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Britt v. Camden Redevelopment Agency


February 28, 2008


On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket No. 1892-04.

Per curiam.


Submitted January 22, 2008

Before Judges Sabatino and Alvarez.

The City of Camden ("the City"), the Camden Redevelopment Agency ("the CRA"), and several individuals affiliated with the CRA each appeal*fn1 a judgment of the Law Division ordering the transfer of certain realty in Camden to Curtis Britt, d/b/a Sunshine Liquors ("Britt" or "plaintiff"). The judgment enforced an alleged settlement of a long-standing dispute between Britt, the City and the CRA.

Because the property conveyances were not voted on and duly approved in a valid manner by the governing bodies of the public entities, we vacate the judgment and remand for further proceedings. The judgment also must be vacated because there is inadequate proof of mutual agreement on all material terms of the putative settlement.


Britt, a former Camden firefighter, owns Sunshine Liquors, at 314 South 3rd Street in Camden. In 2002, Britt sought to purchase from the CRA vacant property adjacent to his store, hoping to create additional parking and possibly open a take-out restaurant. The property in question consists of six vacant lots on the south side of Stevens Street, between 3rd and 4th Streets.

A contract for the six parcels, signed by Britt on April 24, 2002, and by the CRA on June 14, 2002, listed the purchase price as $7600 for the entire property. The CRA Board had previously adopted a resolution in October 2001, which purported to authorize the sale of the property to Britt. However, the sale was never consummated because, at some point after Britt and the CRA signed the contract, it came to light that the property was owned by the City, rather than by the CRA.

Britt claims that, upon learning this, he contacted the City's Department of Planning and Development, whose staff allegedly told him that the City did not own the property. Britt contends that the ownership of the property was disputed over the next two years, with neither the CRA nor the City claiming ownership. The City denies this allegation, and contends that its ownership of the property was never disputed.

In the meantime, Britt went ahead with plans to expand his business by filing an application for a zoning permit to operate a restaurant on the property in October 2002, and filing for use and bulk variances with the Zoning Board of Adjustment in February 2003. The variances were granted on the condition that Britt acquire the property.

Britt contends that the CRA "repeatedly represented" to him that it was taking steps to acquire title to the property so that it could execute the sale. In April 2003, Britt sent a letter to the Bureau of City Properties, offering to buy the property for $5000 and enclosing a $500 deposit. He claims that he received no response from the City.

Britt then filed a complaint in the Law Division in March 2004. His complaint named as defendants the CRA, its individual officers and board members, and the City, as well as the Mayor of Camden and individual members of the City Council. The complaint was later amended to designate CRA Chairman Melvin R. Primas, who was already an individual defendant, in his additional capacity as the Chief Executive Officer of the City. The amended version of the complaint also named defendant Arijit De, the CRA's Executive Director, in his additional capacity as the City's Director of Development and Planning.

The complaint principally alleged breach of contract, arising out of the City's failure to convey the property to the CRA and the CRA's concurrent failure to execute the sales contract it had entered with Britt. The complaint also alleged that defendants Primas and De had engaged in discriminatory acts by causing the public entities to refuse to sell the property to Britt, supposedly because he is African-American, in violation of the New Jersey Law Against Discrimination, N.J.S.A. 10:5-1 to -49, and a provision of the federal Civil Rights Act, 42 U.S.C.A. § 1981. Britt requested specific performance of the contract, as well as money damages.

Negotiations between Britt and the CRA continued while the lawsuit was pending. On November 29, 2006, the CRA's attorney sent a letter to Britt offering, by way of settlement, to convey the property to him "with the express understanding that the CRA retains an option and right of first refusal to purchase the [property] from [p]laintiff or his estate at a fixed price . . . ." The CRA also proposed to pay Britt the sum of $107,000 "for all lost profits alleged in his expert and supplemental expert report." In turn, Britt would have to agree to "dismiss the litigation with prejudice."

The relevant portion of the letter stated:

I am writing to confirm the terms of a settlement offer that the solicitor for the CRA . . . is willing to propose to the [CRA] Board [m]embers for their vote at the caucus meeting scheduled on Thursday, November 30, 2006. It is necessary to know if [Britt] is or is not willing to accept these settlement terms . . . . If he is, they will be presented to the CRA Board [m]embers for vote.

