NJ SHORE BLDRS. v. SOUTH BRUNSWICK TP.

739 A.2d 956

325 N.J. Super. 412

NEW JERSEY SHORE BUILDERS ASSOCIATION; Central Jersey Builders Association; and New Jersey Builders Association, all not-for-profit corporations of the State of New Jersey, Plaintiffs-Respondents, v. TOWNSHIP OF SOUTH BRUNSWICK in the County of Middlesex, a municipality of New Jersey, Defendant-Appellant.

Superior Court of New Jersey, Appellate Division.

Argued September 13, 1999.

Decided October 8, 1999.

Donald J. Sears, North Brunswick, for defendant-appellant (Busch and Busch, attorneys; Mr. Sears, on the brief). Paul H. Schneider, Middletown, for plaintiffs-respondents (Giordano, Halleran & Ciesla, attorneys; Mr. Schneider, of counsel and on the brief; Nicole Devaney, also on the brief).

Thomas W. Dunn, for amicus curiae New Jersey State League of Municipalities (William John Kearns, Jr., General Counsel, attorney; Mr. Dunn, Mahwah, and Jennifer M. Bretz, of Beattie Padovano, Montvale, on the brief).

Before Judges PETRELLA, CONLEY and BRAITHWAITE.

The opinion of the court was delivered by PETRELLA, P.J.A.D.

This appeal by three associations of developers challenges an ordinance of the Township of South Brunswick (Township) which deals with maintenance of water detention basins. Essentially, the Township's ordinance provides for the continued "repairs and major maintenance" of detention basins and provides for responsibility to be assumed by either the Township or the private owner.

In June 1996, approximately eight years after its adoption in 1988, the ordinance was challenged in an action in lieu of prerogative writs by plaintiffs, three New Jersey associations: New Jersey Builders Association, Central Jersey Builders Association and New Jersey Shore Builders Association (collectively "the associations").¹ The associations are represented to be not-for-profit corporations comprised of residential home builders, contractors and suppliers doing business in New Jersey. None of the associations are parties to any agreement with the Township. However, certain of their members are represented to have been affected by the ordinance.

The associations contend that the municipal regulations exceed the Township's authority under the Municipal Land Use Law (MLUL) and allow an unlawful exaction which bears no reasonable relationship to any lawful purpose or objective under the MLUL. The associations also assert that the regulations allow an unconstitutional taking of property and represent an ultra vires attempt by the Township to impose its governmental duties upon private parties. The associations requested release and return of all "escrow" deposits,² including interest collected by the Township under the regulations, to the builders and developers who made such deposits over the last eight years, even though none of them are parties to this lawsuit.

Thereafter, the parties cross-moved for summary judgment. When the motions were listed on January 23, 1998, before the judge assigned to the matter, he indicated that he had a potential conflict due to his representation of one of the builders in the plaintiff associations before becoming a judge. As a result, he transferred the issue raised by the Township relating to the standing of plaintiffs to challenge the ordinance to another judge. The second judge decided the motions regarding plaintiffs' standing on the papers and ruled that the associations had standing, although the record before us contains no findings on this issue. The original judge then took the case back, heard arguments on the cross-motions for summary judgment, and granted the associations' motion while denying that of the Township. The judge declared the Township ordinance invalid and unenforceable in its entirety and ordered the Township to return "escrow" deposits and accrued interest within thirty days of the order to the entities that had paid the funds.

Although the associations' challenge raised several independent issues in attacking the subject ordinance, the judge questioned the validity of the ordinance on grounds of unequal taxation, and as an ultra vires aspect of the municipality's taxation power. The judge raised the unequal taxation issue because he felt that the residents of the Township would be paying for services that they were not getting. The judge stated:

I am not resolving the case because of any sympathy I feel for the builders. The question is impacting the homeowners. Ultimately, there is an effort to subject them to a tax for services that they're not getting. And that, I think, that's where it primarily runs afoul.

* * * *

I also think there is a Constitutional infirmity, that I don't have to address. Ultra vires, the Municipal Land Use, Section 53. I think it is inconsistent with the intent and the purpose of the Legislature that appears to deal with the legal services, legal taxing.

