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Alfieri-Old Bridge Associates, LLC v. Board of Adjustment of the Township of Old Bridge and Planning Board


July 26, 2012


On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-6947-07.

Per curiam.


Argued May 7, 2012

Before Judges A. A. Rodriguez, Sabatino and Ashrafi.

This complex land use dispute returns on an appeal by a developer contesting the trial court's rulings in the aftermath of our October 2007 opinion remanding the case and directing further proceedings before the Old Bridge Township Planning Board ("the Planning Board"). See Alfieri-Old Bridge Assocs., LLC v. Bd. of Adjustment, No. A-1644-06 (App. Div. Oct. 29, 2007). In particular, plaintiff, the developer of a large multi-use project in Old Bridge Township ("the Township"), appeals from various aspects of the trial court's November 19, 2010 order concerning the "staging" of its project and other issues. For the reasons that follow, we affirm the trial court's order, albeit for slightly different reasons than those expressed by the trial judge. We also remand this matter back to the trial court to address certain unresolved issues.


Much of the extensive factual and procedural chronology of this long-standing matter is detailed in our October 2007 opinion and need not be repeated in full here. We briefly summarize that prior history, updating it with an account of the additional proceedings that took place before the Planning Board in 2008 and 2009 and before the trial court in 2010.

Plaintiff, Alfieri-Old Bridge Associates, LLC ("Alfieri"), is the developer of a 139-acre parcel in the Township, located by Exit 120 of the Garden State Parkway ("the Parkway"). Alfieri's predecessor-in-title, Edward J. Rondinelli, also a developer, applied to the Township's Board of Adjustment in 1985 for approval of a general development plan ("GDP") for the site. Rondinelli's GDP application initially called for 1.7 million square feet of office and research space, 250 to 350 hotel rooms, convention space, and 400 dwelling units. The proposed dwellings would be a mix of townhouses, duplexes, and four-unit and eight-unit residential dwellings. Rondinelli intended to call the development "Metropark South."

After two public hearings, the Board of Adjustment approved the GDP in September 1985 and granted Rondinelli certain variances. Most importantly for purposes of the present appeal, the Board of Adjustment granted defendant a waiver of the so-called "staging" requirements for GDPs set forth in the Township's zoning ordinances. Those staging requirements generally require both the residential and commercial components in a GDP to proceed simultaneously. The effect of the staging waiver was to allow the developer to build approximately 400 townhouses first (on what became known as the "Bridgepointe" project) before starting construction on the anticipated office and hotel buildings. In granting that staging waiver in 1985, the Board of Adjustment took into account that the developer was constructing two other office buildings, "Atrium I" and "Atrium II," on a site in the Township near the GDP parcel.

The Board of Adjustment concluded in 1985 that "special reasons" were present to justify the requested variances, including, among other things, the fact that "the area is too difficult and expensive to develop under strict compliance with the requirements of the [GDP] Ordinance due to topographical and other conditions including prior dumping of refuse and mining operations." The Board of Adjustment also took into account the then-existing economic conditions that made the office buildings, despite the tax ratables they would produce for the Township, more difficult to market at that time than the residential townhouses.

In November 1987, the Board of Adjustment issued a second resolution concerning the project. That resolution specifically provided that the previously-issued GDP would be vested for twenty years, calculated from the date of the original resolution on September 5, 1985. This vesting language was inserted to correct what was described as an "oversight" in the original resolution.

In April 1989, the Board of Adjustment granted Rondinelli approval to amend the 1985 GDP in various respects. The modifications included a relocation of certain townhouse units because of wetland requirements enforced by the Department of Environmental Protection ("DEP"). The Board of Adjustment also approved the deletion of a commuter rail station as well as the elimination of a direct roadway connection to the Garden State Parkway, again because of wetland mitigation concerns.

In 1993, Rondinelli presented the Board of Adjustment with a modified version of the GDP, seeking several additional variances. The 1993 Amended GDP included a proposal to construct 155 single-family homes (referred to as the "Canterbury Cove" project). Rondinelli also agreed to build

1.69 million square feet of commercial/industrial buildings on the site (including what was known as the "Esplanade"), subject to market conditions. After additional hearings, the Board of Adjustment approved these changes in a resolution issued in October 1994.

Alfieri purchased the property from Rondinelli in 1998. Thereafter, the Board of Adjustment adopted the legal position that it never had the authority to approve the GDP in the first place and that it would no longer review further applications by the developer to modify or to extend the GDP. Hence, when Alfieri filed three Preliminary Subdivision and Site Plan Approval requests between June 2003 and April 2005,*fn1 the Board of Adjustment declined to act upon them. Alfieri filed an action in lieu of prerogative writs in May 2006 in the Law Division, seeking to compel the Board of Adjustment to act upon those pending applications.

The Law Division judge who was then handling the matter granted Alfieri's motion for a remand. The judge concluded that the Board of Adjustment did, in fact, possess jurisdiction under the then-existing version of the Municipal Land Use Law, currently N.J.S.A. 40:55D-1 to -163 ("MLUL"), to approve the GDP in 1985 and that the Board of Adjustment continued to have such jurisdiction. An appeal of that ruling ensued. In the meantime, the matter was remanded to the Board of Adjustment.