Britt's attorney sent a reply letter on the morning of November 30, 2006, stating that his client accepted the proposed settlement terms. In the course of that letter, Britt's counsel stated to the CRA's attorney, "[i]f the CRA Board of Commissioners votes to approve the settlement, I assume that you will prepare the general releases."

The matter was brought before the CRA Board at its regularly scheduled caucus meeting later that evening, November 30. Although the CRA's brief on appeal concedes that the Board members at the meeting "opined in favor of" the settlement terms with Britt, the CRA maintains that there was never a formal vote by the CRA Board to agree to the settlement. Britt's attorney, conversely, has asserted that "the CRA Board . . . voted at a duly convened and noticed open public caucus meeting [on November 30, 2006] to approve the settlement . . . ."*fn2

The events of the following day, December 1, 2006, are the subject of major disagreement. It is apparent that a flurry of telephone calls and discussions took place that day among the attorneys for the three parties: Morris G. Smith for Britt, Gene R. Mariano for the CRA, and Assistant City Attorney Mark Cieslewicz for the City. Their respective accounts of the conversations vary substantially.

Smith alleges that Mariano called early in the morning of December 1 to inform him that the CRA had agreed to the settlement terms, and that "there would be no need to appear in court" for a hearing scheduled later that day on a pretrial motion that had been filed by the CRA. Smith then allegedly contacted Lewis Wilson, the City Attorney and Cieslewsicz's supervisor, to inform him that Britt and the CRA had settled.

In his own certified account of the events, Cieslewicz recalls that, when he arrived at his office at 10:00 a.m. on December 1, Wilson informed him that Smith had called to discuss a settlement with the City. Smith advised Wilson that Britt wanted a monetary contribution from the City defendants to settle his separate claims against them. Wilson then allegedly instructed Cieslewicz that the City would not settle with Britt. Cieslewicz also spoke with Mariano that morning, who confirmed that "the CRA had reached an agreement to settle with [Britt]."

During an ensuing telephone conference that morning among counsel for all parties, the City's and the CRA's representatives supposedly informed Smith that the settlement terms that his client had agreed to with the CRA were intended to resolve the entire dispute, and that there would be no settlement unless it also included the City. Specifically, Smith was allegedly told that the City would not pay any money to settle the case.

It was at this point in the attorneys' three-way conversation that Cieslewicz evidently stated that the "properties were the City's contribution to the settlement." Smith construed this statement to mean that the City agreed to convey the property to the CRA as part of the settlement. However, in his later certification, Cieslewicz maintains that he did not intend his statement to counsel about the City's "contribution" to constitute a formal offer. Rather, Cieslewicz contends that he had made the comment under the mistaken belief that the CRA had already obtained approval from the City to transfer the properties to the CRA. On this significant point, Cieslewicz certified that, "[a]t no time during the pendency of this case did I ever seek authorization to try and settle this matter by offering to transfer [the property] . . . nor was such authority ever extended to me."

Later on the morning of December 1, Britt agreed to what he perceived to be a "global settlement" offer, and, through his attorney Smith, he informed Mariano of his acceptance. Mariano, in turn, communicated this to Cieslewicz. Smith and Mariano also informed the trial court that a settlement had been reached. Smith claims that the settlement was placed on the record, but the CRA alleges that counsel informed the court only that "the parties had reached a conditional settlement."*fn3

When Cieslewicz informed his supervisor Wilson about the settlement discussions from that morning, Wilson replied that "the City of Camden would not be transferring the properties in question to the CRA." Cieslewicz communicated this to Mariano at around noon that same day. Mariano, in turn, recalls that he informed Smith by 3:00 p.m. that the City had refused to transfer the properties, and that the settlement therefore could not be effectuated.

Smith nevertheless sought to confirm a settlement with the CRA by faxing a letter to Mariano later that afternoon, incorporating the previously-discussed terms. Smith's letter stated, among other things, that "the [CRA] voted on November 30, 2006 to ratify [the settlement] terms," and "I understand that the City of Camden will be a party to this settlement." At about 4:45 p.m. that day, December 1, Cieslewicz spoke with Smith and again explained that there was no settlement because the City would not transfer the properties. At a subsequent conference in the trial judge's chambers on December 4, 2006, the City's counsel asserted that the City did not have authority to transfer the property to the CRA.

