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Fallone Properties, L.L.C. v. Bethlehem Township Planning Board

June 11, 2004


On appeal from the Superior Court of New Jersey, Law Division, Hunterdon County, Docket No. L-346-01.

Before Judges Newman, Fall and Parrillo.

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


Submitted May 3, 2004

This is an action in lieu of prerogative writs. Defendant Bethlehem Township Planning Board (Board) appeals from a judgment of the Law Division reversing its denial of plaintiff Fallone Properties, L.L.C.'s (Fallone) application for major subdivision approval as arbitrary and unreasonable and on the basis that the Board's decision was made in executive session, in violation of the Open Public Meeting Act, N.J.S.A. 10:4-6 to -21 (OPMA). Plaintiff cross-appeals from the Law Division's denial of its application for automatic statutory preliminary approval.

The salient facts are as follows. On March 16, 2000, Fallone, the contract purchaser of a 115-acre parcel in Bethlehem Township, then used for farming, submitted an application for preliminary major cluster subdivision approval. The plan called for the property, to be known as Field Hollow, to be divided into twenty-six residential lots. Twenty-two of the lots were to be approximately 1.5 acres in size; two lots, approximately 2.5 to 2.8 acres in size; and one lot, approximately 7.386 acres in size. The remaining lot was to be approximately 66.73 acres in size, upon which would be located a dwelling, a detention basin and undeveloped open space.

The parcel comprising the Field Hollow development was located in the mountain residential (MR) district or zone, for which Bethlehem Township had recently established new zoning regulations. In 1999, after review and analysis of hydrogeologic and planning studies submitted by Bethlehem Township's experts, the Township Code was amended to require a minimum lot size of five acres. The Township Code, however, allows cluster developments on parcels of twenty-five acres or more in the MR district pursuant to the Cluster Ordinance, §102-13.1. In such cases, the Cluster Ordinance permits a minimum lot size of 1.5 acres provided that 70% of a development tract remains open space. In other words, the Cluster Ordinance, the goals of which are set forth in Section 102-13.1A, relaxed the minimum lot size but required larger open space reservation.

Thus, the Cluster Ordinance required that 80.6 acres of plaintiff's 115-acre tract remain open space. To satisfy this requirement, plaintiff proposed creating an open space lot of 63.157 acres*fn1, which would have comprised 54.8% of the tract area, and making up the resulting 15% shortfall by placing conservation easements on the rear of the residential lots. The proposal essentially involved an overlap of open space and usable portions of residential lots within the building envelopes, and would place more than one-half of many of the residential lots in conservation easements. Also, by placing them in the rear of the lots, the conservation easements would be located in areas that could include septic fields as well as usable yard enjoyment space. Notably, the site is already significantly constrained by wetland areas located in the southern, western and eastern border of the tract. Many of the proposed lots contain wetlands and/or surface waters, and the New Jersey Department of Environmental Protection (DEP) has or is expected to require a 150-foot transition area buffer for these wetland areas. The building envelopes on two of the residential lots are proposed to be located substantially in the buffer area. The application requires a wetlands averaging plan for three of the lots, and a permit to cross wetlands at the entrance.

At the hearing on plaintiff's application*fn2, the Board suggested, alternatively, that if three lots were eliminated as building lots and added to the open space, plaintiff's application would be within approximately 2% to 3% of complying with the 70% open space requirement. The remaining de minimis percentage could then be satisfied by placing conservation easements at the rear of the lots. In that case, the depth of such easements would be less than one-half of the required rear yard set back. Plaintiff, however, declined to modify its application to reduce the number of residential lots originally proposed. Its proposal remained that 24.23 acres of the 115.75 acres would be subject to construction activity, and 82.953 acres, including land depicted as conservation easements, would be set aside as open space, yielding a total of 72% open space.

The Board voted to deny preliminary approval of plaintiff's application. The Board interpreted the Cluster Ordinance, Section 102-13.1C, as requiring a single lot set-aside of 70% open space and the remaining 30% of the tract to be divided into lots meeting the area and yard requirements of the Code. Plaintiff's application fell short of this requirement, proposing lots in excess of the number of lots permitted under the cluster provision and of a density exceeding that allowed under the Code, requiring, in the Board's view, a variance pursuant to N.J.S.A. 40:55D-70(d)(5). Moreover, eight of the proposed lots would be severely constrained by wetlands and/or wetlands transition areas located on the lots, leaving very little usable area within the building envelope. In addition, the Board determined that certain bulk variances were required to resolve minimum lot frontage and maximum width issues. Thus, the Board concluded that plaintiff's application, as proposed, did not conform to the Township's zoning ordinance and that approving it would impair the intent and purpose of the zone plan and master plan.

