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South Salem Street Associates, LLC v. Planning Board of the Township of Montville

October 21, 2008

SOUTH SALEM STREET ASSOCIATES, LLC, DELAWARE HUDSON MANAGEMENT, INC., RONALD SOUSSA AND DELAWARE HUDSON REALTY, INC., PLAINTIFFS-APPELLANTS,
v.
THE PLANNING BOARD OF THE TOWNSHIP OF MONTVILLE AND THE TOWNSHIP OF MONTVILLE, DEFENDANTS-RESPONDENTS.



On appeal from the Superior Court of New Jersey, Law Division, Morris County, L-3369-04.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued September 11, 2008

Before Judges Winkelstein, Fuentes and Gilroy.

Plaintiffs own land in Montville. In an attempt to construct an office building on the property and lease it as a child care center, they applied to the Township Planning Board (the Board) for preliminary and final site plan approval. The Board initially approved plaintiffs' application, but later denied plaintiffs' amended site plan application. The Law Division overturned the latter decision.

Plaintiffs subsequently filed suit, claiming that the Board and the Township deprived them of their property rights pursuant to 42 U.S.C. § 1983, and maliciously prosecuted them in a separate municipal court action, charging plaintiffs with a violation of a Township ordinance. Plaintiffs appeal from the trial court's grant of summary judgment dismissing their claims, as well as from the court's refusal to permit them to amend their complaint to add an additional claim and add the former mayor as a defendant. We reverse the dismissal of plaintiffs' section 1983 cause of action, affirm the dismissal of plaintiffs' malicious prosecution claim, and remand to permit plaintiffs to amend their complaint and for further proceedings.

I.

Due to the fact-sensitive nature of plaintiffs' claims, we recite the record in some detail.

A. Plaintiff's Site Plan Approval

South Salem and Delaware Hudson are the owners of a 6.6-acre tract of land at 330 Changebridge Road in Montville (the property). Plaintiff Ronald Soussa owns Delaware Hudson.*fn1 In February 2000, plaintiffs applied to the Board for preliminary and final site plan approval to construct a 48,000-square-foot office building on the property. Plaintiffs claim that their application complied with all municipal ordinances in the R-27D zone in which the property is located.

At the time of the application, John Rosellini was the Township Mayor. As such, he served on the Planning Board. Deborah Nielson, a member of the Township Committee and a member of the Board until 2004, testified that Rosellini opposed plaintiffs' application because it was a two-story building, and he was concerned with the view and the impact on the neighbors; he thought the project was too large.

On October 26, 2000, Soussa met with the Township Design Review Committee, which is comprised of non-Board members who make recommendations to the Board. Rosellini attended that meeting, even though he was not a member of the Committee. Soussa alleges that at the meeting, Rosellini threatened the project. Soussa testified at his deposition: "[Rosellini] said the building is too large for this site and that he would never allow it to be built in his town, that he had more money and more lawyers and he intended to tie me up in litigation if I tried to build that building." Soussa also claimed that Rosellini threatened to have the property rezoned to eliminate office buildings as a permitted conditional use in the R-27D zone. In fact, on November 13, 2000, the Township Committee introduced Ordinance No. 2000-61; if enacted, the ordinance would have eliminated office buildings as a permitted conditional use in the R-27D zone.

Neilson testified that plaintiffs' application conformed to the zoning and site plan ordinances. Committeeman Robert Purnell also acknowledged that the application conformed to all zoning laws; and, in a letter to fellow committee members and residents of the Township, revealed that: "the developer was told that if he didn't make his building smaller, then the [T]ownship would delay him in the courts, as long as possible, therefore causing financial hardships."

Plaintiffs and the Township later reached an agreement that implied that in return for plaintiffs' selling the Township a portion of its property, the Township would not introduce an ordinance that would preclude the construction of plaintiffs' proposed office building. The agreement was memorialized in a letter of intent dated December 12, 2000. Soussa testified that during discussions relating to the agreement, he told Rosellini that he intended to use the building for a child care facility, and that Rosellini represented to him that child care was a permitted use in the zone.

