Judge Rules Against Town In Short-Term Rental Court Challenge

In a bombshell decision with major implications for Nantucket, a Massachusetts Land Court judge on Thursday ruled against the town in the closely watched short-term rental case brought by Silver Street resident Cathy Ward against her neighbors and the Nantucket Zoning Board of Appeals.

Judge Michael Vhay ruled that the town's zoning bylaw does not allow short-term rentals as a principal use of a primary dwelling. He reversed the Zoning Board's prior decision in the case, and remanded the matter back for further consideration.

Vhay's judgment rejected the town's longheld position that short-term rentals are a residential use under the town's zoning bylaw. That interpretation had been used by the town's building commissioner Paul Murphy and the Zoning Board to dismiss requests for enforcement actions that challenged the legality of short-term rentals operating in residential neighborhoods.

With hundreds - perhaps even thousands - of short-term vacation rentals on Nantucket, the implications and potential impacts of Judge Vhay's ruling on property owners and the overall island economy are significant. For the political action group ACK Now and the island residents who for the past three years had urged restrictions on short-term rentals and challenged their legal standing, the Land Court judgment was a validation of their arguments that commercial vacation rentals were doing damage to year-round residential neighborhoods and had no place in them.

“The court found that short-term rentals are not allowed as of right in any residential districts in Nantucket. The court did find that they are allowed as an accessory use, and the case was remanded back to the Zoning Board to hold another hearing within 45 days to determine whether the use is sufficiently incidental to the primary use as to qualify as an accessory use,” town counsel John Giorgio told the Select Board, Planning Board, and Finance Committee Thursday afternoon during a previously scheduled meeting in which he broke the news to town officials. 

Read Judge Vhay's full decision here

Read Vhay's findings of fact & conclusions of law

Ward sued the town and her neighbors - Peter and Linda Grape, who own the abutting property on West Dover Street - back in February 2022, claiming that their short-term rental property operating in a residential zoning district is an illegal commercial use and that the decision by the town’s Zoning Board of Appeals to reject her request for an enforcement action was arbitrary and capricious.

"I am pleased with the judge’s decision and look forward to zoning being upheld," Ward told the Current shortly after the decision came down.

Judge Vhay's decision left town counsel and the assembled Select Board, Finance Committee, and Planning Board members scrambling to fully understand the decision, and consider the town's immediate next steps.

"I think it's a bad decision with terrible consequences for many people," Planning Board chair David Iverson said.

The town can appeal the decision and most likely will in order to forestall any impacts for the upcoming summer. There is also island attorney Steven Cohen's citizen petition at this year's Annual Town Meeting that seeks to allow and codify short-term rentals in the island's zoning bylaw which, if passed, means "the decision in the Ward case becomes moot," town counsel Giorgio said Thursday afternoon. But he urged the assembled town officials not to press him immediately for legal guidance or strategy given that the decision was hot off the presses.

"What about rentals in the pipeline for summer? We will have time to protect that business?" Iverson asked.

"I’m going to wait on that," Giorgio said. "I want to talk to (fellow town counsel from KP Law) George (Pucci) on that. This is sort of above my pay grade at this point."

The case has been closely watched by town officials, the island’s real estate community, short-term rental operators, and ACK Now, the political action group that has spent the last three years attempting to place restrictions on short-term rentals on Nantucket. Ward, who serves on ACK Now’s advisory council, has had her legal effort supported by the political action group, and her attorney - Nina Pickering Cook - also represents ACK Now.

The recent Land Court trial - part of which was held on Nantucket in late December - was focused solely on whether Ward had standing to bring her complaint. Judge Vhay ultimately ruled that Ward did in fact have standing in the case.

"Ms. Ward’s testimony, the parties’ agreed facts, and the documents admitted into evidence collectively present a 'qualitative' case for Ward’s standing," Vhay wrote in his decision.

In testimony that was at times tearful and defiant of the questions she was peppered with during cross-examination, Ward told the Judge Vhay in December that the “constant turnover” and “constant celebratory occasions happening” at the Grapes’ home had led her to consider moving away from the island she loves.

“I used to look forward to the summer and spending summers outside,” Ward said. “Now when the summers come and I see the changeovers, it makes me cringe. It makes my blood pressure go up. I get tense and irritated. It’s to the point it’s made me consider leaving this island…I love Nantucket, I’d love to stay, but I want to enjoy my property as it was before.”

Ward testified that her experience and enjoyment of her property changed after the Grapes purchased the neighboring home on West Dover Street in 2017. She described a “constant” churn of disrespectful renters who would make noise, leave the flood light on all night, and allow dogs to bark and “yip” at Ward while she was gardening. Whether it was a baby crying early in the morning, a man walking naked to the outdoor shower, or a group of golfers talking about their round, Ward told Judge Vhay that she had to change the way she used her own home to avoid such disturbances.

“It was a constant flow of people,” Ward said.

Judge Vhay's findings and conclusions repeatedly referenced the 2021 Massachusetts Supreme Judicial Court (SJC) decision involving short-term rentals known as the Lynnfield case, or the Styller case. That lawsuit reached the SJC after Alexander Styller, the owner of a home in Lynnfield, Mass., appealed a decision by the local building inspector that prohibited him from offering short-term rentals of his home based on the fact it was located in a residential zoning district. After losing at the local Zoning Board and the Land Court, Styller appealed to the SJC, which also ruled to uphold the building commissioner’s decision. The decision stated: “short-term rental use of a one-family home is inconsistent with the zoning purpose of the single-residence zoning district in which it is situated, i.e., to preserve the residential character of the neighborhood."

This is a developing story. Stay tuned for additional updates.