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Della Monica v. McDonald’s Corporation

A-2464-99T1 (N.J. Super. App. Div. 2003) (Unpublished)

ZONING; TIME OF DECISION RULE—When a zoning ordinance is revised after a board’s decision but before a court hears an appeal, the court must consider the effect of the amendment.

A fast food restaurant sought variances for construction. The planning board approved the variances and an objector sued. During the course of the litigation, the municipality adopted an ordinance to clarify certain provisions in its ordinances specifically in response to the lower court’s overturning of the planning board approval for the fast food restaurant. The lower court took the new ordinance into consideration, invalidated two sections of it, and then held that the planning board should not have granted approval because of certain procedural deficiencies. The objector further appealed, claiming that the “clarification” ordinance should been declared invalid in its entirety. The fast food restaurant appealed the lower court’s overturning of the planning board’s approval and argued that the “time of petition” rule required approval of the variance application.

At the outset, the Court noted that the objector’s attorney “initially refused to respond to the Board’s questions as to the nature of his client’s business.” He would only represent to the board that his client was a resident of the town and declined to disclose any interest in any competitive business or restaurant. Subsequently, he informed the Board by letter that his client had a financial interest in a competing fast food restaurant across the street from the proposed new restaurant. The Court noted that the objector’s financial interest explained “the motive for his detailed challenge to virtually every aspect of [the applicant’s] presentation.” The Court also noted that there were no other objections to the ultimate approval from any other person or entity entitled to notice. The lower court was also concerned about a number of rulings by the planning board with respect to the objector’s presentations. Ultimately, the lower court “found no deprivation of [the objector’s] rights because it was ‘satisfied that all of the data that the [B]oard relied upon was in fact in the files.’”

On the other hand, the lower court concluded that even though each of the individual complaints were, by themselves, unobjectionable, the totality of the “unobjectionable” actions on the part of the planning board caused the planning board hearing to be fundamentally flawed. Nonetheless, the lower court examined the record to see if the board’s decision was supported. Its conclusion was that some items were supported and some were not.

The Appellate Division examined the “corrective” ordinance. The lower court had held an extensive hearing, including taking evidence as to whether one of the municipal councilman had a conflict of interest. The councilman in question had received a real estate brokerage commission on the transaction before he joined the municipal council, but after the restaurant had received the disputed planning board approval. The councilman disclosed his interest to the mayor. Although recusing himself from all of the discussions regarding the “corrective” ordinance, he remained in the council chamber during the presentation and discussions about it. On the day that the ordinance was passed, he made the motion that closed the public hearing.

The Court noted that “[a] presumption of validity attaches to the enactment of a zoning ordinance” and that “[a] conflict of interest exists when a public official’s interest in the matter is distinct from the interest above the members of the public.” The conflict need not be actual. Here, in addition to the councilman’s personal interest in the site, his family “owned property located in close proximity to the property which led to introduction of the ordinance and which will be affected by its adoption.” It was obvious that the councilman had multiple conflicts of interest. He “should have left the Council table during the public hearing on the ordinance and [should have] had no involvement in the motions to carry and close the public hearing even assuming they were mere procedural events.” On the other hand, there was no legitimate inference that he ever discussed the matter with any relevant official other than to tell the Mayor that he was disqualified from participating. There was no “indication he let his view or position on the ordinance be known.” Consequently, the Appellate Division agreed with the lower court’s conclusion that his “disqualification neither tainted the Council proceedings nor it required invalidation of the ordinance.”

The Court pointed out that the Municipal Land Use law expressly specifies that “[t]echnical rules of evidence” are not applicable to a hearing on applications for development. That does not mean that “a hearing on a zoning application” does not need to be conducted in accordance with the “[f]undamental requirements of administrative due process and fair play.” The Appellate Division then examined the single explicit holding of the lower court with respect to a possible due process violation and found after extensive discussion held that there was no due process violation “as to require reversal of the Board’s solution… .”

As to the applicant’s argument that the “time of decision” rule protected its application, the most important issue had to do with whether the planning board had the right to grant a variance for a narrower driveway than what it thought the original ordinance required. The lower court believed that the planning board was “patently wrong because there was more than sufficient room to increase the width of the driveway” to the required width, and thus action was “arbitrary, capricious, and unreasonable.” The Appellate Division disagreed, holding that the planning board’s decision to grant the exception was a reasonable balance of competing considerations. Where an ordinance has been amended between the time a board makes its initial decision and the time of trial, the “time-of-decision rule” requires the Court “to decide a case on direct appeal on the basis of the statute or ordinance in effect at the time of [its] decision, so long as the legislative body that passed the intervening amendment intended the ‘modification [to] be retroactive to pending cases.’” According to the Appellate Division, the lower court “properly decided that the rule applied in this case… .” Nonetheless, the objector argued that the lower court had “properly found” that the amended ordinance “could not simply be superimposed upon the record of the proceeding before the Mayor and Council,” because it did not “cure the due process issues.” The Appellate Division disagreed. In sum, the Appellate Division reversed the lower court when the lower court, itself, reversed the planning board’s decision. Thus, the Appellate Division ordered the matter remanded to the planning board “for purposes of adopting an amended resolution in light of the revised ordinance and [the Appellate Division’s] conclusion.” In doing so, it advised the parties “that this technical remand cannot serve as a basis for further delay in this matter.”

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