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Baker Residential Limited Partnership v. Township of Randolph

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


August 7, 2007

BAKER RESIDENTIAL LIMITED PARTNERSHIP; RANDOLPH MOUNTAIN PARTNERSHIP, A NEW JERSEY PARTNERSHIP, PLAINTIFFS-RESPONDENTS,
v.
TOWNSHIP OF RANDOLPH, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY; TOWNSHIP OF RANDOLPH PLANNING BOARD, DEFENDANTS-APPELLANTS.

On appeal from the Superior Court of New Jersey, Law Division, Morris County, L-2848-94.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued June 4, 2007

Before Judges Lintner, Seltzer and C.L. Miniman.

Defendants, Township of Randolph and Township of Randolph Planning Board, appeal from orders entered on December 15, 2003, May 26, 2004, and June 12, 2006. Essentially, those orders determined that the Law Division had jurisdiction to enforce a mediated settlement agreement that resolved disputes respecting the right of plaintiffs, Baker Residential Limited Partnership and Randolph Mountain Partnership, to construct a housing project with an affordable housing component within defendants' jurisdiction. The orders also provided that the project would be governed by the municipal codes in effect when the project was first approved in accordance with the settlement. We affirm.

Although we do not view the legal principles governing the resolution of this appeal as overly complex, the factual and procedural background necessary to an understanding of the issues require an extended recitation. Those facts are set forth in our prior unpublished opinion, Randolph Mountain Industrial Complex v. Planning Board of Randolph, No. A-845-OO (App. Div. June 5, 2002), and we quote relevant sections of that opinion to provide the background of this dispute:

[Plaintiffs] own[] a 60.8-acre tract in Randolph Township known as Lot 6 and Lot 9 in Block 199. The property has both wetlands and steep slopes. . . .

Prior to 1984, most of the site was zoned R-2, single-family residential, with a 25,000 minimum lot-area requirement; a portion of Lot 6 was zoned I-Industrial.

. . . As a result [of the Supreme Court decision in South Burlington County, N.A.A.C.P. v. Township of Mount Laurel, 92 N.J. 158 (1983)], a settlement agreement was entered into between the parties on August 31, 1984, under which the Township agreed to re-zone various parcels, including a portion of [plaintiffs'] property, for multi-family housing with a density of ten units per acre. . . .

On June 23, 1987, [plaintiff and defendant] entered into a COAH [Council On Affordable Housing] mediation agreement that included the subject property in [defendants'] fair-share plan. See N.J.S.A. [52:]27D-315a. Under that agreement, the Township agreed to re-zone forty acres of [plaintiffs'] property, primarily Lot 6, as "R-5 Multi-Family Residential District" for multi-family inclusionary development; the remaining portion of the subject property was to be zoned R-2. The agreement further provided that [plaintiffs] would be given permission to construct 276 units on the 40 acres, of which 55 units would be low- and moderate-income housing.

[Plaintiffs] had objected to the proposed zoning because it prohibited development above the 600-foot contour line of the site. However, an executive summary prepared by COAH dated September 22, 1987, recommending approval of [defendants'] application for substantive certification of its Housing Element and Fair Share Plan states that "[d]uring mediation, the Township agreed to provide relief from this agreement, if necessary, in order to permit the developer to construct 55 low and moderate income housing units as part of a 20% set aside."

. . . Thereafter, the Township adopted Ordinance #14-88, rezoning, inter alia, [plaintiffs'] property in accordance with the COAH mediation agreement and consistent with COAH's substantive certification.

On June 12, 1989, [defendants] passed a resolution approving the site-plan application of Randolph Mountain for construction of 232 multi-family units on the subject site, of which 48 would be affordable to low- and moderate-income families. The development was to take place on a 35.3-acre portion of the subject property within the R-5 zone. . . .

. . . However, the approved project became unbuildable because of subsequent determinations by the [Department of Environmental Protection], delineating larger areas of the property as wetlands and establishing the need for significant buffers and transition areas.

