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County Concrete Corp. v. Township of Roxbury

2009 WL 872215 (U.S. Dist. Ct. D. N.J. 2009) (Unpublished)

ZONING; ORDINANCES; CONTRACTS — Although a municipality can adopt a zoning ordinance if the ordinance is grounded in advancing the public’s legitimate interest even if done so with an improper motive, the adoption of such ordinance can constitute an unconstitutional taking or a breach of a settlement agreement between a municipality and a property owner.

In 1991, a municipality passed a resolution permitting a concrete company to conduct certain mining operations on its property for twelve years. The parties also entered an agreement requiring the concrete company to restore the property after ending the mining operation. In 1996, the municipality revised its land development ordinance to prohibit mining operations in all zoning districts. In 2002, the municipality revised its land development ordinance again and designated the concrete company’s land as a rural residential and open space zone. The concrete company sued the municipality in United States District Court. It alleged that the 2001 ordinance was a regulatory taking/inverse condemnation which denied it a practical and feasible use of the property in violation of the company’s substantive due process and equal protection rights.

The District Court held that the zoning ordinance withstood a Substantive Due Process challenge because the municipality was able to identify a legitimate state interest that the legislature could rationally conclude was served by the statute. The Court noted that because a legitimate interest was shown, the ordinance would be upheld even if the ordinance was passed with an improper motive. It also held that the municipality “could have rationally found” legitimate interests were served by the ordinance. As to the company’s Equal Protection claim, the Court upheld the ordinance as rationally related to a legitimate government interest. Nevertheless, the Court found that the concrete company may have been subject to an unconstitutional “taking.” It ruled that there were genuine issues of fact as to whether the concrete company was being denied economically viable use of its land. Thus, it denied the municipality’s motion for summary judgment on that issue. In addition, the Court denied the municipality’s request to dismiss the concrete company’s claim that the municipality had violated a contractual duty of good faith and fair dealing. It found that the concrete company cited specific actions taken by the municipality which could show that the municipality acted inequitably in the performance of its contractual obligations and this warranted further consideration on the matter.

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