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Dell’Olio v. Borough of North Plainfield

2006 WL 941971 (N.J. Super. Law Div. 2006)

ZONING; CONTRACTS —Zoning contracts are unlawful even if they are included in settlement agreements; therefore, all land use settlements require further action by the appropriate governing body, after providing notice and a public hearing.

A municipality and a private property owner entered into a consent order, approved by the Court, concerning re-development of the owner’s property. As part of the consent order, the property owner was required to submit a subdivision application to the municipal planning board. The consent order forbade the municipality from taking any action against the property owner. While the subdivision application was pending, the municipality passed an ordinance re-zoning the property owner’s land. Based on the new ordinance, the Planning Board rejected the subdivision application. Classifying the new ordinance as an action against it, the property owner filed suit alleging breach of contract because the consent order was violated. The municipality argued it could not contract away its zoning authority.

A municipality can not contract away its zoning power. To allow otherwise would be to violate public policy. Zoning contracts are unlawful even if they are included in settlement agreements. All land use settlements require further action by the appropriate governing body, after providing notice and a public hearing. In this case, the municipality did not take further steps to approve the consent order. In fact, the municipality passed an ordinance having an adverse effect on the property owner. And, a municipality may change its zoning even in the face of a pending application.

Because both parties had substantially complied with the consent order, the Court hesitated to allow the reinstatement of this long-drawn out litigation as a remedy. On occasion, courts will allow a land use application to proceed under a prior ordinance if equitable reasons exist for doing so. Therefore, the parties were ordered to submit briefs as to whether or not the Court should enforce the time-of-decision rule, and allow the property owner’s subdivision application to proceed under the previous ordinance.


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