The owners of a bed-and-breakfast across the street from Green Lake say they will sue the city after it ordered them to shut down their Greenlake Guesthouse by March 31.

Neighbors, concerned that the business brings unwanted strangers into their neighborhood, had complained that owners Blayne and Julie McAferty expanded the upstairs bedrooms of the house with the express purpose of opening a B&B.

Neighbors say that violates the strict conditions of an October 2003 city law allowing existing houses to be used as B&Bs in residential zones as long as no exterior structural changes are made to accommodate the new use.

When it opened in August 2004 at 7630 E. Green Lake Drive N., the Greenlake Guesthouse was the first — and remains the only — B&B christened under the new law. The City Council said its intent was to encourage more B&Bs inside Seattle as long as they didn't detract from the character of single-family neighborhoods.

After the Department of Planning & Development sided with the neighbors in November, the McAfertys asked for a reconsideration. But the agency upheld its initial decision on Monday and set the shut-down date.

The McAfertys argue that department employees initially told them that their remodel plans complied with the new B&B law, and bought the house under that assumption. In its Monday ruling, the agency said it could not ascertain whether the couple received incorrect advice from any city employee. Even if they had, that "does not alter the meaning of the code," the ruling said.

The couple also argued that the law is vague and absurd. But an attorney for the neighbors disagreed, saying the City Council has the authority to limit development of B&B's in residential zones.

The guesthouse sits on a block zoned exclusively for single-family houses but is across the street from the Green Lake hike-and-bike trail and two blocks south of a commercial district.

The Washington chapter of the Institute for Justice, which is representing the McAfertys pro bono, plans to file a lawsuit on the couple's behalf next week in King County Superior Court. The suit would seek an injunction to keep the B&B open while the case is pending.

Stuart Eskenazi: 206-464-2293