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Coalition For Friendly Environmental Expansion, Inc v. Borough of Magnolia


August 22, 2011


On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket Nos. L-3629-08 and L-3574-08.

Per curiam.


Argued: February 9, 2011

Before Judges Cuff, Fisher and Simonelli.

Plaintiff Coalition for Friendly Environmental Expansion, Inc. (COFFEE) filed a complaint in lieu of prerogative writs in July 2008, seeking to set aside a resolution adopted by defendant Borough of Magnolia (the Borough) Council in July 2005 designating an 81 acre property in the Borough as an area in need of redevelopment and a November amendment to the redevelopment plan affecting 12 acres of the 81 acre parcel (Count One). The complaint also sought to set aside the 2005 release of a restrictive covenant barring construction of any building or the operation of any business within 200 feet of the southern boundary line of the property (Count Two), and challenged the March 2008 major subdivision and preliminary and final site plan approvals for a portion of the redevelopment site (Count Three). COFFEE argues that the trial court erred in dismissing Counts One and Two of the complaint as untimely.*fn1 We affirm.

This appeal concerns an 81 acre tract in the Borough that borders the Borough of Barrington (Barrington). In 1950, the property was purchased by Wilbur and Ralph Granary at a public sale. The property was acquired subject to a restrictive covenant barring the Granary brothers and their successors in title from "construct[ing] any building or conduct[ing] or operat[ing] any business within 200 feet of the South line of said tract of land." The property was purchased by Owens Corning in the 1950s and used in the production of fiberglass. Owens Corning ceased manufacturing fiberglass in 1988 and used the site thereafter as a warehouse and distribution center. It sold the property to AP-Keera Barrington, LLC (AP-Keera) on June 25, 1999. The new owner converted the property to a commercial complex known as the Barrington Business Park.

On April 26, 2005, Steven Bach of Bach Associates prepared for the Borough a map of a proposed Atlantic Avenue Redevelopment Zone, which included the 81 acre tract owned by AP-Keera. On May 4, 2005, the Borough adopted three resolutions to award contracts to Bach Associates, Louis S. Bezich of Public Solutions, Inc., and Michael P. Albano, Esq., for professional services in connection with redevelopment. Bezich was to serve as an economic development consultant, Bach as the redevelopment engineer, and Albano as the redevelopment attorney.

Shortly thereafter, Bach Associates submitted a document entitled "Determination of Need Investigation" (the Bach Report). This document set out the following background information:

The Governing Body and the Planning/Zoning Board have been working towards attracting new business to any vacant or underutilized facilities. They have been promoting redevelopment and beautification projects with existing land and business owners throughout the Borough of Magnolia, in particular, they have focused on the Barrington Business Park which is more commonly known as the [AP-Keera] site.

The AP-Keera site is described as Block 6, Lots 1 and 2, and Block 7, Lot 2, which is stated to have an aggregate total land area of approximately 81.46 acres. Bach Associates determined that the site met several criteria for the "determination of need for redevelopment" under N.J.S.A. 40A:12A-5.

On May 19, 2005, the Borough passed a resolution authorizing the Planning Board to investigate the need for redevelopment of the property and to hold a public hearing to determine whether the property is in need of redevelopment. The Planning Board minutes reflect that on May 25, 2005, it voted to advertise and schedule a special meeting to discuss redevelopment on June 15, 2005. On June 1, 2005, the Planning Board's attorney sent a letter to the Municipal Clerk, asking her to publish a Public Notice "in the Borough's newspaper for two (2) consecutive weeks prior to the redevelopment hearing date." The attorney also requested that the clerk mail by certified mail, return receipt requested, a "Notice To Affected Property Owners" to the owners of the lots in the proposed redevelopment area. The clerk confirmed that this notice was mailed to AP-Keera, who then owned the property.

The public meeting was rescheduled for June 29, 2005, and the Public Notice was published in the Courier-Post on June 12, 2005, and June 19, 2005. In the interim, however, the Borough authorized Bach Associates to prepare a redevelopment plan on June 16, 2005. The minutes reflect that at the hearing on June 29, 2005, Bach testified about the need for redevelopment. The hearing was then opened to the public, but no comments were received. The Planning Board voted to approve the proposed report, with the exception of page seven because "no testimony regarding the information on this page [was] given."

