under sec. 893.80(4), Stats.; and (3) erroneous acts or representations of municipal officials do not estop a municipality from adopting and enforcing a different interpretation of the zoning ordinance. 7/31/00.
448. Discusses to what extent a governmental body has discretion when considering requests for special exceptions or conditional uses. 8/17/00.
449. Briefly summarizes the Federal Religious Land Use and Institutionalized Persons Act, Public Law 106-274, which President Clinton signed into law on September 22, 2000. The Act prohibits local governments from imposing a land use regulation in a manner that imposes a substantial burden on the religious exercise of a person unless imposition of the burden furthers a compelling governmental interest and is the least restrictive means of furthering that compelling governmental interest. 10/31/00.
450. A county constructing a county courthouse within a city is subject to city zoning regulations pursuant to sec. 13.48(13), Stats. 12/28/00.
451. Describes necessity under Wisconsin's "Smart Growth" law of adopting a comprehensive plan by ordinance and includes a sample ordinance for that purpose. 2/28/01.
452. Local government regulation of solar and wind energy systems is limited by Wis. Stat. 66.031 and local restrictions are permitted only if they serve the public health or safety, do not significantly increase the cost or decrease the efficiency of the system, or allow for an alternative system of comparable cost and efficiency. State ex rel. Numrich v. City of Mequon Board of Zoning Appeals, 2001 WI App 88.
453. Properly given notices of an initial hearing before a zoning committee were sufficient to authorize a common council to enact duplicate proposed zoning amendments that had been referred to a different committee, without publishing additional notices where it appeared that the dual functions of the notice and hearing requirements of sec. 62.23(7)(d)2, Stats., had been fulfilled. Oliveira v. City of Milwaukee, 2001 WI 27, reversing 2000 WI App 49, 233 Wis.2d 532, 608 N.W.2d 419. 4/30/01.
454. Discusses Fair Housing Act (FHA) and Fair Housing Amendments Act (FHAA) impact on municipal land use policies and practices affecting group homes and community living arrangements and makes some recommendations for improving compliance with FHA and FHAA. 6/30/01.
455. Summarizes Lake Bluff Housing Partners v. City of South Milwaukee, No. 00-1958 (Wis. Ct. App. June 12, 2001) (recommended for publication) wherein the order requiring Lake Bluff to raze and remove buildings built in contravention of the City's zoning code was affirmed. 6/30/01.
456. The Wisconsin Department of Natural Resources general grant of authority to regulate floodplains does not include the power to write rules that prohibit a local zoning board from exercising its authority to grant a variance from the flood elevation limits where the variance applicant proves unnecessary hardship. State v. Outagamie County Board of Adjustment, 2001 WI 78. 7/31/01.
457. Owner of parcel with wetland and upland areas states ripe Fifth Amendment takings claim even though development proposals rejected by land use authority only involved wetland areas. Acquisition of title to property after complained of regulations were enacted also does not bar landowner from making Fifth Amendment takings claim. Palazzolo v. Rhode Island, 69 U.S.L.W. 4605 (2001). 7/31/01.
458. A municipality's obligation to make a reasonable accommodation under the Fair Housing Amendments Act or the Americans with Disabilities Act to the 2500-foot separation requirement of Â§62.23(7)(i), Stats., arises only when the proposed residents need to live in a community living arrangement because of their disability. State ex rel. Bruskewitz v. City of Madison, Case No. 002563 (Ct. App. September 20, 2001) (publication recommended). 9/30/01.
459. A board of appeals is authorized to grant a zoning variance upon proof of unnecessary hardship which requires the variance applicant to demonstrate: (1) that the hardship complained of is caused by a unique condition of the property for which variance relief is sought and (2) without the requested variance, the applicant has no reasonable use of the property. If the applicant fails to prove the existence of a unique condition and a connection between the condition and the hardship, even if the hardship is great, a board of appeals has no power to grant the requested variance. In addition, the board's variance power does not include use variances since there is no clear legal authority vesting such power and significant reason to doubt its existence. 10/31/01.
460. Section 66.1027 of the Wisconsin Statutes required cities and villages with a population of 12,500 to adopt a traditional neighborhood development ordinance that is similar to a model ordinance developed by UW-Extension by January 1, 2002. It also requires a city or village that reaches this population threshold after January 1, 2002 to adopt such an ordinance. 11/30/01.
461. City plan commission may condition approval of proposed land division within city's extraterritorial plat review jurisdiction upon compliance with master plan lot size requirement that is more restrictive than town zoning ordinance provision. 12/30/01.
462. Moratoria, lasting 32 months, on all development imposed by regional planning agency while it formulated comprehensive land-use plan are not per se takings of property requiring compensation under the Fifth Amendment Takings Clause. Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 2002 WL 654431 (U.S. April 23, 2002).
463. Discusses various methods for controlling big-box (superstores) sprawl including impact assessments, design standards, planning moratoria, retail size limits, intergovernmental agreements, and the withdrawal of subsidies for retail sprawl. 4/30/02.
464. A group home or community living arrangement (CLA) is subject to a public hearing requirement associated with rezoning, variance, conditional use or reasonable accommodation relief from a general land use regulation but a public hearing for purposes of determining whether a proposed exception to the CLA spacing or density restriction of Wis. Stat. sec. 62.23(7)(i) qualifies as a reasonable accommodation is inadvisable and probably contrary to the Fair Housing Amendment Act. 7/31/02.
465. For purposes of reasonable accommodation under the Fair Housing Amendments Act (FHAA) and Americans with Disabilities Act (ADA), party seeking accommodation from municipal group home spacing ordinance need only make an initial showing that proposed accommodation is reasonable and, upon that showing, burden shifts to municipality to "come forward to demonstrate unreasonableness or undue hardship in the particular circumstances" and municipality must adequately establish "the nature or quantity" of alleged financial and administrative burdens imposed by group home facility. Oconomowoc Residential Programs, Inc. v. City of Milwaukee, No. 01-1002 (7th Cir. Aug. 8, 2002). 8/31/02.
