Opinion ID: 2339947
Heading Depth: 1
Heading Rank: 2

Heading: The Facts and the Procedural Status

Text: There are twelve appeals pending before us, each involving the question of the validity of a trial court's decision on a motion to transfer Mount Laurel litigation to the Council. Transfer was denied in all but one. We selected five of the twelve cases for oral argument, designed and structured to cover all of the issues in all of the cases. The factual presentation that follows covers only the five cases that were argued. Our review of the record in the other cases makes it clear that in terms of our ruling today, there is no material difference in those cases. [3] The five cases specifically detailed involve Bernards, Cranbury, Denville, Randolph, and Tewksbury Townships. Tewksbury is the one case before us in which transfer was granted. Cranbury is the oldest of the five. Its history is found in Urban League of Greater New Brunswick v. Borough of Carteret, 142 N.J. Super. 11 (Ch.Div. 1976), rev'd, 170 N.J. Super. 461 (App.Div. 1979). The action was commenced in 1974, before our decision in Mount Laurel I. Our ultimate determination in Mount Laurel II dealt with this matter. There we held that Cranbury's ordinance, along with those of the other Middlesex County municipalities before us, was invalid and remanded the case for trial in accordance with our numerous rulings in Mount Laurel II, 92 N.J. at 350-51. On remand, a trial was held in April and May of 1984, the fair share determined, and an order entered on August 13, 1984, allowing 90 days for rezoning. In April of 1985, the Master, appointed by the court in accordance with Mount Laurel II, submitted a compliance report. The various reports of the parties' experts were exchanged in July of 1985. The court scheduled a hearing for December 2, 1985, on the issue of the compliance of the previously adopted ordinances. As a result of the subsequent events, mentioned below, that hearing was not held. It would have involved the measurement of the enacted ordinances against the fair share, a determination of suitability of certain sites for low and moderate income housing, the appropriate phasing in, if any, of the fair share obligation, and, assuming the enacted ordinances were not approved, a determination of the appropriate revision. It appears that had this Court not interfered, this case might have been completed, assuming further ordinance revisions were required, by the beginning of this year. The claims of manifest injustice that would result from a transfer include the alleged delay in the construction of low and moderate income housing, the potential loss of suitable sites, and significantly increased infrastructure costs for developers. Both the public interest plaintiff who originally brought the suit and the builder-plaintiffs who joined it after Mount Laurel II claim manifest injustice. The Denville and Randolph cases were part of the Public Advocate's lawsuit against municipalities in Morris County. The action commenced in October of 1978, between the decisions in Mount Laurel I and Mount Laurel II. The proceedings before the trial court prior to Mount Laurel II were supplemented after that decision by more discovery and further court conferences. By July of 1984, when the matter was set down for trial, only three of the Morris County municipalities remained in active litigation of the case. Denville and Randolph were two of the three. After ten days of trial a tentative settlement was reached and further trial proceedings were stayed pending the implementation of that settlement. On December 16, 1984, Denville indicated that it was no longer willing to abide by the settlement agreement. An additional day of trial was held in January 1985 (there were 10 days of trial in 1984), Denville's fair share was determined, and the municipality was ordered to rezone in conformance with Mount Laurel. A further interlocutory order was entered in March 1985, appointing a Master and requiring Denville to rezone in 90 days. The Master's report indicated that Denville's compliance plan would have resulted in only 12 additional lower income units (through the rehabilitation of 12 dilapidated units). During this period following our Mount Laurel II decision (from April 1984 to July 1985), five developers intervened, claiming builder's remedies. Three of the sites controlled by those developers were found suitable for lower income housing by the Master. The basis for claiming manifest injustice lies in the alleged delay in producing low and moderate income housing caused by the transfer, as well as in the builders' loss of expected profits. Randolph had also reached a tentative agreement with the Public Advocate to settle the matter, but that settlement fell through too. There is an issue as to whether it fell through because of delays on the part of the Public Advocate, which in turn led to problems concerning the sites, or whether it was the problems concerning the sites that led to the delays. A developer interested in the matter claims that it withheld suit