The Borough passed a resolution on July 6, 2005, "determin[ing] the delineated area known as Block: 6, Lots: 1 & 2 and Block: 7, Lot: 2 along West Atlantic Avenue is a redevelopment area based on the recommendation from the [Borough] Planning Board . . . ." It further adopted Bach Associates' redevelopment plan and forwarded it to the Planning Board for review and recommendations. On the same date, the Borough passed another resolution vacating the deed restriction contained in the deed from the Borough to Granary brothers.

Subsequently, on July 18, 2005, the Planning Board recommended to the Mayor and the Borough Council that the property "be found to be and designated as 'redevelopment areas' and 'areas in need of redevelopment' pursuant to N.J.S.A. 40A:12A-1 et seq." The Board then endorsed the redevelopment plan in a resolution dated July 18, 2005. After publication in the Courier-Post, the minutes reflect that the Borough Council adopted Ordinance 2005-13, entitled "An Ordinance Adopting a Redevelopment Plan Pursuant to [N.J.S.A.] 40A:12A-7," and Ordinance 2005-14: "An Ordinance Releasing, Vacating and Terinating [sic] Restrictinos [sic] on Real Property."

On August 29, 2005, AP-Keera sold the property to Fiberglass Road Associates (FRA). FRA paid the Borough $10 for the "release, termination, and extinguishment" of the restriction in the Granary brothers deed. At some point, these lots were subdivided to create Block 7, Lots 2, 2.03, and 2.04, and Block 6, Lot 2.02. Block 7, Lot 2.04 is the twelve acre undeveloped portion of the 81 acre site at issue in this appeal.

Resolution #R 176-2005 authorized the Borough to enter into a redevelopment agreement with Scannell Properties on October 20, 2005. However, there is no mention of further development until April 5, 2006, when the Borough Council approved the "5 year[] tax abatement plan as submitted by the developer [John D'Anastasio] for the future development on 12 acres off Davis Road."

On August 17, 2006, the Borough authorized the Planning Board to investigate whether Block 7, Lot 2.04 was in need of redevelopment. Bach Associates submitted an amended redevelopment plan, which allowed the construction of age-restricted residential units on Block 7, Lot 2.04. The Planning Board held a meeting on October 25, 2006, and adopted the amended redevelopment plan. On that basis, the Borough, on November 1, 2006, passed an ordinance adopting the amended redevelopment plan. The ordinance was adopted on November 16, 2006.

D'Anastasio submitted an application for subdivision on November 16, 2007, and preliminary and final site plan approval for fifty-nine attached, age-restricted residential units, consisting of eleven four-unit buildings and five three-unit buildings to be known as The Maple Commons. The Planning Board reviewed the application at its regular meetings on January 23, 2008, and February 27, 2008, and at a special meeting held on March 19, 2008. During each session, a portion of the proceeding was dedicated to public comment. Much of the public comment addressed the impact of increased car traffic on the roads. Other members of the public spoke about the environmental concerns they had, including the allegations that Owens Corning had released chemicals into the ground and buried barrels of waste. Some spoke of the effect of the development on existing wildlife in the area. Generally, there was concern from residents of Barrington because the development shares a border with that borough.

On March 19, 2008, the Planning Board approved the application for preliminary and final subdivision and site plan by a five to four vote. On May 28, 2008, the Planning Board adopted Resolution 08-08, which memorialized its findings and conclusions. Specifically, the Planning Board found that "[t]he Applicant's project substantially conforms with Zoning Ordinance standards pursuant to Chapter 270 of the Magnolia Borough Code, and the Atlantic Avenue Redevelopment Plan." Notice was published in the Courier-Post on May 31, 2008.

Barrington filed a verified complaint in lieu of prerogative writs on July 13, 2008. Among its claims, Barrington alleged that the Planning Board's approval of the development and subsequent Resolution of May 28, 2008, were arbitrary, capricious, and contrary to the evidence presented. COFFEE filed its verified complaint in lieu of prerogative writs on July 14, 2008. On March 3, 2009, Judge Orlando consolidated the Barrington and COFFEE actions and bifurcated the issues presented by COFFEE in Counts One and Two, which challenged the 2005 and 2006 redevelopment designations and release of the restrictive covenant.