466. The undefined zoning ordinance term "municipal building" is ambiguous regarding whether it includes or excludes county buildings. Wisconsin courts consistently resolve ambiguity in the meaning of zoning terms in favor of the free use of private property. 10/15/02.
467. Discusses implications of Smart Growth consistency requirement that, effective January 1, 2010, any program or action of a local governmental unit that affects land use be consistent with the local governmental unit's comprehensive plan. 2/28/03.
468. A zoning permit applicant is entitled to an impartial decision-maker and zoning permit proceedings before a plan commission that include analysis of or a recommendation on a zoning permit application by a trustee who is vested with appointment, compensation or other significant authority over members of the plan commission is inconsistent with this essential due process requirement. 3/4/03.
469. In a zoning variance proceeding, neither State v. Kenosha County Bd. of Adjustment, 218 Wis. 2d 396, 577 N.W. 2d 813 (1998) nor State v. Outagamie County Bd. of Adjustment, 2001 WI 78, 244 Wis. 2d 613, 628 N.W.2d 376, require a zoning board to balance the public interest and purpose of a zoning ordinance against the rights of the property owner nor do they establish a two-part variance test, which asks: (1) whether the proposed variance violates the purpose of the zoning ordinance at issue and (2) if the variance violates the purpose of the ordinance, whether the property owner has any reasonable use of the property if the variance is denied. However, Kenosha County does require a successful variance applicant to prove that he or she has no reasonable use of the property without the requested variance. 3/31/03.
470. Expands on Zoning 467 and further explains the Smart Growth consistency requirement that, effective January 1, 2010, any program or action of a local government unit that affects land use be consistent with the local governmental unit's comprehensive plan. 5/30/03.
471. Discusses significant court decisions related to the regulatory takings framework established by the U.S. Supreme Court in Penn Central Transportation Co., v. City of New York, 438 U.S. 104 (1978) and some key unresolved Penn Central analysis issues. 6/30/03.
472. County that obtained opinion of corporation counsel that indicated County could proceed with construction of waste transfer station in Village without the necessary building permits despite the Village's withdrawal from prior positions proceeded with construction in reliance on counsel's opinion, not incorrect representations of Village about zoning requirements and, therefore, County failed to prove necessary element of equitable estoppel defense to Village's zoning enforcement action. Village of Hobart v. Brown County, Appeal No. 03-1907 (Ct. App. Feb. 24, 2004) (recommended for publication). 2/27/04.
473. Comment discusses the Wisconsin Supreme Court zoning variance decision in Ziervogel v. Washington County Bd. of Adjustment, 2004 WI 23. There is brief identification of the leading pre-Ziervogel variance cases, a summary of the Ziergvogel decision analysis, and an exploration of the unique property condition requirement in variance analysis, the new use variance power of zoning boards and the authority of cities and villages to adopt local regulations that define zoning variance terms, and the implications of these aspects of the Ziervogel decision for city and village officials involved in land use policy development and administration. 3/31/04.
474. "[I]n evaluating whether to grant an area variance to an ordinance, a board of adjustment should focus on the purpose of the zoning law at issue in determining whether an unnecessary hardship exists for the property owner seeking such variance" and must consider all of the components of the statutory variance standard, including "the impact that a proposed variance will have on the public interest." State v. Waushara County Bd. of Adjustment, 2004 WI 56, __Wis. 2d __, 679 W.2d 514. 6/30/04.
475. "[W]hen ordinances are ambiguous as a matter of law, the court has 'consistently resolved all ambiguity in the meaning of zoning terms in favor of the free use of private property.' Because zoning ordinances operate in derogation of the common law, their provisions must be 'in clear, unambiguous and peremptory terms.'" Kollock v. City of Cumberland Board of Zoning Appeals, Case No. 04-0949 (Ct. App. Dec. 4, 2004) (not recommended for publication). 12/30/04.
476. A municipal land use decision, if not justified by the municipality, gives rise to the inference that hostility to religion, or more likely to a particular sect, influenced the decision and the delay, uncertainty and expense imposed on a religious institution by a municipal land use decision, even if no different from those imposed on secular applicants, may still constitute a "substantial burden" under section (a)(1) of the Religious Land Use and Institutionalized Persons Act of 2000. Sts. Constantine and Helen Greek Orthodox Church, Inc. v. City of New Berlin, Case No. 04-2326 (7th Cir. February 1, 2005). 1/31/05.
477. Neither the simple adoption of a wetlands inventory map nor a letter from an administrative agency official stating her predictions of agency action are sufficient to establish a cognizable takings claim and, in accordance with the doctrine of prior resort, courts will refuse to intervene in a takings matter while there remains any possibility of future administrative action. Helnore v. DNR, Appeal No. 04-0602 (Ct. App. February 23, 2005). 2/28/05.
478. The fifty-percent of assessed value restriction on structural repairs or alterations in Wis. Stat. sec. 62.23(7)(h) limits the repairs and improvements that can be made on a structure that is used in a manner that does not conform to uses permitted by applicable zoning codes and advances a balancing of private property and governmental interests by forcing the phase-out of uses that do not conform with the zoning plan by limiting the repairs and structural modifications permitted to buildings in which the nonconforming use is taking place and, therefore, is inapplicable to a nonconforming structure in which a use that is in conformity with applicable zoning restrictions is conducted. Hillis v. Village of Fox Point Board of Appeals, Case No. 04-1787 (Ct. of Appeals, March 15, 2005) (recommended for publication). 3/31/05.
480. A conditional use permit is a type of zoning designation and not a piece of property and town's revocation of conditional use permit did not constitute a taking of property without just compensation. Rainbow Springs Golf Co. v. Town of Mukwonago, 2004 AP1771 (Wis. Ct. App., June 1, 2005) (publication recommended). 6/1/05.