On December 8, 2006, Britt filed a motion on short notice to enforce settlement, pursuant to R. 4:42-1(b). At the motion argument on January 5, 2007, Britt's attorney referred to a 1992 Camden ordinance, which he contended had authorized the City to convey the subject property to the CRA. Although the City's counsel was not prepared to respond to that specific point, he argued that the City never reached a valid settlement with Britt that could be enforced.

The 1992 ordinance cited by plaintiff is entitled "Ordinance Authorizing the Transfer of Certain City-Owned Properties to the Camden Redevelopment Agency." The ordinance lists over seventy properties, including the six lots at issue in this case. It states in relevant part:

SECTION 1. The governing body of the City of Camden does hereby authorize the transfer of all right, title and interest which the City of Camden has listed to the Camden Redevelopment Agency for the purposes set forth in this ordinance.

SECTION 2. The instruments of conveyance shall provide that if the properties conveyed pursuant to this ordinance are not rehabilitated within the year pursuant to a plan of redevelopment, title to the properties shall revert to the City of Camden.

The CRA's attorney, Mariano, explicitly took no position at the initial motion hearing as to the enforceability of the 1992 ordinance. Mariano did inform the judge, however, that the CRA Board had never taken formal action on a settlement with Britt.

After hearing the arguments of counsel but not taking any testimony, the motion judge ruled that the City had given approval for the transfer of the properties in its 1992 ordinance. Consequently, the judge ordered the City to convey the properties to the CRA, and further ordered that the settlement with Britt be enforced. However, the judge stayed the implementation of his decision, sua sponte, in order to give the City an opportunity to move for reconsideration and to brief the issues concerning the 1992 ordinance.

After the judge issued his bench ruling, Mariano sought clarification from the court regarding the scope of the decision:

MR. MARIANO: Is your ruling today that the City should be compelled to convey -


MR. MARIANO: - the property to the CRA?


MR. MARIANO: Okay. And at that point then, it would be subject to CRA formal vote and/or approval or nonapproval -


MR. MARIANO: - of the settlement.

THE COURT: That's exactly right, yes.

Thereafter, plaintiff submitted a proposed form of order to the court to reflect the January 5 decision, seeking to enforce the full terms of the alleged settlement as Britt had understood them from the December 1 discussions. The CRA objected to the proposed order. In a letter to the judge dated January 10, 2007, Mariano stated that, "[t]he Order submitted by [Britt's counsel] does not even come close to reflecting the decision made by Your Honor at oral argument . . . ." The CRA submitted an alternative version of a proposed order, which enforced only that aspect of the settlement requiring the City to convey the property to the CRA. The judge signed Britt's version of the order on January 12, 2007, without modifications.

The City moved for reconsideration. At oral argument on the City's motion on March 16, 2007, the City reiterated that there was no settlement with Britt because the City Council never formally approved one. The City's attorney emphasized that the City and the CRA are "two separate and distinct legal entities," both requiring formal approval to bind them to a settlement agreement.

In response, Britt's attorney Smith maintained that "[t]here's been no confusion on the part of the parties that have done discovery in this matter from the very beginning that the City of Camden and the [CRA] were linked[.]" In particular, Smith asserted that the City and the CRA were "joined at the hip" by defendants Primas and De, dual office-holders of both the City and the CRA. Smith reiterated that the transfer of the property to the CRA was mandated by the 1992 ordinance, and that the preparation and execution of the deed was "held up" by Primas and De, who Smith alleged to have "controlled both entities."

The CRA again took no position on the 1992 ordinance. Its counsel simply requested that, if the court's order enforcing settlement were vacated, the CRA would be allowed to present its previously-filed motion in limine to bar Britt's supplemental expert report from trial.

Following these arguments, the judge denied the City's motion for reconsideration and reaffirmed his earlier ruling enforcing the settlement. With respect to the 1992 ordinance, the judge reasoned:

The City Council in June of 1992 by ordinance authorized transfer of property to the CRA. The CRA was created by Council to develop portions of the city. In effect it was an agent -- an agency of -- of the [C]ity.