In November 1993, [plaintiffs] submitted an application to [defendants], seeking to amend the site plan approval granted by the Board on June 12, 1989. That application provided for construction of 165 multi-family units, 25 of which would constitute affordable low- and moderate-income housing units. Municipal officials advised [plaintiff] that the submission would be considered a "new" application, not an "amended" application. The import of such a determination is that it would subject the proposed project to then-current development regulations of the Township, most notably more restrictive steep-slope provisions.

On May 23, 1994, after two hearings, [defendants] ruled that [plaintiffs'] 1993 submission was a new, not amended, application and, therefore, [defendants'] current land-use and steep-slope ordinances would be applied. [Defendants'] steep-slope ordinance applicable to [plaintiffs'] 1993 submission created far more significant restrictions on [plaintiffs'] property then did the Township's prior steep-slope ordinance. . . . Application of the provisions of the 1994 steep-slope ordinance would make it impossible to construct the requested 165 units, including the 25 lowand moderate-income units.

. . . [On plaintiffs' application] COAH . . . determined that [defendants] could not apply the 1994 steep-slope ordinance to plaintiff's application.

However, because there were significant issues about the suitability of the site for inclusionary development because of the wetlands' problems, COAH directed the [parties] to engage in mediation in an attempt to resolve their dispute over the capacity of the subject property to provide at least 48 affordable housing units. The two issues submitted for mediation were:

(1) whether the site was suitable to provide at least 48 units of low- and moderate-income housing under COAH's standards, using the Township's ordinances in effect in 1989; and (2) whether plaintiffs may be permitted to go above the 600-foot contour line based upon the Township's representations in 1987 during the mediation that led to the parties' agreement.

[Randolph Mountain Indus. Complex, supra, at 2-8).]

The mediation failed and, on July 11, 1995, the matter was referred to the Office of Administrative Law for a hearing before an ALJ as a contested case. See N.J.S.A. 52:27D-315c.

The ALJ decided both issues in favor of plaintiffs and we affirmed. Randolph Mountain Indus. Complex, supra. In doing so we noted our agreement with the ALJ that a plain reading of the [1987 settlement] agreement requires the Township to provide relief from the 600-foot contour line if it is necessary to the construction of a development on [plaintiffs'] site that will meet Mount Laurel requirements. The extent to which such relief may be required or appropriate, and whether it may be accomplished by re-zoning, variances or waivers is a matter not before us.

[Id. (slip op. at 19).]

On August 15, 1994, plaintiff had filed a complaint seeking enforcement of the 1987 mediation agreement. The case was been stayed pending exhaustion of the COAH administrative process. Shortly after our decision was announced, a Law Division judge directed defendants to consider plaintiffs' site plan application in accordance with the Randolph Mountain Industrial Complex decision. Plaintiffs submitted a site plan application for the construction of 232 multi-family housing units of which forty-eight were affordable units.

Defendants thereupon advised plaintiffs that the Planning Board lacked jurisdiction to consider the 2002 site plan because "the bulk of the proposed 232 units is being developed on that portion of the property currently zoned R-1 (single family residential) . . . [and] multi-family development is not a permitted use in the R-1 zone." On April 22, 2003, defendant adopted a revised Housing Element and Fair Share Plan dated March 18, 2003, that eliminated plaintiffs' property from its list of sites for inclusionary development. It did so in reliance on N.J.S.A. 52:27D-311g, which was adopted in January 2002, and which permits "[a] municipality which has received substantive certification from the council, and which has actually effected the construction of the affordable housing units it is obligated to provide, [to] amend its affordable housing element or zoning ordinances without approval of the council."*fn1

On June 11, 2003, plaintiffs filed this complaint challenging, among other things, defendants' failure to conform its zoning to permit multi-family development of the site as contemplated by the 1987 COAH mediation agreement. On December 15, 2003, Judge B. Theodore Bozonelis preliminarily granted plaintiffs' motion for partial summary judgment subject to his consideration of COAH's position respecting his authority to enforce the 1987 agreement. His order provided that:

5. Defendants . . . shall permit [plaintiffs] to develop 48 low/moderate income units on the property . . . under COAH standards using [defendants'] land use ordinances in existence in 1989.

