On appeal from Superior Court of New Jersey, Law Division, Mercer County, Docket No. L-1244-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Skillman, Graves and Grall.
Defendant Herring Land Group, Inc. (Herring) owns a 45.7 acre tract of land located in Ewing Township.
On December 27, 1985, Herring's predecessor in title leased a 16.3 portion of this property to the predecessor in title of plaintiff GF Princeton, LLC (Princeton). (For ease of reference, Herring and its predecessor in title are referred to collectively as Herring and Princeton and its predecessor in title are referred to collectively as Princeton.) The lease was for a term of seventy-five years and will not expire until December 31, 2060.
On December 23, 1986, the lease was amended to include an "improvements deed," which granted Princeton an ownership interest in two office buildings together with parking and other improvements located within the leased area. These buildings are approximately 179,940 square feet in area. At the time of this transaction, the office buildings were the only structures on the property. A memorandum of the lease agreements and improvements deed was filed in the Office of the Mercer County Clerk.
Herring subsequently entered into a contract to sell a 4.8 acre portion of its property to defendant American Properties at Scotch Road, LLC (American Properties), contingent upon Herring obtaining subdivision approval for the tract and American Properties obtaining site plan approval for construction of a four-story extended-stay hotel with 127 rooms and 145 parking spaces.
On January 11, 2007, American Properties filed an application with the defendant Ewing Township Planning Board (Board) for subdivision and site plan approval, and on February 7, 2007, American Properties and Herring filed an amended joint application for those approvals. The application proposed to subdivide the tract into three lots: (1) lot 3.03, which is the 4.8-acre lot that Herring has contracted to sell to American Properties for its hotel development project; (2) lot 3.04, which is an 18.3-acre lot that includes the 16.3 acres leased to Princeton; and (3) lot 3.05, which is a 22.6-acre lot that is to remain vacant. The application sought numerous variances and waivers, including variances to permit the minimum lot width of proposed lot 3.04 on which Princeton's buildings are located to be 75 feet whereas 250 feet is required, a ground sign on lot 3.04 located less than the required 25 feet from the street right-of-way, and a waiver of the obligation to prepare a tree survey for lot 3.04.
The applicants did not give Princeton notice of the application for subdivision of the property it leases and on which its two office buildings and other improvements are located.
The Board conducted a one-day hearing on the application. The focus of the hearing was upon the site plan for the proposed hotel. There was no mention during the course of the hearing of Princeton's leasehold interest in most of the proposed lot 3.04 or its ownership of the two office buildings located on that lot. No one appeared at the hearing to cross-examine the applicants' experts or to speak in opposition to the application.
At the conclusion of the hearing, the Board approved the applications, and on April 5, 2007, it adopted a memorializing resolution, which subjected the approvals to numerous conditions, including a requirement that the applicants provide an easement for future access between proposed lots 3.04 and 3.05.
On May 21, 2007, Princeton filed an eight-count complaint in lieu of prerogative writs challenging the Board's grant of Herring's and American Properties' subdivision and site plan applications. The complaint alleged that the applications contemplated using a portion of the parking lot and access road on the leased property for the proposed hotel and that Herring and American Properties failed to obtain Princeton's consent for that use. It also alleged that the easement for future access between proposed lots 3.04 and 3.05 was located within the leased area. The complaint further alleged that Princeton had a "sufficient property interest" in the property for which Herring and American Properties sought subdivision and site plan approval to require notice of their application. In addition, the complaint alleged that the applicant's failure to disclose Princeton's interest in the property to the Board constituted a "material misrepresentation." The complaint further asserted that the grant of the applications was not supported by adequate findings of fact and conclusions of law or evidence in the record and was therefore arbitrary and capricious.
American Properties filed a motion to dismiss the complaint for failure to state a claim, in which the other defendants joined. On August 8, 2007, the trial court granted the motion as to the first six counts of Princeton's complaint, but denied the motion as to the seventh and eighth counts. The dismissed counts claimed that subdivision and site plan approvals were invalid because Herring and American Properties had failed to obtain Princeton's consent for the proposed development project or, alternatively, because the applicants failed to give Princeton notice of the application. In addition, the court dismissed the sixth count, which claimed that the applicants' failure ...