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City of Cape May v. Coldren

February 25, 2000

CITY OF CAPE MAY, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT,
v.
J. FRED COLDREN, DEFENDANT/THIRD-PARTY PLAINTIFF-APPELLANT, AND EDWARD J. MAHANEY; ROBERT W. ELWELL, SR.; WILLIAM G. GAFFNEY; JOHN BAILEY; THOMAS M. PHELAN; AND JOHN DOES 1-10, THIRD-PARTY DEFENDANTS.



Before Judges Stern, Kestin and Steinberg.

The opinion of the court was delivered by: Stern, P.J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued November 4, 1999

On appeal from the Superior Court of New Jersey, Chancery Division, Cape May County.

Defendant, J. Fred Coldren, appeals from a final judgment entered on May 18, 1998 in favor of plaintiff, City of Cape May, in the amount of $20,540.41. An award of $19,046.72 in favor of defendant on his counterclaim was offset by an award of $39,587.13 to plaintiff for legal fees and costs based on defendant's non-acceptance of an offer of judgment, *fn1 resulting in the net award to plaintiff. Defendant also appeals from the June 19, 1998 order denying his motion for reconsideration.

Plaintiff commenced this action seeking a declaratory judgment that defendant had no tenure rights as its City Manager, because the position was abolished when the city changed its form of government. Defendant counterclaimed seeking a declaration of tenure and reinstatement as City Manager, and asserted a breach- of-contract claim. *fn2 After the trial judge ruled in favor of the city on the tenure issue and other counts of the counterclaim were dismissed, the city made an offer of judgment with respect to the remaining count of the counterclaim, but defendant rejected it and prevailed at the trial.

On this appeal, defendant claims that he "Earned Tenure as City Manager in January 1983 pursuant to N.J.S.A. 40:82-3(a);" that regardless of whether he received statutory tenure, the plaintiff-municipality was "barred from challenging Defendant's established tenure as City Manager" because his tenure status was already addressed in prior litigation between the parties, and that, in any event, "N.J.S.A. 40:69A-207 protected Defendant's office from being abolished without due process." Independently, defendant contends that the plaintiff's offer of judgment directed only to one count of his counterclaim, count two seeking, inter alia, insurance coverage, "overtime and compensatory benefits," "unused vacation and sick days" and reimbursement of expenses, did not apply because the "piecemeal" offer was not designed to settle all claims.

In his May 3, 1996 order, the trial judge granted plaintiff's motion for partial summary judgment premised on his determination that the office of City Manager was abolished by a change in form of government approved by voters, effective July 1, 1995. The ruling on the contract counterclaim followed the subsequent trial, at which the judge concluded that defendant was entitled to $19,046.72 for unused vacation, sick and personal leave time. No issue is raised on this appeal with respect to the trial or that finding.

I.

We agree with the trial judge, substantially for the reasons he stated, that defendant was neither entitled to tenure nor to reinstatement to his position as City Manager. The judge concluded that because defendant's 1980 appointment as City Manager was indeterminate, and his reappointment was made before the end of his first three years in office and after the adoption of N.J.S.A. 40:82-3, which abolished tenure for that position, defendant did not achieve tenure before his discharge. In any event, the trial judge found that the change in the form of government from municipal manager to "Small Municipality Plan A" pursuant to N.J.S.A. 40:69A-115 et seq., effective July 1, 1995, was dispositive of the issue. *fn3

N.J.S.A. 40:69A-207 does exempt from the abolition of office "any official or employee now protected by any tenure of office law" as defendant contends. But we agree with the trial judge that N.J.S.A. 40:69A-207 cannot be interpreted to provide continued tenure in these circumstances because there would be no meaningful result flowing from the change of Cape May's form of government if its City Manager remained tenured in that position despite the new form of government which abolished the office. As stated by the judge:

In our case the public has spoken very clearly with respect to this particular issue, and the public has indicated its position that this office, this form of government is no longer to be operative in the City of Cape May. The voters of the City of Cape May have determined to change their form of government, and the council people that have been elected into office were mandated to implement that change.

The ordinance which was passed in July of 1995 did in fact implement that change and abolished the office of municipal manager. Instead, the essential powers of the municipal manager's position are now to be employed by the mayor, an elected position. Those two positions, that is, the position of city manager and the position of mayor under the Small Municipality Plan A form of government, are inconsistent, they are incompatible, and they cannot coexist. Were Mr. Coldren's legal position to be adopted, those two would somehow have to exist side by side, which would produce either confusion or chaos, neither of which I believe to be intended by the legislature, or the people of Cape May, or required by the law as I understand it.

However, in reading the statute [N.J.S.A. 40:69A-207] in attempting to be consistent with its overall purpose, it is my view that it should not be read to have mandated a municipality to continue an office, a policy making office, a high level office such as city manager, upon a change of government that itself has at its very core and purpose the elimination of that position. To allow that municipality to make that change of government on the one hand and then to take away the benefits of that change on the other is a reading that I do not believe is ...


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