Court Opinion

ID: 9694528
Source: CourtListenerOpinion
Date Created: 2023-08-25 17:45:30.047786+00
Date Added: 2024-06-11T18:20:02.981929
License: Public Domain

GARIBALDI, J.,
dissenting.
In 1935 the Borough of South Toms River (“Borough”) acquired an undeveloped tract of land from the State. The deed contains no restrictions on the property’s use. The tract, commonly known as Mathis Plaza, consists of four lots that are numbered 1 through 4 on the Borough’s tax map.
For the last forty years, lots 2 and 4 of Mathis Plaza have been continually leased for commercial purposes. Lots 1 and 3 remained virtually vacant. Lot 3, the lot in issue, is situated between the commercially-used lots, 2 and 4. From 1961, if not earlier, the Borough has continually sought to develop lot 3 for commercial or residential use. Despite the Borough’s efforts throughout the years, no bids met its criteria until 1984, when respondent Alphonse Stanzione successfully bid $330,000 for the entire Mathis Plaza tract.
On January 27, 1978, the Borough received a Green Acres grant of $27,500 to improve land for a baseball park. As a *219condition of that grant, N.J.S.A. 13:8A-47(b) (subsection 47b) of the Green Acres Land Acquisition and Recreation Opportunities Act of 1975 (“1975 Act”) required that “a local unit which receives a grant under this act shall not dispose of or divert to a use for other than recreation or conservation purposes any lands held by such local unit for such purposes [recreation or conservation] at the time of receipt of said grant.” (emphasis added).
During the years that the Borough was seeking to develop lot 3 commercially, it did not fence the vacant lot but permitted its residents to use the property occasionally for ad hoc recreational purposes. The question, therefore, is whether land that a local unit holds primarily for commercial development but that it permits its citizens to use incidentally for recreation is held for “recreation and conservation” pursuant to subsection 47b.
The Appellate Division, reversing the trial court, held that “[although lot 3 was being used for recreation purposes in 1978, it was not ‘held by’ the borough for that purpose within the meaning of subsection 47b.” 233 N.J.Super. 336, 340, 558 A.2d 1351 (1989). The Appellate Division reasoned that “held” within the intent of subsection 47b “requires a showing of more than active or passive use.” Id. at 343, 558 A.2d 1351. It concluded that subsection 47b applies only to “lands used or reserved for recreation and conservation purposes by a local unit with a municipal resolve permanently to devote the lands to those uses.” Id. at 343, 558 A.2d 1351. It therefore would not prevent the sale of the Mathis Plaza tract to Stanzione.
The majority reverses the Appellate Division. Its litmus test is that “property is deemed held by a municipality for recreational or conservation purposes, whenever it has been actually used for such purposes with the condonation or authorization of the municipality.” Ante at 217, 584 A.2d at 792. Moreover, “even if a municipality appears to have intended such property for commercial development, where such development remains wholly executory, any such intent would not outweigh the *220property’s actual and approved use for recreation or conservation.” Ibid.
As in all cases requiring statutory interpretation, the key question is what did the Legislature intend. See AMN, Inc. v. South Brunswick Township Rent Leveling Bd., 93 N.J. 518, 525, 461 A.2d 1138 (1983). The Legislature enacted separate Green Acres Acts in 1961, 1971, and 1975, all of which had the general purpose to increase and preserve public lands for recreational and conservation purposes. N.J.S.A. 13:8A-1 to -34. All the Green Acres Acts enabled the State to grant funds to local units so they could acquire and develop lands consistent with the goal of the Green Acres legislation.
In the 1975 Act, the Legislature enacted subsection 47b to prevent local units from acquiring new Green Acres land at State expense while contemporaneously selling land that it previously held for recreation or conservation. The statutory language, the legislative history, and public policy support the conclusion that the Legislature did not intend subsection 47b to restrict the right of a local unit to sell land that it held predominantly for commercial development when it received a Green Acres grant, but that members of the public used occasionally for recreational purposes.
The majority’s interpretation exceeds the Legislature’s intent. Prior to the adoption of subsection 47b, the Green Acres Acts had not placed any statutory restrictions on diversion of pre-existing recreation lands. Prior to the adoption of the 1975 Act, the Department of Environmental Protection (DEP), which administered the program, used with local units receiving Green Acres funds a standard form contract that contained a provision requiring that the local unit “not dispose of or divert to another use any lands now used for recreation or conservation” without State approval. 233 N.J.Super. at 341, 558 A.2d 1351 (emphasis added). In describing pre-existing lands subject to the new restrictions of the 1975 Act, the Legislature did not adopt the DEP’s language of “used for recreational purposes” *221but instead adopted the more restrictive and formal phrase “held by [local units] ... for recreation and conservation purposes.” (emphasis added).
