Tremarco Corp. v. Garzio

• Decision Date: 04 May 1959
• Docket Number: No. A--208,A--208
• Citation: 55 N.J.Super. 320,150 A.2d 799
• Parties: TREMARCO CORPORATION, a corporation of the State of Delaware, Plaintiff- Respondent, v. John A. GARZIO, Building Inspector of the Township of Ewing in the County of Mercer and the Township Committee of the Township of Ewing in the County of Mercer, a municipal corporation of the State of New Jersey, Defendants- Appellants.
• Court: New Jersey Superior Court — Appellate Division

Page 320

55 N.J.Super. 320

150 A.2d 799

TREMARCO CORPORATION, a corporation of the State of

Delaware, Plaintiff- Respondent, v. John A. GARZIO, Building Inspector of the Township of Ewing

in the County of Mercer and the Township Committee of the

Township of Ewing in the County of Mercer, a municipal

corporation of the State of New Jersey, Defendants- Appellants.

No. A--208.

Superior Court of New Jersey

Appellate Division.

Argued March 16, 1959.

Decided May 4, 1959.

Benjamin Forer, Trenton, for defendants-appellants.

George H. Bohlinger, Jr., Trenton, for plaintiff-respondent (Minton, Dinsmore & Bohlinger, Trenton, attorneys).

Before Judges PRICE, CONFORD and GAULKIN.

The opinion of the court was delivered by

GAULKIN, J.A.D.

This action in lieu of prerogative writ was submitted to the Superior Court, Law Division, upon a stipulation of facts and cross-motions for summary judgment. Summary judgment was entered in favor of plaintiff, ordering defendants to 'forthwith re-issue to the plaintiff, Tremarco Corporation, a building permit for the erection of a two bay gasoline service station.' Defendants appeal.

Defendants admit that on June 25, 1957 the township building inspector issued to John J. Boscarell, the then owner of the premises in question, a valid building permit for the construction of a service station in an area in which the township zoning ordinance, passed in 1950, permitted such use.

Since the parties base their respective positions upon the stipulated facts, we shall quote the essential portions thereof:

'5. The existence of the permit made the property worth more than it would be worth as a location for other business and worth much more than its value for residential purposes.

'6. Relying on the existence of the permit and the provisions of the ordinance under which it was granted, the plaintiff agreed to purchase the premises from John J. Boscarell for $21,500.00.

'7. Plaintiff is a corporation whose sole function is to acquire sites for gas service stations for Gulf Oil Corporation and except for the availability of the premises in question for the service station proposed, plaintiff would have had no interest in it.

'8. The * * * building code of Ewing Township * * * provides that any permit issued thereunder is automatically revoked if the work covered thereby is not actually commenced within three months next after the date on which such permit shall have been issued.

'9. Thtile to the premises passed from John J. Boscarell to plaintiff on October 2, 1957.

'10. Prior to the passing of title * * * the parties or their agents, secured from the building inspector of Ewing Township (then Alexander Savonick) his assurance that the permit could be considered as renewed. Based on such assurance title was passed and full consideration was paid.

'11. On October 8, 1957 (the) Building Inspector, * * * in accordance with his commitment, issued a renewal of the permit for an additional ninety days. * * *

'12. Prior to the expiration of the renewed ninety day period (on January 2, 1958) plaintiff again applied to the same building inspector for the reissuance or renewal of the building permit for an additional ninety days. The renewals were granted in the name of Gulf Oil Corporation, the plaintiff's principal.

'14. During the period of the renewals of the permit, the plaintiff spent $145.00 for a survey, $647.16 for architect's fees, and (on March 3, 1958) entered into a contract with South Jersey Pump and Tank Service, Inc. for the construction of the building and equipment to be erected on the site (for the price of $31,412.00). * * *

'16. Sometime during the month of March, 1958, South Jersey Pump & Tank Service, Inc. deposited on the premises gas storage tanks as its first step in the execution of the contract.

'17. In March, 1958, and prior to the expiration date of the last renewal (April 2, 1958) plaintiff again applied to the defendant Building Inspector (then Garzio) for a reissuance or renewal of the building permit. The defendant, Garzio, issued plaintiff a new building permit on March 27, 1958.

'18. The defendant Garzio knew of the prior permits and was informed that the plaintiff in reliance thereon had let the contract to South Jersey Pump and Tank Service, Inc.

'19. Shortly thereafter, the Township Committee of Ewing Township, or one or more of the members thereof, having received a petition from residents of the Township protesting the issuance of the permit to plaintiff, instructed the Building Inspector to revoke plaintiff's building permit.