Following the remand, the Board of Adjustment initially considered Alfieri's pending applications in May 2007. At the conclusion of those hearings, the Board of Adjustment declined to extend Alfieri's vested rights period and deemed the 1993 Amended GDP as expired. The Board of Adjustment's resolution recited that the pending applications represented a "material change" to the 1993 Amended GDP, also noting that there were still unresolved environmental and roadway issues for the project.*fn2

Alfieri filed an order to show cause and a verified complaint in the Law Division in August 2007, challenging the Board of Adjustment's decision not to extend the vested rights period. While that complaint was pending, on October 29, 2007, we issued an unpublished opinion affirming the trial court's jurisdictional decision in the prior litigation, with certain modifications. See Alfieri-Old Bridge Assocs., supra, slip op. at 20-22.

In our October 2007 opinion, we noted that the Board of Adjustment was no longer seeking a judicial nullification of its past approvals of the GDP and related variances. Id., slip op. at 9. Instead, the Board of Adjustment sought a ruling that all pending and future applications concerning the site should be presented to the Township's Planning Board. Ibid. We held that "the Board of Adjustment had the legal authority under the Township's [ordinance] and also under the then-existing provisions of the MLUL to grant the property owner a use variance in April 1985 and approval of the GDP, as it was conceptually presented, in September 1985," and that the doctrine of ultra vires was not applicable. Id., slip op. at 17. However, given the subsequent adoption of N.J.S.A. 40:55D-45.1, in May 1987, entrusting the approval of GDPs to planning boards and not to boards of adjustment, we ruled that, on remand, the merits of Alfieri's unresolved applications should be decided by the Planning Board, not by the Board of Adjustment. Id., slip op. at 20-22.

In remanding this matter, we provided specific instructions with respect to the legal treatment of prior approvals obtained by the developer from the Board of Adjustment, stating:

We therefore modify the Law Division judge's determination to provide that Alfieri's undecided and complete site plan applications, and any other future site plan applications, arising out of or connected to the GDP, shall be heard by the Old Bridge Planning Board. We do so on the strict condition that the Planning Board may not nullify the GDP itself, nor the variances and other approvals already issued by the Board of Adjustment, unless the site owner or developer seeks their modification. We further instruct that the Planning Board address, expeditiously, Alfieri's three unheard site plan applications. This dispute has festered long enough over jurisdictional disagreements, and it is time for the open applications to be considered by the municipality on their merits, with dispatch.

[Id., slip op. at 21-22 (emphasis added).]

Given the inadequate record before us, we declined to resolve the vested-rights question, i.e., "whether an additional extension of the GDP from its already extended date of March 2, 2006 to November 12, 2007 should or should not be authorized[.]" Id., slip op. at 20. We instead directed that the propriety of such an extension should be addressed first at the municipal level. Ibid. We also made the following observations:

We were informed at oral argument that since the time of the trial court's October 2006 order, the Board of Adjustment denied an extension request by [plaintiff], and that denial triggered an order to show cause filed by [plaintiff] in the Law Division, the outcome of which was undetermined as of the time this case was argued before us. Because those proceedings are not in the record, we do not address the merits of that decision. Nor do we address the related question of whether the maximum twenty-year vesting period under N.J.S.A. 40:55D-45.1 should be equitably tolled here because of the time the parties have spent litigating jurisdictional issues. If the Law Division judge remands the GDP extension issue back to the municipality, or has already done so, such remanded proceedings should be conducted before the Planning Board rather than the Board of Adjustment, consistent with our general prospective determination that jurisdiction should now lie in the Planning Board. [Id., slip op. at 20 n.6 (emphasis added).]

In January 2008, the trial court held a case management conference to develop the process for implementing our October 2007 remand. As a result of that conference, the parties entered into a consent order, which provided that the matter would be remanded to the Planning Board and that the Planning Board "shall grant or deny" the developer's applications "not later than 120 days from the entry of the [consent order] or such extended period as may be consented to by the parties or fixed by the [trial] [c]court." The trial court retained jurisdiction during the remand proceedings before the Planning Board to facilitate compliance with the consent order.

The Planning Board subsequently held twelve hearings on Alfieri's pending applications between February 19, 2008 and November 18, 2008. At these hearings, Alfieri presented testimony from its project engineer, its planner, its environmental consultant, an engineer from the Turnpike Authority, and a real estate appraiser. These witnesses generally explained why certain adjustments to the 1993 Amended GDP were now warranted and, in particular, why it was not financially feasible for Alfieri to be forced to construct the proposed office space in the current economic climate.

The Planning Board also heard testimony from its consulting engineer and its planners. The Planning Board's engineer asserted that the 2005 Amended GDP reflected a significant difference in the project's uses from those that had been specified in the 1993 Amended GDP. Among other things, the Board's planner noted that the new plans reflected a 33.6 percent reduction in proposed office space, taking into account the average of the range approved in 1993. Moreover, the planned hotel space had been reduced by 32.5 percent. In addition, Canterbury Cove, which the Planning Board considered to be a residential section unto itself, had been reduced by

46.5 percent.