No explanation for the change is provided in legislative history. It is presumed that a Legislature intends statutory language to have its ordinary and well understood meaning unless a special meaning is clearly indicated. Levin v. Township of Parsippany-Troy Hills, 82 N.J. 174, 182, 411 A.2d 704 (1980). The Legislature is deemed to be aware of all existing laws, Brewer v. Porch, 53 N.J. 167, 174, 249 A.2d 388 (1969), and administrative regulations construing such laws, when it enacts new statutory provisions. Generally, a legislature is presumed to be aware of established administrative practices and to promulgate its enactment with those in mind. Lorillard v. Pons, 434 U.S. 575, 581-82, 98 S.Ct. 866, 870-71, 55 L.Ed.2d 40, 46-47 (1978) (legislative “willingness to depart from those provisions regarded as undesirable or inappropriate for incorporation” is clearly expressed by the selectivity of and modifications to certain provisions before the legislature). The Legislature’s decision to enact a provision at variance with the language used by the administrative agency is significant.
By substituting the phrase “held by” for the word “used” that the DEP had previously employed, the Legislature manifested its intent to substitute the concept of ownership and possession for use. The regulations governing Green Acres grants also support this interpretation. N.J.A. C. 7:36-1.8(k) restricts diversion to “other lands owned, dedicated or maintained for public recreation or conservation purposes * * (emphasis added). That regulation was first adopted in October 1977. See R. 1977 d. 395, 7:36-1.8(1). The DEP has used contract language mirroring the regulations and providing: “No other lands presently owned, dedicated or maintained for recreation or conservation purposes by the local unit shall be diverted____” See Kauffman v. Mayor of N. Haledon, 229 N.J.Super. 349, 355, 551 A.2d 564 (Law Div.1988).
*222Likewise, the Proposed Development Agreement the Borough entered with the State, in connection with its $27,500 1978 Green Acres grant, provides that the Borough would not divert any “other lands owned, dedicated or maintained for recreation or conservation purposes.” These terms used in the regulations, the DEP standard contract, and the contract in this case — “owned, dedicated and maintained” — furnish additional support for the conclusion that more than occasional recreational “use” is needed to support a subsection 47b restriction.
Subsection 47b has been addressed twice by our courts and neither of those cases presents a close question regarding the status of the property. See Kaufmann v. Mayor of N. Haledon, supra, 229 N.J.Super. 349, 551 A.2d 564 (Law Div.1988) (finding land previously zoned as “open space” to be subject to subsection 47(b)); Borough of Demarest v. State, 148 N.J.Super. 322, 372 A.2d 656 (Ch.Div.1977) (finding existing parklands at time of grant to be subject to Green Acres restrictions).
Subsection 47b would apply if, in 1978, the Borough were holding lot 3 for purposes of recreation and conservation. What then do we look at in determining the Borough’s intention? We look to the formal actions of its governing body. Those actions show that the Borough consistently intended this property to be held for commercial development. The Borough never deviated from that intention.
The evidence is overwhelming that from at least 1961, the Borough intended to develop lot 3 commercially, and merely permitted its residents to use the lot occasionally for recreational purposes.
On June 12, 1961, the borough council adopted a motion “that a For Lease sign be erected on Mathis Plaza.” The minutes of the August 28, 1961 council meeting reflect a request by the then-mayor "that bids on the Mathis Plaza be held off until such time as he is able to look over plans.” The same minutes reflect the filing of a petition with the council requesting that the lease of Mathis Plaza be placed on the general election ballot. At its August 18, 1962 meeting, the council adopted a resolution placing the Mathis Plaza question on the ballot. The record does not indicate whether the question was indeed placed on the ballot in November 1962 or, if so, the result of the vote. *223However, on July 8, 1963, the council adopted a motion to hire a real estate consultant “in regards to the leasing of Mathis Plaza____” One year later, on August 10, 1964, the council adopted a motion to advertise “in regards to the leasing of Mathis Plaza.” The minutes of an October 15, 1964 special meeting established that the council held for further study a bid for Mathis Plaza from Nassau Marine. The bid contained no price and was for the use of Mathis Plaza for parking in conjunction with the docking of “a steam operated passenger vessel____”
[233 N.J.Super. at 343-44, 558 A.2d 1351],
There were no further developments until November 12, 1973, when the Borough retained its real-estate appraiser to update his earlier appraisal of Mathis Plaza. Significantly, on February 11, 1974, the Borough Council adopted a resolution that stated that it was the “desire of Mayor and Council to secure the highest and best use” for Mathis Plaza under the terms of a long-term lease and for the tenant to erect an improvement with a value of at least $1,000,000 and with an annual basis of $850,000. The resolution further provided that the Borough’s request for bids shall recommend as a highest and best use for the property, a marina, motel, restaurant, or condominium/townhouse complex. As the Appellate Division concluded:
[Tjhree years before the Green Acres application, the council, consistent with its earlier efforts, was attempting to return [the vacant portion of] Mathis Plaza ... to the private sector for what the council considered to be the property’s highest and best use, a site for commercial development.
