160 Chubb Props., LLC v. Twp. of Lyndhurst
| Decision Date | 31 May 2019 |
| Docket Number | DOCKET NO. 002442-2014,DOCKET NO. 006305-2015 |
| Parties | 160 CHUBB PROPERTIES, LLC, Plaintiff, v. TOWNSHIP OF LYNDHURST, Defendant. |
| Court | New Jersey Tax Court |
NOT FOR PUBLICATION WITHOUT APPROVAL OF THE TAX COURT COMMITTEE ON OPINIONS
Joseph G. Ragno and Robert J. Guanci for plaintiff (Waters, McPherson, McNeill, P.C., attorneys).
Kenneth A. Porro for defendant (Chasan Lamparello Mallon & Cappuzzo, P.C., attorneys).
ORSEN, J.T.C.
This opinion constitutes the court's decision with respect to the motion of defendant, Township of Lyndhurst ("Lyndhurst"), seeking reconsideration of the court's December 14, 2018, decision and January 3, 2019 Order, granting relief to plaintiff, 160 Chubb Properties, LLC ("Chubb"), under N.J.S.A. 54:51A-8 ("Freeze Act") for the 2017 tax year based on the settled and adjudged assessment for base tax year 2015 as to property designated as Block 231, Lot 3 ("subject property"). In the court's December 14, 2018, published opinion, 160 Chubb Props., LLC v. Twp. of Lyndhurst, 30 N.J. Tax 613 (Tax 2018), the court held that:
Lyndhurst sought reconsideration, primarily based on the same arguments presented during the original motion, namely, (1) unsupported allegations of the subject property's occupancy; (2) unsupported allegations of a physical change made to the subject property based on issued construction permits; and (3) the subject property's sales price, demonstrated prima facie evidence that a substantial and meaningful change in value occurred between the base year 2015 and freeze year 2017, warranting a plenary hearing. Lyndhurst's only new arguments alleged that Chubb had no legal standing to file the Freeze Act motion and by receiving Freeze Act relief for tax year 2017, the subsequent owner of the property received a "windfall" that should not be permitted as the subsequent owner neither negotiated the base year settlement nor was it a named party to the Freeze Act motion.
For the reasons explained more fully below, the court denies Lyndhurst's motion for reconsideration.
For purposes of providing context, the court will include a brief statement of facts. A detailed statement of facts can be found in the court's published opinion referenced above.
On December 3, 2013, Chubb purchased the subject property, a multi-tenanted office building located at 160 Chubb Avenue, Lyndhurst, New Jersey, designated as Block 231, Lot 3 on the local tax map for $10,300,000. Chubb filed local property tax appeals for the 2014 and 2015 tax years. The parties negotiated a settlement agreeing to an assessment of $13,000,000 for each tax year, which settlement agreement expressly adopted application of the Freeze Act for the 2016 tax year. The court entered judgments on December 18, 2015 for the 2014 tax year and December 4, 2015 for the 2015 tax years, reflecting the agreed-to assessment amounts.
Chubb sold the subject property on November 17, 2016, to its current owner, CCC NJ Owner, LLC ("CCC NJ Owner") for $20,025,000.
Notwithstanding the settlement, for the 2017 tax year, Lyndhurst again assessed the subject property at the pre-settlement amount of $16,250,000. Waters, McPherson, McNeill, P.C. ("WMM"), counsel for Chubb and the new owner, CCC NJ Owner, sought to file a consensual Freeze Act application on behalf of CCC NJ Owner. When it became apparent that Lyndhurst would not consent to the application, WMM filed a motion on July 19, 2017, for entry of judgment applying the Freeze Act to the 2017 tax year based on the 2015 tax year judgment. Lyndhurst opposed the Freeze Act motion alleging that: (1) the settlement reducing the assessments was based on Chubb's representation that the subject property was substantially unoccupied at the time of Chubb's purchase and in need of substantial improvements; and (2) Chubb waived Freeze Act protection for 2017. Lyndhurst additionally emphasized that after the alleged improvements were made to the subject property, Chubb sold the property for $20,025,000. In support, Lyndhurst's tax assessor certified that based on the construction permits, "[s]ubstantial building improvements along with the tenant occupancy undoubtedly increased the value of the property as it was sold for $20,025,000 on November 17, 2016."
Oral argument was heard and the court issued an opinion granting Freeze Act relief for the 2017 tax year.
