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South Brunswick Center, L.L.C. v. Township of South Brunswick

A-1813-07T2 (N.J. Super. App. Div. 2009) (Unpublished)

ZONING; DEVELOPERS — A developer’s agreement is not an independent source of rights either as to its substantive provisions or as a basis for denying an opportunity to be heard by an appropriate governmental agency to develop a factual basis for relief from its terms.

A developer acquired an interest in certain property, including the property’s prior land use waivers, design exceptions and conditions. Among the several conditions contained in the developer’s agreement was a provision requiring the developer to construct a road extension adjacent to the property. The municipality also granted 20 year zoning protection for the developer’s subdivision approval, contingent on the developer completing the road extension by a certain date. The municipality refused to grant the developer an extension to build the road, believing there was no ambiguity about extensions in the developer’s agreement and pointing out the developer had agreed to its specific provisions. Thus, it insisted that the terms of the developer’s agreement governed such questions. The zoning board responded likewise and denied the developer the opportunity to appear before it to present evidence to support an extension application. The developer appealed, seeking an extension to complete the road, which would have continued the extended zoning protection granted by the municipality.

The Law Division denied the developer’s request, holding that the municipality had an absolute right to refuse to extend the deadline since the developer’s agreement was a binding contract and the municipality was not required to modify the contract if it chose not to do so. The developer appealed, claiming that Toll Bros., Inc. v. Bd. Of Chosen Freeholders of Burlington County, a case decided after the lower court’s decision was rendered, required reversal.

The Appellate Division reversed. In doing so, it held that the lower court’s decision was grounded on the presumption that a developer’s agreement was a binding contract, but such a presumption was vitiated in Toll Bros. The Court ruled that although Toll Bros. was decided after the Law Division’s ruling, it was applying the law in effect at the time of its decision and not the law in effect when the issues were initially presented. The Court noted that the Toll Brothers decision relied on a statutory provision that had codified the right of a party to request a change in the conditions of approval, public notice, and a hearing for modifications of conditions reflected in a developer’s agreement. The Court held that, based on the Toll Bros. decision, a developer’s agreement was not an independent source of rights either as to its substantive provisions or as a basis for denying an opportunity to be heard by the appropriate governmental agency to develop a factual basis for relief from its terms. It viewed the developer’s agreement as an ancillary agreement that existed solely as a tool for the implementation of the resolution establishing the conditions.


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