Following these hearings, the Planning Board determined

that: (1) an amended GDP was required; (2) the proposed 2005 Amended GDP must be denied, "as a result of it being inconsistent with the staging requirements of [the] GDP ordinance"; (3) the preliminary subdivision and site plan applications would be approved and nearly all requested variances and design waivers would be granted, provided that Alfieri obtain a valid GDP; and (4) the vesting of the 1985 GDP extended only through November 2009. Importantly, this decision rejected Alfieri's contention that it was entitled to a continued staging waiver allowing it to build the residences in Canterbury Cove before building the office and hotel buildings.

The Planning Board's decision was memorialized in a resolution dated February 3, 2009, which contained the following pertinent findings:

(1) The Board finds and concludes that the vested rights associated with the initial 1985 GDP are extended until and through November 12, 2009.

(2) The Board finds and concludes that the Amended GDP application is not consistent with, and represents a material deviation from, the 1993 Amended GDP, and therefore requires consideration by the Board. The Board further finds that the Amended GDP does not comply with the staging requirements of the Ordinance and that the prior approvals of the Zoning Board, regarding staging, only applied to the Bridgepointe section and not the balance of the GDP.

(3) The Board finds the relocation of the various land uses, the reduction in the size of the residential portion of Canterbury Cove section, the relocation of the Hotel and the Esplanade, the removal of the interconnection between the Esplanade and Canterbury Cove and the removal of the gas station as constituting a variation in physical features requiring approval under Section 40:55D-45.5 of the MLUL.

(4) The Board finds the modifications to the plan are not a result of DEP action and finds the testimony of the Applicant's experts in that regard to be wholly lacking credibility. The Board finds that all of the environmental constraints and steep slopes to have existed on the Property at the time the 1993 Amended GDP was approved and at the time the Applicant purchased the property in 1998. The Board finds that those conditions were simply omitted from the plan by mistake. . . . The Board finds that it has a right to rely upon the previously approved plan and that Section 40:55D-45.5(b) of the MLUL was not enacted to absolve drafting mistakes.

(5) The Board also finds the testimony of the Applicant's experts that the modifications to the plan, specifically the Canterbury Cove section, are a result of the enactment of the [Residential Site Improvement Standards] to be unpersuasive. . . .

(6) The Board finds the staging proposal of the Amended GDP application,

i.e., to construct Canterbury Cove before the Esplanade or the Hotel, to be inconsistent with the 1993 Amended GDP and constitute the need for relief under Section 40:55D-45.4 of the MLUL. The Board finds that [Alfieri's real estate expert's] testimony regarding market conditions as being a justification for the staging variance as lacking credibility, especially in light of the fact that [the expert] premised the validity of his testimony on the outcome of the impending financial crisis, which the Board finds impossible to predict. . . .

(8) The Board finds that the purpose of the GDP statute and Ordinance is to protect the public interests by providing a balance of residential and commercial development, in exchange for the extended vesting that a GDP approval provides. The Board further finds that to approve the staging variance would result in an imbalance and the construction of 100% of the residential sections of the GDP without any commercial ratables. The Board finds that to grant such a variance would violate the entire premise of the GDP ordinance.

(9) The Board finds that the Applicant did not satisfy its burden of proof relative to the variance requested from the staging requirements of the Ordinance. The Board further finds and concludes that the previous action of the Zoning Board applied only to the Bridgepointe section and not the balance of the GDP. The Board finds that the Applicant has already fully constructed the 400 townhome units in Bridgepointe, representing approximately 70% of the residential land uses and that it must construct the Esplanade and the Hotel, and related roadway improvements, prior to Canterbury Cove.

(10) The Board finds that the modifications to the GDP represent a greater than 15% change in the specific sections (The Esplanade, Canterbury Cove and the Hotel individually) as contemplated under Section 40:55D-45.6(b) and rejects the Applicant's testimony that (1) the Atrium I & II square footage should be included in any calculations and (2) that it is appropriate to combine Bridgepointe and Canterbury Cove and combine the Esplanade and the Hotel, in more general terms, residential and nonresidential sections, respectively. [Emphasis added.]

The Planning Board further specified that its grant of the preliminary subdivision and site plan approvals was conditioned upon Alfieri's "obtain[ing] a valid Amended GDP, demonstrating full compliance with the staging requirements of the

[o]rdinance[.]" The Planning Board also imposed various other conditions concerning roadway improvements and affordable housing fees.

The case then returned to the trial court for consideration of Alfieri's contention that the Planning Board had improperly imposed conditions on its pending applications. In particular, Alfieri challenged the Planning Board's insistence upon staging the project consistent with the zoning ordinance. Alfieri also contested the Planning Board's refusal to treat the Atrium development as part of the GDP.

