April 2, 2008
801 ASBURY PARK ASSOCIATES, L.P., PLAINTIFF-APPELLANT,
PLANNING BOARD OF OCEAN CITY, DEFENDANT-RESPONDENT.
On appeal from Superior Court of New Jersey, Law Division, Cape May County, Docket No. L-777-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued March 11, 2008
Before Judges Skillman, Yannotti and LeWinn.
In 1996, Crown Holdings Corp. (Crown) applied to the Ocean City Planning Board for approval of a site plan for lots 9 through 14 in block 806 in Ocean City. At that time, Crown was the first-floor tenant of a six-story building on lot 9 in which it operated a bank. The objective of the site plan application was to secure authorization for construction of a bank drive- thru facility on lots 10 and 11, which Crown also leased. When the application was submitted, lots 10 through 14 were used solely for parking. The construction of the bank drive- thru facility necessitated elimination of some of the parking spaces on lots 10 and 11. The site plan provided for a reconfiguration and a eight-space reduction in the total number of parking spaces on lots 10 through 14. The site plan sought various waivers and variances in connection with this reconfiguration of the parking.
When Crown applied for site plan approval, lot 9 was in condominium ownership, and the premises occupied by Crown were owned by East Oak Associates. Lots 10 through 14 were owned by plaintiff 801 Asbury Associates. Della Ostein, who was a general partner in both East Oak Associates and plaintiff, signed the site plan application. Although the application identified Della Ostein only as a general partner of East Oak Associates, plaintiff's other general partner, Paul Ostein, acknowledged that it consented to Crown's site plan application.
In 2005, plaintiff filed three applications with the Planning Board for preliminary and final approval of a site plan for the construction of three buildings on Lots 12, 13 and 14. In August 2005, the Board approved the applications. However, these approvals were made "contingent upon the Board solicitor and the Engineer finding that the Property is not linked or tied in any way" with the operation of the bank drive-thru facility on lots 10 and 11 or the building on lot 9.
Plaintiff filed an action in lieu of prerogative writs seeking to invalidate the condition imposed on the approvals. The trial court concluded that the condition was invalid because it impermissibly delegated the Board's decision-making authority to the Board's solicitor and engineer. The court remanded the matter to the Board so that it could determine whether the 1996 site plan approval granted to Crown was conditioned upon maintaining Lots 12, 13 and 14 as a parking lot for the drive- thru facility on lots 10 and 11 and/or the building on lot 9.
On remand, the Board concluded that an amendment to the 1996 site plan approval was required in order for plaintiff to construct buildings on lots 12, 13 and 14, and it denied plaintiff's request for such an amendment. Plaintiff filed another action in lieu of prerogative writs challenging the Board's action.
Judge Perskie concluded in an oral opinion that plaintiff was required, under the 1996 site plan approval, to maintain lots 12, 13 and 14 as a parking lot and that it would have to obtain the Board's approval of an amendment to that site plan to construct three buildings on those lots. In reaching this conclusion, he stated:
[T]here was never any explicit restriction in the '96 proceedings with respect to lots 12, 13, and 14. The Board made, or some of its members made some kind of effort to effect that by the suggestion of a deed restriction or otherwise, but it is clear that . . . the Board eventually did not insist upon receiving any type of explicit restriction or limitation on the development of lots 12 through 14.
It is, however, also true that the record with respect to [the 1996 site plan approval] evidences beyond dispute that the owner of the property, which was not the applicant for the site plan approval, rather the applicant was the owner's tenant, consented to the tenant's application. And that application included, both explicitly in the form of the application itself and substantively in the form of the proposals made to the Board, certain uses of lots 12 through 14, specifically as a restructured and redeveloped parking lot facility to service the development that was undertaken at lots 10 and 11, which was the drive-thru facility . . . for the bank.
So we have to look then at what it is that the Board had before it in '96. And the Board had before it, as I've noted, an application by the tenant of lots 10 and 11, an application that had been explicitly consented to by the owner of that property, as it had to be before the Board could properly consider it, and that application for site plan approval included explicit representations in the application and in the approval with respect not only to the subject property of the site plan, 10 and 11, but also to the lots in question here, 12 through 14. And when it approved the application in 1996 the Board acted in a fashion that was consistent with the application, that is to approve it based in part on the representations that were made with respect not only to lots 10 and 11, but also lots 12 through 14, knowing, as it had to and as it is charged with the knowledge, that it did not have at that point, either by concession or by legal power, any permanent restriction on the use of lots 12 through 14.
Now the same owner applies for development of lots 12 through 14 in a fashion that is inconsistent with the use of those lots that was represented to the Board . . . in the 1996 application. . . . The applicant, the plaintiff here, has every legal right to seek the development of lots 12 through 14. But the Board, in my view, also has the legal right to conclude, as it did, that the development that is sought here of lots 12 through 14 is so substantively different . . . from the use to which those same lots were put in the context of the application that it approved in '96 that . . . the application here could not be granted without an amendment to the prior site plan.
Phrased a different way, once the owner of lots 12 through 14 consented at the time to the site plan application and to the specific representations that were to be made for those lots in order to achieve the Planning Board's approval in 1996 of the site plan approval for lots 10 and 11, it creates a situation in which the Board, in my view, has the legal right if it chooses to exercise it, which it did in this case, to deny a separate application for lots 12 through 14 without requiring an amendment to the site plan application for lots 10 and 11.
The court also concluded that the Board's denial of plaintiff's application for an amendment of the 1996 site plan approval to authorize the construction of three buildings on lots 12, 13 and 14 was not arbitrary or capricious.
On appeal, plaintiff argues that the trial court erred in concluding that it was required, under the 1996 site plan approval, to maintain lots 12, 13 and 14 as a parking lot. We reject this argument substantially for the reasons set forth in Judge Perskie's oral opinion. We add the following supplemental comments.
It is clear on the face of Crown's 1996 application for site plan approval and the Board's resolution approving that application that the reconfiguration of the parking on lots 12 through 14 was an integral part of the plan. The approved site plan, which was submitted to us after oral argument, shows substantial changes in the lay-out of the parking and the buffering on lots 12 through 14. Moreover, the resolution approving the application expressly stated that the application sought "preliminary and final site plan approval with variance relief for Block 806, Lots 9 through 14[.]" The resolution indicated that Crown had presented testimony by George Thomas, its project architect, engineer and planner, who stated:
[A]lthough the Applicant is only proposing to use a portion of the existing parking lot for its drive-through facility, the Applicant is proposing substantial improvements to the entire parking lot. The entire parking lot will be landscaped, the parking spaces will [be] realigned and repainted and the parking surface will be covered with a coating of slurry seal.
Thomas also testified about various waivers and variances that Crown was seeking with respect to the parking lot including the portion on lots 12 through 14.
It is clear that the part of former Mayor Knight's August 10, 2005 testimony, in which he asked whether the 1996 site plan could be amended to expressly require parking on lots 12 through 14 for the building on lot 9, was before the Board when it concluded that plaintiff had to obtain the Board's approval of an amendment to the 1996 site plan in order to construct buildings on lots 12 through 14. The Board members who voted on the November 15, 2006 resolution were either present at the August 10, 2005 hearing or certified that they had read the transcript of that hearing. Moreover, plaintiff's planning expert, Lance Landgraf, referred to this part of former Mayor Knight's testimony in his testimony at the October 5, 2006 hearing.
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