Ocean Bay Mart, Inc.
The City of Rehoboth Beach
Richard A. Forsten, Esquire.
SCOTT BRADLEY JUDGE.
my decision on Petitioner Ocean Bay Mart, Inc's Petition
for a Writ of Certiorari and the Motion to Dismiss that
petition filed by Respondents the City of Rehoboth Beach,
Delaware, and the Commissioners of the City of Rehoboth Beach
in this case involving a proposal by Ocean Bay Mart to build
a 63-unit condominium development to be known as "Beach
Walk" on a 7.83 acre parcel of land that it owns at
20673 Coastal Highway, Rehoboth Beach, Delaware. "Beach
Walk" consists largely of single-family detached
condominium units, making it look like a residential
are two issues in this case. The first issue is whether
"Beach Walk" is subject to the City's
subdivision requirements even though it is a condominium
development. The City Building Inspector thought so. The City
Board of Adjustment did not think so. The City Planning
Commission and City Commissioners both thought so, reasoning
that 25 Del. C. §8l-105(b)(1)'s statement
that a condominium unit, together with its interest in the
common elements, constitutes for all purposes a separate
parcel of real estate and, as such, mandated compliance with
the City's subdivision requirements. Section 81 -105
deals with the titling and taxation of condominium units and
common elements. Ocean Bay Mart disagrees with the
Commissioners' reasoning, arguing that §81-105(b)
has no application to the City's subdivision
requirements. Ocean Bay Mart is seeking certiorari review of
the Commissioners' decision.
second issue is whether City Ordinance 1116-01 is applicable
to "Beach Walk." Ordinance 1116-01 provides that
"no more than one single-family detached dwelling with
its customary non-habitable accessory buildings may occupy or
be constructed upon any lot." Ordinance 1116-01 was
introduced by the Commissioners after Ocean Bay Mart filed
its application for site plan review with the Building
Inspector and adopted by the Commissioners before, but not
relied upon by, the Commissioners when they denied Ocean Bay
Mart's appeal of the Planning Commission's decision.
If Ordinance l 116-01 applies to "Beach Walk," then
"Beach Walk" would be subject to the City's
subdivision requirements. The Commissioners argue that it
does, making Ocean Bay Mart's request for certiorari
review moot. Ocean Bay Mart argues that it has no application
to "Beach Walk."
decided that I cannot now determine whether Ordinance 1116-01
applies to "Beach Walk," reasoning that this issue
should, in the first instance, be presented to and decided by
the appropriate City officials. I have concluded that the
Commissioners' reliance on 25 Del. C.
§81-105(b)(1) was an error of law because
§81-105(b)(1) deals with the titling and taxation of
condominium units and common elements and not subdivisions.
Bay Mart is the owner of a retail shopping center located on
the east side of Route 1 in Rehoboth Beach known as
"Ocean Bay Plaza" (the "Property"). Ocean
Bay Mart proposes to redevelop the Property by eliminating
the shopping center and replacing it with 63 residential
condominium units on the 7.83-acre Property to be called
"Beach Walk." "Beach Walk" would consist
of 58 single-family detached units and five single-family
attached units. On June 18, 2015, Ocean Bay Mart filed its
site plan application (the "Plan") for review and
approval by the City of Rehoboth Beach, Delaware.
City Building Inspector placed the application on the
Planning Commission's November 2015 agenda for review and
a public hearing. Shortly thereafter, the Building Inspector
removed the application from the agenda, claiming that Ocean
Bay Mart's Plan needed to be resubmitted as a
"subdivision" plan instead of a site plan. Ocean
Bay Mart then appealed the Building Inspector's decision
to the Board of Adjustment.
Board of Adjustment Decision
specific issue before the Board of Adjustment was the meaning
of Footnote 1 of Attachment 1 to the Table of Use Regulations
to Chapter 270 of the City Code. Footnote 1 provides
"that no more than one main building may be erected on a
single lot." The Building Inspector had concluded that
Footnote 1 limited Ocean Bay Mart to one building on its
7.83-acre Property. Thus, to get more buildings, Ocean Bay
Mart would have to go through the subdivision process. The
Board concluded that Footnote 1 was ambiguous and reversed
the Building Inspector's decision. The practical effect
of the Board's decision was to allow Ocean Bay Mart to
put more than one building on its Property. The Board's
decision was consistent with the City's past practice of
not requiring a condominium plan to be reviewed as a
subdivision plan and instead allowing condominium plans to be
reviewed and approved under the site plan process. No one
appealed the Board's decision.
Planning Commission Decision
the Board's decision, the matter was placed on the
Planning Commission's August 12, 2016, agenda so that the
site plan review could be completed. However, instead of
reviewing the Plan, the Commission asked for briefing on
whether it was bound by the Board's decision. The
Briefing was done and the Commission met on January 13, 2017.
There were three issues before the Commission. One, whether
the Commission was bound by the Board's decision. Two,
whether "Beach Walk" was subject to subdivision
review. Three, whether "Beach Walk" was required to
be zoning compliant. The Commission members discussed 25
Del. C. §81 -105(b)(l), the condominium form of
ownership, a proposed ordinance that would become Ordinance
1116-01, and the City's subdivision requirements.
Ultimately, the Commission refused to consider Ocean Bay
Mart's Plan and concluded that "Beach Walk"
would have to go through subdivision review with one
commissioner stating, "that if it looks like a
subdivision, and it smells like a subdivision, then it is a
subdivision." In making this determination, the
Commission relied upon 25 Del. C.
§8l-105(b)(1), which states:
(b) In a condominium or planned community:
(1) If there is any unit owner other than a declarant, each
unit that has been created, together with its interest in the
common elements, constitutes for all purposes a separate
parcel of real estate.
Commission told Ocean Bay Mart that unless it submitted a
full "subdivision" plan for review within 60 days,
it would consider the Plan rejected. Ocean Bay Mart refused
to submit a subdivision plan and instead appealed the
Commission's decision to the City Commissioners.
City Commissioners"' Decision
City Commissioners retained independent counsel to advise
them in this matter because the City Solicitor, who usually
advises them, was representing the Planning Commission in the
appeal. Following extensive briefing on the matter, on
January 26, 2018, the City Commissioners voted 4-2 to uphold
the Planning Commission's decision, stating:
[t]his decision [is] based on the fact that the Planning
Commission made the proper decision in applying 25 Del.
C. §81-105(b) to conclude that the creation of63
condominium units from one acre of land is the legal
equivalent of creating 63 ...