After reviewing the copious record from the Planning Board proceedings, the trial judge*fn3 issued a written decision and judgment on November 19, 2010, denying Alfieri's requests for relief. The judge concluded that the Board of Adjustment had, in fact, waived the ordinance's staging requirement in 1985, but found that this waiver was applicable only with respect to the Bridgepointe element of the project. The judge also noted that the changes subsequently granted in the 1993 Amended GDP had been conditioned upon the construction of 1.7 million square feet of nonresidential space. The judge agreed with the Planning Board that the proposed 47 percent reduction in the size of Canterbury Cove comprised an amendment to the GDP that required Board approval. According to the judge, amended GDP approval was also necessary because of the relocation of the various uses, the removal of an internal roadway between the Esplanade and Canterbury Cove, and the elimination of a gas station.

The judge further reasoned that the proposed amendment to the GDP rendered the GDP subject to review, in accordance with both the Township's current zoning ordinance and also N.J.S.A. 40:55D-45.1 to -45.8. The GDP was not exempt from these provisions because it did not have final approval for any section of its plan prior to May 28, 1987 (the date that N.J.S.A. 40:55D-45.1 was adopted). The judge also concluded that the Planning Board was entitled to reimpose a staging requirement and that doing so did not violate this court's October 2007 opinion. Additionally, the judge ruled that the Planning Board had not abused its discretion in denying Alfieri's alternative grounds for requesting a new staging waiver.

Furthermore, the judge agreed with the Planning Board that the Atrium buildings were not part of the 1985 GDP. The judge noted in this regard that: (1) Rondinelli had received various site plan approvals for the Atrium buildings prior to the 1985 GDP; (2) the required open space for the 1985 GDP was calculated without incorporating the Atrium acreage; (3) it was confirmed at the 1985 hearings that Atrium I was not part of the 1985 GDP; (4) the Atrium buildings were not included by block and lot reference in any resolution relating to the 1985 GDP; and (5) the total scope of nonresidential development within the 1985 GDP would have been greater than 1.7 million square feet had the Atrium development been included. The judge thus concluded that "Atrium I was offered by Rondinelli to induce the Zoning Board to waive the staging requirement of the [local ordinance] for Metropark South. It was a justification for the waiver and was not intended to be a part of the GDP. It was linked to it but not part of it." (Emphasis added).

On the present appeal, Alfieri principally contends that the trial court's decision was erroneous because the Board of Adjustment had waived the staging requirements for the entire project in 1985. Alfieri maintains that the most recent changes to the GDP have not reopened the issue of staging. Alfieri further argues that the Planning Board and the trial court misapplied our October 2007 decision by resurrecting the staging requirements that had been previously waived.

If, hypothetically, the staging waiver were not preserved and must be justified anew, Alfieri argues that the testimony of its real estate expert about market feasibility of the commercial units was arbitrarily rejected by the Planning Board and that it should not be required at this time to build commercial units in tandem with additional residential units.

Lastly, Alfieri requests that we direct the trial court on remand to address specifically whether the Planning Board's imposed conditions for affordable housing and off-tract traffic mitigation and roadway improvements are ultra vires.

We now consider these arguments, focusing mainly on the pivotal staging issue.


We examine the staging issue by first considering the rationale underlying the initial grant of the staging waiver by the Board of Adjustment in 1985. We then turn to the approval of the 1993 Amended GDP and the extent to which that approval impliedly extended the waiver. Next, we consider the impact of the changes to the project reflected in the 2005 Amended GDP and the mutual conclusions of the Planning Board and the trial court that those 2005 changes were sufficiently material modifications of the GDP affecting the project's staging to eliminate any vested rights that the developer may have had in the waiver. Lastly, we review the Planning Board's rejection of a new staging waiver on the alternative grounds presented by the developer, as well as the trial court's affirmance of that rejection.


The record clearly establishes that the Board of Adjustment's grant of a staging waiver to Rondinelli in 1985 was predicated upon careful consideration of the overall advantages and disadvantages of the GDP as a whole.

In conjunction with his 1985 application, Rondinelli requested a variance from a requirement set forth in § 9-10:2.1 of a local ordinance. That ordinance specified in this regard that residential and non-residential development had to proceed concurrently. The ordinance required that the construction of certain percentages of the total residential units would be dependent upon how many non-residential acres had been improved with public water and sewer. The percentages would also hinge upon the minimum assessed value of the non-residential space under construction.

At the hearing before the Board of Adjustment in 1985, Rondinelli confirmed that, prior to commencing any construction on the Esplanade, he sought to build all of the approximately 400 townhouses (the total number of residential units permitted under the 1983 ordinance for the entire 139-acre property) on a relatively undisturbed 37-acre portion of the parcel situated away from the Parkway. Rondinelli noted that twenty-three percent of the 139-acre parcel (i.e., 32 acres) had been designated as open space in accordance with § 9-4:1.1 of the local ordinance.

In return for the staging waiver, Rondinelli offered to complete the construction of 112,000 square feet of office space on an adjacent site before starting the residential Bridgepointe project. He explained that in 1984, he had received approval to construct two connected office buildings, Atrium I (112,000 square feet) and Atrium II (224,636 square feet), on a 14.5-acre parcel also situated in Old Bridge, directly across from the proposed Metropark South site on the west side of the Parkway. Rondinelli acknowledged that his proposed GDP only applied to the 139 acres to the east of the Parkway, but stated that "in reality" the site should be seen and evaluated as comprising the land on both sides of the Parkway.