[233 N.J.Super. at 345, 558 A.2d 1351 (emphasis added)].
It makes no sense that a Borough, seeking a tenant in year one for a long-term lease for property with a gross rental value of $850,000 and imposing the condition that improvements costing not less than $1,000,000 be made, would take $27,500 in unrelated Green Acres money in year three and foreclose its right to future proceeds from the sale or lease of such property-
Moreover, those attempts by the Borough to develop the land commercially were consistent with the Borough’s land use plan.
The 1971 Master Plan’s community facilities element excluded Mathis Plaza from lands designated as parks and playgrounds. In the land use element, *224Mathis Plaza was placed in the Special Economic Development zone, although other lands were described as public/conservation.
In 1972, the official map designated seven tracts for playgrounds, parks or conservation lands. Mathis Plaza was excluded from these designations. Consistent with the Master Plan, the 1972 zoning ordinance placed Mathis Plaza in the Special Economic Development (SED) zone which permitted “offices for business and professional uses, research laboratories, retail uses permitted in the B-l zone, and garden apartment developments____” Mathis Plaza continued to be zoned SED when the borough received the Green Acres grant. [Ibid.]
Prior to accepting Green Acres funding a local unit must complete a “Recreation and Open Space Inventory.” On that Inventory the local unit must list all developed park and recreation areas and undeveloped lands owned by the local unit and designated for open space, recreation, or conservation purposes. N.J.A.C. 7:36-1.8(b)(2). Although certain public vacant land was listed on the Inventory, the Borough did not list Mathis Plaza as being held by it for recreation or conservation purposes. The parties agree that the Borough omitted Mathis Plaza in good faith in the belief that the tract was not held for recreational or conservation use.
As the Appellate Division correctly concluded:
Although a local unit’s failure to include a tract in the inventory is not a conclusive bar to § 47(b)’s applicability, it is highly probative of municipal intent when accompanied by other indicia of that intent.
[233 N.J.Super. at 345, 558 A.2d 1351]
Likewise, the zoning map prepared in May 1985, as well as the Borough’s new Land Use Ordinance, designated the area including Mathis Plaza as “marine” and “residential.”
During the time that Mathis Plaza was the subject of the Borough’s efforts to realize its highest commercial value, Mathis Plaza lay vacant. Admittedly, the Borough did not fence off the area or otherwise deny the public access to the undeveloped property. However, an examination of the testimony from the five residents of the town explaining the recreational use of lot 3 reveals how unorganized and sporadic such use was. Certain events and activities, such as fishing off the bulkhead and a demonstration of water safety, were permitted. In addition, a *225World War monument was apparently placed in Mathis Plaza, but testimony at trial indicated that it became obscured on account of overgrown grass or was removed prior to the year in which the Borough received its Green Acres grant. The people who used the bulkhead of Mathis Plaza for docking paid a fee to the Borough for that use, although the testimony at trial indicated, at least in part, that the collection of those fees may have begun after the Borough’s receipt of the Green Acres monies. Finally, documentary evidence showed that certain equipment such as benches and grills were placed on the property in 1979, after the Green Acres grant was received and thus after any recreational uses of the property were relevant.
Every official act of the Borough demonstrates that the Borough intended to hold the property for commercial development. Against this anecdotal evidence of sporadic use, the Borough submitted resolutions, motions, mappings, and plans that convincingly establish that the Borough held the Mathis Plaza tract for commercial development. Such documented evidence, while not decisive, certainly is relevant in determining whether the property was held in 1978 for recreation or for commercial development. Yet, the DEP official “in charge of administering the legal side of all the Green Acres bond issues” testified that he could not recall reviewing those documents when the DEP made its decision that the Mathis Plaza tract was subject to the Green Acres Act.