In October of 2001, the CRA passed a resolution to sell the property in question to Mr. Britt. The title had to be obtained. The formality of title had to be obtained from the City and that's what this case is all about. In fact, the deed was prepared to Britt on June the 14th, 2002 subject to obtaining the title.

The ordinance in question has never been repealed. I think the CRA had the authority to enter into the agreement with Mr. Britt which [it] did. The only thing left to be done is a ministerial procedure of actually preparing a title from the City to the CRA so that it can be transferred to Mr. Britt.

I think there was a settlement, or if there wasn't a settlement the plaintiff is entitled to judgment in the nature of a summary judgment on that aspect of it, so the motion will be denied.

Both the City and the CRA appeal. In essence, the public entities argue that the trial judge erred in two principal respects. First, the City argues that it was not legally bound because its governing body, the City Council, never properly authorized a transfer of the property from the City to the CRA. Likewise, the CRA argues that its Board never properly authorized the proposed settlement with Britt. Furthermore, the City asserts that it lacked the power to transfer the property to the CRA, under the terms of the 1992 ordinance, in the absence of a valid redevelopment plan. The City also disputes that there was an enforceable meeting of the minds as to all material terms of the putative settlement.

Plaintiff argues that these arguments are legally unsound, and that the trial court's decision should be upheld, particularly in light of the long delay he has experienced in his dealings with these public bodies.

Although we appreciate the equitable concerns involved and Britt's frustration in having this real estate transaction finally come to fruition, as a matter of law we are constrained to vacate the trial court's orders enforcing the alleged settlement. The matter must be remanded for further proceedings. We explain the legal reasons that compel that result in the pages that follow.


It is well established that governmental bodies, including municipal boards, "must act by formal action . . . as to giving consent to the settlement of litigation." Jersey City v. Roosevelt Stadium Marina, Inc., 210 N.J. Super. 315, 327 (App. Div. 1986), certif. denied, 110 N.J. 152 (1988). Absent such formal action, "[t]he unauthorized consent of a municipal attorney cannot bind the governing body." Ibid.

The City argues that the alleged settlement with Britt was not binding because the City Council never voted to approve it. The City further asserts that it never authorized a specific conveyance of the property to the CRA, and that it could not do so legally absent a valid redevelopment plan. Similarly, the CRA asserts that any settlement negotiated between plaintiff's counsel and the CRA's attorney required formal approval by the CRA Board.

Plaintiff counters that the settlement with the CRA was approved and made binding at the CRA's caucus meeting on November 30, 2006. He also contends that the 1992 ordinance binds the City to convey the property to the CRA, which, in turn, is obligated under the settlement to transfer the land to him. Additionally, Britt argues that counsel for both defendants had implied authority from their respective clients to settle the matter, and that, in particular, the actions of the CRA's attorney, Mariano, implied that the settlement was binding.*fn4

We first address the significance of the CRA's caucus meeting. As a matter of law, informal caucus sessions of a municipal body, whether open to the public or not, do not satisfy the requirement of formal action. See N.J.S.A. 10:4-7 (finding that caucus meetings are not governed by the requirements of the Open Public Meetings Act); see also Brazer v. Borough of Mountainside, 102 N.J. Super. 497, 502 (Law Div. 1968) ("Decisions reached at a caucus are nothing more than gentlemen's agreements as to how the members will vote at a later public meeting"), aff'd, 104 N.J. Super. 456 (App. Div. 1969), modified on other grounds, 55 N.J. 456 (1970).

The record indicates that plaintiff was aware that the November 30 session, at which members of the CRA allegedly expressed favorable views of the proposed settlement, was only a caucus meeting. No formal action to bind the Board could be taken at such a meeting. Any settlement would remain contingent on formal CRA Board approval. Britt and his attorney are presumed to be aware of such constraints. See Saint Barnabus Med. Ctr. v. County of Essex, 111 N.J. 67, 77-78 (1988) (the law presumes that parties dealing with government officials are aware of laws constraining their discretion to act).