Rondinelli explained that he viewed the Atrium buildings as integral parts of the site, which would dictate the success of the entire project. He wanted to start Atrium I first because the lot on which it was to be built was attractively wooded and required no heavy construction or extensive site costs. He represented that he would be building Atrium I using his own money, on "spec," and that he had no tenants at that time.

Rondinelli anticipated that corporate tenants would be drawn to the site, which would then enable him to build Atrium II as an expansion project. By contrast, a single building constructed in the middle of the clay pits on the GDP site would not be similarly marketable. Thus, Atrium I and Bridgepointe would help Rondinelli carry the expensive project costs associated with the Esplanade.


At the Board of Adjustment's September 5, 1985 meeting, Rondinelli's counsel offered a developer's agreement confirming that Rondinelli would build Atrium I before commencing work on Bridgepointe and also that, as the townhouses were built, Rondinelli would put money aside and begin restoring the clay pits. Counsel asked that the Board of Adjustment consider the agreement as fulfilling the staging requirements for Metropark South.

At the conclusion of the September 5, 1985 meeting, the Board of Adjustment approved Rondinelli's application for a GDP with a density variance and a staging waiver. The Board of Adjustment noted at this meeting, as well as in its resolution of the same date, that the variances were justified because the property was "too difficult and expensive to develop under strict compliance with the requirements of the ordinance." The Board's 1985 resolution further provided, in pertinent part, as follows:

[T]his Board does hereby grant Approval of the General Development Plan for Class I PD with variances for residential density and waiver of staging as requested provided that applicant shall . . . substantially complete the 100,000 square feet office project known as Atrium I prior to construction of any residential units.

This chronology plainly shows the multiple and offsetting considerations that induced the Board of Adjustment to grant the staging waiver in the first instance.


As we have already noted, difficulties arose in the construction of Bridgepointe, particularly stemming from sewer moratoriums and disputes over affordable housing issues.*fn4

Consequently, in 1993, while construction of Bridgepointe was still underway, Rondinelli applied to the Board of Adjustment for a density/use variance to allow more residential units to be constructed on the site. He also sought an amendment to the GDP to permit residential construction on some of the remaining ninety-seven acres previously designated for office/hotel development. He proposed to eliminate certain office buildings and to scale down the remaining four, which would result in a total of about 950,000 square feet of nonresidential space. He also sought to reduce the size of the hotel to 200 rooms with no conference center and to construct a development of up to 155 single family homes to be known as "Canterbury Cove" on 36.4 acres.

As part of the 1993 Amended GDP, Rondinelli sought a waiver of the local ordinance's staging requirements so that the Canterbury Cove residential units could be constructed before the Esplanade. The "Illustrative Site Plan" prepared by Rondinelli also reflected the previously-deleted ramps connecting to the Parkway, which had been proposed anew by Rondinelli following certain traffic re-routing decisions made by the Township. Apparently, Rondinelli intended to amend the GDP at a later date to put the ramps back into the plan once it had final approval from Parkway authorities.

The Board of Adjustment conducted public hearings on the 1993 Amended GDP on April 29, May 24, and June 30, 1993. Harvey Schultz, an expert in office leasing and sales, testified in support of the applications. Schultz noted that he had reviewed the trends in the office market between 1986 and 1992 and found that speculative office building had been decreasing, particularly since 1988. According to Schultz, there was no real demand for new office space because companies were consolidating and leaving New Jersey. Vacancy rates had remained constant at between 21 and 25 percent. Schultz did not expect demand to improve over the course of the next four or five years. The market for hotels was similarly depressed.

Rondinelli's planner, E. Fletcher Davis, emphasized in his 1993 testimony that the site was presently zoned into economic inutility because it could not reasonably be developed as office buildings in the foreseeable future. The proposed amended plan still provided for 950,000 square feet of office space within Metropark South. Further, that square footage could be increased utilizing parking decks to 1.7 million square feet in accordance with the original GDP. Davis also noted that, despite the troubled market, Rondinelli was about to begin construction on Atrium II, which would provide the Township with an additional 224,636 square feet of office space.

Rondinelli advised the Board of Adjustment that he could not project a start date for construction of any office buildings at the GDP site, explaining that he could no longer get funding on a speculative basis or through now-discontinued state programs, as he had been able to do with Atrium I. He wanted to start building Canterbury Cove immediately, while still building Bridgepointe, in the hope that this new residential section would make the entire site more viable. Rondinelli stated that he had been drawn to Old Bridge to build office buildings, but because of the economy, he needed the "one-family housing on the project right now to sustain the project." He committed that he would follow through with the original plan to build 1.7 million square feet of office space "if it is in demand."

A financial consultant, Joseph Pirone, testified that he had tried to get funding for the Esplanade. However, according to Pirone, the market for commercial office building financing was virtually nonexistent throughout New Jersey.

