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K-Land No. 54, LLC v. Township of North Brunswick

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


July 22, 2009

K-LAND NO. 54, LLC, PLAINTIFF-RESPONDENT,
v.
TOWNSHIP OF NORTH BRUNSWICK, A MUNICIPAL CORPORATION; THE PLANNING BOARD OF THE TOWNSHIP OF NORTH BRUNSWICK; AND MICHAEL PROIETTI, ZONING OFFICIAL OF THE TOWNSHIP OF NORTH BRUNSWICK, DEFENDANTS-APPELLANTS.

On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-6359-07.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted June 15, 2009

Before Judges Carchman and Parrillo.

Defendant Township of North Brunswick (Township), the Township's Planning Board (Board) and Zoning Official Michael Proietti (collectively defendants) appeal from a November 13, 2007 order of the Law Division finding that a particular zoning use was permitted and directing that a zoning permit be issued to plaintiff K-Land No. 54, LLC (the Kaplan Group). We affirm.

Plaintiff is the owner of a 23.83 acre parcel of property that is part of a larger, 404-acre tract originally known as the Manor Realty Tract -- a planned unit development in North Brunswick spawned from a Mount Laurel suit. The present matter arises from plaintiff's attempt to seek a zoning permit to develop approximately 180,000 square feet of commercial space on its parcel.

By way of background, in 1984, the Urban League of Greater New Brunswick sued the Township to compel it to provide low and moderate income housing in accordance with the requirements of S. Burlington County NAACP v. Mount Laurel Twp., 92 N.J. 158 (1983). A developer, Brunswick Manor Associates (Brunswick Associates), joined the Urban League as a plaintiff in that lawsuit. Brunswick Associates was comprised of members of the Halpern Group, the Wilf Group, and plaintiff Kaplan Group. At the time of the lawsuit and for almost two decades thereafter, Brunswick Associates owned the Manor Realty Tract.

In September 1984, the parties reached an agreement, embodied in a Consent Order dated September 10, 1984, which directed the Township to enact a zoning ordinance so that the "mixed use residential and non-residential development" of the Manor Realty Tract contemplated by the consent order could be effected. The consent order set forth the number of affordable housing units to be constructed, the location where the units were to be constructed, and a schedule for construction of the units.

In accordance with the requirements of the consent order, the Township enacted a planned unit development ordinance, known as the "PUD-II Planned Unit Development" Ordinance (the Ordinance or PUD-II Ordinance), on February 4, 1985. The ordinance was enacted to effectuate the rezoning of the Manor Realty Tract contemplated by the consent order and thus established a new zone for the Manor Realty Tract, known as the "PUD-II Zone." Additionally, the ordinance established the permitted residential and non-residential uses in the PUD-II Zone (§205-87.3), the development standard for the zone, as well as the procedures for pursuing development within the zone.

As a result of ongoing negotiations between Brunswick Associates and the Township, in August 1994, the PUD II ordinance was amended to limit the total number of residential units to 1,975 with a gross density of approximately 13.5 units per acre, to provide that 348 units would be built which would qualify as affordable housing, with 1/3 of these units affordable to low-income households and 2/3 affordable to moderate income households. In addition, and significant for present purposes, the 1994 amendments also required that the net non-residential development would consist of approximately 138 acres which would result in a minimum of 1,500,000 square feet of non-residential space, not exceeding 100 feet in height, with commercial uses limited to 33 1/3% of non-residential floor space (§205-87.4(b)(1)).*fn1

At present, the Manor Realty Tract is partially developed with a planned unit residential development known as "Renaissance." The tract also currently houses 160,000 square feet of non-residential development, all of which is commercial.

Sometime in 2000, Brunswick Associates split and divided ownership of the Manor Realty Tract. Plaintiff acquired ownership of a 23.82 acre portion of the Manor Realty Tract, and an approximately 30-acre parcel of the remaining non-residential real-estate was transferred to the successor of the Halpern/Wilf Group from the original Brunswick Associates joint venture.

Thereafter, on November 18, 2005, plaintiff's CEO, Michael Kaplan, wrote the Township's zoning officer (Proietti) advising that plaintiff sought to construct a commercial/retail development on its parcel that would contain approximately 180,000 square feet of floor space, and requesting that Proietti confirm that plaintiff's plans constitute a permitted use under the PUD-II. On February 1, 2006, plaintiff sent copies of the concept development plans to the Planning Board, requesting an informal review meeting. In November of 2006, plaintiff again requested an informal review meeting with the Planning Board, and, on January 31, 2007, Kaplan submitted his third request. Plaintiff finally received a response on February 2, 2007, wherein the Township informed plaintiff that informal review would be delayed, explaining further:

A serious evaluation of the best use of the remaining land in the... development is underway. We are aware of your present proposal... The development in question has a long and complicated legal and planning background. There are many legal and land issues to be addressed. The Township intends to proceed in a deliberate, considered fashion. As you have been advised by time and time again, we are not prepared to meet with you at this time.