6. Defendants shall immediately re-zone the Property to permit Plaintiffs to proceed before the Planning Board for site plan approval.

7. Plaintiffs shall be permitted to develop the Property above the 600 (600') foot contour line, if necessary, and such relief is to be granted pursuant to paragraphs 5 and 6.

At the judge's invitation, COAH represented that

[i]t is COAH's position that in the current litigation between [plaintiffs] and [defendant], where the issues involve [defendant's] affordable housing obligation and how that obligation is to be fulfilled, such issues squarely rest within the exclusive jurisdiction of COAH as the result of the pending petition for substantive certification filed with COAH by [defendant]. To the extent the current litigation raises zoning or planning issues that do not involve the affordable housing plan pending before COAH, [the Law Division] clearly retains jurisdiction to hear those matters.

When the judge reconsidered his December order, COAH conceded that the Law Division retained jurisdiction "with respect to what action the planning board" was required to take and that COAH does "not have the authority to order a Planning Board to do anything." Although both defendant and COAH requested the judge defer his consideration of the complaint until COAH had reviewed the pending request for substantive certification without plaintiffs' property, the judge declined to do so. He reasoned:

[T]here is a difference between developing an affordable housing number, which is COAH's function, and enforcing an Appellate Division decision which relied on a mediated agreement, relied on by the Administrative Law judge and COAH, in terms of contractual rights . . . that have been developed over the course of fourteen years by . . . the developer here.

Of course there's an overlay, and of course they inter-relate, and of course this Court cannot tell COAH what to do, in terms of developing that number and whether it seeks to delete the site. But that is separate and apart from contractual rights that have been developed and are being pursued by the parties here, over a course of time.

[(Emphasis added).]

On May 26, 2004, he reaffirmed the relief granted in his December 15, 2003 order. Defendants appealed. As a result of a limited remand, Judge Bozonelis explained that his requirement that defendants "permit [plaintiffs] to develop 48 low/moderate income units on the property . . . under COAH standards using [defendants'] land use ordinances in existence in 1989" was meant to "put the parties back in the position they were in 1989" such that the 1989 ordinances would apply, the 1994 steep-slope ordinance would not apply, and plaintiff would be permitted to go above the 600 foot contour line to achieve affordable housing. It was not his intention to require construction of forty-eight affordable housing units because the number of units was not an issue before either the ALJ or the Appellate Division. Rather, the judge explained, he intended the parties to work out the actual number of units taking current environmental concerns into consideration.

He rejected defendants' claim that it should not be required to accommodate development at the property because it had satisfied its affordable housing obligation. The judge explained:

[I]t never was an issue where the town is saying Randolph Mountain is open space; we don't want any development there. They have always zoned this for development. And back in 1987 and in 1989 they had affordable housing obligations, and that's how they came up with allowing Randolph Mountain to do what they wanted to do. Then they get caught up in this litigation for 15 years.

Well the fact that Randolph has now satisfied or may have satisfied their affordable housing units does not give them relief from what is due the plaintiff[s] in that regard. And if they had more affordable housing units than they need, so be it. And our case law tells us that that's okay. You can have more housing than you need in that regard. That's a decision for COAH to make in terms of what affordable obligations there are. But COAH does not have jurisdiction to tell this Court how it's going to enforce an Appellate Division decision. That is for this Court to decide.