In advocating the significance of these proofs before the Board of Adjustment, Rondinelli's counsel stated that his client was seeking approval for 155 residential "units subject to final engineering" at which point definitive density would be determined. Rondinelli sought to preserve the commercial character of the development to the greatest extent possible, but first needed to generate income through the residential development to help him carry the property financially. Since 1984, Rondinelli had not only carried a mortgage on the property but had also paid the Township more than $800,000 in taxes on vacant land. Rondinelli expected to build up to 155 houses immediately "with the understanding that we will ride out the storm . . . and . . . build office buildings" in the near future. Rondinelli would begin construction on the Esplanade as soon as he secured committed tenants, which would then enable him to get financing.

At the end of the June 30, 1993 meeting, the Board of Adjustment approved Rondinelli's applications, subject to the proviso that the conditions set forth in the original GDP would carry over and that Rondinelli would ultimately build a minimum of 1.7 million square feet of nonresidential space. The requested staging waiver was not specifically mentioned, but the Board of Adjustment members expressed their satisfaction that their approval would guarantee the commercial development while still addressing the hardship of the present economic conditions. The minutes from the June 30, 1993 Board of Adjustment meeting confirmed the Board's understanding that the pending applications were for residential relief and that the residential construction would proceed first.

More than a year later, the Board of Adjustment memorialized its approval of the Amended 1993 GDP in a resolution dated October 20, 1994. In that resolution, the Board of Adjustment noted that the granting of the variance for Canterbury Cove would "promote the general welfare and satisfy various special reasons testified to by the Applicant and his witnesses." The Board of Adjustment found that "the originally planned hotel and office space development of the site would not be economically prudent in light of economic projections for the next four to five years." It also found that, through the use of parking decks, Rondinelli could expand the 950,000 square feet of non-residential space proposed in the Amended GDP to more than 1.5 million square feet and that Rondinelli had agreed to "comply, subject to market conditions, with the original commercial proposal in his [GDP] to build a minimum of 1.69 million square feet of commercial buildings."

The Board of Adjustment noted that it had considered the testimony of: (1) Schulz, to the effect that there was currently "very little demand" for office space; (2) Davis, to the effect that the property could not reasonably be developed for nonresidential land use in the foreseeable future; (3) Rondinelli, to the effect that Canterbury Cove would be a "concession to salvage the development of the property in light of the projected economic difficulties facing office development"; and (4) Pirone, to the effect that it was next to impossible to obtain commercial office building financing at the present time. Based upon those presentations, the Board of Adjustment was "satisfied that special reasons exist[ed] which justif[ied] the requested relief," and concluded that it was confirming its action of June 30, 1993, "granting approval of this application for 155 single-family houses on 36.4 acres." The Board further noted that Rondinelli had "commit[ed] to build, market permitting, a minimum of 1.696 million square feet of commercial industrial property[.]"

These 1993 proceedings and the 1994 resolution make clear that the economic rationale for the staging waiver originally granted in 1985 still persisted as of 1994 and that it justified extending that waiver so that the Canterbury Cove residences could be built before the office and hotel components of the project. This chronology also reflects, however, that the land use body was not, in effect, issuing the developer an open-ended, unqualified right (in effect, a "blank check") but instead was relying upon his commitment to build the projected amounts of hotel and office space when market conditions became more favorable.


We now turn to what becomes the dispositive aspect of the present appeal: the subsequent modifications of the GDP reflected in the 2005 Amended GDP submitted by Alfieri, which by that point had acquired the property and succeeded Rondinelli as the GDP developer. As the Planning Board in its 2009 remand decision and the trial judge in his November 19, 2010 opinion both observed, the 2005 Amended GDP materially changed the 1993 Amended GDP in numerous respects.

Among other things, the 2005 Amended GDP significantly scaled back the amount of office and hotel development originally allotted for in the GDP. Specifically, the proposed floor area for the office space declined from a range of 790,000 square feet to 1.5 million square feet in the 1993 Amended GDP to 760,323 square feet in the 2005 Amended GDP, a drop of about 30,000 square feet or more. In addition, the size of the hotel was reduced in the 2005 Amended GDP by about one-third or more, dropping from 150,000 to 185,000 square feet in the 1993 Amended GDP to only 101,311 square feet, or about 40,000 square feet less.

We agree with the Planning Board and the trial judge that these modifications in the 2005 Amended GDP were of sufficient magnitude to comprise a material alteration of the GDP and, most importantly, a marked alteration of the terms and expectations associated with the granting of a staging waiver in 1985, as renewed in 1993.

The concept of materiality is contextual. See, e.g., In re Petition By Controlled Cable Corp., 95 N.J. 473, 484-85 (1984) (noting that the administrative agency, as the decision-maker concerning a proposed cable television franchise, must consider the "materiality" of information about a change in the franchise's corporate structure "in the context" of the interests at stake); Selective Ins. Co. v. McAllister, 327 N.J. Super. 168, 176-78 (App. Div.), certif. denied, 164 N.J. 188 (2000) (requiring the jury, as fact-finder, to evaluate whether an insurance policyholder's false misrepresentations to the insurer were material in the context of her PIP claims) (citing Pacific Indemnity Co. v. Golden, 985 F.2d 51, 56-67 (2d Cir. 1993) (noting that materiality is context dependent)).

