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Newman-Steele v. Mayor and Council of the Borough of Tinton Falls

August 17, 2010

MARTHA NEWMAN-STEELE, DR. MARK C. NEWMAN, DR. GARY NEWMAN, AND FRAN NEWMAN SESTI, PLAINTIFFS,
v.
THE MAYOR AND COUNCIL OF THE BOROUGH OF TINTON FALLS, THE BOROUGH OF TINTON FALLS, AND THE BOROUGH OF TINTON FALLS PLANNING BOARD, DEFENDANTS, AND PRC TINTON AVENUE DEVELOPERS, LLC, DEFENDANT/AS AN INDISPENSABLE PARTY, AND THE MAYOR AND COUNCIL OF THE BOROUGH OF TINTON FALLS, THE BOROUGH OF TINTON FALLS, AND THE BOROUGH OF TINTON FALLS PLANNING BOARD, THIRD-PARTY PLAINTIFFS-APPELLANTS,
v.
PAUL ABRAMS AND SAYMARK REALTORS, THIRD-PARTY DEFENDANTS-RESPONDENTS, AND ABRAHAM LESER AND TINTON TELECOM, LLC, THIRD-PARTY DEFENDANTS.



On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-1444-05.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued: October 7, 2009

Before Judges Cuff, C.L. Miniman and Waugh.

Defendants/third-party plaintiffs Mayor and Council of the Borough of Tinton Falls, the Borough of Tinton Falls and the Borough of Tinton Falls Planning Board*fn1 (collectively the Borough) appeal from an order granting third-party defendants Paul Abrams and Saymark Realtors' motion for summary judgment and dismissing their complaint. It argues that Abrams' agreement with a property owner to provide real estate consulting services was contrary to public policy and breached Abrams' fiduciary duty, as a member of various land use boards, to the residents of the Borough. The Borough seeks disgorgement of all funds received from the property. We disagree and affirm.

The genesis of the various claims that ultimately produced four pieces of litigation lies in efforts to redevelop the former CECOM site in Tinton Falls. The CECOM property is a thirty-nine acre site located in the Borough, which housed, until recently, a massive office building and a sprawling paved parking lot. The property had been used until 1998 by the United States Army to support its activities at Fort Monmouth. In 2002, the property was owned by Tinton Telecom, LLC. The principal was Abraham Leser. At that time, the owner's plans for the property reached a stage that permitted it to begin informal discussions with the Borough officials. The procedural history of the redevelopment efforts and the litigation spawned by the several approvals need not be related in detail, but a brief history of the events and the various efforts to contest the redevelopment of this site is necessary to place the issues raised in this appeal in context.

In 2002, Abrams was a member of the Planning Board, the Board of Adjustment and the Environmental Commission of the Borough. At that time he was also a real estate broker and a principal of Saymark Realtors. In summer 2002, he commenced discussions with Leser and Tinton Telecom, LLC, to serve as a real estate consultant for the redevelopment of the CECOM site. Abrams and Leser signed a consulting agreement on November 19, 2002. Abrams submitted his resignation from the Planning Board, Board of Adjustment and Environmental Commission the next day. The Borough Council accepted his resignation from the Planning Board on November 22, 2002, after determining that his business relationship with the proposed developer of the CECOM site implicated only his Planning Board responsibilities.

On August 28, 2002, acting in his capacity as a principal of Saymark Realtors and as an agent for Leser and Tinton Telecom, LLC, Abrams submitted an offer to purchase the 16.6 acre parcel adjacent to the CECOM site. Plaintiffs, various family members who own the parcel, rejected the offer.

Subsequent offers were submitted on September 26 and November 4, 2002.

During early Fall 2002, the Planning Board was considering a general revision to the Master Plan, including an amendment to allow age-restricted or active adult residential development at the CECOM site. The Planning Board discussed the Master Plan amendment, specifically addressing the CECOM site, at its October 23, 2002 meeting; Abrams recused himself citing a potential conflict of interest. On November 26, 2002, four days after Abrams resigned from the Planning Board, the Board planner recommended active adult residential use at the CECOM site. On December 11, 2002, the Planning Board recommended to the Borough Council an amendment to the Master Plan to allow active adult residential use at the CECOM site.

The proposed Master Plan revision, including active adult residential use at the CECOM site, was presented to the Borough Council at its February 4, 2003 regular workshop meeting. On May 2, 2003, Abrams sent a copy of a proposed ordinance permitting active adult residential housing at the CECOM site to Leser.

A May 21, 2003 memorandum from the Board planner to municipal council members reveals that Abrams had shared with him the CECOM site plans developed for Leser and Tinton Telecom, LLC. A later memorandum from the Board planner to municipal council members reveals the planner knew that Abrams was "trying to put together" a 90-acre parcel for development.

On September 16, 2003, the Borough Council adopted a resolution requesting the Planning Board to conduct a preliminary investigation of the CECOM tract for redevelopment. The Planning Board held a public hearing on August 31, 2004, and adopted a resolution recommending that the CECOM site be declared an area in need of redevelopment. The Borough Council adopted a resolution accepting this recommendation and designated the CECOM site as an area in need of redevelopment on October 25, 2004. Two weeks later, the Borough Council requested the Planning Board to prepare a redevelopment plan. On December 7, 2004, the Borough Council adopted an ordinance amending the land use ordinance to create an active adult residential zone that encompassed the CECOM site.

Litigation commenced on January 27, 2005, when plaintiffs filed a complaint against Leser and Tinton Telecom, LLC, in which they sought compensatory damages and injunctive relief as remedies for trespass and disparagement of title, and compensatory and punitive damages for unfair ...


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