On June 21, 2001, plaintiff filed a complaint in lieu of prerogative writs in the Law Division, challenging the Board's denial of its cluster plan application and asserting that, in any event, it was entitled to automatic statutory preliminary approval under N.J.S.A. 40:55D-48(c) because of the Board's delay in acting on its application. The trial court disagreed with the Board's interpretation of the Cluster Ordinance and held that the provision could be interpreted to allow plaintiff to satisfy any shortfall from the 70% open space requirement by the use of conservation easements on other lots. Accordingly, the trial court held that the Board's rejection of plaintiff's application was arbitrary and capricious, reversed the Board's denial of plaintiff's application, and remanded the matter to the Board. As an additional basis for reversal, the court ruled that the Board reached its decision to reject plaintiff's application in executive session, in violation of the OPMA. Finally, the court rejected plaintiff's argument that its plan was entitled to automatic statutory approval because plaintiff failed to demonstrate that the Board's inaction was the type of intentional or undue delay the statute was designed to remedy.

On appeal, the Board contends:



On cross-appeal, plaintiff argues:


It is well established that when a reviewing court is considering an appeal from an action taken by a planning board, the standard employed is whether the grant or denial was arbitrary, capricious or unreasonable. See Burbridge v. Mine Hill Tp., 117 N.J. 376, 385 (1990); Kramer v. Bd. of Adjustment, Sea Girt, 45 N.J. 268, 296 (1965); Med. Ctr. v. Princeton Zoning Bd. of Adjustment, 343 N.J. Super. 177, 198 (App. Div. 2001). The factual determinations of the planning board are presumed to be valid and the exercise of its discretionary authority based on such determinations will not be overturned unless arbitrary, capricious or unreasonable. Burbridge, supra, 117 N.J. at 385; Rowatti v. Gonchar, 101 N.J. 46, 51-52 (1985)."[T]he law presumes that boards of adjustment and municipal governing bodies will act fairly and with proper motives and for valid reasons." Kramer, supra, 45 N.J. at 296.

The purpose of judicial review is for the court to determine whether or not the board acted within the statutory guidelines and properly exercised its discretion. Burbridge, supra, 117 N.J. at 384-85. The reviewing court is not permitted to substitute its judgment for that of the board's. Kaufmann v. Planning Bd. for Warren Township, 110 N.J. 551, 558 (1988). A reviewing court is not to"suggest a decision that may be better than the one made by the board of adjustment or planning board, but to determine whether the board could reasonably have reached its decision." Davis Enters. v. Karpf, 105 N.J. 476, 485 (1987).

To be sure, a court is not bound by an agency's determination on a question of law, In re Distrib. of Liquid Assets, 168 N.J. 1, 11 (2001), and the court's construction of an ordinance under review is de novo. DePetro v. Township of Wayne Planning Bd., 367 N.J. Super. 161, 174 (2004). Nevertheless, we"give deference to a municipality's informal interpretation of its ordinances." Ibid. See also Wyzykowski v. Rizas, 254 N.J. Super. 28, 38 (App. Div. 1992), aff'd in part, rev'd in part, 132 N.J. 509 (1993). Thus, planning boards are granted"wide latitude in the exercise of the delegated discretion" due to their"peculiar knowledge of local conditions." Burbridge, supra, 117 N.J. at 385 (quoting Kramer, supra, 45 N.J. at 296). Indeed, local officials are"thoroughly familiar with their communities' characteristics and interests" and are best suited to make judgments concerning local zoning regulations. Pullen v. Township of South Plainfield, 291 N.J. Super. 1, 6 (App. Div. 1996) (citing Ward v. Scott, 16 N.J. 16, 23 (1954); Bellington v. Township of East Windsor, 32 N.J. Super. 243, 249 (App. Div. 1954), aff'd, 17 N.J. 558 (1955)).

Likewise, when reviewing the decision of a trial court that has reviewed municipal action, we are bound by the same standards as was the trial court. Fred McDowwell, Inc. v. Bd. of Adjustment of Township of Wall, 334 N.J. Super. 201, 212 (App. Div. 2000), certif. denied, 167 N.J. 88 (2001); Charlie Brown of Chatham, Inc. v. Bd. of Adjustment of Township of Chatham, 202 N.J. Super. 312, 321 (App. Div. 1985). Thus, while we will give substantial deference to findings of fact, it is essential that the board's actions be grounded in evidence in the record. E.g., Tomko v. Vissers, 21 N.J. 226, 239-240 (1956). Cf. Smith v. Fair Haven Zoning Bd. of Adjustment, 335 N.J. Super. 111, 120 (App. Div. 2000). By the same token, although we construe the governing ordinance de novo, we recognize the board's knowledge of local circumstances and accord deference to its interpretation. Somers Assoc. v. Gloucester Township, 241 N.J. Super. 323, 342-43 (App. Div.), certif. denied, 122 N.J. 355 (1990).


With these standards in mind, we consider the Board's rejection of plaintiff's preliminary cluster subdivision application as not in conformity with relevant provisions of Bethlehem Township's zoning code. For reasons that follow, we find the Board's construction of the Cluster Ordinance to preclude the use of conservation easements to make up a significant shortfall from the 70% open space requirement entirely reasonable and consistent with the overall goals of the zone plan.

The Cluster Ordinance expressly provides that the maximum number of lots permitted is to be determined by first establishing the requisite 70% open space. Indeed, section 102-13.1C of the Cluster Ordinance provides in relevant part: Procedure to determine density. The maximum number of lots permitted under the clustering zoning shall be determined by establishing the required ...

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