On June 22, 2007, plaintiff sent another letter to Proietti, stating that "[p]ursuant to the Municipal Land Use Law [MLUL], request is hereby made that you issue a zoning permit consistent with the enclosed concept plan... I believe that these uses are permitted uses in this zone." On July 9, 2007, Proietti finally responded, stating:

Please be advised that a zoning permit application does not apply to this type of request. There have been no determinations made by this office that the uses are not consistent with the ordinance and settlement agreement in the commercial development in this PUD II zone, but rather whether the application and concept proposal is consistent with the entire scope of the remaining future commercial areas.

Consequently, plaintiff filed this lawsuit in the Law Division asserting, in the first count, that (i) the Planning Board's refusal to schedule an informal review of plaintiff's proposal violated N.J.S.A. 40:55D-10.1 of the MLUL, and (ii) under N.J.S.A. 40:55D-18 of the MLUL, plaintiff was entitled to a "deemed approval" since the zoning officer failed to either grant or deny its permit request within ten business days. Plaintiff also alleged, in the second count, a violation of its civil rights and, in the third count, its entitlement to attorney's fees.

After hearing argument on cross-motions to dismiss and for partial summary judgment, the trial court entered an order dismissing counts two and three, and, as to count one, compelling the issuance of a zoning permit and an informal Board review of plaintiff's proposed use. In its order, the court did not hold that Proietti's response constituted a failure to grant or deny the request, triggering automatic approval, but instead concluded that "the Zoning Officer did not refuse to issue a ruling on the use [of plaintiff's property]; therefore he determined the use to be permitted, [and the] zoning permit is to be issued." The court further noted that it based its ruling on the "Zoning Officer's decision that the use is not 'not permitted.'"

This appeal follows in which defendants raise the following issues:

I. The Trial Court erred in failing to dismiss Respondent's Complaint on ripeness grounds.

II. The trial court erred in finding that the zoning officer determined the use to be permitted, and further erred in directing the zoning permit to be issued.

A. The Trial Court erred in construing the July 9, 2007 letter from Appellant Proietti to Respondent's counsel as a determination that a zoning permit should be issued.

B. The Trial Court's order was, in effect, an erroneous grant of an automatic approval to Respondent.

C. Respondent was not entitled to an automatic approval because it failed to submit a proper application for a zoning permit (not raised below).

We have considered these issues in light of the record, the applicable law and the arguments of counsel, and we affirm.

(i)

Defendant first contends that plaintiff failed to exhaust its administrative remedies by first appealing the zoning officer's determination to the Board, and, therefore, its complaint should have been dismissed on ripeness grounds. We disagree.

Pursuant to N.J.S.A. 40:55D-18, the governing body of a municipality may require that a zoning permit be issued as a condition precedent to the erection or construction of any building or structure and establish an administrative officer for the purpose of issuing such a permit. This provision also states:

The administrative officer shall issue or deny a zoning permit within 10 business days of receipt of a request therefor. If the administrative officer fails to grant or deny a zoning permit within this period, the failure shall be deemed to be an approval of the application for the zoning permit. [N.J.S.A. 40:55D-18 (emphasis added).]

On the other hand, a denial of a zoning permit is appealable to the Board of Adjustment, N.J.S.A. 40:55D-72(a), which has the power to:

a. Hear and decide appeals where it is alleged by the appellant that there is error in any order, requirement, decision or refusal made by an administrative officer based on or made in the enforcement of the zoning ordinance;

b. Hear and decide requests for interpretation of the zoning map or ordinance or for decisions upon other special questions upon which such board is authorized to pass by any zoning or official map ordinance, in accordance with this act[.]

[N.J.S.A. 40:55D-70.]

See also R. 4:69-5.

Here, the Township adopted an ordinance requiring a zoning permit for the construction of any structure and designated the zoning officer as the administrative officer responsible for issuing such approvals. §205-137. However, because plaintiff's application was not expressly denied, yet no zoning permit having issued, no appeal properly lay with the Board. Rather, plaintiff's position was that the failure of the zoning officer to act amounted to an automatic approval, N.J.S.A. 40:55D-18, for which it sought enforcement in the Law Division by way of an action in lieu of prerogative writs, Rule 4:69-1, for either mandamus or declaratory relief. Obviously aggrieved by the inaction of the municipal official charged with the responsibility for issuing zoning permits, but lacking any final determination or adverse findings for the Board to review, plaintiff clearly had the right to resort to a judicial challenge, without first appealing to the Board. Indeed, such an added gesture would have caused useless delay in an already prolonged municipal process, and proven futile to boot, since the zoning officer was apparently acting at the behest of the municipality, whose planning-related concerns over how 1.5 million square feet of non-residential space were to be constructed had no relevance to whether plaintiff's proposed use was permitted, which it clearly was.

