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City of Asbury Park v. Asbury Park Towers

August 8, 2006

CITY OF ASBURY PARK, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT,
v.
ASBURY PARK TOWERS, DEFENDANT-RESPONDENT, AND THE PRESBYTERIAN HOME OF ASBURY PARK; NEW JERSEY HOUSING FINANCE AGENCY; THE CITY OF ASBURY PARK SEWERAGE AUTHORITY; THE CITY OF ASBURY PARK; AND THE STATE OF NEW JERSEY, DEFENDANTS. ASBURY PARTNERS, LLC, APPELLANT.



On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, L-2915-05.

The opinion of the court was delivered by: Axelrad, J.T.C. (temporarily assigned).

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

APPROVED FOR PUBLICATION

Argued: June 6, 2006

Before Judges Skillman, Axelrad and Payne.

This appeal raises the issue of whether a private entity that is contractually obligated to pay the amount of a condemnation award is entitled to intervene as a party in the condemnation action and participate in a plenary manner in the valuation proceedings. The private entity in this case is appellant, Asbury Partners, LLC, which has contracted with the City of Asbury Park (the "City") to redevelop the City's waterfront. We hold that Asbury Partners may not intervene as of right pursuant to Rule 4:33-1, because it has made no showing that the condemning authority does not adequately represent its interest. We further hold there was no abuse of discretion in the denial of permissive intervention pursuant to Rule 4:33-2. Accordingly, we affirm the order of the Law Division judge denying intervention in the condemnation action.

The City, which had been a thriving seaside community, declined physically and economically in the second half of the twentieth century following the growth of the suburbs, the development of shopping malls and the completion of the Garden State Parkway in the 1950s, which made it easier to by-pass the City. In November l984, following an investigation and the conclusion that the twenty-eight block oceanfront area extending generally from Wesley Lake to Deal Lake was blighted and in need of renewal, the City adopted an ordinance approving a waterfront redevelopment plan. The first plan did not succeed and was amended, but that plan was also unsuccessful because the developer filed for bankruptcy in 1992. All work in the redevelopment area then ceased.

On June 5, 2002, the City adopted by ordinance a new Waterfront Redevelopment Plan ("WRP"), a long-term, comprehensive plan to redevelop the blighted waterfront, with the projects designed to be accomplished through a master developer.

On October 28, 2002, the City and Asbury Partners entered into an Amended and Restated Developer and Land Disposition Agreement ("Redeveloper Agreement"), which designated Asbury Partners the Master Developer of the WRP. The Redeveloper Agreement sets forth the obligations of both parties and provides a framework for implementation of the WRP. Pursuant to the Redeveloper Agreement, Asbury Partners is obligated to acquire properties necessary for implementation of the WRP and, if Asbury Partners is unsuccessful in negotiating the purchase, the City is obligated to acquire by eminent domain any required parcels. Both parties are obligated to "[a]ssist with and participate in a coordinated defense in the event of litigation," and the City is obligated to "[u]tilize the right of eminent domain on behalf of [the] Master Developer and in connection therewith retain specific appraisers to be approved by the Master Developer."

Pursuant to the Redeveloper Agreement, Asbury Partners bears all of the costs of the land acquisition process, including the purchase price of the assembled parcel and all the costs associated with either negotiating or condemning the property, including reimbursing the City for all costs it incurs. Asbury Partners is also obligated to fund and undertake the major reconstruction of the City's infrastructure required to implement the WRP. According to the certification filed in the trial court, Asbury Partners and its predecessors in interest have already expended approximately $33 million in furtherance of the City's overall redevelopment to procure the redevelopment rights from the City, assemble land for development*fn2 and assist the City in the WRP's implementation.

Respondent Asbury Park Towers is the owner of Block 208, Lot 3, a vacant lot located at 1611 Ocean Avenue in Asbury Park. The property is in the R-5 (Multifamily High Density) Waterfront Redevelopment Zone. It was previously used as a parking lot serving the nearby twenty-six-story Asbury Tower apartment building, which is not in the Redevelopment zone. Pursuant to the Redeveloper Agreement, the block comprising the former Monterey Hotel property, which includes Block 208, Lot 3, was given priority and placed on the "fast track" for development under the WRP. Accordingly, in November 2003, Asbury Partners attempted negotiations with Asbury Park Towers for acquisition of the vacant lot. Private negotiations were unsuccessful, and Asbury Partners requested that the City acquire the land by eminent domain.

With consent of Asbury Partners, the City retained Donald M. Moliver to appraise Block 208, Lot 3. Following unsuccessful negotiations with the owner, the City filed a condemnation complaint on July 1, 2005. On July 7, 2005, the trial judge signed an order requiring the City to deposit the $240,000 appraised value of the subject property into court and scheduled the return date of the order to show cause conferring jurisdiction for the acquisition of the property and the appointment of commissioners to fix the compensation. Asbury Towers filed an answer denying the City's authority to condemn on the ground that it failed to engage in bona fide negotiations as required by N.J.S.A. 20:3-6 and that the acquisition of the parcel was not necessary for redevelopment purposes.

Asbury Partners moved to intervene in all aspects of the case, claiming it had a unique and unprotected interest.*fn3 The City did not object to the intervention.

Following oral argument on the order to show cause and intervention motion, the Law Division judge determined that the City had engaged in bona fide negotiations pre-litigation and had duly exercised its authority to condemn. He also found the public need for the subject property had been demonstrated by the City's WRP. He entered an order to that effect and fixed the date of valuation and appointed commissioners. In an unpublished opinion being filed ...


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