481. Although the erroneous acts of municipal officials do not afford a basis for estopping a municipality from asserting that there has been a violation of its zoning ordinance and a municipality cannot be estopped from asserting a zoning violation in court, once a zoning violation is proven a circuit court may deny a municipality's request for injunctive relief if equitable considerations warrant it. Village of Hobart v. Brown County, 2005 WI 78 (June 15, 2005), aff'g 2004 WI App 66, 271 Wis.2d 268, 678 N.W.2d 402. 6/30/05.
482. The Public Use Clause of the Fifth Amendment permits the taking of private property for a public purpose and a city's "carefully formulated" development plan preceded by "thorough deliberation" that is projected to create in excess of 1000 jobs, increase tax and other revenues, revitalize the City's downtown, create leisure and recreational opportunities on the City's waterfront and in a park and make the City more attractive "unquestionably serves a public purpose" consistent with the Public Use Clause. Kelo v. City of New London, 2005 WL 1469529, 545 US ___ (June 23, 2005). 6/30/05.
483. This comment provides background and an update on the Religious Land Use and Institutionalized Persons Act (RLUIPA) of 2000 with a summary of cases addressing the constitutionality of section 2 and some implications of the substantial burden standard under RLUIPA compared to the pre-RLUIPA standard. 7/29/05.
484. In order for meaningful certiorari review to take place, a zoning board of appeals must adequately express its reasons for its decisions. Conclusory statements that an applicant does or does not meet the relevant criteria are insufficient and a board must articulate, either orally or in a written decision, the particular reasons why an applicant has or has not met the statutory or ordinance criteria. If the board's reasoning is not clear by virtue of a written or oral decision, or by reviewing the hearing transcript, a court will view the board's action as representing its will rather than its judgment. Lamar Central Outdoor, Inc. v. Board of Zoning Appeals of the City of Milwaukee, 2005 WI 117. 8/31/05.
485. Under City of Renton v. Playtime Theaters Inc., municipal zoning regulations applicable to adult oriented businesses must (1) serve a substantial government interest and (2) allow for reasonable alternative avenues of communication. This legal comment focuses on Renton's second requirement, that such regulations allow for reasonable alternative avenues of communication. (Bitar and Pollen) 7/1/06.
486. Comment provides overview of planned development district (PDD) (more commonly identified as planned unit development (PUD)) zoning authority in Wisconsin with a discussion of PUD purposes, criticisms and key statutory standards for creating such zoning districts. 9/30/06.
487. Application of a conditional use permit requirement to a family day care home by a municipality is contrary to the plain language of Wis. Stat. 66.1017(2) since such a requirement is not a zoning regulation that applies to a "dwelling" and a municipality is not authorized to impose conditions on a family day care home dwelling on a case-by-case basis since such conditions are unique to each family day care home and not "applicable" to other dwellings as required by 66.1017(2). 10/31/06.
488. A zoning board of appeals may consider the mistakes of a zoning official when evaluating "unnecessary hardship" for a zoning variance and whether the hardship is self-created. Accent Developers, LLC v. City of Menomonie Board of Zoning Appeals and Timber Ridge Homes, LLC, Appeal No. 2006AP1268 (Ct. App. February 27, 2007) (recommended for publication). 2/28/07.
489. The U.S. Constitution and the federal Religious Land Use and Institutionalized Persons Act of 2000 (RLUIPA) do not create a federal "vested rights" doctrine for property owners. Petra Presbyterian Church v. Village of Northbrook, No. 06-1329 (7th Cir. June 7, 2007). 6/30/07.
490. A zoning ordinance that does not permit churches to locate everywhere in a municipality does not impose a "substantial burden" on religious activity under RLUIPA in the absence of evidence showing the unavailability of land in areas where churches are permitted under the ordinance. Petra Presbyterian Church v. Village of Northbrook, No. 06-1329 (7th Cir. June 7, 2007). 6/30/07.
491. Identification of area as "public use" on zoning map did not amend zoning ordinance and reclassify area zoned A2 as public use where the zoning ordinance did not contain "public use" as a zoning district and procedures for amending a zoning ordinance had not been followed. Village of Hobart v. Brown County, 2007 AP 891 (Ct. App. Oct. 18, 2007, publication recommended). 10/31/07.
492. Equitable considerations did not outweigh village's right to enforce its zoning code where county that built waste transfer station decided to proceed with construction despite village's assertion that current zoning prohibited the facility and knew that village had rescinded an earlier MOU indicating its intention to approve facility and would not issue permits necessary for building the facility. The fact that the county's corporation counsel had opined that the county could proceed without village approval, did not authorize the county to bypass the village's zoning ordinance. Village of Hobart v. Brown County, 2007 AP 891 (Ct. App. Oct. 18, 2007, publication recommended). 10/31/07.
493. Local zoning ordinance that prohibits directional signs on residential or agricultural zoned property is not preempted by Wis. Stat. sec. 84.30(3)(a). Donaldson v. Town of Spring Valley, 2008 WI App 61, 750 N.W.2d 506, petition for review denied. 3/31/08.
494. Zoning district classification which authorizes only conditional uses violates substantive due process rights of landowner where ordinance restriction does not bear an identifiable and substantial relation to the health, safety, morals or general welfare of the public. Town of Rhine v. Bizzell, 2008 WI 76. 7/31/08.
495. Legal comment reviews key principles and significant issues related to utilization and enforcement of special use permits for conditional uses and special exceptions. 8/29/08.
496. Legal comment reviews key principles and significant issues related to zoning amendments. 9/30/08.
497. The impact of a proposed use in an area variance case is a proper consideration by a zoning board provided use considerations do not overwhelm all others in the analysis, rendering irrelevant any inquiry into the uniqueness of the property, the purpose of the ordinance, and the effect of a variance on the public interest. Driehaus v. Walworth County, 2008AP947 (Ct. App. April 1, 2009) (recommended for publication). 4/30/09.
