January 11, 2012
BOROUGH OF FREEHOLD, PLAINTIFF-APPELLANT,
BOROUGH OF FREEHOLD PLANNING BOARD AND VERONICA M. DAVIS, DEFENDANTS-RESPONDENTS.
On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-4922-10.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued December 12, 2011
Before Judges A. A. Rodriguez and Sabatino.
The Borough of Freehold ("the Borough") appeals the trial court's order dated February 25, 2011 dismissing its complaint in lieu of prerogative writs contesting a use variance granted by the municipality's Planning Board to Veronica M. Davis, Esq. ("Davis"). The use variance permits Davis to operate a portion of her residence as a law office, an activity that otherwise would be disallowed on the premises under the applicable zoning ordinance. The trial court dismissed the Borough's complaint for lack of standing. We affirm.
These are the relevant facts. Davis is a matrimonial lawyer. In or
about February 2008 she entered into a contract to purchase, at a
price of $500,000, certain property located in the Borough at 68 Court
Street. The property contained a twoand-a-half-story residential
dwelling, a two-story building including a two-car garage, and another
building containing a one-car garage. The contract for sale was
contingent upon Davis obtaining a so-called "D" variance*fn2
to convert the property into a law office for six attorneys
and staff. The property is in the Borough's R-5 residential zone,
which generally does not permit office or commercial uses.
Davis consequently applied for a "D" variance with the Planning Board. The application did not contemplate that Davis would reside on the premises. After two days of hearings, the Planning Board denied her initial application in a resolution dated November 12, 2008.
Despite the Planning Board's initial denial of Davis's request for a use variance, she purchased the property for a reduced price of $375,000. Davis moved into the residence and began using a portion of the premises as her law office. According to Davis, she thought she was entitled to do so pursuant to Borough Ordinance RPO 18.70. That ordinance permits up to 500 square feet of certain residences to be used as office space. Davis mistakenly believed that the ordinance applied in the entire Borough, but the Planning Board determined that it did not apply where her residence was located. Davis also thought that she could lawfully use the residence as a home office because the surrounding neighborhood contains several law offices and her property is situated within only 525 feet of the Monmouth County Courthouse.
In January 2009, Davis applied to the Planning Board for a second time for a use variance, invoking a "general welfare" justification that can support such variances.*fn3 Specifically, Davis requested that she be permitted to convert two rooms on the first floor of the residence, consisting of 380 square feet, to a home office, and to use the remainder of the building as her dwelling. As described by the trial court, the proposed variance would enable Davis to use the premises to meet with clients, hire one employee, display exterior signage, create additional parking on the property, and install a handicap ramp or lift.*fn4
The Planning Board heard Davis's post-purchase variance application on three non-consecutive sessions in June and July 2009. Davis testified in support of her application. She also presented expert testimony from Michael Geller, a planner and engineer.
On August 26, 2009, the Planning Board issued a resolution denying Davis's post-purchase variance request. According to the resolution, the Planning Board was not persuaded that Davis had met the positive and negative criteria required for granting a use variance pursuant to N.J.S.A. 40:55D-70(d). Nevertheless, Davis apparently continued to operate her law office at the property, and she consequently received a summons*fn5 for doing so.
Having failed to obtain the Planning Board's approval, Davis filed a complaint in lieu of prerogative writs in the Law Division in October 2009. Davis asserted that the Planning Board had not properly applied the standards for a use variance set forth in N.J.S.A. 40:55D-70(d), and had not correctly analyzed the applicable positive and negative criteria. She argued that despite recitals in the Planning Board's resolution alluding to "general welfare" considerations, several Planning Board members, in actuality, had mistakenly applied the alternative "hardship" test of N.J.S.A. 40:55D-70(d) in casting their votes. In particular, as the trial court noted, several Planning Board members had referred to Davis's failure to demonstrate hardship.*fn6
After considering these arguments, Assignment Judge Lawrence M. Lawson issued a written opinion on May 24, 2010, remanding the matter to the Planning Board to reconsider Davis's variance application using the proper standards. Among other things, Judge Lawson noted that [t]he language throughout the [hearing] transcripts is of not only undue hardship, but also of blatant frustration with [Davis] for making the application. As such, this [c]court is unable to glean from the record below whether the [Planning] Board accurately applied the positive and negative criteria, or rather, if such language was in the Resolution as mere pretext and the incorrect standard was applied to reach the denial.
Judge Lawson concluded that the Planning Board's application of the erroneous legal standards rendered its denial of the variance request "arbitrary, capricious and unreasonable."
In remanding the matter, Judge Lawson specifically instructed the Planning Board not to hear further testimony or to review additional evidence. Instead, the Planning Board was directed to review only the evidence that had been previously adduced and to apply to that evidence the correct legal standards for a variance founded upon general welfare rather than hardship considerations.
Pursuant to the court-ordered remand, the Planning Board reconsidered Davis's application at a hearing on August 25, 2010. The transcript of that hearing shows that the Planning Board's attorney endeavored to assure that each member had reviewed the record, and was made aware of the correct legal standards to apply.
