This has been reported to the Quagga community as quagga bug
879 https://bugzilla.quagga.net/show_bug.cgi?id=879
This patch can be removed after upgrading to a version of Quagga 
with bug 879 fixed.

*** solaris/quagga.init.in
--- solaris/quagga.init.in
*************** esac
*** 149,156 ****
  DAEMON_ARGS=`routeadm_daemon_args $DAEMON`;
  routeadm_zebra_enable $DAEMON;
  
! if [ ! -f "@sysconfdir@/${DAEMON}.conf" ] ; then
! 	echo "Could not find config file, @sysconfdir@/${DAEMON}.conf"
  	exit $SMF_EXIT_ERR_CONFIG
  fi
  
--- 149,160 ----
  DAEMON_ARGS=`routeadm_daemon_args $DAEMON`;
  routeadm_zebra_enable $DAEMON;
  
! CONF_FILE=`get_routeadm_property $SMF_FMRI config_file`
! if [ -z "$CONF_FILE" ] ; then
! 	CONF_FILE="@sysconfdir@/${DAEMON}.conf"
! fi
! if [ ! -f "$CONF_FILE" ] ; then
! 	echo "Could not find config file, $CONF_FILE"
  	exit $SMF_EXIT_ERR_CONFIG
  fi