498. Wis. Stat. sec. 66.0401 does not authorize local policymaking regarding wind and solar energy systems and regulations that apply uniformly to all alternative energy systems but instead delegates administrative power and permits only case-by-case assessment of each individual wind or solar energy system through a process such as conditional use permits and subject to the limitations of 66.0401. Ecker Brothers v. Calumet County, No. 2007AP2109, 2009 WL 2032336, 2009 WI App __, __ Wis. 2d. __, __ N.W.2d __ (Ct. App. July 15, 2009) (decision recommended for publication). 7/31/09.
499. 2009 Wisconsin Act 28 creates Wis. Stat. sec. 84.06(12) which exempts from municipal zoning ordinances any sites from which “borrow” is excavated for use in a specified state highway construction project as long as certain conditions are met. “Borrow” is defined to mean “soil or a mixture of soil and stone, gravel, or other material suitable for use in the construction of embankments or other similar earthworks constructed as part of a state highway construction project.” 7/31/09.
500. Condominium development approval that authorizes a land use that conflicts with underlying zoning or other zoning requirements is invalid “de facto rezoning.” State ex rel. Village of Newburg v. Town of Trenton, No. 2008AP2997, 2009 WL 2602328, 2009 WI App __, __ Wis. 2d __, __ N.W.2d __ (Ct. App. Aug. 27, 2009)(recommended for publication). 8/31/09.
501. A protected nonconforming land use under Wis. Stat. sec. 59.69(10)(a) requires a vested interest in the continuance of the use, which is present only when substantial rights would be adversely affected if the use is prohibited. Town of Cross Plains v. Kitts, et al., No. 08-0546, 2009 WL 3030209, 2009 App __, __ Wis. 2d. __ (Ct. App. Sep.24, 2009) (recommended for publication). 9/30/09.
502. A vested interest in a nonconforming land use requires reasonable reliance on existing law, which is not present when owners have notice existing law may soon change. Town of Cross Plains v. Kitts, et al., No. 08-0546, 2009 WL 3030209, 2009 App __, __ Wis. 2d. __ (Ct. App. Sep.24, 2009) (recommended for publication). 9/30/09.
503. Legal comment discusses content neutrality, overbreadth, vagueness and prior restraint constitutional principles and current issues regarding municipal zoning and licensing regulation systems for adult entertainment businesses. 10/30/09.
504. Local land use regulations which differentiate between religious and non-religious assemblies do not violate the Equal Terms provision of the Religious Land Use and Institutionalized Persons Act merely because they impose differential treatment but must be shown to target religious assemblies for non-secular reasons and are not subject to strict judicial scrutiny under that provision. River of Life Kingdom Ministries v. Village of Hazel Crest, No. 08-2819 (7th Cir. Oct. 27, 2009).
505. Minutes of a local zoning board for a hearing on a proposed cell tower satisfy the written decision or “in writing” requirement of the Telecommunications Act of 1996 so long as they contain a sufficient explanation of the reasons for the board’s decision to allow a reviewing court the opportunity to evaluate whether substantial evidence exists in the record to support those reasons. Helcher v. Dearborn County, No. 07-3949 (7th Cir. Feb. 9, 2010). 3/31/10.
506. Local land use regulations that treat religious and secular assemblies the same from the standpoint of an accepted zoning criterion such as “commercial district,” or “residential district,” or “industrial district,” do not violate the Equal Terms provision of the Religious Land Use and Institutionalized Persons Act. River of Life Kingdom Ministries v. Village of Hazel Crest, No. 08-2819 (7th Cir. Jul. 2, 2010). 7/30/10.
507. A municipal zoning ordinance that effectively bans tattoo businesses in the municipality violates the First Amendment free speech clause given that tattooing and tattoo business is a protected speech activity and a total ban is not a reasonable "time, place and manner" restriction of it. Anderson v. City of Hermosa Beach, No. 08-56914 (9th Cir. Sep. 9, 2010). 9/30/10.
508. Legal comment provides overview of zoning boards of appeal with a focus on zoning board membership and organization, powers, and decision making. 10/29/10.
509. Legal comment provides overview of plan commissions with a focus on organization, and responsibilities, including the plan commission’s role in community planning, plan implementation, development review and referrals and advisory recommendations. Also reviews decision standards and procedures for legislative and quasi-judicial decisions. (Rebecca Roberts). 7/31/11.
510. Wisconsin cities and villages probably have general welfare zoning authority to restrict the location of tax exempt land uses for fiscal reasons. 10/31/11.
511. Determining whether an ordinance is a zoning ordinance is done through a functional approach that compares the characteristic(s) and purpose(s) of the subject ordinance with the characteristics and purposes of traditional zoning ordinances. Zwiefelhofer v. Town of Cooks Valley, 2012 WI 7, __ Wis.2d. __, __ N.W.2d __. 2/29/12.
512. The traditional characteristics of a zoning ordinance are: the division of a geographic area into zones or districts; the designation of permitted land uses within established districts or zones; a regulatory emphasis on where a use takes place, as opposed to how it takes place; a comprehensive focus on all possible uses in a geographic area; a fixed, forward-looking determination about what uses will be permitted, as opposed to case-by-case, ad hoc determinations of what individual landowners will be allowed to do, and; provisions allowing lawful preexisting land uses to continue. Zwiefelhofer v. Town of Cooks Valley, 2012 WI 7, __ Wis.2d. __, __ N.W.2d __. 2/29/12.
513. The traditional purpose of a zoning ordinance is the separation of incompatible land uses. Zwiefelhofer v. Town of Cooks Valley, 2012 WI 7, __ Wis.2d. __, __ N.W.2d __. 2/29/12.