At the January 5, 2007 motion argument, the trial court acknowledged the necessity of a formal vote by the CRA Board to approve the settlement at a future meeting. It is unclear from the record why the court did not continue to recognize this need when it entered its ensuing orders that bound the CRA, as well as the City, to carry out the settlement. The CRA Board never approved the settlement by a formal vote at a full Board meeting, with proper notices to the public and a listing on the Board's agenda of official business. The positive reaction to the settlement expressed by Board members at a caucus meeting simply does not suffice.

A similar analysis applies to the City's failure to approve the settlement through an appropriate vote of the governing body. All parties agree that the settlement with Britt was never put before City Council for a vote. This omission is fatal to Britt's claim for enforcement.

Plaintiff argues that the City had already given its formal approval for the transfer of the property through the 1992 ordinance. Whether or not that is so, any proposed settlement of litigation involving the City also had to be either approved or rejected in a formal action by the City Council. See Jersey City, supra, 210 N.J. Super. at 327.

Approval for the transfer of municipal property and approval of a settlement of litigation are two separate and distinct requirements. Plaintiff's complaint sought monetary damages from the City as well as specific performance of the realty transfer. The trial court erred by implicitly conflating these two claims. The City Council had to approve both aspects of the settlement. It failed to do so.

Furthermore, we are persuaded that the 1992 City ordinance did not suffice, in and of itself, to convey the property from the City to the CRA. It is an elemental principle of statutory construction that "the words and phrases in the statute must be given their generally accepted and ordinary meaning." State v. Malik, 365 N.J. Super. 267, 275 (App. Div. 2003), certif. denied, 180 N.J. 354 (2004). Likewise, municipal ordinances should be construed in a manner that imbues meaning to all of their provisions. Id. at 278 ("[I]t is not proper statutory construction to reach a result which would render a provision completely meaningless").

Section 1 of the 1992 ordinance does recite that it "does hereby authorize the transfer of all right, title and interest" in the subject properties, including the property at issue here, "to the Camden Redevelopment Agency for the purposes set forth in this ordinance." However, that recital in Section 1 is qualified by the following language in Section 2:

The instruments of conveyance shall provide that if the properties conveyed pursuant to this ordinance are not rehabilitated within the year pursuant to a plan of redevelopment, title to the properties shall revert to the City of Camden.

These words in the ordinance signify that an "instrument of conveyance" was required to transfer the property. The ordinance literally only "authorized" the City to transfer the property; it did not require the City to do so.

Moreover, the ordinance clearly states that the property could only be transferred pursuant to a "plan of redevelopment." This condition of an authorized transfer was not fulfilled. The requirement emanates from the Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1 to -73, a statute that grants municipal redevelopment agencies such as the CRA the power to:

Lease or convey property or improvements to any other party pursuant to this section, without public bidding and at such prices and upon such terms as it deems reasonable, provided that the lease or conveyance is made in conjunction with a redevelopment plan . . . . [N.J.S.A. 40A:12A-8(g) (emphasis added).]

This requirement cannot be read out of the plain terms of the statute or the City's ordinance. The ordinance specified that the property would revert to the City if the property were not redeveloped within a year. There can be no such redevelopment without a redevelopment plan. It is undisputed that no such plan covering the subject properties was in existence.*fn5

Consequently, the terms of an authorized conveyance under the 1992 ordinance have yet to be satisfied.

Britt argues that this requirement of the ordinance should be disregarded because the City has allegedly observed a "pattern and practice" of transferring land to the CRA for the benefit of private developers without any redevelopment plan being in place. Even if it were proven that the City has at times operated in such a manner, that does not justify its non-adherence with respect to the properties that are at issue in this appeal. The public is entitled to compliance with the law.

Simply stated, plaintiff cannot pick and choose which portions of the 1992 ordinance he would like enforced. If Britt wishes to rest his claim to the property on Section 1 of the ordinance, he must also accept that under Section 2, he cannot acquire and redevelop the property because there is no redevelopment plan. We will not enforce one section of the ordinance and disregard another equally valid section. Hence, we reverse the trial court's ruling that the City must convey the property to the CRA.

Plaintiff alternatively contends that, regardless of whether sufficient formal action was taken, both Mariano and Cieslewicz had implied authority to negotiate a binding settlement on behalf of their respective clients, the CRA and the City. We are unpersuaded by this contention.