After several members of the Planning Board commented on the record about the remanded application, the body approved the use variance, by a vote of five to three.*fn7 On September 8, 2010, the Planning Board issued a corresponding resolution granting the variance. In particular, the resolution set forth the following reasons:
9. The Planning Board finds that [Davis] has met the positive and negative criteria to justify the requested variance under N.J.S.A. 40:55D-70(d). The Planning Board bases this determination on the following:
a. There are special reasons to justify the granting of the variance, and the subject site is particularly suited for the proposed use as a mixed residence and law office. There are numerous properties to the north of the property on Court Street that contain office and quasi-commercial uses, including the Garden State Indemnity Company, the Law Offices of Thomas Mallon, the Law Offices of Ronald Sage, the Dittmar Insurance Agency and the Monmouth County Historical Society. The property is in the near vicinity of the Monmouth County Courthouse. Further, the property is an oversized lot for the area, and contains a substantial side yard that would act as a suitable buffer between the proposed use, the office and mixed commercial uses to the north, and the residential neighborhood that is located to the south on Court Street; and
b. The requested variance is not inconsistent with the zone plan and zoning ordinance, and can be granted without substantial detriment to the public good. The Board bases this determination on the fact that only a small portion of the site will be utilized for the law practice, and the majority of the building will be used in accordance with R-5 requirements. Further, the fact that the property will be simultaneously occupied by [Davis'] family will likely result in better monitoring of the site, and decrease the possibility of any adverse affects from the office use on the residential neighbors located to the south on Court Street. Lastly, since the property is oversized, and there is a vacant side yard, a suitable buffer will exist between the office uses and the residences to the south.
As a further condition of approval, the Planning Board restricted the use of the office to no more than one employee in addition to Davis. Davis's lawsuit against the Planning Board was consequently dismissed.
On September 29, 2010, the Borough filed a complaint in lieu of prerogative writs challenging the Planning Board's decision to grant Davis a use variance. Among other things, the Borough asserted that: (1) the Planning Board failed to base its post-remand decision on the appropriate positive and negative criteria; (2) the Planning Board usurped its authority by ignoring the intent of the municipality's zoning ordinance and master plan; and (3) Davis had misled the Planning Board about the number of employees working in her office.*fn8 The Planning Board did not take a position on the Borough's complaint.
Davis moved to dismiss the Borough's complaint for lack of standing. She further maintained that the Planning Board's ultimate resolution granting her a use variance contained sufficient facts to support its finding that the variance would not cause substantial detriment to the public good, and that the variance was not inconsistent with the Borough's master plan and ordinances. Additionally, Davis argued that the Planning Board properly considered the statutory negative criteria in the remand proceedings, but reasonably concluded that the positive criteria outweighed them.
The Borough's lawsuit was likewise assigned to Judge Lawson. After hearing oral argument, Judge Lawson granted Davis's motion to dismiss the Borough's complaint, in a written order dated February 25, 2011, followed by a written opinion dated February 28, 2011.
Judge Lawson agreed with Davis that the Borough did not have standing to assert its claims against the Planning Board. The judge also was satisfied that the Planning Board had not exceeded its powers or usurped the Borough's own authority. In addition, the judge found that the Borough had presented no proof that Davis employed more than one person at her office.
On appeal, the Borough argues that the trial court erred in granting Davis's motion to dismiss its complaint, and misapplied principles of standing. The Borough also reiterates its grounds for challenging the substance of the Planning Board's ultimate decision to grant the variance.
Having fully considered the arguments raised on appeal, we sustain the trial court's dismissal of the Borough's complaint, substantially for the reasons cogently expressed in Judge Lawson's written opinion dated February 28, 2011. We add the following comments.
The applicable legal authority strictly limits a municipal agency's ability to sue another governmental body within that same municipality. Our Supreme Court has recognized that, in general, "a municipal agency's parens patriae interest in protecting the general public is insufficient to support standing to challenge an exercise of power by another municipal agency." Twp. of Stafford v. Stafford Zoning Bd. of Adjustment, 154 N.J. 62, 77 (1998).
A governing body has standing to challenge a decision of another municipal agency only in "those rare circumstances where a zoning board exceeds the scope of its authority, thereby arrogating the governing body's authority, and such action threatens either the public interest or enforcement of the MLUL." Id. at 81; Cox & Koenig, N.J. Zoning & Land Use Admin., § 33-1.1 at 719 (2011). For example, we have noted that where a zoning board's decision is procured by fraud, the municipal government may have standing "to rescind the relief so granted and to enjoin what is actually a violation of the zoning ordinance and plan." Zoning Bd. of Adjustment of Green Brook v. Datchko, 142 N.J. Super. 501, 508 (App. Div. 1976). Additionally, we have noted that "a municipal governing body may sue to protect the integrity of its own legislatively conferred powers . . . when a board has exceeded its statutory powers and attempted, through a use variance, to impose its own view" regarding the appropriate use of a portion of a municipality. Twp. of N. Brunswick v. Zoning Bd. of Adjustment of N. Brunswick, 378 N.J. Super. 485, 490 (App. Div.) (citing Twp. of Dover v. Bd. of Adjustment of Dover, 158 N.J. Super. 401, 409-10 (App. Div. 1978)), certif. denied, 185 N.J. 266 (2005).