514. A nonmetallic mining ordinance that does not create zoning districts, does not designate any permitted uses, does not directly regulate where a land use activity can occur by predetermining specific locations where the activity can occur and where it cannot, focuses on a single land use activity in a geographic area, authorizes a land use activity entirely on a case-by-case ad hoc basis, provides for lawful preexisting mining activities to continue, and does not explicitly separate land uses or explicitly declare any land uses incompatible with any others, is a valid exercise of a Town’s non-zoning police power that does not require county board approval. Zwiefelhofer v. Town of Cooks Valley, 2012 WI 7, __ Wis.2d. __, __ N.W.2d __. 2/29/12.
515. A government demand for money that is not a property tax, user fee or similar payment, must satisfy the Nollan and Dolan takings analysis even if there is no payment made where the demand for money burdens the ownership of a specific parcel of land. Koontz v. Saint Johns River Water Management District, 570 U.S. ___. 6/30/13.
516. Legal comment compares Wisconsin shoreland zoning and comprehensive planning laws to more recent nonconforming structure and cell tower siting laws and raises question of whether impacts of latter legislation on local control suggest a change in the state and local land use policy relationship comparable to one that occurred from the 1970s through the 1990s. 10/31/13.
517. A subdivision ordinance that restricts land division within its extraterritorial jurisdiction to a density of no more than one lot per thirty-five acres of land and a minimum lot size of one acre and explicitly intended to protect rural character and farming viability is an impermissible land use restriction contrary to Wis. Stat. sec. 236.45(3)(b). Lake Delavan Property Co. v. City of Delavan, 2013AP1202 (publication recommended). 03/01/14.
518. Note summarizes 2013 Wisconsin Act 80 shoreland zoning requirements and reports availability of and web link for League model ordinance implementing the requirements. 4/30/14.
519. Zoning ordinances are construed in favor of the free use of private property and an ordinance that lists “single-family dwellings” as a permitted use in a “single-family residential district” and does not require occupancy over a period of time permits short-term rentals as a permissible use. Heef Realty and Investments, LLP v. City of Cedarburg Board of Appeals, 2014AP62 (Ct. App. Feb. 4, 2015, publication recommended). 2/26/15.
520. Wisconsin follows the bright-line building-permit rule for vested rights and a developer does not acquire any vested rights in a development plan based on expenditures or other actions until a valid building permit application is submitted. McKee Family I, LLC v. City of Fitchburg, 2017 WI 34.
521. A planned development district zoning designation applied to property pursuant to Wis. Stat. sec. 62.23(7)(b) does not create a binding contract between the consenting landowner/developer and a municipality unless there is a clear indication that the municipality’s governing body intends such binding effect. McKee Family I, LLC v. City of Fitchburg, 2017 WI 34.
522. Designation of a land use as a conditional use in a zoning code does not pre-ordain approval of a conditional use permit application for it or disallow use of broad health, safety, welfare standards to evaluate it. AllEnergy Corp. and AllEnergy Silica, LLC v. Trempeleau Cty. Environment and Land Use Committee, 2017 WI 52. 09/01/2017.
523. Article reviews changes to city and village conditional use permit authority established by 2017 Wisconsin Act 67 and codified in Wis. Stat. 62.23(7)(de). 1/31/18.
525. The rights vested by the filing of a valid building permit application are to develop the land specifically identified in the application, not merely construction and vesting extends to all land specifically identified in a building permit application. Golden Sands Dairy v. Town of Saratoga, 2018 WI 16. Published as a League League-L e-Newsletter.

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Mellado v. Anthony Urbano/Earth Materials, L.L.C.
The claimant was represented by John J. D’Elia, Esq., D’Elia Gillooly DePalma, L.L.C., 700 State Street, 4th Floor, New Haven, CT 06511.
Respondents Anthony Urbano/Earth Materials, L.L.C., were represented by John M. Walsh, Jr., Esq., Licari, Walsh & Sklaver, L.L.C., 322 East Main Street, Suite 2B, Branford, CT 06405.
Respondent Second Injury Fund was represented by Lisa Guttenberg Weiss, Esq., Assistant Attorney General, Office of the Attorney General, 55 Elm Street, P.O. Box 120, Hartford, CT 06141-0120.
JOHN A. MASTROPIETRO, CHAIRMAN.2 The respondents have petitioned for review from the March 29, 2017 “Finding and Award Pursuant to C.G.S. § 31-355” (finding) by Scott A. Barton, the Workers’ Compensation Commissioner (commissioner) acting for the Third District.3 We find error and accordingly reverse the decision of the commissioner and remand this matter for additional proceedings consistent with this Opinion.
The commissioner made the following factual findings which are pertinent to our analysis of this appeal. On June 27, 2016, a special investigator for the State of Connecticut Office of the Treasurer filed a report stating that the claimant was injured on January 27, 2016 while in the employ of the respondents, who were not insured for workers’ compensation liability on the date of the claimant’s injury. The investigator also reported that “Earth Materials, L.L.C.,” was listed as a company with the Secretary of State, but “Anthony Urbano” was not listed with the Secretary’s office.
The commissioner further found that the claimant began working for the respondents prior to the work incident of January 27, 2016. The claimant earned $14.00 per hour and worked an average of forty hours per week. He earned $560.00 per week, and his compensation rate was $375.03 based on a filing status of married, filing jointly, with two exemptions.
On January 27, 2016, the claimant suffered compensable injuries to his head and face while in the course of his employment with the respondents. The claimant was using a chainsaw when the injuries occurred. He received treatment for his injuries at the emergency department at Yale New Haven Hospital, and also received extensive followup medical care at clinics for oral and maxillofacial surgery, neurology, and pediatric dentistry within the Yale New Haven Hospital system. In addition to incurring substantial medical bills as a result of his injuries, the claimant was totally disabled from employment from January 27, 2016, until July 26, 2016. The commissioner also found that the claimant may be eligible for additional disability benefits for some period after July 26, 2016.