We agree with Alfieri that minor changes to the GDP that did not affect the bona fides of the previously-granted staging waiver would not divest the developer of its previously-acquired right to that waiver. For example, the relocation of an access road within the complex would not necessarily affect the relative mix of benefits that had justified a waiver from the ordinance's requirement that commercial and residential development included in the GDP be built at the same time. Here, however, we are presented with a much more pertinent change, one that goes to the heart of the logic underlying the staging waiver. Although we recognize that the developer also scaled back the size of Canterbury Cove from 155 units to 83 units, that does not eliminate the fact that the Township's expectations regarding the scope of the hotel and office development, and the associated tax ratables, were significantly reduced in the 2005 Amended GDP.

Even though our October 2007 opinion preserved certain vested rights conferred upon the developer by the approvals previously issued by the Board of Adjustment before the Planning Board assumed jurisdiction over the project, our opinion explicitly allowed such prior approvals to be nullified where "the site owner or developer seeks their modification." Alfieri-Old Bridge Assocs., supra, slip op. at 21-22. That, in essence, is what occurred here when Alfieri significantly reduced the office and hotel space to be constructed. The modifications are material, and they are sufficient to require the developer to obtain a new staging waiver on its own merits. See, e.g., Macedonian Church v. Planning Bd., 269 N.J. Super. 562, 572-74 (App. Div. 1994) (noting that where a developer's plans "differed substantially" from the original plans approved by the Planning Board, that body acted properly in deciding to review the application anew); Centex Homes v. Twp. of Mansfield, 372 N.J. Super. 186, 197-98, 202 (Law Div. 2004) (upholding a municipal decision to terminate a GDP previously approved by the Planning Board, where the developer had significantly changed the original plan, including substantial reductions in the units to be built).

We further agree with the determination that the significant changes and reductions in the scope of the commercial features of the project were not solely caused by new environmental requirements. Although it is true that one of the four office buildings depicted in the 1993 plans (which were arranged in pairs, with the hotel accompanying one of the pairs) could not be built because of environmental constraints, Ralph Orlando, Alfieri's witness and project engineer, conceded that Alfieri voluntarily chose to switch the other building in its pair -- which would have been problematic, but not necessarily impossible, to build -- with the hotel so that the three remaining office buildings could be together. This resulted in the hotel being situated directly across from pre-existing homes, which was also a major change in the project. Moreover, as the Planning Board correctly pointed out, the difficulties posed by the topography of the site and other environmentally-sensitive aspects of the property should have been known to the developer in the first instance. Consequently, Alfieri's reliance upon the limited exception in N.J.S.A. 40:55D-45.5 for changes to a GDP that are "a direct result" of determinations by the DEP, is unavailing.

We also agree with the Planning Board and the trial court that the reduction of residential units in Canterbury Cove triggers the application of N.J.S.A. 40:55D-45.6. That statute provides:

a. Except as provided hereunder, once a general development plan has been approved by the planning board, it may be amended or revised only upon application by the developer approved by the planning board.

b. A developer, without violating the terms of the approval pursuant to this act, may, in undertaking any section of the planned development, reduce the number of residential units or amounts of nonresidential floor space by no more than 15%[.] [Emphasis added.]

We reject Alfieri's argument that the statute should be construed such that the term "section" must encompass all of the residential units in the project, not just Canterbury Cove alone. The Planning Board's contrary interpretation was reasonable and sound, and in accordance with an ordinary understanding of the term "section" to connote a portion. See Webster's II New College Dictionary 998 (1995).

We are mindful that the trial judge, in the course of his written decision sustaining the Planning Board's finding of materiality, also mentioned several modifications within the 2005 Amended GDP that do not directly bear upon the rationale underlying the staging waiver, such as the removal of a roadway and the removal of a gas station. Although these other changes of physical features in the GDP require approval by the Planning Board under N.J.S.A. 40:55D-45.5, they are not inherently the kinds of changes that would upset the approved grounds for allowing the residential construction to go forward before the hotel and office buildings. Even so, the significant reductions in the square footage of the office and hotel buildings reflected in the 2005 Amended GDP suffice, in and of themselves, to support the conclusion of the Planning Board and the trial court that a new staging waiver is necessary.

We reject Alfieri's contention that it did not need a new staging waiver because the 1993 Amended GDP was essentially a "cartoon" depiction of the buildings to be constructed. We appreciate that the large-scale scope of a GDP reasonably entails the need to have the project initially considered in a more general way, followed by more-detailed ensuing applications for preliminary site plan and subdivision approvals. Citizens United to Protect the Maurice River and its Tributaries, Inc. v. City of Millville Planning Bd., 395 N.J. Super. 434, 448 (App. Div. 2007). Nevertheless, the considerable reduction in commercial square footage in the 2005 Amended GDP comprised such a material deviation from the 1985 and 1993 versions of the project as to vitiate the developer's continued expectation of a staging waiver.

