ADS ENVIRONMENTAL INC. v. THE TOWNSHIP OF BETHLEHEM (L-0330-19, HUNTERDON COUNTY AND STATEWIDE) ( 2022 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2545-20
ADS ENVIRONMENTAL INC.
and MININNI & SONS REALTY
1087 ROUTE 173, LLC,
Plaintiffs-Respondents,
v.
THE TOWNSHIP OF
BETHLEHEM, THE TOWNSHIP
COMMITTEE OF THE
TOWNSHIP OF BETHLEHEM,
THE ZONING AND
CONSTRUCTION CODE
COORDINATOR OF THE
TOWNSHIP OF BETHLEHEM,
and THE GENERAL CODE
ENFORCEMENT OFFICIAL OF
THE TOWNSHIP OF BETHLEHEM,
Defendants-Respondents,
and
THE PLANNING BOARD OF
THE TOWNSHIP OF BETHLEHEM,
Defendant-Appellant.
_______________________________
Argued March 15, 2022 – Decided August 16, 2022
Before Judges Fisher, DeAlmeida, and Smith.
On appeal from the Superior Court of New Jersey, Law
Division, Hunterdon County, Docket No. L-0330-19.
Kara A. Kaczynski argued the cause for appellant
(McNally Yaros Kaczynski & Lime LLC, attorneys;
Kara A. Kaczynski, on the briefs).
John M. Marmora argued the cause for respondents
ADS Environmental, Inc., and Mininni & Sons Realty
1087 Route 173, LLC (K&L Gates LLP, attorneys;
John M. Marmora and Alison T. Saling, on the brief).
Matthew R. Flynn argued the cause for respondents the
Township of Bethlehem, the Township Committee of
the Township of Bethlehem, the Zoning and
Construction Code Coordinator of the Township of
Bethlehem, and the General Code Enforcement Official
of the Township of Bethlehem (Savo, Schalk, Corsini,
Gillispie, O'Grodnick & Fisher, PA, attorneys; Kevin P.
Benbrook, on the brief).
PER CURIAM
Defendants Bethlehem Township and its planning board appeal the Law
Division's order reversing the board's denial of plaintiff's preliminary and final
site plan and use variance application. The board found that the site had been
abandoned by plaintiffs and their predecessors in interest. The trial court
concluded the board's abandonment finding was arbitrary and capricious. It
A-2545-20
2
vacated the order and remanded for further proceedings. For the following
reasons, we reverse and remand.
I.
ADS Environmental, Inc. and Mininni & Sons Realty 1087 Route 73, LLC
(ADS) are the current owners of the disputed property. Historically, the
property operated as a quarry and concrete batch facility. In 1960, Bethlehem
Township (Township) adopted a zoning ordinance which changed the parcel's
zone to mixed use commercial, including residential and farming. A subsequent
ordinance continued the mixed-use zoning.
The Lentine family purchased the property in 1972 and used it to operate
their concrete business, Bethlehem Concrete. A few years later they
successfully obtained site plan approval from the Board to add a new truck sales,
maintenance, and repair business to the concrete operation.
By 1994 the Lentines had successfully obtained preliminary and final site
plan approval for certain improvements on the property. The site plan approval
was conditioned upon restriction of "the operation of businesses on [the
property] . . . to the concrete business with two batch plants, the sale of new and
used trucks . . . , and the repair and maintenance of trucks . . . ." The 1994
conditional site plan approval prohibited the quarry use going forward.
A-2545-20
3
In the mid-2000's Bethlehem Concrete suffered financial setbacks and had
a series of hazardous substance discharges at the property, receiving at least one
violation notice from the New Jersey Department of Environmental Protection.
The owners stopped paying property taxes, which led to a tax sale. The
certificate holder foreclosed in 2013 and ADS, an entity with environmental
cleanup and business operations experience, acquired the property.
Prior to acquisition of the property, ADS sought a certificate of continued
occupancy (CCO) from the Township's zoning officer & construction code
coordinator, John Barczyk, in order to confirm the validity of the 1994 site plan
approval.
Barczyk consulted with the Township attorney, who issued a letter to
ADS's counsel dated June 18, 2014 which confirmed ADS was legally entitled
to operate pursuant to the 1994 site plan approval. Immediately thereafter,
Barczyk issued ADS a CCO.1 After receiving the CCO, ADS acquired the
property and commenced remediation efforts, demolishing certain structures on
the property.
In September 2017, ADS applied to the Board for site plan approval, with
an accompanying variance application pursuant to N.J.S.A. 40:55D-70(d)(2) to
1
The CCO was labeled "Zoning Permit."
A-2545-20
4
expand a nonconforming use. From February 2018 to June 2019, the Board held
fifteen public hearings on ADS's site plan application. After public opposition,
ADS elected to modify its application to include a request for certification of a
legal nonconforming use. The Board determined in a 5-1-1 vote that the three
uses listed in ADS's application were indeed preexisting nonconforming uses.