In an oral decision on December 2, 2009, Judge Orlando held that Counts One and Two were untimely. The judge recognized that the forty-five day requirement of Rule 4:69-6 could be relaxed but held that it was not manifest that the interest of justice required the enlargement of time requested by COFFEE. In so holding, Judge Orlando held that the Borough complied with all procedural requirements outlined by N.J.S.A. 40A:12A-6. The judge considered the following facts in reaching this conclusion:

One, . . . COFFEE does not own any property in the redevelopment area. Two, no member of COFFEE owns property in the redevelopment area. The property owner supports the redevelopment designation. The designation of an area in need of redevelopment was made on July the 6th, 2005. The challenge comes over three years later on July the 14th, 2008.

During that three years significant events have occurred. The governing body signed a redevelopment agreement. The site has been substantially developed. A two [hundred thousand] square foot Federal Express distribution center has been constructed.

There has been a community center built, which . . . hosts a variety of civic and governmental activities. Athletic fields have been created, which are used by the youth of the surrounding communities.

Judge Orlando acknowledged that COFFEE sought to confine its challenge to the redevelopment plan for the wooded 12 acre parcel known as Lot 7, Block 2.04, but observed that its challenge could not be so limited. The judge also found that rights to parties not involved in the litigation would be compromised by any attack on the underlying redevelopment designation. Any challenge to the redevelopment designation after the passage of three years would undermine redevelopment efforts throughout the State. Finally, the judge noted that COFFEE was not without a remedy because it could challenge, and had challenged, the major subdivision and preliminary and final site plan approvals granted by the Planning Board.

The judge also dismissed Count Two which challenged the release of a restrictive covenant inserted in the deed to the Granary brothers in 1950 as time barred. In addition, citing Hendlin v. Fairmount Construction Co., 8 N.J. Super. 310 (Ch. Div. 1950), Judge Orlando held that the Borough, as the originator of the restriction, retained the authority to discharge the same restriction, especially when there was no evidence that the restriction conferred or was intended to confer any benefit on COFFEE.

COFFEE emphasizes that it does not challenge the redevelopment designation of the entire 81 acre parcel but limits its challenge to the 12 acre parcel known as Lot 7, Block 2.04. It then suggests that this action is timely because it filed a timely challenge to the Planning Board resolution granting major subdivision and preliminary and final site plan approvals. Count Three of its July 14, 2008 complaint, which challenges the May 28, 2008 resolution, was timely.

COFFEE seems to suggest that the subdivision and site plan approvals amended the redevelopment plan, and because COFFEE seeks to challenge the redevelopment designation, its July 2008 complaint is timely. That is not so. The May 2008 approvals, however, are a consequence of the 2006 amendment to the redevelopment plan. Therefore, unless the filing date is enlarged, Counts One and Two of its Complaint are untimely.

COFFEE argues that it raises substantial issues of public concern, citing the redevelopment designation itself, the process utilized by the Borough, and the notice provided of the intention of the governing body. Admittedly, these issues raise not only constitutional but also public policy issues, two long-recognized justifications for enlarging the time allowed to challenge municipal action. A court, however, must still find that it is manifest or plainly or palpably evident that the interests of justice require enlargement of time. Hopewell Valley Citizens' Grp., Inc. v. Berwind Prop. Grp. Dev. Co., 204 N.J. 569, 578 (2011). We are not satisfied that COFFEE has met this standard.

Recently, in Hopewell Valley, the Supreme Court addressed the issue of enlargement of time for prerogative writs actions. Id. at 571. The Court instructed that a court rule, such as Rule 4:69-6, is interpreted in the same manner as a statute. Id. at 577-78. Therefore, the usual canons of statutory construction are applied and courts should always start with the plain language of the rule. Id. at 578. In doing so, we will ascribe the ordinary or plain meaning to the words of the rule and a court will resort to extrinsic evidence to interpret the rule only if the language is ambiguous. Ibid.