On the basis of the foregoing, the commissioner determined that the Workers’ Compensation Commission (commission) retained jurisdiction over the claim and the respondents were not insured for workers’ compensation liability on the date the claimant was injured. He further concluded that on January 27, 2016, the claimant sustained work-related injuries to his head and face while in the employment of Anthony Urbano and Earth Materials, L.L.C., and ordered the respondents “to pay all workers’ compensation benefits as a result of the incident of January 27, 2016, including but not limited to medical bills, pharmaceutical bills, travel expenses, and authorization of medically necessary medical treatment.” Finding; Order. In addition, the commissioner ordered the respondents to pay to the claimant temporary total disability benefits for the period of January 27, 2016, until July 26, 2016, and indicated that he would order the Second Injury Fund (fund) to make such payments if the respondents did not pay the benefits within twenty days.
On April 20, 2017, the respondents filed a motion to submit additional evidence seeking to offer testimony from Urbano regarding the commissioner’s conclusion that an employeremployee relationship existed between Urbano/Earth Materials and the claimant. It is the respondents’ position that the additional evidence which Urbano sought to provide, essentially attesting that the claimant was casually employed, was material to the jurisdictional issue of whether an employer-employee relationship existed. The respondents also contend that this testimony was not presented at the formal hearing because the respondents never received notice that the formal hearing had been scheduled and only learned the hearing had occurred when they received the finding.
On April 28, 2017, the respondents filed a motion to open the finding and award pursuant to the provisions of § 31-315, arguing that for the reasons set forth in their motion to submit additional evidence, the findings of the commissioner should be opened “in order to effectuate the spirit of the Act.”5 The commissioner denied this motion on May 1, 2017, and this appeal followed.
On appeal, the respondents contend that the facts found by the commissioner were “arbitrary and capricious,” in that no evidence, apart from the stipulated agreement between counsel for the claimant and the fund, was presented at the formal hearing which provided a reasonable basis for the commissioner’s conclusion that the claimant was an employee of the respondents at the time of his injury. The respondents also assert that the commissioner’s denial of their motion to open and his refusal to allow additional evidence into the record constituted an abuse of discretion.
We begin our analysis of this matter with a recitation of the well-settled standard of review we are obliged to apply to a commissioner’s findings and legal conclusions. “The trial commissioner’s factual findings and conclusions must stand unless they are without evidence, contrary to law or based on unreasonable or impermissible factual inferences.” Russo v. Hartford, 4769 CRB-1-04-1 (December 15, 2004), citing Fair v. People’s Savings Bank, 207 Conn. 535, 539 (1988). Moreover, “[a]s with any discretionary action of the trial court, appellate review requires every reasonable presumption in favor of the action, and the ultimate issue for us is whether the trial court could have reasonably concluded as it did.” Burton v. Mottolese, 267 Conn. 1, 54 (2003). “This presumption, however, can be challenged by the argument that the trial commissioner did not properly apply the law or has reached a finding of fact inconsistent with the evidence presented at the formal hearing.” Christensen v. H & L Plastics Co., Inc., 5171 CRB-3-06-12 (November 19, 2007).
Returning to the matter at bar, we begin with the respondents’ contention that the facts found by the commissioner were “arbitrary and capricious,” in that no evidence, apart from the stipulated agreement between counsel for the claimant and the fund, was presented at the formal hearing which provided a reasonable basis for the commissioner’s conclusion that the claimant was an employee of the respondents at the time of his injury. The respondents point out that because no testimony was presented and no exhibits were submitted into evidence at the formal hearing, the commissioner’s conclusions regarding the existence of an employeremployee relationship were based solely on the stipulated agreement between counsel for the claimant and the Assistant Attorney General (AAG) representing the fund. However, the record contains no indication that the AAG “had any knowledge of how the appellee was involved with the appellants, how the appellee came to be where he was at the time of the injury and most importantly, the existence or nonexistence of the right to control the means and methods of his work.” Id., 7. See Hanson v. Transportation General, Inc., 245 Conn. 613, 620 (1998).
In support of this argument, the respondents point to this tribunal’s analysis in Beedle v. Don Oliver Home Improvement, 4491 CRB-3-02-2 (February 28, 2003). In Beedle, the commissioner heard testimony from the claimant as well as three witnesses on behalf of the respondent employer, and credited the testimony of the claimant over that of the respondent’s witnesses in concluding that an employeremployee relationship existed. This board affirmed the decision, observing that “[i]t is not up to us on review to focus our attention on the aspects of his testimony (and that of the other three witnesses) that lean in the other direction, and to decide that the balance of the evidence favors a contrary finding that the claimant was an independent contractor on the date of injury.” Beedle v. Don Oliver Home Improvement, 4491 CRB-3-02-2 (February 28, 2003). See also Altieri v. R&M Builders, 3647 CRB-5-97-7 (December 18, 1998); Pepin v. Carvalho, 15 Conn. Workers’ Comp. Rev. Op. 350, 3012 CRB-1-95-3 (June 26, 1996), aff’d, 44 Conn. App. 931 (1997) (per curiam).
The respondents argue that the present matter can be distinguished from Beedle, supra, given that no witness testimony was proffered and the AAG was not canvassed regarding the basis for her agreement with the stipulations relative to the existence of an employeremployee relationship. As such, it is the respondents’ position that the commissioner improperly relied upon this stipulated agreement in resolving a jurisdictional issue.