Unless these rare exceptions apply, the governing municipal body lacks standing to litigate against another municipal agency. Such a restrictive approach prevents the unwarranted dissipation of taxpayer dollars in legal expenses and the diversion of public resources, including those of the court system.
The Borough argues that it has standing to challenge the Planning Board's grant of a use variance to Davis because the Planning Board allegedly failed to comply with statutory requirements under the Municipal Land Use Law ("MLUL"), N.J.S.A. 40:55D-1 to -163. Specifically, the Borough alleges that the Planning Board members failed at the August 25, 2010 meeting to address with adequate specificity the positive and negative criteria for a subsection d variance set forth in N.J.S.A. 40:55D-70(d).
Regardless of what the individual Planning Board members chose to discuss on the record at the August 25, 2010 meeting on remand from the trial court, it is abundantly clear that the Planning Board's corresponding resolution dated September 8, 2010 amply addresses both the applicable positive and negative criteria under the statute. The resolution identifies a litany of positive special reasons that justify awarding the use variance to Davis. These considerations include, for example, the particular suitability of the site to a mixed residential/office use, the other surrounding properties that likewise house office and quasi-commercial uses, the parcel's close proximity to the courthouse, and the substantial side yard buffers. The resolution also duly explores the negative criteria, including such factors as the fractional portion of the site used for an office, the simultaneous residential occupancy of Davis and her family, and the considerable dimensions of the buffers.
We recognize that the Planning Board members did not discuss the positive and negative criteria in as detailed a manner at the August 2010 meeting as did the September 2010 resolution memorializing its decision. Nevertheless, several Planning Board members did state on the record their reasoning in support of their vote. Additionally, the Planning Board's counsel expressly advised the members on the record to apply the relevant positive and negative criteria.
As Judge Lawson correctly noted in his February 28, 2011 opinion:
[a]lthough many of the [standing] cases use the phrase "exceeded its statutory authority," the case law has not reflected that any deviation from the statutory regime gives the governing body standing. If that were the case, the mere allegation that a Board's decision is arbitrary, capricious and unreasonable would give rise to standing. Such an application of the case law would render the limitation on a governing body's standing to challenge the exercise of power by another municipal agency meaningless.
In a similar vein, as the late Judge Pressler noted in Township of Dover, supra, 158 N.J. Super. at 409:
[in] the ordinary variance case in which the board of adjustment's action may be vulnerable for such alleged misuses of discretion or power as, for example, an action taken unwisely or imprudently, or without an adequate factual basis in the evidence before it, or without an adequate statement of reasons or contrary to the governing body's collective perception of what the public good may permit or what the integrity of the zoning ordinance may require. In our judgment, review at the instance of the governing body of such alleged errors in the exercise of statutory authority and such disputes as to the exercise of discretion would seriously and perhaps irremediably undermine the board's essential autonomy. We are therefore satisfied that so long as the board acts within the ambit of its authority, whether it has acted wisely or not, and whether it has acted correctly or not, are not matters which the governing body itself should be able to raise. [Twp. of Dover, supra, 158 N.J. Super. at 409 (emphasis added).]
In assessing whether a municipal governing body has standing to sue to challenge "the grant of a use variance, a court must consider whether the requested variance would substantially alter the character of the district as set forth in the applicable zoning ordinance." Twp. of N. Brunswick, supra, 378 N.J. Super. at 491 (citing Twp. of Dover, supra, 158 N.J. Super. at 412-13). Courts review several factors when making this determination, including (1) the tract size itself;
(2) the tract size relative to the size and character of the district where it is located and of the municipality as a whole;
(3) the number of parcels into which the tract will be subdivided; and (4) the nature and extent of the variation sought from district regulations. Ibid. (citing Twp. of Dover, supra, 158 N.J. Super. at 413).
Applying these factors here, Judge Lawson identified several persuasive reasons for rejecting the Borough's asserted standing to challenge the Planning Board's grant of the use variance. First, the Planning Board granted the variance for a small tract of land. Second, as Judge Lawson noted, the relative size of the tract of land being granted the variance is small compared to the overall zoning district. Additionally, there are other commercial entities on the block, and thus the variance will not disturb the character of the district. Third, the tract will not be subdivided into smaller parcels. Fourth, the property is zoned for residential use, and it will continue to be used for a residential purpose in addition to containing a small office.
We disagree with the Borough that the Planning Board's September 2010 resolution was required to say more than it did, and to recite explicitly why it was departing from its prior decision rejecting Davis's application. The Planning Board was entitled to change its mind, so long as it gave adequate reasons for its ultimate action, which it did.
For these reasons, Judge Lawson correctly dismissed the Borough's complaint for lack of standing. The Planning Board did, in fact, consider the relevant positive and negative criteria, and it did not usurp the Borough's authority.