The Court also reiterated that the decision to enlarge the time to file a prerogative writs action is discretionary but the standard is whether it is "manifest that the interest of justice so requires," so that "a court has discretion to enlarge a Rule 4:69-6(a) or (b) timeframe when it perceives a clear potential for injustice." Ibid.

The Hopewell Valley Court also clarified that the traditional three exceptions identified in Brunetti v. Borough of New Milford, 68 N.J. 576 (1975) was a non-exclusive list. 204 N.J. at 583. Hopewell Valley instructs us that the time for pursuing a prerogative writs action may be enlarged if the action involves constitutional questions, ex parte determinations, important public issues, or the reason for the delay is occasioned by reasonable reliance on information provided in response to an inquiry and a lack of prejudice to a defendant, or other as yet unidentified reasons. Id. at 584-85. Furthermore, in Harrison Redevelopment Agency v. DeRose, 398 N.J. Super. 361, 414 (App. Div. 2008), we recognized that trial judges "must retain the residual power to extend the time for a property owner to assert all claims of invalidity of a redevelopment designation, whether general or property-specific, where the interests of justice so require."

COFFEE argues that its application for an enlargement of time to pursue its challenge to the redevelopment designations should have been granted because its challenge raises fundamental due process issues occasioned by lack of notice to nearby residents of the redevelopment process and important public issues due to the very nature of the impact of redevelopment projects. Specifically, COFFEE argues that the notice was "singularly uninformative" because it did not inform the public of the nature of the redevelopment process and the consequences of a redevelopment designation and the notice was published in a section of the newspaper not calculated to actually notify the public of the intentions of the governing body.

The Supreme Court addressed the notice requirements of the Local Redevelopment and Housing Law (LRHL), N.J.S.A. 40A:12A-1 to -73, twice in the last two years. Town of Kearny v. Disc. City of Old Bridge, Inc., 205 N.J. 386 (2011); Iron Mountain Info. Mgmt., Inc. v. City of Newark, 202 N.J. 74 (2010). In Kearny and Iron Mountain, the parties challenging the lack of notice of a redevelopment proposal were non-record owners of property. Kearny, supra, 205 N.J. at 392-93; Iron Mountain, supra, 202 N.J. at 76. In each case, the Court held that the non-record owner of property was not entitled to individualized notice that redevelopment of the property it occupied was being considered for redevelopment. Kearny, supra, 205 N.J. at 393; Iron Mountain, supra, 202 N.J. at 78-79. Furthermore, the Court held that non-record owners were entitled to no more than newspaper notice as required by N.J.S.A. 40A:12A-6(b)(3). Kearny, supra, 205 N.J. at 393. Furthermore, if the newspaper notice is consistent with the statutory requirement, the non-record property owner must object at the blight hearing or in a timely action in lieu of prerogative writs, or the non-record owner will be foreclosed from challenging the designation at a later date in another proceeding. Ibid.

In Kearny, the non-record property owner was a lessor of property. Id. at 393-94. It sought to challenge the notice provided to it of the redevelopment proposal and proceedings in the condemnation action commenced by the town to condemn its leasehold interest. Id. at 403. The Court summarized the redevelopment process and noted that the Legislature recognized that the governing body was required to provide notice of any proposal that a property would be declared "in need of redevelopment." Id. at 400-03. The Court also highlighted that the Legislature "differentiated between the classes of persons entitled to general notice and those warranting specific notice." Id. at 403. Non-record owners of property subject to a redevelopment proposal are entitled to general notice only. Id. at 404; accord Iron Mountain, supra, 202 N.J. at 78-79.

This court addressed whether the general and individualized notice requirements of the LRHL comport with due process requirements in DeRose, supra. There, the property owner did not receive timely and individualized notice that his property was subject to a redevelopment proposal. 398 N.J. Super. at 416-17. We, therefore, held that the property owner could challenge the redevelopment designation in a subsequent condemnation action. Id. at 413, 418. In the course of our discussion, we highlighted several deficiencies of the statutory notice requirements for property owners that informed our decision to permit the property owner to challenge the redevelopment designation as a defense in the condemnation action rather than in a timely action in lieu of prerogative writs. We wrote:

The statute lacks, however, any individualized mechanism to assure that property owners are fairly informed that the blight designation, if approved by the governing body, operates as a conclusive finding of public purpose that will authorize the government to condemn their properties. The statute also fails to require that owners be apprised of any time limits for contesting a blight designation.