The fund argues that although no testimony was taken and no exhibits were entered into evidence at the formal hearing, “sufficient documentation and information was provided to ... counsel before commencement of the formal hearing to make a wellreasoned determination that the Claimant would be found to be an employee of the Respondent(s) and had suffered a compensable injury as claimed.” Second Injury Fund’s Reply to the RespondentAppellant’s Memorandum of Law, p. 4, n.1. The fund also points out that the stipulation relative to jurisdictional facts entered into by counsel for the claimant and the fund “constitutes a mutual judicial admission and under ordinary circumstances should be adopted by the court in deciding the case.” Cantonbury Heights Condominium Assn., Inc. v. Local Land Development, LLC, 273 Conn. 724, 745 (2005). However, we are not persuaded that our Supreme Court’s analysis in Cantonbury is applicable to the circumstances of this matter.
In Cantonbury, which involved an action for summary judgment against two defendants, the Supreme Court determined that the stipulated fact at issue was actually an admission against interest by the claimant, who had stipulated that one of the defendants in the underlying suit had not performed the allegedly tortious activities.6 The court affirmed the granting of summary judgment on several counts as to that particular defendant, stating, “[w]e can discern no reason to subject [the defendant] to a potential judgment for actions that the plaintiff admits were conducted by another party.” Id., 745.
We therefore find that the present matter can be distinguished from Cantonbury, given that the stipulation of facts was not reached as a result of an agreement between the claimant and the respondents but, rather, arose out of negotiations between counsel for the claimant and the AAG representing the fund. This agreement does not appear to have been submitted into the record, thus depriving this board of the opportunity for appellate review.7 However, even had the agreement been submitted into the record, we share the respondents’ perplexity in wondering how the fund, which came into the case as a secondary payer pursuant to the provisions of § 31-355 (b), would have any basis whatsoever for stipulating to facts relative to the nature of the respondent employers’ employment relationship with the claimant.
Given that we are not persuaded that the underlying stipulation between claimant’s counsel and the AAG provided a sufficient basis for the commissioner’s conclusions in this matter, we are unable to sustain the finding. This is particularly so in light of the well-settled precept that a challenge to jurisdiction can be raised at any time. “[O]nce the question of lack of jurisdiction of a court is raised, ‘[it] must be disposed of no matter in what form it is presented;’ and the court must ‘fully resolve it before proceeding further with the case.’” (Internal citations omitted.) Castro v. Viera, 207 Conn. 420, 429 (1988). Moreover, it is axiomatic that subject matter jurisdiction “cannot be conferred by waiver, consent, silence or agreement of the parties.” Id., 425.
The respondents have also claimed as error the trial commissioner’s decision to proceed with the March 16, 2017 formal hearing in the absence of the respondents and/or their representative and his subsequent denial of the respondents’ motion to open pursuant to the provisions of § 31-315. The respondents point out that at the March 16, 2017 formal hearing, the commissioner stated that despite the respondents having received proper notice of the formal hearing, and having attended all prior hearings, the respondents had “chosen to not appear here this morning.” Transcript, p. 4. The respondents contend that “[t]he Commissioner’s use of the term ‘chosen’ implies that Mr. Urbano made a conscious decision not to attend the formal hearing, which is entirely inconsistent with Mr. Urbano’s actions prior to the formal hearing.” Appellants’ Brief, p. 5. The respondents also assert that Urbano attended and participated in every prior hearing, and even arranged for a pre-formal hearing originally scheduled for August 17, 2016, to be rescheduled. In addition, Urbano called the commission as soon as he received the finding and retained legal counsel to appeal the award. The respondents therefore contend that “[a]t the very minimum, Mr. Urbano should have been afforded the opportunity to appear before the commissioner at an informal hearing to explain his absence and allow the Commissioner to assess his credibility prior to a decision being made on the motion [to] open.” Id., 5.
Having reviewed the record in its entirety, we recognize that the respondents’ failure to appear at the March 16, 2017 formal hearing was inconsistent with their prior actions in defending this claim. However, it is well-settled that General Statutes § 31-298 endows a commissioner with ample discretion to conduct hearings “in a manner that is best calculated to ascertain the substantial rights of the parties and carry out the provisions and intent of this chapter.”9 In light of the degree of discretion generally afforded a commissioner, this board has historically been reluctant to second-guess a commissioner’s decisions regarding the manner in which hearings are conducted.
Moreover, we have already concluded that the subject finding cannot be sustained because the record on which it was predicated did not provide a sufficient basis for the conclusions drawn by the commissioner relative to the issue of the existence of an employer-employee relationship. As such, we decline to reach the respondents’ claim of error alleging that the trial commissioner’s decision to proceed with the March 16, 2017 formal hearing in the absence of the respondents and/or their representative and his subsequent denial of the respondents’ motion to open constituted an abuse of discretion.
There is error; the March 29, 2017 “Finding and Award Pursuant to C.G.S. § 31-355” by Scott A. Barton, the Commissioner acting for the Third District, is accordingly reversed and remanded for additional proceedings consistent with this Opinion.
Commission Chairman John J. Mastropietro and Commissioners Jodi Murray Gregg and Nancy E. Salerno concur in this Opinion.


“Free and Clear” Means You’re out of Here?
Section 365(h) of the Bankruptcy Code provides considerable protection to a tenant in the event of a bankruptcy filing by its landlord. Despite rejection of its lease, the tenant can elect to retain its rights, including the right to possession, for the balance of the term of the lease, including any renewal or extension period. This is black-letter bankruptcy law reflecting a sound policy judgment: it would be ruinous to business (not to mention an individual or family) if a landlord could upend a tenant’s possession whenever economic circumstances made a bankruptcy filing necessary or desirable.
Section 363(f) of the Bankruptcy Code permits the sale of a debtor’s assets “free and clear” of any interest in those assets if one of five factors are satisfied. The ability to strip assets of liens, claims and other interests enhances their value because purchasers would pay far less for assets that remain subject to the claims of a debtor’s creditors.
But what happens when these two sections are implicated by the same transaction? The sale of real property by a landlord “free and clear” of a tenant’s leasehold interest would terminate the tenant’s right to possession in apparent contravention of Section 365(h). But, Section 363(f) brooks no exception for a leasehold interest: it clearly provides for the sale of assets free and clear of “any interest” in the property.