'20. On March 31, 1958, defendant Garzio, by personal visit, informed plaintiff's agents that the permit had been revoked at the direction of the Township Committee. Plaintiff's agents refused to acknowledge or accept the revocation and on the same day, Garzio mailed his official notification of the revocation to the plaintiff which notice was received on April 2, 1958.

'21. The Ewing Township Committee met in a regular meeting on April 3rd and at the meeting, * * * plaintiff protested the action of the Building Inspector and asked for relief from the Township Committee. The minutes of the Township Committee show (that) 'Mayor Panaro informed (plaintiff) that the Township was in the process of adopting an ordinance allowing the building of service stations only after appeal and recommendation by the Zoning Board of Adjustment. * * *'

'22. Plaintiff, desiring to cooperate with the municipal officials, accepted the Mayor's statement that the proposed ordinance would be changed only in the respect of requiring an appeal and waited for the passage of the new ordinance.'

On June 5, 1958 the zoning ordinance of the township was amended, but instead of providing for service stations upon recommendation of the zoning board of adjustment, as Mayor Panaro said it would, the amendment forbade them altogether. Plaintiff thereupon filed its complaint in this action, on June 16, 1958. Defendants then discovered that the June 5 amendment was invalid, for reasons which do not concern us here. Therefore, on September 3, 1958, the township passed another and further amendment to its zoning ordinance which changed a large area, including the property in question, from a business zone to a residential zone in which service stations ate forbidden.

The final paragraphs of the stipulation are as follows:

'27. There has been no change in the character of the neighborhood since the Zoning Ordinance was originally passed in 1950.

'28. The Building Permits issued on June 25, 1957 and March 27, 1958 were properly issued at the time of issuance.'

Upon these facts the trial court held:

'The court is of the opinion that the building permits and the renewals thereof were valid; that the plaintiff herein relied thereon * * * the plaintiff * * * paid for the property involved a price * * * in excess of its true value, by virtue of the fact that the permit contemplated erection of a gasoline station and was attached thereto.

'* * * this fact, coupled with the * * * expenditure of architectural fees, engineering fees, and a contract entered into between the plaintiff and a sub-contractor, cumulatively indicates to the Court that a vested right had been acquired by this plaintiff.'

The township argues that Crecca v. Nucera, 52 N.J.Super. 279, 145 A.2d 477 (App.Div.1958), and Roselle v. Mayor and Council of Borough of Moonachie, 48 N.J.Super. 17, 136 A.2d 773, (App.Div.1957), and 49 N.J.Super. 35, 139 A.2d 42 (App.Div.1958), plainly show that the trial court erred. The township says (and plaintiff does not deny) that it is established law in New Jersey that a permit for a use valid when issued may be revoked by a subsequent ordinance prohibiting such use, adopted prior to substantial investment or expenditure by the owner in reliance upon the permit. The point upon which the parties disagree sharply is whether, under our law, the purchase of realty, the expenditure of surveyors' and architects' fees, and the entry into a construction contract, in reliance upon a permit give the permittee an irrevocable right to his permit.

The township says they do not, quoting from the Crecca case, supra 52 N.J.Super., at page 286, 145 A.2d at page 481, in which it was said 'The substantial reliance contemplated by our decisions * * * pertained to investments or expenditures in connection with the actual commencement of excavation or construction. * * *' The Crecca opinion cited numerous authorities for the proposition that 'The mere facts that property has been purchased or leased with the intention to use it for purpose allowable under the existing zoning regulations or that plans have been made and expenses incurred in preliminary preparations for such use have been held not to prevent the application to it of a subsequent amendment prohibiting its use for such purpose'. The court concluded:

'We hold that reliance is not constituted by the change of position brought about by merely entering into a contract to purchase with the intention to make the use later prohibited. Nor do we regard the incurrence of the miscellaneous expenses for title policy, surveyors' and architects' plans as constituting substantial reliance, under all the circumstances of the case.'

Plaintiff replies that neither Crecca nor any other New Jersey case is in point because the case at bar is the first in which (1) the permit had been issued before the plaintiff purchased the land; (2) the plaintiff bought the land only because of the existence of the permit; and (3) paid more for the property than it was worth without the permit.

For the sake of disposing of this argument we will assume that plaintiff is correct in saying that this is the first case in New Jersey in which one bought property, and for more than it was intrinsically worth, only because of the existence of a valid permit. We will also assume (without so deciding) that all of the permits and the renewals here involved were valid, and...