Additionally, the statute omits any obligation to notify owners individually that the governing body has designated their premises as in need of redevelopment, except for those prescient owners who filed a written objection with the Planning Board. [Id. at 407.]

We did not declare the notice provision of N.J.S.A. 40A:12A-6 unconstitutional as it applied to property owners because we allowed the property owners to challenge the designation in the context of any subsequent eminent domain action. Id. at 408-09. Notably, however, we recognized that the Legislature had clearly expressed a preference "to have at least generalized attacks on the redevelopment effort litigated to conclusion before the municipality completes the time-consuming and expensive process of acquiring each parcel in the redevelopment zone." Id. at 414.

COFFEE does not dispute that the general notice provided by the governing body comports with the LRHL. To avoid the consequences of that concession, it attempts to cloak itself in the protections afforded to property owners of record. The Court, however, has twice in the last two years rejected arguments that non-record owners of property are entitled to individualized notice of redevelopment proceedings. Kearny, supra, 205 N.J. at 393; Iron Mountain, supra, 202 N.J. at 78-79. DeRose was also limited to property owners. 398 N.J. Super. at 413. Moreover, DeRose allowed the property owner to pursue its claims in the condemnation proceeding, thereby enlarging the time ordinarily required to challenge a redevelopment designation, due to the deficient nature of the notice and the direct consequences to the property owner flowing from the redevelopment designation. Ibid.

COFFEE can identify only general, non-specific harm attributable to the redevelopment designation and amendment to the redevelopment plan. The general and non-specific harms identified by it underscore the reasons the Legislature identified different classes of persons entitled to notice, and different types of notice. Moreover, we have found no authority that questions the content or form of notice required to be given to the general public. To the contrary, courts have repeatedly held that publication of required notices in newspapers of general circulation comports with due process requirements. See, e.g., Mullane v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 317, 70 S. Ct. 652, 658, 94 L. Ed. 865, 875 (1980) ("This Court has not hesitated to approve of resort to publication . . . where it is not reasonably possible or practicable to give more adequate warning.)"

The general and non-specific harms identified by COFFEE do not overcome the clear legislative preference that challenges to redevelopment actions should be promptly commenced. DeRose, supra, 398 N.J. Super. at 414. Moreover, COFFEE was not without a remedy to challenge the implementation of the redevelopment plan. It could and it did protest implementation of the residential element of the redevelopment plan. That it was unsuccessful in that regard does not provide an independent reason to mount a belated challenge to the initial redevelopment designation or the later amendment to the redevelopment plan.

We have related the process utilized by the Borough and the notice provided to the public because the notice is substantially similar to that employed prior to submission of the land use application in 2007. COFFEE appeared at the 2008 Planning Board hearings. It did so based on similar public notice as accompanied the 2005 and 2006 redevelopment designations. Moreover, we agree with Judge Orlando's reasoning that the passage of time and the substantial work performed in accordance with and in reliance on the 2005 redevelopment designation, some of which produced projects used by the public in the Borough and neighboring communities, strongly counsels against permitting such a belated challenge by non-owners of property.

For the same reasons, we also agree that COFFEE's challenge to the release of the 1950 restriction is time-barred. COFFEE has not demonstrated that release of the covenant imposed by the municipality when the parcel in its entirety was sold to the Granary brothers in 1950 is an issue of manifest public importance to permit an enlargement of time. COFFEE cannot demonstrate that the municipal action created a windfall to the redeveloper, Goodfellow Construction Co. v. Planning Board of Clementon, 147 N.J. Super. 500, 509 (App. Div. 1977), or was undertaken in bad faith or dishonesty, Hendlin, supra, 8 N.J. Super. at 339. Moreover, COFFEE had the ability to challenge the proximity of the proposed residential subdivision to the boundary of the parcel and the adjoining municipality during the land use approval process.

We, therefore, affirm the December 15, 2009 order dismissing Counts One and Two of COFFEE's complaint.


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