[In the view of some courts,] if a trustee explicitly rejects a lease by the time of the sale, he triggers the protections for lessees set forth in § 365(h), but if there is no timely rejection, § 363(f) permits a free and clear sale because § 365(h) is irrelevant. [. . .] This reading may reconcile the outcomes in the case law, but it does not address the underlying interpretive arguments. The majority can still argue that § 363(f) will be used to undermine the protections of § 365(h), and the minority can still assert that the sections ought to be read harmoniously (at least when possible).
The impact of the Dishi court’s determination that property can be sold free and clear of a tenant’s leasehold interest, however, was tempered significantly by the conclusion that followed. After evaluating the five grounds for sales of property free and clear under Section 363(f), the Court found that none of them authorized a sale free and clear of the tenant’s leasehold interest in this case. And, even if the sale could have been approved in accordance with one of those five subsections, the District Court concluded that the Bankruptcy Court did not abuse its discretion in holding that the adequate protection required by Section 363(e) of the Bankruptcy Code could be achieved only through the tenant’s continued possession of the leased premises.
A few years after Dishi, the Ninth Circuit also rejected the majority approach and instead followed Qualitech and the other “minority” decisions. As an initial matter, the Court concluded that it could “easily” read the two sections of the Bankruptcy Code in a manner that gives effect to each one.
Although undefined in the Code, a ‘rejection’ is universally understood as an affirmative declaration by the trustee that the estate will not take on the obligations of a lease or contract made by the debtor. A sale of property free and clear of a lease may be an effective rejection of the lease in some everyday sense, but it is not the same thing as the ‘rejection’ contemplated by section 365. In sum, section 363 governs the sale of estate property, while section 365 governs the formal rejection of a lease. Where there is a sale, but no rejection (or a rejection, but no sale), there is no conflict.
But, wary of its decision being construed as tantamount to “an effective repeal of Section 365(h),” and recognizing that its precise holding would be of little use in a situation (like the one the court faced in Dishi) in which there was both a formal rejection of the lease and a proposed sale of property, the Spanish Peaks Court offered the following additional guidance. First, as in Dishi, the Court noted that the requirement for adequate protection of an interest to be terminated by a Section 363(f) sale constitutes a “powerful check on potential abuses of free-and-clear sales.” Second, also as in Dishi, the Ninth Circuit observed that a sale free and clear of the tenant’s leasehold interest could only be consummated upon satisfaction of one of the five provisions of Section 363(f).
Accordingly, even in the minority of cases in which courts appear to subordinate a tenant’s rights under Section 365(h) to the provisions of Section 363(f), the tenant is not without recourse. To the contrary, a debtor seeking to sell property free and clear of a tenant’s leasehold interest must satisfy one of the five bases for approval of such sales set forth in Sections 363(f)(1)-(5). And, if the tenant requests it, the Court can condition the sale on “adequate protection” of the leasehold interest, which may take the form of continued possession for the duration of the lease term. Given these protections, the interplay between Sections 363(f) and 365(h) may be of more interest to academics and practitioners than to tenants, who appear to enjoy broad protection of their rights under both the majority and minority view.
 In re Churchill Props. III, Ltd. Pshp., 197 B.R. 283, 288 (Bankr. N.D. Ill. 1996).
 See, e.g., In re Taylor, 198 B.R. 142, 165 (Bankr. D.S.C. 1996) and In re LHD Realty Corp., 20 B.R. 717, 719 (Bankr. S.D. Ind. 1982).
 Churchill, 197 B.R. at 288. Cf. In re Revel AC, Inc., a recent decision of the Third Circuit Court of Appeals appears to be in accord with the majority view. 2018 U.S. App. LEXIS 34028 (3d Cir. Nov. 30, 2018) (tenant permitted to reduce its rent obligations by recoupment amounts applicable under the lease by virtue of its election under Section 365(h) notwithstanding new landlord’s acquisition of the property “free and clear” under Section 363(f)).
 In re Downtown Ath. Club of N.Y. City, 2000 U.S. Dist. LEXIS 7917, *12-13 (S.D.N.Y. 2000).
 In re Qualitech Steel Corp. & Qualitech Steel Holdings Corp., 327 F.3d 537 (7th Cir. 2003).
 Dishi & Sons v. Bay Condos, LLC, 510 B.R. 696 (S.D.N.Y. 2014) (“Dishi”).
 Dishi at 704 (citing In re Zota Petroleums, LLC, 482 B.R. 154, 163 (Bankr. E.D. Va. 2012)).
 Id. at 707, 708 (emphasis added).
 In re Spanish Peaks Holdings II, LLC, 872 F.3d 892 (9th Cir. 2017) (“Spanish Peaks”).
 Id. (citing Dishi, 510 B.R. at 704).
 Unlike in Dishi, however, in Spanish Peaks there does not appear to have been any dispute “that at least one provision of § 363(f) was satisfied.” Id.


text:
DEDICATIONAL - Sorry, definition not available.
DEDICATORIAL - dedicatorial adj. dedicatory.
DERACIALISED - deracialised v. simple past tense and past participle of deracialise.
DERACIALIZED - deracialized v. simple past tense and past participle of deracialize.
DIAGONALISED - diagonalised v. simple past tense and past participle of diagonalise.
DIAGONALIZED - diagonalized v. simple past tense and past participle of diagonalize.
diagonalized adj. (mathematics) Converted into a diagonal matrix.
DISACCHARIDE - disaccharide n. (biochemistry) Any sugar, such as sucrose, maltose and lactose, consisting of two monosaccharides combined.
INCARDINATED - incardinated v. simple past tense and past participle of incardinate.
INCARNADINED - incarnadined v. simple past tense and past participle of incarnadine.

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