July 18, 2008
ROBERT A. FEE AND VICTORIA FEE, PLAINTIFFS-APPELLANTS,
COLLEGE TOWERS APARTMENTS, SECTION ONE, A NEW JERSEY CORPORATION, AND DEPARTMENT OF COMMUNITY AFFAIRS OF THE STATE OF NEW JERSEY, DEFENDANTS-RESPONDENTS, AND THE CITY OF JERSEY CITY, DEFENDANT.
On appeal from Superior Court of New Jersey, Law Division, Hudson County, Docket No. L-5598-04.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued December 3, 2007
Before Judges Parrillo, Graves and Alvarez.
Plaintiffs Robert A. Fee and Victoria Fee appeal from an order entered on August 15, 2006, dismissing their complaint and entering judgment for possession in favor of defendant College Towers Apartments, Section One (College Towers) on its counterclaim. For the reasons set forth in a sixty-page written decision, the trial court found plaintiffs were in default of their Occupancy Agreement for failing to occupy their apartment.
On appeal, plaintiffs present the following arguments:
THE TRIAL COURT ERRED IN FINDING THAT DEFENDANT COLLEGE TOWERS' STATUS AS A LIMITED DIVIDEND HOUSING CORPORATION WAS NOT TERMINATED IMMEDIATELY AFTER FEBRUARY 8, 2004.
THE TRIAL COURT ERRED IN FINDING THAT DEFENDANT COLLEGE TOWERS' TAX EXEMPTION DID NOT EXPIRE AS OF FEBRUARY 8, 2004 AND THAT THE EXTENSION OF SUCH BY THE CITY TO JUNE 30, 2006 WAS LEGAL.
THE TRIAL COURT ERRED IN FINDING THAT THE EQUITABLE DEFENSES OF LACHES AND/OR ESTOPPEL PRECLUDED THE PLAINTIFFS FROM CHALLENGING OR OBJECTING TO THE EXTENSION OF THE TAX EXEMPTION AND/OR 1997 SETTLEMENT BETWEEN THE CITY AND DEFENDANT COLLEGE TOWERS.
THE TRIAL COURT ERRED IN FINDING THAT THE PLAINTIFFS BREACHED THEIR OCCUPANCY AGREEMENT BY MAINTAINING THEIR PRINCIPAL RESIDENCE ELSEWHERE.
THE TRIAL COURT ERRED IN FINDING, AND EVEN CONSIDERING, THAT THE PLAINTIFFS WERE NEVER QUALIFIED SHAREHOLDERS IN DEFENDANT COLLEGE TOWERS.
THE TRIAL COURT ERRED IN FINDING THAT THE DEFENDANT COLLEGE TOWERS' STOCK-TRANSFER RESTRICTIONS ARE REASONABLE.
After reviewing these contentions in light of the record, the applicable law, and the arguments of counsel, we are satisfied plaintiffs' arguments do not warrant extended discussion in a written opinion. R. 2:11-3(e)(1)(E). Because the trial court's factual findings are supported by sufficient credible evidence in the record, and its conclusions based on those findings are legally sound, we affirm.
Defendant College Towers was incorporated on February 8, 1954, under the now repealed Limited-Dividend Nonprofit Housing Corporations or Associations Law (1949 Tax Exemption Law), N.J.S.A. 55:16-1 to -22. It is a state subsidized cooperative housing corporation restricted to low and moderate income families, and it is subject to regulation by the public housing and development authority in the Department of Community Affairs. College Towers constructed eight apartment buildings with 319 units and began operating as a limited-dividend housing corporation on September 1, 1956, when it began to collect ten percent of the annual gross shelter rents, or "carrying charges," from its shareholder tenants and paid the City of Jersey City (Jersey City) the carrying charges in lieu of property taxes. As a limited-dividend entity, College Towers was eligible to receive a fifty-year property tax exemption, pursuant to N.J.S.A. 55:16-18.
