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Hudanich v. Borough Council of Borough of Avalon

Decided: December 23, 1981.


Steedle, Acting A.j.s.c.


This is a prerogative writ action wherein plaintiff Hudanich is challenging the validity of a special reasons variance and ordinance interpretation granted by defendants Borough Council of the Borough of Avalon (council) and Board of Adjustment of the Borough of Avalon (board) which benefited defendants-variance applicants Hunts Theatres, Inc. (Theatre) and Greenberg. The parties previously filed cross-motions for summary proceeding on the record. These motions were denied without prejudice in a letter opinion of this court, because factual issues existed as to plaintiff's second-count allegation that the variance meeting violated the Open Public Meetings Act, N.J.S.A. 10:4-6 et seq. The court invited the parties to enter into a stipulation of facts on this issue and upon renewal of the cross-motions the court would decide the case based on the record of the administrative hearings. The parties have entered into such a stipulation of facts and the cross-motions had been renewed. Accordingly, the case is now amenable for disposition.

The record reveals that defendants Theatre and Greenberg are owners of premises designated as Block 28.01, Lots 11.03, 11.01, 13.03, 13.04, 15.01, 15.02, 15.03, 17.01, 17.02, 17.03 and 18, on the tax map of Avalon. The premises consisted of a pier structure upon which rested a building composed of one 550-seat theatre and two stores. The pier structure is on the ocean or eastern side of the boardwalk, between 28th and 29th Streets of the borough, with beach on either side, north and south, and ocean to the rear of the pier. Defendants Theatre and Greenberg acquired this property from the Borough of Avalon on May 21, 1971 at a public auction.

The history behind the building situate on defendant Theatre and Greenberg's property is important to the disposition of this case. The structure itself is approximately 50 years old. From its inception the building had been used, at various times, as a theatre, bathhouses, luncheonette, gift shop, game room and skee-ball alley for the benefit of the public using the beach and boardwalk. When the property was deeded to Theatre and Greenberg in 1971 the deed contained two restrictions. The first was that the premises be used at all times to show movies and the second was that operation of restaurant and stores be continued. In the summer of 1979 Avalon removed the movie restriction but maintained the restriction as to the operation of the restaurant and stores. From 1971 until 1978 Theatre and Greenberg operated the premises as a theatre and skee-ball alley. During that period these defendants had to expend considerable sums in renovation of the building and supporting pier. In the fall of 1978 the theatre ended operations due to the cost of continued renovations and the decline of movie attendance by the public in the Avalon area. On March 8, 1979 Theatre and Greenberg received notice from Avalon that the theatre was declared an "unsafe structure" and thus could not be opened to the public without substantial repairs to the structure. Theatre and Greenberg received subsequent notices from Avalon to the same effect in April and December of the same year. On April 20, 1979 defendants Theatre and Greenberg received estimates from an engineer that the repairs necessary to make the theatre building comply with Avalon's building code would cost approximately $80,000. However, the building, even with these repairs, would remain in a rather dilapidated condition. At this point in time Theatre and Greenberg decided not to renovate the building, but rather tear it down and construct in its place seven stores.

On February 7, 1980 Theatre and Greenberg, each represented by counsel, appeared before defendant board seeking approval of a plan for construction of the seven stores. Also at the meeting was plaintiff Hudanich, who was also an owner of a

store located approximately 200 feet from Theatre and Greenberg's property. The theater-store structure is located in a public conservation (P-C) zone which does not permit a store use and does require a side-yard clearance of ten feet. Theatre and Greenberg's plan was incongruent with the zone in terms of use, and the side-yard clearance on the north side of the pier was eight, rather than ten, feet in length. Accordingly, Theatre and Greenberg's application entailed a use and side-yard variance.

The testimony presented by Theatre is important concerning the validity of the variance pursuant to statutory directives. William Hunt, an officer of Theatre, testified as to the decline in movie attendance, the decline of profits in operation of the theatre and that the building was declared an unsafe structure by Avalon. At this juncture the Avalon notices of unsafe structure were received into evidence by the board.

The next witness was another officer of Theatre, William Dry. Dry, besides discussing profit and loss figures with the board, also testified to the existence of the prior uses of the premises, e.g. , luncheonette, gift shop, game room and skee-ball alley. At this point Theatre presented its proposed plan, consisting of structural design, measurement and description, to the board. The plan was marked into evidence. The board noted that there were captions in the plan above each of the stores that were similar to the prior uses of the premises. Dry indicated these captions were not necessarily binding as to the use of each store. Upon questioning, Dry indicated that the stores, which would be leased, would not be utilized for any noxious purpose such as a fish store, and that there were certain guidelines upon which Theatre would not lease the stores. Nobody asked for further elaboration of these guidelines.