Our law has long recognized, with respect to the settlement of litigation, that:

The general rule is that unless an attorney is specifically authorized by the client to settle a case, the consent of the client is necessary. . . . Negotiations of an attorney are not binding on the client unless the client has expressly authorized the settlement or the client's voluntary act has placed the attorney in a situation wherein a person of ordinary prudence would be justified in presuming that the attorney had authority to enter into a settlement, not just negotiations, on behalf of the client.

[Amatuzzo v. Kozmiuk, 305 N.J. Super. 469, 475 (App. Div. 1997) (citations omitted).]

Furthermore, "[a] municipal corporation is bound only by the acts of an agent that are expressly or implicitly authorized. Apparent authority does not suffice." Seacoast Realty Co., v. W. Long Branch, 14 N.J. Tax 197, 203 n.2 (Tax 1994).

Britt argues that the CRA's attorney, Mariano, had implicit authority to settle the case based on (1) his negotiation with plaintiff of a settlement; (2) his indication to plaintiff that he would not proceed with a motion in limine on December 1, 2006; (3) and his phone call to the court apprising it that a settlement had been reached. Although these activities might suggest that Mariano was authorized to negotiate settlement terms with plaintiff that could then be presented to the CRA Board for its consideration, they do not support plaintiff's claim that Mariano also had the authority to bind the CRA to a settlement agreement. Board approval was still required, as was noted in court at the oral argument on January 5, 2007, without contradiction.

Likewise, there is no support in the record for plaintiff's contention that Cieslewicz, as an assistant municipal attorney, was authorized to bind the City to a settlement agreement. The facts in the record indicate just the opposite. The City had limited involvement in the settlement discussions between plaintiff and the CRA. Cieslewicz was specifically told by his supervisor the morning of December 1, 2006 that the City would not settle. Moreover, Cieslewicz certified that he never asked for, nor received, authorization to finalize a settlement with plaintiff. Plaintiff's claim that Cieslewicz possessed the authority to settle is based on pure speculation about his contacts with defendants Primas and De, and is not supported by the record. Again, absent clear proof of authorization, we shall not presume that the City's governing body cast aside its powers of ratification and gave its assistant counsel free rein to bind the municipality.

Even if, for the sake of argument, we were to dispense with the procedural requirements that constrain the ability to bind either of these two public entities to a lawful settlement, no enforceable agreement was ever attained in this case. The record shows that the parties did not achieve a meeting of the minds on all material elements of a settlement.

With respect to the City, plaintiff alleges that its commitment to settle was manifested by Cieslewicz's statement during the course of counsel's three-way discussion on the morning of December 1 that the property represented the City's "contribution" to a settlement. However, Cieslewicz has certified that he made that comment only as a way of emphasizing to plaintiff that the City would not be open to making a monetary contribution in any settlement of the case. Furthermore, when he made the comment, Cieslewicz was under the impression that the CRA had already obtained an agreement from the City to transfer the property. This assumption, which Britt apparently also shared, was mistaken. "A compromise which is the result of a mutual mistake is not binding and consent to a settlement agreement is not considered freely given when it is obtained as the result of a mistake." Lampley v. Davis Mach. Corp., 219 N.J. Super. 540, 550 (App. Div. 1987) (rescinding a negotiated settlement between three parties on the grounds that one party had never given valid consent to the settlement, where the other two parties had mistakenly assumed that there was such consent).

At best, counsel's mistaken assumption that the City had agreed to give up the property lasted only a few hours. Cieslewicz was specifically informed by his supervisor shortly after the December 1 conference call that the City would not convey the property, and he in turn promptly communicated that to Mariano. Plaintiff and his attorney became aware of the City's position by 3:00 p.m. that same day. No global settlement agreement binding all three parties was ever signed.

In sum, there was never a binding settlement among Britt, the City and the CRA. Consequently, the trial court erred in its attempt to enforce a putative compromise. The issues must be returned to the local governing bodies for their further consideration. Given the regrettably protracted nature of this litigation, we urge the public bodies to ratify or reject any new or revised settlement proposals expeditiously, and to address any deficiencies relating to the absence of a redevelopment plan. In the meantime, plaintiff's complaint is restored, and the litigation, including plaintiff's claims for monetary relief, is remanded back to the Law Division.

Vacated and remanded.

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