In 1992, the Long Term Tax Exemption Law (Long Term Law), N.J.S.A. 40A:20-1 to -22, superseded the 1949 Tax Exemption Law. Town of Secaucus v. City of Jersey City, 19 N.J. Tax 568, 571 (Tax 2001). Pursuant to the Long Term Law, any uncertainties in the superseded laws "shall be construed with respect to, and in a manner consistent with, this act." N.J.S.A. 40A:20-19; Secaucus, supra, 19 N.J. Tax at 573.
In September 1956, Robert Fee's parents became shareholders and moved into College Towers Apartment 5A, located at 43 College Drive, Jersey City, New Jersey. Robert Fee resided in Apartment 5A with his parents until October 1972, when he married and moved out. After plaintiff's father died in September 1990, plaintiff, who had separated from his wife, moved back into Apartment 5A to care for his mother until her death in June 1991. Under Paragraph 31(b) of College Towers' bylaws, Robert Fee became a shareholder with the right to occupy Apartment 5A as his mother's beneficiary. Plaintiff lived exclusively in Apartment 5A from June 1991 to December 7, 1997.
In 1996, a dispute arose in which Jersey City contended the tax abatement would expire in July 1996, while College Towers claimed the abatement did not expire until 2006. College Towers filed suit, and on April 16, 1997, the parties negotiated a settlement agreement to extend the fifty-year real estate tax abatement until June 30, 2006, because the abatement did not commence until September 1, 1956, when the housing project was completed and College Towers began service charge payments to Jersey City in lieu of taxes.
On December 7, 1997, Robert Fee married his current wife, Victoria Fee. From December 7, 1997, to November 7, 2003, the two resided exclusively in Apartment 5A with Victoria Fee's daughter. On May 27, 1999, plaintiffs' occupancy rights in Apartment 5A were memorialized in both an Occupancy Agreement and a stock certificate, which was worth two hundred dollars in par value at ten dollars per share.
On November 7, 2003, plaintiffs purchased residential property in Lumberton, New Jersey. During the trial, Robert Fee acknowledged the Lumberton residence became his "primary residence," and the apartment in College Towers became a "secondary residence."
Q: Mr. Fee, you filed a motion . . . to exclude certain evidence . . . that the defendant, College Towers, intended to offer, right?
Q: And in connection with that motion . . . you signed a certification?
Q: And you also submitted to the [c]court a memorandum of law . . . you prepared and signed, correct?
Q: Now in your certification, you state, "Our primary residence," and by "our" are you referring to you and your wife?
A: As a family unit, yes.
Q: "Our primary residence, subsequent to November 7th, 2003 is our residence located at 10 Banberry Road (phonetic), Lumberton, New Jersey." That's what you stated in the certification.
Q: And you say, the next paragraph, Paragraph 4 of your certification, you say, "subsequent to November 7th, 2003, my wife and I have maintained our apartment at College Towers as a secondary domicile," correct?
Q: And in your memorandum that you submitted to the [c]court . . . you said that the Fees' position in this case has always been that they have their primary residence in Lumberton, New Jersey, subsequent to November 7th, 2003.
A: Right. My position is as of November 7th, 2003 the primary residence for my family unit is Lumberton. During the transition period when I was moving my office from Rutherford to Mt. Laurel, my position is during that three-and-a-half-month period, my principal residence was still in the apartment. That's my position.
Q: . . . [W]as the home in Lumberton your principal residence as of November 7th, 2003 or was it not?
A: I just gave you my answer. . . . [M]y principal residence from November until . . . around the end of February I consider was the apartment. My family-unit principal residence I consider to be Lumberton, New Jersey.
Q: . . . [T]he apartment in College Towers was a secondary residence after November 7th, 2003.
In May 2004, College Towers' on-site property manager, Peter M. Barron, made several unsuccessful attempts to gain access to plaintiffs' apartment to investigate the source of a water leak, but plaintiffs did not answer the door, had changed door locks that caused Baron's emergency key to fail, disconnected their phone line, and did not respond to Barron's letter dated May 14, 2004. Subsequently, on May 24, 2004, College Towers notified plaintiffs: "If you no longer reside in the apartment, you are in default of your obligations under the [Occupancy] Agreement and the Agreement may be terminated by College Towers." By letter dated June 9, 2004, plaintiffs informed College Towers they had "not vacated" the apartment.