based on Randolph's assurance that it would receive satisfactory treatment after resolution of the suit brought by the Public Advocate. That developer (Randolph Mountain), whose prior status had been as an intervenor, ultimately filed its own complaint after the adoption of the Act. The only claim of manifest injustice lies in the alleged delay that would result in the production of low and moderate income housing. Tewksbury is the most recent of the pending cases brought, having been filed on June 19, 1984. That suit resulted from the failure of Tewksbury's proposed rezoning to include the developer's tract in a zone that would permit multiple dwelling housing at a density satisfactory to the developer. Extensive discovery has occurred. The trial date, formerly set for July 1985, was adjourned in order to continue the settlement negotiations. There has been no trial, nor any determination of constitutionality, fair share, need to rezone, compliance, and so forth. The claimed manifest injustice in this case arises from the expected delay in the resolution of this matter resulting from a transfer to the Council, and includes the duplication of efforts already spent in this litigation, the financial burden to the plaintiff resulting from his continuing mortgage obligation during the Council's process, the denial of the claimed due process right to have a court ruling on the constitutionality of Tewksbury's ordinance, and the delay in realizing the opportunity for affordable low and moderate income housing. Bernards Township is the last matter on which we held oral argument. The suit before us is the second Mount Laurel suit brought by the developer, the first one having followed Mount Laurel I, the second, Mount Laurel II. The present suit was almost settled without any trial or discovery. Based on the apparent settlement, the municipality sought an immunity order, a device designed by one of the trial court judges to give a municipality the opportunity to rezone in accordance with the Mount Laurel obligation without having to face numerous suits by builders claiming a builder's remedy. [4] Through such an order the court allows the municipality 90 days to rezone (the municipality conceding the invalidity of its then zoning ordinance) either with or without a builder's remedy, depending on whether a builder is a party or otherwise involved at that time. In the meantime (and this is the advantage of the order) no builders may commence suit. If the rezoning conforms to the Mount Laurel obligation, the court renders a judgment protecting the municipality for a six year period against the requirement of any further relief, including any further builder's remedies. The deadline in Bernards' immunity order was extended from time to time to a date well after the effective date of the Act. Ultimately, Bernards decided not to go through with the settlement and thereafter filed a motion for transfer to the Council. The developer (Hills Development Company) by that time had expended substantial sums. The municipality had adopted an ordinance that appeared to comply with the Mount Laurel obligation. The developer alleges not only substantial expenditures that will be wasted if the builder's remedy that was part of the settlement is not granted, but further asserts that it has entered into numerous contractual arrangements that will cause it serious harm if the project is delayed or prohibited. The potential of a two-year delay allegedly would drastically affect the builder's business operations, which have depended on high-volume production. The manifest injustice, therefore, in this matter consists not only of the delay in providing low and moderate income units (Hills claims it could produce 550 by 1990) but significant actual and potential damage to the builder. As noted above the Act's effective date was July 2, 1985. Shortly thereafter, various motions were made in numerous cases, pursuant to the Act, to transfer the matters to the Council and hearings on those motions were held. In these five cases the motion for transfer was granted only for Tewksbury, and denied in the four others (as well as in all other cases before us). Following that denial many municipalities sought leave to appeal to the Appellate Division along with a stay of further proceedings at the trial level. In Tewksbury's case it was the developer who appealed from the order granting transfer. We have certified all of these appeals directly from the trial courts and, where requested, have entered a stay of all further proceedings at the trial level. The issue before us in each of these cases is the trial court's order on the motion for transfer. Numerous builders have also challenged the constitutionality of the Act, their position being that even if transfer should have been granted, the matter should proceed in court since the Act is unconstitutional. Along with the attack on the Act in its entirety are claims that various sections are unconstitutional. As suggested above the central issue in the transfer motions is the meaning of manifest injustice.