Next, in a 4-3 vote, the Board found that the preexisting nonconforming concrete
batch plant along with ancillary uses and structures were abandoned.
ADS filed a complaint in August 2019 seeking to reverse portions of the
Board's resolution which found ADS had no right to continue preexisting
nonconforming uses on the property. Citing the letter from the Township
attorney and the CCO, ADS argued that the Township confirmed the validity of
the nonconforming use prior to their acquisition of the property . As such, ADS
argued, the Board improperly denied their application.
The Township admitted in its pleadings that Barczyk, its code official,
acted in good faith and was within the scope of his authority to issue the CCO.
However, the Board argued that Barczyk and Township attorney lacked the
requisite authority to bind it, contending that ADS should have approached
either the planning board secretary, the municipal engineer, or the Board
attorney for the CCO.
A-2545-20
5
Prior to the hearing, the trial court issued a case management order dated
January 17, 2020. In addition to a briefing and trial schedule, the order included
the following language:
The court has determined that it is appropriate to
bifurcate the trial of this matter pursuant to Rule 4:38-
2(a). All of the claims against defendant Township of
Bethlehem, as set forth in Counts One through Four of
the First Amended Complaint shall be stayed pending
the disposition of the remaining claims against
defendant Planning Board of the Township of
Bethlehem.
After a hearing, the court issued an oral decision. The trial court reversed
the Board, concluding that its decision was arbitrary and capricious. The court
identified the central issue to be:
whether or not the Board's finding of abandonment
here, which was a finding that was made with regard to
the combined activities of the predecessor property
owner, Lentine, and the current property owner, ADS,
. . . is adequately supported by competent evidence in
the record.
The court found the Board's "findings on the abandonment issue" were
"not extensive," nor "terribly specific." It also noted that the Board relied
significantly on the combined actions of the Lentine family and ADS in reaching
its conclusion.
A-2545-20
6
Ultimately, the trial court found that the contested uses were not
abandoned. Critical to its reasoning was its finding that the Township, through
its attorney letter and the CCO, admitted that the uses were not abandoned and
that ADS had the right to continue them. Because the Township made this
determination in 2014, it concluded that looking to the Lentine family's activity
was neither relevant nor appropriate under these circumstances. The court found
the only period relevant for evaluating abandonment was ADS's ownership of
the property.
The court concluded the record showed "no evidence establishing [the]
Lentine[s'] subjective intent to abandon the pre-existing nonconforming uses."
It also concluded that there was nothing in the record to indicate ADS intended
to abandon the nonconforming uses. To the contrary, the court found ADS spent
significant sums to remediate the site and renovate the facilities; demonstrating
their intent to continue the nonconforming uses. Relying in large part on
estoppel principles, the court found the Board was bound by the representations
made to ADS by the zoning official and Township attorney.
The court noted that ADS's demolition of one of the concrete batch plants
could be interpreted as ADS's partial abandonment of that use at that particular
A-2545-20
7
site on the property. However, the court left that determination to the Board on
remand.
On appeal, the Board and the Township argue the trial court erred by
declining to consider the actions of ADS's predecessors, the Lentine family, in
deciding the issue of abandonment. They contend that the court improperly
relied on equitable estoppel principles to reverse the Board, after it stayed use
of those principles in its January 2020 severance order.2
II.
We acknowledge that a trial court "has broad case management
discretion." Lech v. State Farm Ins. Co., 335 N.J. Super. 254, 260 (App. Div.
2000). To that end, Rule 4:38-2(a) instructs that "[t]he court, for the
convenience of the parties or to avoid prejudice, may order a separate trial of
any claim, cross-claim, counterclaim, third-party claim, or separate issue,
or of any number of claims, cross-claims, counterclaims, third-party claims,
or issues."
2
The defendants also argue that the trial court's interpretation of N.J.S.A.
40:55D-68 is incorrect. We do not reach this issue, and we leave its resolution
to the trial court on remand.
A-2545-20
8
As to decisions of the local zoning board, "'[a] local zoning determination
will be set aside only when it is arbitrary, capricious, or unreasonable. '" Kane
Props., L.L.C. v. City of Hoboken, 423 N.J. Super. 49, 63 (App. Div. 2011)
(quoting Kramer v. Bd. of Adjustment, Sea Girt, 45 N.J. 268, 296 (1965)). Even
were we to harbor reservations as to the good judgment of a local land use
agency's decision, "there can be no judicial declaration of invalidity in the
absence of clear abuse of discretion by the public agencies involved." CBS
Outdoor v. Lebanon Plan. Bd., 414 N.J. Super. 563, 577 (App. Div. 2010).