The letter of intent called for the Township to purchase two acres of wetlands from plaintiffs, to be used as a conservation easement, and for plaintiffs to reduce the size of the proposed office building from 48,000 square feet to 24,000 square feet. The Township Committee agreed to hold in abeyance "the adoption of an ordinance eliminating the office use as a conditional use" in the zone.

Plaintiff and the Township executed a land sale contract on September 25, 2001. Pursuant to its terms, plaintiffs sold 2.2 acres of its property to the Township for $525,000. The sale required plaintiffs to substantially reduce the size of the proposed building, from a two-story 48,000-square-foot building to a one-story 27,000-square-foot building. Soussa claimed he agreed to the sale under duress and coercion because of Rosellini's alleged threats to rezone the property to remove the conditional use for office buildings.

As to the purchase price, Soussa had asked for the appraised value, $720,000. Although the Township's appraisal was $648,000, the mayor and other Township officials offered him $400,000. The parties ultimately agreed to $525,000. The Township also agreed to install a sewer line and water line to plaintiffs' building by June 1, 2002, and to obtain "any and all required permits or approvals" for the sewer line.

On January 10, 2002, the Board approved plaintiffs' preliminary and final site plan application, authorizing the construction of two single-story, 13,075-square-foot office buildings.*fn2 The sale of the property from plaintiffs to the Township closed on January 22, 2002.

B. Site Clearing and Municipal Prosecution

Plaintiffs were required to secure a construction permit before conducting site work. The Township had a policy, however, that permitted certain site preparation work to proceed in advance of the construction permit if the developer posted a restoration bond that could be used to restore the area in the event the developer did not obtain a construction permit. Although plaintiffs did not have a construction permit, they wanted to begin clearing the site. Soussa met with Assistant Township Engineer Mark Mantyla and provided him with a copy of the landscaping map included with plaintiffs' subdivision proposal. Based on that map, Mantyla calculated a restoration bond of $10,688, which plaintiffs would have to post to begin clearing the property before obtaining a construction permit. Plaintiffs posted the bond on February 7, 2002, and the Township granted their request to begin clearing within the area designated on the map.

Soon after plaintiffs began site clearing in June 2004, Mantyla informed Soussa that plaintiffs had cleared an area larger than permitted under the terms of the restoration bond. The Township then prohibited plaintiffs from performing future site work without a construction permit.

Due to the excess site clearing, the Township instituted a municipal court action against Delaware Hudson. On August 27, 2004, the Montville Municipal Court issued a summons against "Delaware Hudson Realty Group, Inc. c/o Ron Soussa," charging Delaware Hudson with "deviat[ing] from an approved lot grading plan expanding beyond limits," in violation of a Township ordinance. Mantyla signed the summons, but he did not prepare the complaint, which had been prepared by the Township land use department. When Mantyla signed it, he was not sure if either Soussa or the corporate plaintiffs had violated a Township ordinance. He was aware, however, that the clearing violated the restoration bond as to the limits of clearing on the site before plaintiffs were issued a building permit.

The municipal court case was tried on October 8, 2004. Evidence in the record suggests that the municipal court judge had been Rosellini's attorney in connection with the development of 323 Changebridge Road (the 323 property), a property across the street from plaintiffs' that Rosellini owned and operated as a child care center. The record contains a letter outlining an engineering proposal for building renovations to accommodate The Learning Experience Nursery and Preschool at the 323 property; the letter was addressed to the judge, apparently in his capacity as Rosellini's attorney. Also, during this time, Soussa was actively opposing Rosellini in the 2004 Republican primary campaign.

On November 22, 2004, the court found Soussa and Delaware Hudson guilty of violating a municipal ordinance. The court imposed a fine of $9778, plus court costs, and an additional fine of $250 per day until the clearance was in conformity with the site plan.

On January 4, 2005, the municipal court entered a judgment of conviction against "Ronald Soussa" personally. Delaware Hudson was not named on the judgment, despite having been named on the summons. Sherry Pressman, the municipal court administrator, certified that she erroneously listed Soussa as an individual defendant on the judgment of conviction, which should ...


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