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Outerbridge Terminal Inc. v. City of Perth Amboy

Decided: March 20, 1980.

OUTERBRIDGE TERMINAL, INC., A CORPORATION OF THE STATE OF NEW JERSEY; NEUBERNE H. BROWN, JR. AND LOVETT C. PETERS, PLAINTIFFS,
v.
CITY OF PERTH AMBOY, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY; ZONING BOARD OF ADJUSTMENT OF THE CITY OF PERTH AMBOY AND THOMAS SINATRA, BUILDING INSPECTOR OF THE CITY OF PERTH AMBOY, DEFENDANTS



Long, J.s.c.

Long

The issue involved here is whether the existence of a particular contractual arrangement between a private citizen and the Federal Government entitles the citizen to claim immunity from local zoning regulations.

Plaintiffs are Outerbridge Terminal, Inc., Neuberne H. Brown, Jr. and Lovett C. Peters. Defendants are the City of Perth Amboy, its zoning board of adjustment and Thomas Sinatra, its building inspector. The case arose as follows: on January 16, 1981 plaintiffs entered into a contract with an agency of the United States Department of Defense, pursuant to the Armed Services Procurement Act (10 U.S.C.A. § 2301 et seq.) to provide services and facilities in Perth Amboy for the receipt, storage and shipping of government owned jet fuel. Subsequently, plaintiffs sought a building permit for tank construction from the municipality, which permit was denied by the building inspector on January 30, 1981 on the basis that under the local zoning ordinance the proposed facility was not a permitted use. On February 1, 1981 plaintiffs filed a complaint in lieu of prerogative writs seeking an order directing defendant municipality and its building inspector to issue a building permit for the construction. Alternatively, plaintiffs sought a declaration that no permit was needed.

On February 11, 1981 plaintiffs moved for summary judgment on the basis that the project in question was being built for the Federal Government pursuant to a lease and that it was therefore immune from the strictures of the Perth Amboy zoning ordinance. Plaintiffs have argued in the alternative that even if their arrangement is not a lease, they are still entitled to immunity. Defendants opposed the motion on the grounds that

the agreement between plaintiffs and the Federal Government is not a lease at all and is therefore subject to local zoning restrictions, and that in any event, the enabling legislation in question distinguishes this case from any of the applicable immunity decisions.

Initially, it should be noted that the Armed Services Procurement Act, supra , which is the relevant enabling legislation here and which allows the Department of Defense to enter into leases for valid governmental purposes, specifically prohibits the leasing of land. 10 U.S.C.A. § 2303(b). It has also been conceded that the Federal Government is unwilling to provide the court with a statement that its agreement with plaintiffs is actually a lease, or even that it is a lease in substance.*fn1

The court is faced with several questions which will be dealt with serially. The first is whether the decision in Thanet Corp. v. Princeton Tp. Bd. of Adj. , 108 N.J. Super. 65 (App.Div.1969), certif. den. 55 N.J. 360 (1970), provides immunity from local zoning restrictions in cases in which the government has other than an ownership or leasehold interest in the land at issue. In Thanet the Appellate Division unqualifiedly adopted the holding of the trial court (reported at 104 N.J. Super. 180 (Law Div.1969) that the United States Government, whether as owner or lessee, is immune from local zoning ordinances. There is no question but that Thanet is a more expansive decision than that in Tim v. Long Branch , 135 N.J.L. 549 (E.&A.1947), its basic predecessor case, insofar as the general principles of immunity are concerned. In this regard, the enabling legislation at issue in Tim contained a specific grant of immunity from local zoning restrictions. Thanet , on the other hand, involved enabling legislation which did not explicitly confer such immunity. The Thanet court, nevertheless held the immunity to be presumptive in the absence of statutory language to the contrary. See, also, Aviation

Services v. Hanover Tp. Bd. of Adj. , 20 N.J. 275 (1956). Thus, Thanet expanded the law of immunity to include all cases of ownership or lease by the government in which immunity was not specifically precluded by statute.

Here, plaintiffs seek a ruling that Thanet immunity applies even if the interest of the government in the property falls short of ownership or leasehold. In my estimation, nothing in Thanet supports plaintiffs' view, and important public policy considerations militate against such a wide-ranging extension of Thanet. I take this position in light of the language of the decision in that case which is limited on its face to ownership and leasehold interests. More important, in my estimation, is the fact that the common sense of the situation points to the same conclusion. There is no question but that the Federal Government has a concern with the subject of storage of its jet fuel. But plaintiffs' suggestion that that concern is, in itself, absent an ownership or leasehold interest, sufficient to bring the contract in this case within the immunity provisions of Thanet is irreconcilable with the underpinnings of zoning-immunity law. Zoning regulations are directed to the land itself, and in determining whether the important local interests which are reflected in a zoning scheme ought to be avoided by immunity, the pivotal question is the nature of the government's interest in the property and not the nature of the government's interest in the subject matter of the contract. Absent some kind of ownership or leasehold interest in the property, the government's philosophical concern with the subject matter of a particular contract is irrelevant to a claim of immunity.

Moreover, there are important policy considerations which undercut the expansion of Thanet suggested by plaintiffs here. These policies were expressed in the concurring opinion of Judge Carton in Thanet when he said:

Indeed, the broad principle enunciated by the majority cannot fail to encourage private lessors to invoke governmental immunity through leasing arrangement with state or federal agencies, thereby avoiding local planning considerations and ...


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