Nonconforming use status may be terminated as a result of abandonment;
however, the mere non-use of a nonconforming right will not automatically
constitute abandonment. New Jersey courts have traditionally found that
abandonment of a nonconforming use or structure requires the concurrence of
two factors: (1) some overt act or some failure to act which carries a sufficient
implication that the owner neither claims nor retains any interest in the subject
matter of the abandonment, and (2) an intention to abandon. See Berkeley
Square v. Trenton Zoning Bd. of Adjustment, 410 N.J. Super. 255, 268-69 (App.
Div. 2009); compare Belmar v. 201 16th Ave., Belmar, 309 N.J. Super. 663(Law Div. 1997) (finding abandonment of a rooming house where operator's
financial problems resulted in bankruptcy and properties were boarded up) with
A-2545-20
9
Eltrym Euneva v. Keansburg, 407 N.J. Super. 432, 439-40 (Law Div. 2008)
(finding previous owner's failure to pay taxes which resulted in foreclosure did
not express the required intent to abandon a nonconforming use).
If a property merely remains idle, or if there are no significant changes
made or changes indicative of an intent to abandon the nonconforming use, then
the nonconforming right is not extinguished. See, e.g., Child.'s Inst. v. Verona
Twp. Bd., 290 N.J. Super. 350, 357 (App. Div. 1996); Borough of Saddle River
v. Bobinski, 108 N.J. Super. 6 (Ch. Div. 1969). These cases are highly fact
sensitive and zoning boards, and the courts, must pay special attention to the
intentions and actions of the property owners. See Campbell v. Bd. of
Adjustment, South Plainfield, 118 N.J.L. 116 (Sup. Ct. 1937) (finding no
intention to abandon the nonconforming use where the owner was unable to
carry on the business and the property stood vacant for several years); see also
Cox & Koenig, New Jersey Zoning & Land Use Administration, § 27-3 at 602
(2022).
In the specific context of the issuance of building permits, the application
of estoppel requires proof of four elements: (1) the building permit was issued
in good faith, (2) the building inspector acted "'within the ambit of [his] duty'"
in issuing the permit, (3) a sufficient question of interpretation of the relevant
A-2545-20
10
statutes or zoning ordinances as to "render doubtful a charge that the . . . official
acted without any reasonable basis" for issuing the permit, and (4) there was
"'proper good faith reliance'" on the issuance of the permit. Motley v. Borough
of Seaside Park Zoning Bd. of Adjustment, 430 N.J. Super. 132, 152-53 (App.
Div. 2013) (citations omitted).
III.
On appeal, defendants' primary argument is a procedural one: that the trial
court relied upon equitable estoppel principles to reverse the Board, when that
claim was not properly before the court after its severance order. Given the
posture of the case, they contend that the court's use of the Township attorney's
letter and the CCO was error. We agree.
Reduced to its essence , the trial court's decision was based on the actions
of the Township attorney and its code official. The court referenced ADS's
reliance on the Township documents in its rationale for reversing the Board. It
found that, because of the Township's admissions in its pleadings, the Board was
precluded from looking to the actions of the previous owners to find
abandonment. Mindful of its severance order separating the plaintiffs' claims
against the Township, the court found the order did not preclude use of equitable
estoppel against the Board, stating:
A-2545-20
11
I am finding that the Board's findings are inconsistent
with law[,] because I'm satisfied that the Board is
precluded here by virtue of either the admissions that
were made, or principles of equitable estoppel, or the
Square Corners doctrine[,] from basing its
abandonment decision . . . in whole or in part on the
activities of the predecessor owner Lentine.
Given the record before us, we find the trial court's severance of the
plaintiffs' claims against the Township and the Board to be a mistaken exercise
of discretion. In the current procedural posture, a cogent analysis of the
intertwined issues of abandonment and equitable estoppel is difficult, if not
impossible. The court, perhaps recognizing too late the significance of the
severed cause of action against the Township, imported plaintiffs' equitable
estoppel claims against the Township into the case against the Board. Had the
case against the Township and the Board proceeded together, a less convoluted
and more fulsome record would have emerged on whether the doctrine of
equitable estoppel was an appropriate remedy to the Board's action.3
The trial court's severance of ADS's claims against the two municipal
defendants prevented it from conducting a sound review of the extensive record
3
We make no finding on the issue of whether the Board and the Township,
together, were equitably estopped from declaring that ADS or its predecessor-
in-interest had abandoned the nonconforming uses at the disputed site. We leave
the issue to the trial court on remand.
A-2545-20
12
below. For this reason, we reverse the trial court's order against the Board, as
well as paragraph one of its January 2020 case management order which
bifurcated the matters. We remand to the trial court for further proceedings to
address the issues in a manner consistent with the principles set forth in this
opinion.
Reversed and remanded. We do not retain jurisdiction.
A-2545-20
13