On appeal, defendants present the following arguments for our consideration:

POINT I

THE TRIAL COURT ERRED IN ADJUDICATING A MATTER FUNDAMENTAL TO THE TOWNSHIP OF RANDOLPH'S AFFORDABLE HOUSING OBLIGATION AND HOW THAT OBLIGATION IS TO BE FULFILLED OVER WHICH COAH HAD, AT THE BEHEST OF THE TRIAL COURT ITSELF, PROPERLY ASSERTED EXCLUSIVE JURISDICTION

POINT II

THE TRIAL COURT ERRED BY ACTING IN FUNDAMENTAL AREAS OF AFFORDABLE HOUSING EXCLUSIVELY RESERVED TO THE JURISDICTION OF COAH, AND IN SO DOING HAS BROUGHT ABOUT THE UNINTENDED CONSEQUENCE OF CAUSING CONFLICTING COURT ORDERS AND ADMINISTRATIVE DECISIONS

POINT III

THE TRIAL COURT ERRED IN ORDERING THE TOWNSHIP OF RANDOLPH TO ACT TO APPROVE THE CONSTRUCTION OF AN AFFORDABLE HOUSING WITHOUT ACTUAL NEED FOR ADDITIONAL AFFORDABLE HOUSING, AND IN SO DOING HAS ACTED CONTRARY TO THE ESTABLISHMENT OF GOOD AFFORDABLE HOUSING PUBLIC POLICY

Defendants' arguments amount simply to a claim that judicial enforcement of the parties' 1987 agreement is an unwarranted intrusion into COAH's responsibility to implement the Fair Housing Act, N.J.S.A. 52:27D-301 to -329, with its requirement for the provision of affordable housing. We recognize that COAH is the agency constituted to implement the Fair Housing Act. Holmdel Builders Ass'n. v. Twp. of Holmdel, 121 N.J. 550, 562 (1990).

Nevertheless, the judge's decision neither impinged upon the jurisdiction of COAH nor was it, as defendants claim, "inextricably intertwined" with the affordable housing issues before COAH. The settlement agreement was a contract, see Varano, Damian & Finkel, L.L.C. v. Allstate Ins. Co., 366 N.J. Super. 1, 8 (App. Div. 2004). The judge's orders amounted to nothing more than the routine enforcement of that contract.

Defendants remain bound by their agreement.*fn2 The obligation to permit construction in accordance with the 1989 ordinances and above the 600-foot contour line, to the extent necessary, does not arise from any obligation imposed by the Fair Housing Act to provide affordable housing.

Alexander's Department Stores of N.J., Inc. v. Borough of Paramus, 125 N.J. 100 (1991), held that the Law Division may entertain a challenge to a municipal ordinance even if it was adopted to implement a COAH substantive certification of the municipality's fair-share housing plan. Id. at 103. The Superior Court retains jurisdiction of suits "challenging municipal actions not directly related to the COAH proceedings themselves." Ibid. We view the action of the judge here to be only indirectly, if at all, related to the pending COAH proceedings and defendants' attempt to distinguish Alexander's is not persuasive. Nor does Sod Farm Associates. v. Twp. of Springfield, 366 N.J. Super. 116 (App. Div. 2004), assist defendants. That case involved the assertion of jurisdiction by the Law Division "to determine whether [a municipality] had satisfied its Mt. Laurel obligations by its affordable housing compliance plan, which was pending before COAH under the Fair Housing Act (FHA), N.J.S.A. 52:27D-301 et. seq., and whether a builder's remedy should be given." Id. at 118 (footnotes omitted). The situation here is quite different.

As Judge Bozonelis appropriately noted, the orders do not purport to direct COAH to maintain plaintiffs' property within the defendants' Housing Element and Fair Share Plan and does not speak to the effect upon the enforcement of the settlement should COAH grant defendants' application to amend its Fair Share Plan.*fn3 Judge Bozonelis did nothing more than direct the Planning Board to re-zone the property in accordance with its prior agreement and to consider an application for relief from restrictions affecting construction above the 600-foot contour line, to the extent necessary to permit construction of a project reasonably designed for the property onto which the parties agreed it could be placed.

We view the judge's action as nothing more than a run-of- the-mill enforcement of a settlement in light of the appellate panel's previous decision that the property remains suitable for inclusionary zoning and subject to the terms of the 1987 agreement. The propriety of enforcing that settlement was the only issue before Judge Bozonelis and is the only issue before us. The judge appropriately resolved the extremely limited issue before him, and we agree with his result and the rationale expressed in his oral opinions of October 24, 2003, April 16, 2004, and December 1, 2005.

Affirmed.


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