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Greenberg v. Fornicola

Decided: January 17, 1961.

IRVING GREENBERG, PLAINTIFF-APPELLANT,
v.
DONALD FORNICOLA, KENDALL H. LEE, ETC., ET AL., DEFENDANTS-RESPONDENTS



Goldmann, Foley and Collester. The opinion of the court was delivered by Foley, J.A.D.

Foley

Plaintiff in a taxpayer's suit appeals from a summary judgment entered on motion of the defendants in the Chancery Division.

The essential facts as displayed by the affidavits offered by the respective parties on the motion were not in dispute. Pursuant to the provisions of R.S. 40:179-113 et seq. the City of Asbury Park had erected a pavilion on the Boardwalk consisting of bathing facilities and six stores, known as the Fourth Avenue Pavilion. In order to secure tenants for the stores, the city caused legal advertisements to be inserted in authorized newspapers inviting competitive bidding for the leasing of same for either a five-year or a ten-year term. Originally the advertisements specified the class of goods or merchandise which could be sold in each store and the services which could be performed therein. The use specified for No. 1105 Boardwalk and for No. 1103 adjacent thereto was "First Class Confectionery, Manufacture and sale, Also Soda Fountain." When the City received no response to its invitation to bid in accordance with these specifications, the legal notice in subsequent advertising was supplemented to provide:

"The bidder will be permitted to submit an offer for some other line of business suggested by the bidder, subject to the approval of City Council."

On May 12, 1959 defendant Fornicola submitted a bid for a 10-year lease of No. 1105 Boardwalk, the store to be used for the sale of frozen desserts, ice cream, soft drinks and milk products. The bid was accepted and, pursuant to a resolution of the council, a lease was executed on May 26, 1959 providing for such use "and for no other purpose whatsoever." Shortly thereafter the city received a bid for No. 1103 Boardwalk proposing "frozen custard, orange drink and amusements." At the direction of the city the defendant Lee, its municipal manager, negotiated an arrangement with Fornicola by which the latter waived

his right to sell frozen custard, providing that he be permitted to sell sandwiches and cakes. This was approved by the governing body and by letter of July 1, 1959 Fornicola was given permission to sell cold sandwiches, cake, pie and coffee. About two weeks thereafter the council also granted permission to Fornicola to sell frankfurters and hamburgers. These modifications in the use of the leased premises purportedly were effected in accordance with various clauses in the lease which reserved to the city the right to determine the kind and character of goods to be sold in the store.

Finally, by a resolution adopted March 8, 1960 by the governing body, an addendum to the lease was executed permitting sale of the following items of goods:

"ice cream, drinks (soft), milk products, cold sandwich platters, cakes, pies, and coffee, frankfurters and hamburgers, and for no other purpose whatsoever."

The complaint, filed on August 6, 1959, was based entirely upon the allegations that the approval of the changes in use particularized in the lease had not been "publicly advertised for open bids by the City Manager of the City of Asbury Park" and that the Mayor and Council of Asbury Park had not "adopted a resolution in legal manner, permitting such change." The relief sought by the plaintiff was that (a) Fornicola be restrained from selling any products other than those described in the lease as originally executed; (b) the defendant Lee be required to "enforce the lease provisions"; (c) the city be enjoined from permitting Fornicola to violate the lease provisions by selling products not originally specified therein. The pretrial order, which became a part of the record for the purposes of the motion for summary judgment, adopted by reference the legal issues involved in the proceeding as drafted in paragraph No. 7 in plaintiff's pretrial memorandum. They follow:

"7. Can the City of Asbury Park permit a tenant of leased premises to vary the terms of his lease by letter or resolution, and not in accordance with re-advertisement and public bidding; damages."

The argument on the motion was contained within the boundaries of the inquiry of whether the bidding statutes hereinafter referred to, required public advertisement of the proposed changes in, and extension of, the uses specified by Fornicola in his bid, and incorporated in the lease executed by the parties. In granting the motion the trial court held that had the invitation to bid specified a particular use and Fornicola's bid been based thereon, a subsequent change in use without readvertisement would have been in violation of the statutory mandate; but since the invitation granted to all bidders equally the right to propose the use for which the bids were made, the use granted, once the highest bid ...


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