Finally, defendant Greenberg presented Harry Clayton, who was the fire marshall for Avalon for eight years and the construction code official of that community since 1977, as a witness. Clayton, from his personal knowledge and inspection of the building, testified in terms of life safety that the seven

stores as proposed would be more "palatable" than the existing structure. Clayton also testified, based on inspections of the building, that it should be torn down because the building could never be repaired to the point of complying with Avalon's codes. During the course of all of the above testimony there was no challenge by any member of the public, especially Hudanich, of any of the evidence presented.

During the course of testimony there was some confusion in ascertaining exactly in what zone the Theatre and Greenberg property was situated. Allen Lovegrove, a zoning planner for Avalon, testified that the property was indeed in a public conservation (P-C) zone.

At the conclusion of the testimony the counsel for all parties were permitted to summarize their positions. However, before the summations the Solicitor for the Board stated, "Before we go into executive session or open the deliberations up I think if [counsel] would like to make closing comments now is the time to do that." After the summations the chairlady of the board stated, "We will now go into executive session." The events transpiring during this "executive session" constitute the stipulations of fact agreed between the parties. The deliberations of the board at this point were conducted in the same room as the hearing and in full view of the public. Although the discussion of the board was not audible to all members of the general public, as many of them left their seats and formed small discussion groups or went into the hall outside the meeting room, anyone who wished to hear the deliberations was free to move toward the front of the meeting room and listen. This deliberation period lasted for about 15 to 20 minutes. During this period the stenographer did not record the deliberations but noted in the record, "Discussion during the executive session before the public takes place."

After this "executive session" the solicitor for the board recounted the discussion on the record. The content of this recount was the consensus of the board that Theatre and Greenberg's

plan application should be granted subject to ten conditions. Noteworthy among these conditions are that there must be a minimum of eight feet access area on the north side (the side yard) and that, other than specifically provided, the structure must be constructed in conformity to the plans Theatre and Greenberg submitted. The record reveals that "special reasons" criteria were utilized in the granting of the conditioned variance for the implementation of Theatre and Greenberg's plan. The record then reveals that, after some discussion, the board publicly voted unanimously to adopt the resolution granting the special reasons variance.

The resolution embodying the terms of the variance enumerates factual findings for the special reasons variance, notably, that safety will be improved by elimination of the theatre use. The resolution also states that the proposed use is consistent with prior uses and that the store use is consistent with beach use. It is important to note that during the course of the entire hearing the parties used the term "use" in reference to the application for variance; however, what was actually discussed was a use and side-yard variance as part and parcel of the submitted plan.

On February 15, 1980 Hudanich filed an appeal to the council contesting the variance. However, during the pendency of that appeal, on March 6, 1980, upon notice to Hudanich's attorney, Theatre sought certification before the board, under N.J.S.A. 40:55D-17(f), to permit demolition of the remaining portion of the partially destroyed building. The grounds of the certification were essentially that the building posed an imminent peril to life. Theatre, which worried that total destruction of the building would prejudice the nonconforming use status of the property if the appeal to the council was granted in favor of Hudanich, moved that either a stipulation be made that such total destruction of the building would not prejudice the nonconforming use status of Theatre and Greenberg's property or that the plan previously considered be deemed a "restoration" under the Avalon codes, thus making a variance unnecessary. Theatre

submitted this interpretation-restoration issue to the board at the February 7, 1980 hearing, but since the issue was not considered Theatre argued it could be revived at the certification hearing. The board heard extensive testimony as to the dangers presented by the remaining portion of the structure and also heard Theatre and Greenberg's counsels' arguments for the interpretation of the Avalon ordinance regarding the "restoration" status of the property plans. The board passed a resolution certifying that the building should be destroyed, that the structure plans approved at the February 7, 1980 hearing constituted a "restoration" and that a variance was not necessary. Hudanich had not appealed the results of the March 6, 1980 meeting to the council.

On April 7, 1980 defendant Council convened to consider Hudanich's appeal of the variances. The appeal was based on the record of the February 7, 1980 hearing, the arguments of counsel for all parties and the observations of one of the council members who stated in the record that he actually attended that variance hearing. Upon consideration of all the evidence the council affirmed the board's grant of the variance and a resolution to that effect was passed unanimously by the council.

On May 16, 1980 Hudanich filed a complaint for this instant action. However, the summons was served on defendants on May 29, 1980, or 13 ...

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