Starbucks Boss's Cottage Is Questioned

The saga of a caretaker’s apartment on the four-plus-acre property owned by the Starbucks chain’s chief executive officer occupied the East Hampton Village Zoning Board of Appeals at its meeting Friday. An attorney for the owners, Howard D. Schultz and Sheri Kersch-Schultz, argued for legalization of the structure, which has nearly doubled from its original size.

In the mid-1980s, the then owner of the property, at 14 Gracie Lane, tore down an existing house and cottage and built a new house, designed by Charles Gwathmey. At that time, a variance was granted to allow construction of a 650-square-foot garage and caretaker’s apartment. The certificate of occupancy issued in 1988 referred simply to a one-story framed garage with caretaker’s apartment.

When the Schultzes bought the place in 1995 they obtained an updated C of O, which included the same description of the garage/apartment. It currently measures 1,022 square feet, with four bedrooms, three bathrooms, and a half-bath.

In 2012, the couple sought to add two bedrooms and two bathrooms to the  main house, and were granted a coastal erosion hazard permit and variance to allow the construction. At that time, however, the building inspector pointed out that the garage and caretaker’s apartment did not match the description in the C of O. The board granted the permit and variance for the addition to the main house provided that the garage and caretaker’s apartment be reduced to its original size, and the applicant agreed.

The Schultzes now seek either a modification of the 2012 determination or a variance to let the cottage remain as is, with the promise to reduce the number of bedrooms and bathrooms to two of each. They have sent several lawyers, including Fred W. Thiele Jr., also a state assemblyman, to make their case.

“This property was advertised by Sotheby’s as having a legal [certificate of occupancy] for this dwelling that was issued in 1988 and subsequently ratified by the building inspector’s office in 1995,” Leonard Ackerman, representing the applicants, told the board at an earlier hearing, on March 14. “There was adequate due diligence by attorneys that there were no violations on the property.”

Further, Mr. Ackerman and Mr. Thiele argued, the previous owner’s 1986 request for a variance was unnecessary because the property was in excess of four acres. (At the time, the village allowed a secondary structure on certain properties, subject to various conditions; that provision was rescinded last year.) “We’re asking you to forgive the building inspector’s office for issuing two valid [certificates of occupancy] that these people relied upon,” Mr. Ackerman  said.

Frank Newbold, the board’s chairman, said that a site visit prior to the March 14 meeting revealed that a garage bay had been illegally converted to an additional bedroom, and that a microwave oven and refrigerator were discovered in a storage closet. The board and building inspector had considered not issuing a building permit in 2012 until the caretaker’s apartment was reduced to the agreed-upon 650 square feet, he said. “You can see, based on the history, why this board is skeptical,” he told Mr. Ackerman.

Members of the board wondered how they could be sure that the cottage as it stands is the same as was there in 1995, before the Schultzes bought the property. On Friday, Matthew Pachman, an attorney, presented affidavits from the project manager for the construction company that built it, the Sotheby’s broker who listed the property in 1995, the selling broker who told the Schultzes about it, and Ms. Schultz herself, as well as a brochure from Sotheby’s in which the property was listed. He also said that two beds that had been found in the garage bay had been removed.

To ignore the two certificates of occupancy, “one of which the applicant relied upon in purchasing the property,” Mr. Pachman cautioned, “may lead the board away from doing what it has traditionally done so well, which is look at the facts and statutory criteria and come up with a rational, fact-based decision.”

But Lys Marigold, the board’s vice chairwoman, told Mr. Pachman that she had voted to grant the addition to the main house in 2012 on the understanding that the caretaker’s cottage would be reduced to 650 square feet. In applying for an addition to the main house, she said, “You asked to have eight bedrooms and nine and a half baths in the main house . . . If I had known there were three bedrooms and three and a half baths staying in the cottage, I don’t think I would have said yes” in 2012. “I relied on the decision that it was going to be taken back to a one-bedroom, one-bath [cottage]. That was important to me.”

Legalizing the caretaker’s cottage, Mr. Pachman said, would cause no detriment to the neighbors. The condition attached to the 2012 determination, he said, should not preclude the board from judging the present application on its merits. “It just seems inequitable to stop the analysis,” he said.

Brian Matthews, an attorney representing Donald Kostin, the owner of 73 Lily Pond Lane, attended both meetings to argue that the board should not even entertain the application. In rescinding the provision allowing accessory structures, he said, “the village made a proclamation  that they don’t want these second dwellings on properties anymore.”

The applicant, he said, was “asking the board to invite chaos.” Those with the means to afford high-priced counsel, he said, could “open up the floodgates as to why they should be able to get out from conditions of approvals or denials that this board has issued.”

The affidavits presented by the applicant, Mr. Matthews said, were irrelevant, merely establishing that at some point the caretaker’s cottage was illegally expanded. “You don’t vest an illegality,” he said.

The hearing was held open and will resume at the board’s April 11 meeting.