Lyndhurst filed a motion for reconsideration under R. 4:49-2, claiming that it was entitled to a plenary hearing on the applicability of the Freeze Act and re-asserted the same arguments that the Freeze Act was inapplicable due to the subject property's occupancy and physical changes made to the subject property based on issued construction permits, and that the subject property's sales price demonstrated prima facie that a substantial and meaningful change in value occurredbetween base year 2015 and freeze year 2017. Lyndhurst's only new arguments alleged that Chubb had no legal standing to file a Freeze Act motion, and by granting Freeze Act relief, the subsequent owner, CCC NJ Owner received a windfall.
The court heard the motion and requested that the parties submit supplemental briefs limited to issues raised and newly cited case law referenced during oral argument. During oral argument, and further outlined in its supplemental brief, Lyndhurst argued that by invoking the Freeze Act for tax year 2017 based on the 2015 base year judgment, the successor in title, CCC NJ Owner, received a "windfall," and that such a "windfall" should not be permitted as CCC NJ Owner neither negotiated the base year settlement nor was a named party to the Freeze Act motion. Further, Lyndhurst argued that conversations between the tax assessor and Chubb attest to an agreement that the Freeze Act would not be invoked for the 2017 tax year notwithstanding what was documented in the Stipulation of Settlement executed by the parties, and that the November 17, 2016, sales price of the subject property "tells us on its face" that a substantial and meaningful change in value has occurred, entitling Lyndhurst to a plenary hearing on the applicability of the Freeze Act.
Motions for reconsideration are governed by R. 4:49-2. See also R. 8:10 (R. 4:49-2 applies to Tax Court matters). A motion for reconsideration shall "state with specificity the basis on which it is made, including a statement of the matters or controlling decisions which counsel believes the court has overlooked or to which it has erred." R. 4:49-2. Reconsideration is granted under very narrow circumstances and should only be used "for those cases which fall into that narrow corridor in which either 1) the [c]ourt has expressed its decision based upon a palpably incorrect or irrational basis, or 2) it is obvious that the [c]ourt either did not consider, or failed to appreciatethe significance of probative, competent evidence." D'Atria v. D'Atria, 242 N.J. Super. 392, 401 (Ch. Div. 1990); R. 4:49-2; accord Cummings v. Bahr, 295 N.J. Super. 374, 384 (App. Div. 1996). "[I]f a litigant wishes to bring new or additional information . . . which it could not have" offered during the first motion, then the court "should, in the interests of justice (and in exercise of sound discretion), consider such evidence." D'Atria, 242 N.J. Super. at 401.
Our courts have held that "[a] litigant should not seek reconsideration merely because of dissatisfaction with a decision of the [c]ourt," as such arguments are best raised on appeal. Ibid. Reconsideration is also not appropriate to reiterate the merits of or "reargue a motion." Capital Fin. Co. of Delaware Valley, Inc. v. Asterbadi, 398 N.J. Super. 299, 310 (App. Div. 2008). "The standards for reconsideration are substantially harder to meet than are those for reversal of a judgment on appeal." Dantzler v. Dir., Div. of Taxation, 18 N.J. Tax 507, 508 (Tax 1999).
Before engaging in the reconsideration process, the "litigant must initially demonstrate that the [c]ourt acted in an arbitrary, capricious, or unreasonable manner." D'Atria, 242 N.J. Super. at 401; see also Palombi v. Palombi, 414 N.J. Super. 274, 289 (App. Div. 2010) (). Critically here, reconsideration is not meant to re-litigate issues already decided or otherwise award a proverbial 'second bite at the apple' to a dissatisfied litigant. With these standards in mind, the court denies Lyndhurst's motion for reconsideration for the following reasons.
As a preliminary matter, the court will first address Lyndhurst's argument that Chubb had no legal standing to file the Freeze Act motion. Application of the Freeze Act is "mandatory and self-executing." Clearview Gardens Assocs. v. Twp. of Parsippany-Troy Hills, 196 N.J. Super.323, 328 (App. Div. 1984). Our court has held that "[a] subsequent owner has the right to apply the Freeze Act, for a subsequent year, to a judgment obtained by a prior owner for a prior year." ADP of New Jersey, Inc. v. Twp. of Parsippany-Troy Hills, 14 N.J. Tax 372, 378 (Tax 1994); Zisapel v. Borough of Paramus, 20 N.J. Tax 209, 214 (Tax 2002) (). Standing to make a Freeze Act motion is therefore "dependent on the status of the applicant, i.e., one who has interest in the property when the application is...
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