Although I don't criticize the municipality's attempt to lower its operating budget. I don't think you can do it in this fashion, without regard to an overall plan to deal with these issues, on a municipal-wide basis, not a development by development, homeowner by homeowner basis.

I think once you have a development, that takes drainage run-off from public entities, such as the streets or parks, or anything else, you're asking the homeowners to build up-front. But, ultimately, the homeowners to subsidize that which other areas of the town don't have to do.

I don't think that's legal under our current set of legislation. So, I will declare this ordinance to be unlawful on its face, on the basis of the motion for summary judgment, without the need for a plenary hearing.

We granted the Township's request for stay of the Law Division's order pending determination of this appeal.

On July 5, 1988, the Township of South Brunswick amended Chapter 175 of its Township Code to add Detention Basin Maintenance Regulations (§ 26-88). Section 175-186.2 provides in relevant part:

C. Maintenance.

(1) At the time of approval of the plan, responsibility for continued maintenance of surface water runoff control structures and measures shall be stipulated and recorded in the resolution of approval.

(2) Where continued maintenance is to be the responsibility of the applicant, a proposed maintenance agreement, a form to be provided by the township, shall be submitted. The agreement shall specify maintenance responsibility and standards during and after completion of the proposed activity and, upon approval, shall be recorded by the applicant in the office of the Middlesex County Clerk. The applicant shall thereafter file a copy of the recorded agreement with the township Planning Department. The township shall retain the right to enter and make repairs and improvements where necessary to ensure that all control measures as well as areas dedicated to surface water retention or groundwater recharge are adequately maintained and preserved. The township may charge the owner for the costs of these services if such maintenance is his responsibility.

(3) Where continued maintenance of a detention basin is to be the responsibility of the township, the following provisions shall apply:

(a) The applicant shall maintain the basin during the construction phase of the project.

(b) As a condition of final approval and prior to acceptance of the basin by the township, the applicant shall enter into an escrow agreement with the township, which agreement shall include a statement that the escrow contribution is made in consideration of the township assuming all future maintenance of the basin. The form of agreement shall be provided by the township. The agreement, upon execution, shall be recorded by the applicant in the Office of the Middlesex County Clerk. The applicant shall thereafter file a copy of the recorded agreement with the township Planning Department.

(c) The amount of the escrow contribution shall be based upon area of the detention basin on an acreage basis, which shall include the plan area at the top of the bank plus an additional twenty five (25) feet at the top of the bank encircling the basin. The amount of the escrow contribution shall be calculated according to the following formula:

Nine thousand dollars ($9,000) per acre of area of basin, plus twenty-five thousand dollars ($25,000)per basin for repairs and major maintenance.

The total of the above shall be multiplied by a factor of one and one-tenth (1.1) to cover the cost of the first year of maintenance.

The minimum contribution, regardless of the size of the basin, shall be thirty-five thousand dollars ($35,000).

(d) Upon certification by the Township Engineer that the project is complete and the guarantee bond for the project may be released, acceptance of the basin by the township shall be specifically stated in the resolution authorizing the bond release. The township shall retain from the cash portion of the bond a sum equal to the escrow contribution calculated by the Township Engineer in accordance with the formula in Subsection C(3)(c) above. In the event that the cash portion of the bond is less than the escrow contribution, the developer shall post the deficit in cash prior to release of the bond. Any interim bond reductions authorized by the township shall not be construed to mean that all or any part of the detention basin has been accepted by the township, nor shall any such interim reduction reduce the cash portion of the bond to an amount less than the escrow contribution.

(e) The escrow contribution does not include maintenance of the lot or open space area in which the detention basin is located.

According to the Township, before enactment of its detention basin ordinance it relied upon individual owners of basins to maintain them. However, the Township asserted that private owners failed to maintain the basins adequately, and, as a result, the basins became potential serious health hazards to its residents. Thus, a stated purpose of the ordinance was to lessen such hazard.

The...