Township of Marlboro v. Planning Bd. of Tp. of Holmdel

• Decision Date: 24 February 1995
• Citation: 279 N.J.Super. 638,653 A.2d 1183
• Parties: TOWNSHIP OF MARLBORO, Plaintiff-Respondent, v. PLANNING BOARD OF the TOWNSHIP OF HOLMDEL, The Township of Holmdel, Mayor and Township Committee of the Township of Holmdel, Westor Partnership, County of Monmouth, State of New Jersey, and New Jersey Department of Environmental Protection, Defendants. TOWNSHIP OF COLTS NECK, a municipal corporation of the State of New Jersey, Plaintiff-Respondent, v. PLANNING BOARD OF the TOWNSHIP OF HOLMDEL, Township of Holmdel, a municipal corporation of the State of New Jersey, and Westor Partnership, a New Jersey partnership, Defendants. GRC DEVELOPMENT CORP., a New Jersey Corporation, HMF Associates, a New Jersey Partnership, RJS Realty Associates, a New Jersey Limited Partnership and Westor Partnership, a New Jersey General Partnership, Plaintiffs-Appellants, v. TOWNSHIP OF HOLMDEL, in the County of Monmouth, a municipal corporation of the State of New Jersey, Township Committee of the Township of Holmdel, Mayor of the Township of Holmdel and Clerk of the Township of Holmdel, Defendants-Respondents.
• Court: New Jersey Superior Court — Appellate Division

Page 638

279 N.J.Super. 638

653 A.2d 1183

TOWNSHIP OF MARLBORO, Plaintiff-Respondent, v. PLANNING BOARD OF the TOWNSHIP OF HOLMDEL, The Township of

Holmdel, Mayor and Township Committee of the Township of

Holmdel, Westor Partnership, County of Monmouth, State of

New Jersey, and New Jersey Department of Environmental

Protection, Defendants.

TOWNSHIP OF COLTS NECK, a municipal corporation of the State

of New Jersey, Plaintiff-Respondent, v. PLANNING BOARD OF the TOWNSHIP OF HOLMDEL, Township of

Holmdel, a municipal corporation of the State of

New Jersey, and Westor Partnership, a

New Jersey partnership, Defendants.

GRC DEVELOPMENT CORP., a New Jersey Corporation, HMF

Associates, a New Jersey Partnership, RJS Realty Associates, a New Jersey Limited Partnership and Westor Partnership, a New Jersey General Partnership, Plaintiffs-Appellants, v. TOWNSHIP OF HOLMDEL, in the County of Monmouth, a municipal

corporation of the State of New Jersey, Township Committee

of the Township of Holmdel, Mayor of the Township of Holmdel

and Clerk of the Township of Holmdel, Defendants-Respondents.

Superior Court of New Jersey,

Appellate Division.

Argued Jan. 24, 1995.

Decided Feb. 24, 1995.

John R. Halleran, Middletown, for appellant Westor Partnership (Giordano, Halleran & Ciesla, attorneys; Mr. Halleran, of counsel and on the brief).

Thomas F. Carroll, III, Princeton, for appellants GRC Development Corp., HMF Associates and RJS Realty Associates (Hill Wallack, attorneys; Mr. Carroll, on the brief).

Jeffrey P. Blumstein, Lawrenceville, for respondent Planning Bd. of the Tp. of Holmdel (Szaferman, Lakind, Blumstein, Watter & Blader, attorneys; Arnold C. Lakind, of counsel; Messrs. Blumstein and Lakind, on the brief).

Brian J. Molloy, Woodbridge, for respondent Tp. of Colts Neck (Wilentz, Goldman & Spitzer, attorneys; Mr. Molloy, of counsel and on the brief with Steven J. Tripp and Robert J. Curley, Woodbridge). Michael B. Steib, Middletown, also submitted a brief for respondent Tp. of Colts Neck.

Joseph D. Youssouf, Englishtown, for respondent Tp. of Holmdel (Mr. Youssouf, on the brief).

Respondent Tp. of Marlboro relies upon the brief and appendix submitted by respondent Tp. of Colts Neck.

Before Judges PRESSLER, LANDAU and NEWMAN.

The opinion of the court was delivered by PRESSLER, P.J.A.D.

This consolidated appeal requires us once again to consider the consequences of illegal exactions obtained by a municipal land use planning agency from a developer during the application approval process. In Nunziato v. Edgewater Planning Bd., 225 N.J.Super. 124, 541 A.2d 1105 (App.Div.1988), we held that a resolution approving the variance and site plan application of the developer of a high-rise luxury apartment building was vitiated by the board's imposition of the condition, agreed to by the developer, that a substantial financial contribution be made for the town's future affordable housing fund. Relying on Nunziato, the trial judge granted summary judgment invalidating the preliminary site plan approvals granted by the Holmdel Township Planning Board to the two appellant developers here. We conclude that he erred in so doing and consequently reverse and remand for further proceedings.