On June 10, 2004, Robert Fee met Barron and indicated that he still lived in the apartment. On July 13 and September 8, 2004, College Towers sent letters to plaintiffs requesting proof, such as plaintiffs' daughter's school enrollment certification, that plaintiffs still lived in the apartment, but it received no response. In September 2004, College Towers learned that plaintiffs had purchased a home in Lumberton, New Jersey, which they had been using as their principal residence since November 2003, and they had enrolled their daughter at Lumberton Middle School. Thus, on October 5, 2004, College Towers notified plaintiffs that, unless cured within thirty days, plaintiffs' rights would terminate because they were "in default . . . for [their] failure to occupy [their] apartment as required by the terms of the [Occupancy] Agreement."
On November 1, 2004, plaintiffs filed a verified complaint seeking to enjoin College Towers from terminating their occupancy agreement. Plaintiffs' complaint also challenged the status of College Towers as a limited dividend entity under the 1949 Tax Exemption Law, and it challenged the status of College Towers' property tax abatement with Jersey City. In its answer and counterclaim, College Towers claimed plaintiffs were in default of their Occupancy Agreement "for failing to occupy the subject apartment." Thus, College Towers sought the entry of a judgment terminating plaintiffs' Occupancy Agreement and canceling their shares of stock in College Towers. Plaintiffs answered the counterclaim on January 4, 2005, and a bench trial was held on November 2, 3, and 4, 2005, and December 21, 2005.
Following the trial, the court determined the 1997 settlement agreement between College Towers and Jersey City, which extended the tax abatement termination date to June 30, 2006, was a valid and enforceable modification of the original tax abatement agreement, and it also found plaintiffs were in default of their Occupancy Agreement for failing to occupy their apartment. The court's written decision included the following:
Defendant's stated purpose is to provide affordable dwellings for families who are in need of housing, pursuant with Sections 55:16-2 and 16-4 of the 1949 Limited-Dividend Nonprofit Housing Corporations or Associations Law. N.J.S.A. 55:16-1 et seq.
The [c]court agrees with Defendant's contention that if Plaintiffs maintained their primary residence elsewhere, as they have admitted, then clearly they are not in need of their Apartment for housing as contemplated by the above statute. The apartments were not meant to be convenient second homes, hotel rooms for individuals, or maintained simply for investment reasons. The law requires that Plaintiffs' Apartment be offered to one of the many low and moderate-income families on Defendant's waiting list who do need it. To permit Plaintiffs to continue to possess the Apartment without occupying it would contradict Defendant's purpose as a housing corporation. Plaintiffs continue to enjoy the tax abatement brought about by the settlement with the City of Jersey City and have not paid rents based on market value.
When Defendant's investigation finally revealed that Plaintiffs lived in Lumberton and that their daughter had enrolled at the local school, Defendant promptly notified Plaintiffs that . . . their Occupancy Agreement would be terminated because they violated its terms by failing to occupy the Apartment.
Clearly, Plaintiffs knew, as did their neighbors and Defendant, that Plaintiffs were required to live in the Apartment as a principal residence. This [c]court finds from the evidence that Plaintiffs failed to "occupy" the Apartment and violated the Occupancy Agreement. Therefore, Defendant properly and legally terminated the Agreement.
All of plaintiffs' arguments were carefully considered but rejected by the trial court, and our scope of review is limited.
In a non-jury trial, "'we do not disturb the factual findings and legal conclusions of the trial judge unless we are convinced that they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice.'" Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974) (quoting Fagliarone v. Twp. of N. Bergen, 78 N.J. Super. 154, 155 (App. Div.), certif. denied, 40 N.J. 221 (1963)). This is not such a case.
In the present matter, the trial court's findings are amply supported by substantial credible evidence, and it correctly applied well-settled legal principles. We therefore affirm substantially for the reasons stated by Judge Frances L. Antonin in her written decision on August 15, 2006.
© 1992-2008 VersusLaw Inc.