We also reject Alfieri's argument that the Planning Board and the trial court both erred in not treating the Atrium commercial square footage as part of the present GDP. To be sure, the Board of Adjustment did take into account Rondinelli's plans to build Atrium I and II near the GDP when it granted the staging waiver in 1985 and further authorized it in 1994. But that recognition of the beneficial impacts of the adjacent project for the Township cannot dictate the acceptability of the present GDP, which must pass muster on its own merits under the applicable statutes and ordinances. Whether or not Atrium I and II existed, the Township gained nothing in terms of commercial ratables in the 2005 Amended GDP when Alfieri scaled back the hotel and office space by a combined amount of over 70,000 square feet. We thus sustain the trial court's finding that the Atrium development was not part of the present GDP.


Because renewed approval of the staging waiver was, for the reasons we have stated, required in connection with the 2005 Amended GDP, we must finally consider the Planning Board's determination, as sustained by the trial court, denying such relief to Alfieri. In doing so, we bear in mind the general deference that we owe to local land use authorities. "[P]ublic [land use] bodies, because of their peculiar knowledge of local conditions, must be allowed wide latitude in their delegated discretion." Jock v. Zoning Bd. of Adjustment, 184 N.J. 562, 597 (2005) (citing Booth v. Bd. of Adjustment, 50 N.J. 302, 306 (1967)). Hence, the ordinary standard of judicial review applied to a decision by such bodies is to determine whether the decision was "arbitrary, capricious, or in manifest abuse of its discretionary authority[.]" Ibid. We apply a de novo standard of review, however, to questions of law arising in connection with the land use application. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).

Guided by this standard, the Planning Board's November 2008 denial of a staging waiver for the revised GDP must be sustained. The Planning Board's denial of the contentions made by Alfieri and its witnesses in support of such relief was neither arbitrary nor capricious.

The pertinent statute on this issue, N.J.S.A. 40:55D-45.4, provides that:

[i]n the event that the developer seeks to modify the proposed timing schedule, such modification shall require the approval of the planning board. The planning board shall, in deciding whether or not to grant approval of the modification, take into consideration prevailing economic and market conditions, anticipated and actual needs for residential units and nonresidential space within the municipality and the region, and the availability and capacity of public facilities to accommodate the proposed development.

The Planning Board manifestly took these considerations into proper account here. It was not bound to accept the opinions of Alfieri's expert witness on these economic issues. A land use board has the choice of accepting or rejecting the testimony of witnesses, and where the board's assessments of that proof is reasonably made, its choice is conclusive on appeal. Allen v. Hopewell Twp. Zoning Bd. of Adjustment, 227 N.J. Super. 574, 581 (App. Div.), certif. denied, 113 N.J. 655 (1988).

On this point, we adopt the trial court's perceptive analysis of the Planning Board's decision:

Alfieri presented several expert witnesses. The Planning Board contends that the testimony offered by Alfieri's real estate appraisal expert, Jeffrey Otteau, regarding market conditions as being a justification for the staging variance lacked credibility, in light of the fact that Mr. Otteau premised the validity of his testimony on the outcome of the impending financial crisis, which the Board found was impossible to predict. The Planning Board concluded that Mr. Otteau's testimony was subjective and speculative. He opined that the housing market is improving. But[] based upon the knowledge of the local conditions within the Township in the face of repeated news stories concerning the state of the economy and the financial and credit markets, the Planning Board found his opinions to be questionable. The Planning Board, through its own professionals and cross examination by various Planning Board members, not rebutted, found flaws in Mr. Otteau's testimony. It was within the province of the Planning Board to accept or reject the opinions of Mr. Otteau, and they chose to reject them. Allen v. Hopewell Tp. Zoning Board, 227 N.J. Super. 574, 581 (App. Div. 1988). "A determination predicated on unsupported findings is the essence of arbitrary and capricious action." Bryant v. City of Atlantic City, 309 N.J. Super. 596, 610 (App. Div. 1998). When considering findings of fact, the court will give deference to the Planning Board's findings, but when a question of law exists, no such deference is given. The Planning Board's decision is supportable based upon the record.

Nothing further needs to be said on this issue. The Planning Board's decision, as sustained by the trial court, is affirmed.*fn5


Alfieri requests that we direct the trial court to address on remand whether the Planning Board exceeded its authority in conditioning its approval of the site plan for Canterbury Cove upon plaintiff's constructing all Phase 1 and Phase 2 road improvements and paying all affordable housing development fees.

Alfieri is correct that the trial court did not address these separate matters in its decision.

A planning board may impose reasonable conditions that are directly related to the proposed use of the land. Orloski v. Planning Bd., 226 N.J. Super. 666, 672 (Law Div. 1988), aff'd o.b., 234 N.J. Super. 1 (App. Div. 1989). A reviewing court may modify or excise conditions that it rules are unreasonable or unlawful. Darst v. Blairstown Twp. Zoning Bd. of Adjustment, 410 N.J. Super. 314, 338-39 (App. Div. 2009).

The trial court, having properly focused its attention upon the central issues connected with the staging waiver, did not address these incidental issues concerning roadway improvements and affordable housing in its decision. That court has not yet examined the reasonableness of these conditions imposed upon the project by the Planning Board. Consequently, we remand these open issues to the trial court for disposition, if requested by Alfieri at this time in light of the other determinations set forth in our opinion.

Affirmed in part, modified in part, and remanded in part. We do not retain jurisdiction.

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