In any event, even if the Board had jurisdiction over the zoning official's inaction, plaintiff's failure to exhaust its administrative remedy in this case does not implicate the validity of the Law Division's determination. While, ordinarily, administrative remedies should be exhausted before resort is had to the court, exhaustion is neither a jurisdictional nor an absolute requirement. Nolan v. Fitzpatrick, 9 N.J. 477, 487 (1952); 21st Century Amusements, Inc. v. D'Alessandro, 257 N.J. Super. 320, 322 (App. Div. 1992). The requirement may be dispensed with where the interest of justice requires, or if there is a need for prompt decision in the public interest or where there is no question as to administrative discretion or judgment and only a question of law is involved or where further resort to administrative recourse would be futile. See Riggs v. Long Beach Twp., 101 N.J. 515, 525 (1986); Aparin v. County of Gloucester, 345 N.J. Super. 41, 62 (Law Div. 2000), aff'd o.b., 345 N.J. Super. 24 (App. Div. 2001).

Here, the subject matter of plaintiff's application involved no factual question requiring the exercise of administrative discretion. Indeed, no one disputes that plaintiff's proposed use was a permitted one in the PUD-II Zone, and the zoning officer's July 9, 2007 response acknowledged as much. Considering zoning's role is to establish permitted uses, the Township's articulated concern over whether the project would result in sufficient density of commercial development i.e. how the balance of the 1.5 million square foot minimum of non-residential space can be developed on the remainder of the Manor Tract, was inconsequential to the rather straightforward determination being asked of the zoning officer. This factor, coupled with the substantial amount of time that elapsed without official action taken, in our view, relieved plaintiff of any exhaustion requirement.

(ii)

Defendants next complain, for the first time on appeal, that plaintiff never filed an official application form with the Township as required by the Township. Because this issue was never raised below, we are not obligated to consider it here. State v. Walker, 385 N.J. Super. 388, 410 (App. Div.), certif. denied, 187 N.J. 83 (2006); see, e.g., Nieder v. Royal Indem. Ins. Co., 62 N.J. 229 (1973); Ferraro v. Demetrakis, 167 N.J. Super. 429, 431-32 (App. Div.), certif. denied, 81 N.J. 290 (1979). Nevertheless, we are satisfied that defendants' argument is without merit.

First, the Law Division was not asked to rule on whether plaintiff's application should have been approved or denied, but on whether the zoning officer had actually determined that the proposed project constituted a permitted use such that a zoning permit should have issued. Moreover, defendants fail to identify any information not provided by plaintiff that the zoning permit application required, or that was needed to make an informed determination on whether plaintiff's proposed use was permitted. And finally, the Law Division's determination did not foreclose the possibility that plaintiff might be required to submit further information later in the municipal approval process, since even with a zoning permit, plaintiff's project was subject to site plan review by the Board. N.J.S.A. 40:55D-67.*fn2 In this regard, the judge noted:

He, [zoning officer], essentially, in a double negative, says it's permitted. So why don't you give him-why doesn't he just issue a zoning permit, if that's what the town requires?... All that does, it gives the applicant the opportunity to go to the planning board.

Thus, the receipt of a zoning permit does not constitute, in itself, an approval of the project. If the Township has concerns about the development of the remainder of the tract, rather than deny a permit to which plaintiff is lawfully entitled, the Township may address its concerns over plaintiff's plans during the Board's review.

(iii)

Lastly, defendants contend that the trial court erred in finding that the zoning officer acknowledged that plaintiff's use was a permitted use. We discern no error.

As noted, the sole question posed by plaintiff's zoning permit application was whether its proposed use constituted a permitted use under the PUD-II Ordinance, and the zoning officer's response effectively, albeit somewhat inartfully by use of a double negative, acknowledged that the proposed use is such a permitted use. In this regard, the zoning officer expressly stated that "There have been no determinations made by this office that the uses are not consistent with the ordinance and settlement agreement in the commercial development in this PUD II zone." (emphasis added).

Contrary to defendants' argument, the question posed was one of use, and not whether the project would result in a sufficient density of commercial development. Consequently, Proietti's July 7, 2007 letter was more than a mere reiteration of the Township's concern over the latter. It was a determination, as found by the Law Division judge, that plaintiff's use is not "not permitted" under the ordinance and the floor area ratio criteria set forth therein. Having found plaintiff's use is not prohibited, a zoning permit should have issued. Thus, the inaction of the zoning officer in this instance was unreasonable, arbitrary and capricious, and, accordingly, the Law Division judge, in so finding, did not err in issuing plaintiff the zoning permit to which it was undeniably entitled.

Affirmed.


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