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S&S Auto Sales, Inc. v. Zoning Board of Adjustment for the Borough of Stratford

December 22, 2004


On appeal from the Superior Court of New Jersey, Law Division, Camden County, L-7969-02.

Before Judges Conley, Braithwaite and Lisa.

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


Argued November 4, 2004

This appeal requires determination of whether a nonconforming use has been abandoned and the standard by which that determination should be made. Applying a subjective test, the Stratford Zoning Board of Adjustment (Board) found that the owner did not establish the intention to continue the use, and declared the right to the use terminated. The Law Division affirmed, but applied an objective test of abandonment, without regard to the owner's intent. We hold that the Board applied the correct test, but the result it reached is not supported by the evidence. We further hold that the test applied by the Law Division is not authorized under New Jersey law. We therefore reverse.


Because our decision rests in part on an evaluation of the Board's factual findings, it is necessary that we set forth in some detail the facts. S&S Auto Sales, Inc. (S&S) began operation of a used car dealership at 1010 South White Horse Pike (Route 30) in Stratford in 1993. Prior to that time, the premises were devoted to the same use. The location is a corner property measuring 200 feet by 200 feet on a busy commercial highway. It contains a freestanding building, two large freestanding signs and a sixty-foot flagpole. The paved lot can hold thirty-five to forty cars for display. The building is set up with small offices for use by car salespersons, and contains large plate glass showroom windows. Typical of an automobile dealership operation, the building is relatively small and surrounded by a large lot. Important to such an operation is the visibility resulting from substantial frontage on a busy highway.

The property is in a C-Commercial Zone. There is no dispute that when the automobile dealership was initially established, at some undisclosed time before 1993, it was a permitted use. Under the current zoning regulations, a car dealership is not a permitted use.*fn1 S&S operates several automobile dealerships in the Stratford area. In 1995, S&S entered into a fifteen-year lease-purchase agreement with the owner of the property, permitting S&S to purchase the property for one dollar at the end of the lease term. Thus, S&S is the property's equitable owner. S&S continuously and actively sold cars from the site from 1993 until the summer of 2001.

In August 2001, lacking sufficient trustworthy employees to staff the Stratford site, S&S removed the inventory of vehicles to its other locations and ceased sales operations at Stratford.

S&S also removed two metal ramps used to display featured vehicles in an elevated position. Several cement bumpers were moved from the back of the lot and positioned to block the driveways, preventing vehicular access to the lot. No other exterior changes were made. The signs and flag pole remained in place, as did the banners that adorned the front of the property. The signs were continuously lit at night at all times after August 2001.

On October 24, 2001, the attorney for Stratford's Planning Board wrote to S&S, confirming that business operations had ceased, acknowledging the nonconforming use status, and advising that"subject to any additional information received" the Borough"considers that neither [the legal owner nor S&S] have an interest in maintaining the use for the subject property." The letter invited advice to the contrary. S&S's attorney responded on November 8, 2001 that S&S"does not intend to abandon its right to utilize the property for used car sales" and"intends to resume operations in the very near future on the property. They have no present plans to use the property for any other purpose." On November 15, 2001, the Planning Board attorney confirmed receipt of the letter on behalf of S&S, expressed"the Borough's interest to have a pre-existing nonconforming use no longer in operation" and stated"the Borough will continue to monitor the situation."

In July 2002, S&S did not receive in the mail from the Borough the customary forms for annual renewal of the business and signage licenses. On July 15, 2002, S&S made a written inquiry requesting the forms and informing the Borough it"still intend[ed] to operate this location for automotive sales." After several weeks with no response, Angela Shtutman, a principal of S&S, went to the municipal building to follow up on the request. The Zoning Board secretary informed her the Borough deemed the nonconforming use abandoned and she would have to appear before the Board for a determination of the issue. Borough officials refused to process any license renewal applications.

