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Witt v. Borough of Maywood

328 N.J. Super. 343, 746 A.2d 25 (App. Div. 2000)

ZONING; PRIVATE INTERESTS—Zoning changes that serve as a benefit to the community as a whole and, at the same time, are directly related to a government function, will be upheld even if an incidental benefit accrues to a private party.

A bank sought permission to develop an “underutilized” tract of land for the construction and operation of a new branch. The land was adjacent to a municipal parking lot. The bank’s proposal invited the municipality to engage in an exchange of easements, in return for which the bank would improve and expand the municipal parking lot. A portion of the bank’s tract and all of the municipality’s property were located in a residential zone where a bank branch was not a permitted use. The lower court upheld the municipality’s ordinances, but remanded the matter to the planning board for an entirely new hearing because of procedural shortcomings during the original approval process.

The land was located on the boundary of the municipality’s central business district and a residential zone. A portion of the bank’s tract contained residential structures which had been devoted to commercial use. Another portion contained a nonconforming automobile repair facility. Yet another portion of the bank’s tract was actively devoted to residential use. The municipal parking lot was an unimproved vacant lot and within it was a vest-pocket municipal park. The bank pressed the municipality’s governing body to consider re-zoning and to enter into an exchange of easements for ingress, egress, and parking. The municipality referred the bank’s re-zoning proposal to its planning board which, at that time, was engaged in a periodic review of the municipality’s Master Plan. The planning board approved a Master Plan update but did not include any recommendation concerning the bank’s proposal. The following year, the municipality’s governing council introduced a re-zoning ordinance and the planning board reviewed the ordinance without taking exception. The municipality then adopted the re-zoning ordinance which now permitted the bank’s intended use on the bank’s tract. The planning board then granted conditional approval (including necessary variances) to the bank. The approvals required the bank to make off-site change improvements, obtain appropriate easements, and make certain intersection improvements. Subsequently, the municipality adopted an ordinance authorizing certain cross-easements. Objectors commenced three proceedings to challenge these actions.

The first suit asserted that the re-zoning ordinance was tailor-made for the bank without consideration for the public interest and that it was inconsistent with the municipality’s Master Plan. They further asserted that the easement ordinance was a donation of municipal property which, if true, would violate the Local Lands and Buildings Law (LLBL). The Court recognized that the governing body of a municipality was vested with broad powers and that courts were required “to interpret statutes liberally in favor of the existence of local power to deal with local needs.” The Legislature has the authority to regulate land use and to delegate some of that power to municipalities. The Municipal Land Use Law, adopted by the Legislature, grants municipalities exclusive powers to adopt and enforce zoning ordinances. A court will not overturn a municipal action unless it is arbitrary, capricious or unreasonable. Municipal actions “are not arbitrary and capricious if exercised honestly and upon due consideration, even if an erroneous conclusion is reached.” Nonetheless, the underlying principle is that “public money should be raised and used only for public purposes.” The concept of public purpose, however, is a broad one, and activities that serve as a benefit to the community as a whole and, at the same time, are directly related to the functions of the government, will be upheld even if an incidental benefit to a private party accrues. The objectors characterized the municipality’s actions as pretextual cover-ups of its true intent to advance the interests of a private developer. The Court, however, was not convinced that the re-zoning ordinance did violence to “an integrated and comprehensive zoning scheme,” or was objectively inconsistent with the ideals and goals of the municipality’s Master Plan. In this regard, it found a “clearly expressed and proper zoning purpose both in minimally expanding the commercial district to foster redevelopment and the appropriate use of land, and to facilitate better traffic flow on a heavily trafficked transportation artery.” Having found that at least one of those purposes was substantially supported by the record, the Court held that “it is irrelevant that an improper motive can be reasonably argued ... .” The Court found it “hardly surprising in this age that virtually all zoning decisions confer direct and indirect benefits on some property owners.” Even if the municipality creatively disguised otherwise illegal re-zoning activity into acceptable land use regulation, where there is substantial public benefit such as the Court found in this case, “[i]t is no zoning sin to provide regulations that will encourage the appropriate [use] of land in a commercial district and to attract a particular user to that end.” Further, a municipality is not disqualified from using suggestions of an applicant in a way that “will spruce up [the municipality’s] aging central business district and obtain a spanking new municipal parking lot at the same time.” With respect to the easement exchange, the Court pointed out that a municipality’s governing board may exchange any lands or any rights or interests (except public highways) for other lands or rights of interests desired for public use. A municipality may exact and receive a cash consideration in addition for such other lands or rights. The lands or rights received, together with the cash consideration, must be at least of equal value to the rights being exchanged and the acquisition must be more advantageous to the municipality than the rights or lands being given up. According to the Appellate Division, the lower court properly evaluated expert testimony regarding the value of the easements conveyed by the municipality and the value of the easements and other cash consideration received by the municipality. Consequently, the ordinance authorizing the exchange of easements was upheld.

With respect to the planning board hearings, the Appellate Division affirmed the lower court’s finding that the planning board was “more concerned with clearing its docket and less interested in hearing the panoply of issues from” the objectors. In particular, it should have adjourned its hearings rather than continuing them late into the night, especially where the objectors were surprised by the proceedings sprung upon them at the last moment. “The notion that the planning board might have actually entertained listening to the objectors’ witnesses (even if they were present and ready to testify) after midnight is preposterous.” Even though some applicants are belligerent and sometimes objectors are obstructionists, a planning board must “remain above the fray and conduct itself with dignity and even-handedness, even in the midst of a calamitous hearing.” The lower court found the planning board resolution the “hallmark of the Planning Board’s impatient attitude,” being adopted with the most conclusionary findings. Consequently, the actions of the planning board were reversed and the development application was remanded for an entirely new planning board hearing, even though the applicant was “largely blameless in the actions which compel a remand.”


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