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Hillsborough Storage, L.L.C. v. Hillsborough Township Zoning Board of Adjustment

A-4125-06T3 (N.J. Super. App. Div. 2008) (Unpublished)

ZONING; SELF-STORAGE FACILITIES — Provided it is not acting arbitrarily, capriciously or unreasonably, a land use board has the right to interpret the meaning of “self-storage facilities” within its local ordinance even though its interpretation may differ from the meaning given to that term by other land use boards or even court decisions.

A property owner sold a 3-1/2 acre property located in an industrial zone to a company that planned to construct and operate a self-storage facility there. The property owner and the storage company applied for minor subdivision approval and for a rear-yard variance. A competitor that operated a nearby facility objected and argued, with the aid of an expert witness, that while warehouses were a permitted use in the zone where the company wanted to build, self-storage facilities were not considered warehouses and therefore were not a permitted use on the property. The municipality’s planner testified that self-storage facilities were a permitted use and pointed out that three such facilities had been built in the same zone and that the zoning ordinance had been not been changed since they had been built. The municipality’s zoning board of adjustment found that self-storage facilities were a permitted use under the zoning ordinance. It approved the application. The competitor sued the board, the storage company, and the property owner. The property owner responded with a counterclaim alleging frivolous litigation. The lower court upheld the board’s finding, but dismissed the property owner’s motion for sanctions against the competitor based on its frivolous litigation claim.

On appeal, the Appellate Division disagreed with the competitor’s argument that a previous decision holding that self-storage facilities differed from warehouses in storage methods, clientele, and mode of delivery indicated that they were not a permitted use in a zone where warehouses were explicitly permitted. It pointed out that a governmental agency’s interpretation of a statute over a number of years without legislative interference indicated evidence of conformity with the legislative intent. Therefore, it found that the presence of, and prior board approval of, the three existing self-storage facilities indicated that the board interpreted the zoning ordinance to allow them. Additionally, the board’s decision was found not to be arbitrary, capricious or unreasonable. On the property owner’s cross-appeal of the lower court’s dismissal of its frivolous litigation claim, the Court found that the competitor had reason to believe that the property owner was a legitimate party to the litigation since the sale was contingent on approval of the self-storage facility’s construction. Based on its findings and conclusions, the Court affirmed the lower court’s rulings that had upheld the board’s decision and to dismiss the property owner’s frivolous litigation claim.

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