In this case, where the evidence is overwhelming that the property is held predominantly for commercial or residential development and merely used occasionally by residents for recreational purposes, it should not be subject to Green Acres restriction. However, there will undoubtedly be cases in which the evidence is not so overwhelming. In those cases of dual purpose I think that the inquiry should be: what was the “primary purpose” for which the local unit held the land at the time of the Green Acres grant?
*226Coneededly, that inquiry does not provide for a bright line determination of “purpose.” Nonetheless, it is a fair resolution that furthers the goal of Green Acres legislation by allowing citizens to engage in intermittent recreational activities on a lot that otherwise serves no present purpose. A factual determination will have to be made to determine the local unit’s primary purpose in holding the land. Some of the factors to be considered include:
1. the examination of all the local unit’s official acts concerning the property;
2. the consistency of the asserted purpose with the zoning and other land-use plans of the local unit;
3. the zoning of the property;
4. the existence of written projections or agreements for future commercial development;
5. the existence of a formal dedication for the lot’s purpose;
6. the attempts at commercial development, including, inter alia, advertisements;
7. the local unit’s assessment of the lot in its inventory listing; and
8. the extent and continuity of recreational activities, including expenditures and receipts.
I note that this case also involves two countervailing public policies, the policy that restrictions on the alienability of land are to be strictly construed and the policy of preserving and increasing recreational lands. Where there are two such countervailing policies, the courts should use a reasonableness test when determining exceptions to the rule against restraint on alienability. See Greco v. Greco, 160 N.J.Super. 98, 104, 388 A.2d 1308 (App.Div.1978) (“We recognize that restraints on alienation must be reasonable____”); Brace v. Black, 51 N.J.Super. 572, 584, 144 A.2d 385 (App.Div.1958) (invalidating a deed’s provision which was “an unreasonable and unjustified restraint on alienation”); see also Coast Bank v. Minderhout, *22761 Cal.2d 311, 38 Cal.Rptr. 505, 392 P.2d 265 (1964) (delineating only a small number of reasonable exceptions to the rule against restraints on alienation); cf. Malouff v. Midland Fed. Sav. & Loan Assn, 181 Colo. 294, 509 P.2d 1240, 1243 (1973) (“We subscribe to the view that the question of the invalidity of a restraint depends upon its reasonableness in view of the justifiable interests of the parties.”). Despite a countervailing “recognized legitimate interest,” a contractual clause can be an unreasonable restraint on alienation, and even “reasonable restraints ... will be construed to operate within their exact limits.” Bingaman v. Valley Sav. & Loan, 97 N.M. 8, 12, 636 P.2d 279, 283 (1981). In this case, the majority has unreasonably restricted the alienability of the entire Mathis tract, because some of it was always commercially developed and all of it was held for commercial development.
The majority fails to address what a municipality must do to ensure that property it is holding for future commercial development is not deemed to be held for recreational purposes because of occasional recreational use by the public. Short of barring any citizen from using the property for occasional recreational uses, a feat to be accomplished under the majority’s opinion, I suspect, only by fencing the property, a municipality can do very little.
Municipalities need money. This is an important problem today. Nevertheless, the majority invalidates a rather large sale by the Borough. In these days of sluggish economic development, few areas are currently being developed, but many are being held for future development. Should even the possibility of future Green Acres applications exist, the majority puts municipalities on notice that they must either prohibit any use of undeveloped lands that are being held for future commercial development or execute otherwise unappealing transactions now. Both of those alternatives frustrate the objective of the Green Acres program and can provide only net losses to the communities involved.
*228As the Appellate Division recognized, “if mere active or passive use of municipal lands triggers § 47(b) restrictions, * * * the temporary use of undeveloped municipal land for recreation or conservation purposes” would be prevented. 233 N.J.Super, at 343, 558 A.2d 1351. A local unit should be permitted to allow its citizens to use vacant, but commercially-zoned, land for recreation pending commercial development of the land. Local units should not be compelled to fence off vacant land from the public for fear that DEP may one day claim that it is subject to the Act because the permitted recreation uses have met some vague and unarticulated threshold. That result directly conflicts with the legislative effort to expand — not diminish — land for public recreation.
I would affirm the judgment of the Appellate Division.
For reversal and reinstatement — Chief Justice WILENTZ, and Justices CLIFFORD, HANDLER, POLLOCK, O’HERN and STEIN — 6.
For affirmance — Justice GARIBALDI — 1.