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Dalen v. Washington Township

Decided: July 18, 1990.

JOHN G. VAN DALEN, ON HIS OWN BEHALF AND AS CO-TRUSTEE WITH JOHN P. CHESTER OF CHESTER AND VAN DALEN ASSOCIATES, INC. EMPLOYEES' RETIREMENT TRUST, AND CHESTER AND VAN DALEN ASSOCIATES, A NEW JERSEY PARTNERSHIP, PLAINTIFFS-RESPONDENTS AND CROSS-APPELLANTS,
v.
WASHINGTON TOWNSHIP, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY LOCATED IN MORRIS COUNTY, NEW JERSEY, DEFENDANT-APPELLANT AND CROSS-RESPONDENT



On certification to the Superior Court, Appellate Division, whose opinion is reported at 232 N.J. Super. 205 (1989).

For affirmance in part and reversal in part -- Chief Justice Wilentz, and Justices Clifford, Handler, Pollock, O'Hern, Garibaldi and Stein. Opposed -- None. The opinion of the Court was delivered by Stein, J. Wilentz, C.J., and Clifford, Handler, Pollock, O'Hern, and Garibaldi, JJ., join in this opinion.

Stein

[120 NJ Page 236] This exclusionary-zoning case requires us to consider the use by the Council on Affordable Housing (COAH or Council) of the State Development Guide Plan (SDGP) in determining a municipality's

Mount Laurel obligation. The SDGP, compiled during the late 1970s and released in May 1980, is scheduled to be replaced by the State Development and Redevelopment Plan (SDRP) in 1993. L. 1985, c. 398. Plaintiff, John G. Van Dalen, challenges the interim use of the SDGP in defendant, Washington Township (the Township), claiming that the "growth" area delineation in the municipality is inadequate and based on outdated information. Van Dalen seeks to expand the growth area and to increase the Township's "fair share" burden so that his property can be considered as a site for any additional Mount Laurel obligation. COAH granted substantive certification to the Township's housing element and fair-share plan, and denied the developer a builder's remedy.

The Appellate Division affirmed the denial of a builder's remedy but vacated the grant of substantive certification. 232 N.J. Super. 205, 556 A.2d 1247 (1989). The court reviewed "the history and limitations of the SDGP * * *" and concluded that Van Dalen should be given the opportunity to present evidence at a hearing concerning the size of the growth area and the SDGP's reliability as a planning tool. Id. at 211, 556 A.2d 1247.

We granted the Township's petition for certification, 117 N.J. 631, 569 A.2d 1333 (1989), and Van Dalen's cross-petition for certification addressed to his entitlement to a builder's remedy. 117 N.J. 632, 569 A.2d 1333 (1989).

We affirm so much of the Appellate Division judgment as denied Van Dalen a builder's remedy, but reverse the judgment to the extent that it vacated the Township's substantive certification and remanded for a hearing on the appropriateness of COAH's reliance on the SDGP.

I.

Van Dalen owns two parcels of land comprising approximately 127 acres in Washington Township. He applied for a permit to build multi-family dwellings on the property, including the construction of low- and moderate-income housing units. Because

the intended use did not comply with the Township's zoning laws, Van Dalen applied for a variance. While that application was pending, we rendered our decision in Southern Burlington County N.A.A.C.P. v. Mount Laurel, 92 N.J. 158, 456 A.2d 390 (1983) (Mount Laurel II). The zoning board subsequently denied Van Dalen's application for a variance. In July 1983 Van Dalen commenced this litigation, claiming that the Township's land-use ordinances were unconstitutional and that he was entitled to a builder's remedy under Mount Laurel II.

The Law Division first concluded that a portion of the Township contained a "growth area" as designated in the SDGP. The court subsequently determined that the Township's total regional fair-share obligation was 227 units. 205 N.J. Super. 308, 332, 500 A.2d 776 (1984). In addition, the court held that the Township's zoning laws were invalid under the Mount Laurel doctrine because they "fail[] to provide a realistic opportunity for construction of the 227 housing units it is obliged to provide." Id. at 344, 500 A.2d 776. The court ordered the municipality to rezone within ninety days. Id. at 345, 500 A.2d 776.

In July 1985 the Legislature enacted the Fair Housing Act. L. 1985, c. 222 (codified at N.J.S.A. 52:27D-301 to -329). The Fair Housing Act established the Council on Affordable Housing, N.J.S.A. 52:27D-305a, and gave the Council the responsibility for determining whether a municipality's proposed ordinances will satisfy its Mount Laurel obligation. The Township moved to transfer the case to COAH. See N.J.S.A. 52:27D-316(a).

In October 1985 the Law Division denied the transfer motion. Based on our subsequent holding in Hills Dev. Co. v. Township of Bernards, 103 N.J. 1, 510 A.2d 621 (1986), the court reconsidered its decision and transferred the case to COAH in April 1986. The Appellate Division affirmed, and we denied certification. 110 N.J. 162, 540 A.2d 164 (1988).

In January 1987 the Township filed its housing element*fn1 and fair-share plan with COAH. See N.J.S.A. 52:27D-309a. The plan sought to satisfy the Township's Mount Laurel obligation by zoning two sites for inclusionary development, neither owned by Van Dalen. The filing was considered a petition for substantive certification because of the Township's status as a court-transferred municipality. See N.J.A.C. 5:91-4.2. Van Dalen objected to the Township's plan, claiming that the size of the Township's growth area was understated by the SDGP, and that the Township's fair share of low- and moderate-income housing should be increased.

COAH initiated the Fair Housing Act's "mediation and review" process to resolve the dispute. See N.J.S.A. 52:27D-315. After mediation efforts proved unsuccessful, COAH transferred the matter to the Office of Administrative Law (OAL) as a contested case. See N.J.S.A. 52:27D-315c.

In July 1987 an Administrative Law Judge (ALJ) rendered an initial decision denying Van Dalen's request for a builder's remedy. The matter was transferred back to COAH on August 19, 1987, for final disposition. COAH informed Van Dalen that it would "not entertain arguments regarding the extent of the growth area as established in the [SDGP] * * *." The Council stated that it would, however, hear testimony concerning any computational error "involving the accuracy of the local growth acreage measurement * * *." Van Dalen also sought a builder's remedy from COAH but was denied relief in January 1988.

COAH granted the Township's petition for substantive certification in February 1988. The plan provided for the inclusionary development of a five-hundred-acre site that did not include Van Dalen's land.

The Appellate Division affirmed the denial of a builder's remedy, but reversed and remanded the matter to COAH to determine whether the SDGP could conclusively establish the extent of a municipality's growth area:

We are satisfied that plaintiff does not assail the reasonableness of COAH's determination to utilize the SDGP, so long as it is treated as only one factor among others in its allocation methodology. In plaintiff's words, however, what is at issue is 'COAH's rigidity in not permitting any party to challenge the reasonableness of a particular SDGP designation as applied to a given municipality.' * * * From our review of the history and limitations of the SDGP as perceived by the Supreme Court, we have no doubt that plaintiff should be allowed an opportunity to question its reliability as a planning tool in this particular instance. Factual questions concerning delineation of defendant's growth area are ...


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