The Township of Holmdel has several commercial zones which, in recent years, have been the subject of significant development, including major shopping centers, a Bell Laboratories complex, an AT & T complex, a Prudential Insurance Company complex, a hospital medical center, and numerous large office buildings. This controversy involves two separate developers, each of whom propose construction of an office building complex on its respective property. Westor Partnership owns a ninety-two acre tract in the OL-2 (office) zone abutting County Route 520. GRC Development Corp. is acting for RJS Realty Associates and HMF Associates (collectively GRC), which together own a total of two hundred and eleven acres in the OL-3 zones straddling State Highway 34. Although the site plan applications of the two developers remained at all times entirely separate, they were dealt with by the Planning Board, both substantively and procedurally, in a parallel manner, particularly in respect of off-site improvements.

Ultimately the Planning Board, following public hearings, granted preliminary site plan approval to both applicants. Westor's project, denominated Holmdel Corporate Office Center, proposed a three-building office complex containing about 379,000 square feet and requiring neither use nor bulk variances but only two relatively minor design standard waivers. GRC's project proposed a six-building office complex containing about 902,000 square feet. That project required one relatively minor zoning variance, namely provision of 3,570 parking spaces rather than the 3,604 spaces required by the ordinance. It also required several minor design standard waivers.

The issue before us involves the cash contribution for off-site improvements required by the Planning Board as a condition of its approval for each of the projects. Westor was required to make a cash contribution of $1,140,000, of which $200,000 was allocated to the cost of a fire truck and $50,000 as seed money for a recreation center. The balance was allocated in specific amounts to specific street and road improvements. GRC was required to make a cash contribution of $3,800,000, of which $100,000 was allocated to the fire truck and $100,000 as seed money for the recreation center. In addition GRC was required to transfer to the municipality title to a parcel of land, between three and four acres in size, valued at $300,000, for construction of a new firehouse. That $300,000 was calculated as part of the total $3.8 million dollars. The balance was allocated in specific amounts to specific street improvements.

The Planning Board approved the two projects in the fall of 1991. The developers accordingly each submitted the required developer's agreement to the Township Committee for execution. Before the Committee acted, however, the general election of November 1991 was held. The election changed the composition of the governing body, resulting in a majority now opposed to the continuation of large-scale development in the township. Although the newly-elected members were not yet seated at the December 1991 Township Committee meeting at which the developers' agreements were to be voted on, one member of the Committee had resigned. The agreements were rejected by a tie vote.

Three law suits, thereafter consolidated, ensued. The developers, in a joint action, sued the Township because of its failure, alleged to be arbitrary, unreasonable and unlawful, to execute the developers' agreements. Two neighboring municipalities, Colts Neck and Marlboro, both of which opposed further development in Holmdel, sued Holmdel, its planning board, and the developers, among others, seeking invalidation of the site plan approvals and of the offending portions of the Holmdel zoning ordinance. Among their various claims of invalidity was the assertion that the fire truck, fire house, and recreation center contributions were illegal exactions in violation of N.J.S.A. 40:55D-42 rendering the approvals null and void under Nunziato.

After issue was joined, Colts Neck and Marlboro moved for summary judgment on the illegal-exaction issue. In order to determine the facts pertinent to that issue, the trial judge directed an evidentiary hearing, following which he held that since the fire house, fire truck and recreation center contributions were not authorized by that statute, they had indeed been illegally exacted. He therefore concluded for that reason alone that the approvals had to be set aside. Hence the judge did not consider any other of the multiple challenges to the approvals and to the zoning ordinance made by the two neighboring towns. Nor did he address the developers' affirmative claims against Holmdel. The developers each appealed from the ensuing summary judgment in favor of Colts Neck and Marlboro and from the subsequent order denying the motion to alter or amend the judgment.

As we held in Nunziato, the municipal authority to condition development approvals on the developer's agreement to provide or contribute to off-site improvements is limited by N.J.S.A. 40:55D-42, which permits such contributions only with respect to street improvements and water, sewerage and drainage facilities, and only to the extent necessitated by the reasonably anticipated impact of the development on those facilities. See also N.J. Bldrs. Ass'n. v. Bernards Tp., 108 N.J. 223, 233, 528 A.2d 555 (1987); Longridge Builders, Inc. v. Planning Bd. of Princeton Tp., 52 N.J. 348, 350-351, 245 A.2d 336 (1968); West Park Ave., Inc. v. Ocean Tp., 48 N.J. 122, 224 A.2d 1 (1966); Lake Intervale Homes, Inc. v. Parsippany-Troy Hills, 28 N.J. 423, 441, 147 A.2d 28 (1958); F & W Associates v. County of Somerset, 276 N.J.Super. 519, 648 A.2d 482 (App.Div.1994). Plainly, contributions for recreational facilities and for fire-fighting facilities, even those necessary for proper servicing of the development itself, are beyond the authorization of the statute, and hence a development application may not be conditioned on the developer's undertaking to provide them. But the mere fact that such a condition was imposed does not, in our view, necessarily and inevitably render the ensuing approval void. Nor do we read Nunziato as compelling that result. We are convinced that the undisputed facts here sufficiently distinguish this case from Nunziato so as to warrant a quite different remedy.

In sum, we view the critical issue as whether the illegal exaction...