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Bonnabel v. Township of River Vale

A-3643-10T4 (N.J. Super. App. Div. 2011) (Unpublished)

COAH; BUILDER’S REMEDIES — If a court does not wish to rule on a builder’s remedy suit during the pendency of an ongoing Council on Affordable Housing suit, it should not dismiss the builder’s remedy suit if its concerns can be alleviated by measures other than a dismissal.

A developer sought to build affordable housing units on his property, and to have the property rezoned by the municipality for that purpose. He filed a “builder’s remedy” lawsuit against the municipality, its mayor, and its council. At the time, the municipality was attempting to satisfy its affordable housing obligations through a plan submitted to the Council on Affordable Housing (COAH). The municipality’s plan did not include the use of the developer’s property for affordable housing units. The COAH issued a resolution granting “third-round” substantive certification to the municipality. The resolution required the municipality to execute a developer’s agreement for two sites and to adopt a Fair Share ordinance, both within forty-five days. The municipality later requested, and was granted a short extension of the deadline to execute the agreement and adopt the Fair Share Ordinance.

The developer was not only suing the municipality for a “builder’s remedy” but it also challenged the COAH certification. The municipality filed a motion to dismiss the developer’s “builder’s remedy” suit. It argued that the lower court did not have jurisdiction over the “builder’s remedy” suit because the COAH had already granted it substantial certification. The developer disagreed, arguing that the COAH certification only meant that his suit now had to be proven under a more rigorous legal standard, but was still viable. He noted that, with COAH certification, he would need to overcome the presumption of validity of the municipality’s affordable housing plan by clear and convincing evidence. The lower court agreed that the developer could still maintain his lawsuit even after COAH granted certification. However, the lower court noted that until the COAH suit was resolved, it was unclear which legal standard would govern the developer’s “builder’s remedy” case. Therefore, the lower court elected to dismiss the case without prejudice, but specified that the case could be re-filed once the COAH suit was resolved. The developer moved for reconsideration, but its motion was denied. Even though the lower court recognized that instead of dismissing the case it could have merely stayed the case until the COAH suit was resolved, it refused to do so. Instead, the lower court chose to dismiss the case for reasons of “judicial economy and judicial administration.” When the developer appealed, the Appellate Division reversed.

The Court found uncertainty as to the applicable legal standard because of the ongoing COAH suit, but held that the preferable course of action was to remand to the lower court to reinstate the developer’s “builder’s remedy” suit. The lower court, in its discretion could then decide to stay the case until the COAH case was resolved, stay a trial but allow discovery to proceed, or let the case proceed to trial.

The Court noted that generally, a case may be dismissed for lack of personal or subject matter jurisdiction, insufficiency of service of process, failure to state a claim or failure to join a necessary party. However, in this case, none of those reasons applied. It recognized the lower court’s reluctance to try the case until the COAH matter was resolved and the appropriate legal standard could be determined. It also recognized the municipality’s reluctance to spend money defending the “builder’s remedy” suit while also defending the COAH suit. However, the Court found that those concerns could have been alleviated by measures other than dismissing the developer’s suit.


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