S&S promptly applied to the Board, seeking a determination that it had not abandoned its nonconforming use.*fn2 The Board conducted a hearing on September 26, 2002, at which Shtutman explained in detail S&S's activities with respect to the Stratford site over the previous thirteen months. By August 2001, the number of employees staffing the Stratford site had dwindled from five to one. After unsuccessful efforts to find suitable help to run the facility properly, operations were stopped. Throughout the remaining months of 2001, S&S advertised for help. Its preference was to obtain a partner, who would have an equity interest. Six to twelve people were interviewed during those months, but no arrangement resulted. These efforts were consistent with S&S's representations to the Borough in November 2001 that it intended to resume operations in the near future.

By January 2002, S&S decided to change course. Rather than resuming the operation, individually or with a partner, it would attempt to sublease or sell the property. All marketing efforts were directed at car dealers or prospective car dealers only, and the property was marketed only as an automobile dealership facility. The property was offered as a"turn key" operation, with all furniture, equipment and supplies included for immediate initiation of business. The advertisements stated that the use complied with local zoning.

Shtutman described the various marketing techniques used and produced corroborating documentation, including copies of the ads and billing records. Initially, S&S sent out two waves of mailers to all new and used automobile dealers in the tri state area. These contained a picture of the property and other information and advertised the property for lease, with a monthly rent specified. Shtutman also distributed these ads three times a week at automobile dealer auctions.

Next, S&S engaged the services of a marketing company that made three waves of fax solicitations to about 532 used and new automobile dealers in the tri-state area. These were sent on March 25, April 1 and May 10, 2002. They offered the property for lease or sale, with amounts specified. The lease amount was about 10% lower than in the earlier ad. In May or June, S&S also advertised the property in the Shopper Auto Mart, a car magazine distributed without charge to the public at convenience stores, fast food restaurants, and similar establishments.

At the hearing, Shtutman stated S&S was continuing its marketing efforts, but also expressed the possibility that if efforts continued to be unsuccessful S&S would resume the operation. S&S was an active business entity, operating other car dealerships in the immediate area. Throughout the thirteen-month cessation of operations at Stratford, S&S kept its lease-purchase agreement current. By that time, it was about one-half way through the fifteen-year agreement and had a substantial stake in preserving the nonconforming use status of the property.

During the thirteen months, S&S maintained electricity and water service, and, as we have stated, lit the signs every night. Real estate taxes were kept current. In the spring of 2002, the telephone service was discontinued, and in September 2002, the yellow pages ad was not renewed for the upcoming year. Of course, the telephone service was not needed during the cessation of operations, and because it was still S&S's primary goal to lease or sell the property to a third party, renewing the yellow pages ad was not deemed necessary.

S&S did not remove any contents from the building. All telephone equipment and the attendant paging system were left intact. The computers, set up specifically for automobile dealership use, remained on the premises, although they were placed in the attic for security reasons, because on the first floor they would be in plain view through the large windows. All furniture, file cabinets, forms, equipment and supplies needed to operate the business remained on the premises.

Throughout the thirteen months, S&S paid a company to provide weekly lawn and landscape maintenance. It kept the property insured, and the policy it produced for the Board was in effect from November 2001 to November 2002, and designated the"Business Description" as"USED AUTO DEALER." The placement of the concrete bumpers was to prevent people from driving through or parking in the lot. The ramps were not necessary for operation of the business; they were removed to prevent their theft. Of course, the concrete bumpers could be moved in minutes and, if desired, the ramps could be returned in short order.

Shtutman steadfastly informed the Board the cessation of the automobile dealership use was always intended to be temporary and, with everything left in place, the use could again"be operational in two days." Throughout the thirteen months, the property was never used for any other purpose. No equipment was brought onto the property to render it useable for other purposes. No efforts were ever made to sell or lease it for any other purpose. No physical changes were made to the property.

At the conclusion of the hearing, the Board's attorney instructed the members on the legal ...

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