Court Opinion

ID: 4427916
Source: CourtListenerOpinion
Date Created: 2019-08-20 18:57:56.887455+00
Date Added: 2024-06-11T14:50:47.782843
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE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-0621-17T2

IN THE MATTER OF TOWERS
ASSOCIATES' MOTION REQUESTING
THAT MEPT LINCOLN CROSSING'S
WITHDRAWAL OF ITS VARIANCE
APPLICATION BE CONSIDERED
AS WITH PREJUDICE.
__________________________________

                Submitted January 10, 2019 – Decided July 30, 2019

                Before Judges O'Connor and DeAlmeida.

                On appeal from the New Jersey Sports & Exposition
                Authority.

                Sills Cummis & Gross, PC, attorneys for appellant
                Towers Associates (Joseph B. Fiorenzo and Kristoffer
                S. Burfitt, on the briefs).

                Waters Mc Pherson Mc Neill, PC, attorneys for
                respondent MEPT Lincoln Crossing, LLC (Eric D. Mc
                Cullough, of counsel and on the brief).

                Gurbir S. Grewal, Attorney General, attorney for
                respondent New Jersey Sports & Exposition Authority
                (Melissa Dutton Schaffer, Assistant Attorney General,
                of counsel; Ryan C. Atkinson, Deputy Attorney
                General, on the brief).
PER CURIAM

      Respondent MEPT Lincoln Crossing, LLC (MEPT) submitted an

application to the New Jersey Sports and Exposition Authority (NJSEA)

seeking a use variance and site plan approval.       After the NJSEA staff

commenced public hearings, MEPT withdrew its application without

prejudice.   Thereafter, appellant Towers Associates, an objector to the

application, filed a motion with NJSEA requesting MEPT's application be

deemed withdrawn with prejudice or, in the alternative, that MEPT

compensate appellant for the counsel and expert fees and costs it incurred to

object to MEPT's application. In a resolution dated September 21, 2017, the

NJSEA Board of Commissioners (Board) denied MEPT's motion. Appellant

appeals from that resolution. We affirm.

                                      I

      MEPT is the owner of property in North Bergen and Secaucus, on which

is a warehouse. The property is located in the Meadowlands District, where

NJSEA regulates land use. In 2015, MEPT wanted to demolish its warehouse

in order to build a larger one. To accomplish that goal, in accordance with

N.J.A.C. 19:4-4.4 and N.J.A.C. 19:4-4.14, MEPT applied to NJSEA for a use

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variance from zoning regulation N.J.A.C. 19:4-5.52(a) and for site plan

approval.

      Appellant owns property adjacent to the property on which MEPT's

current warehouse exists. On appellant's property is a Home Depot and an

undeveloped lot on which appellant plans to build a hotel. Appellant opposed

MEPT's application, as did another entity, Vee Jay International (Vee Jay),

which owned property adjacent to MEPT's, as well.

      The NJSEA staff conducted public hearings on MEPT's application over

the course of six days in the fall 2015. Both objectors participated in the

hearings. Shortly before the sixth day of hearings, MEPT modified its site

plan in order to meet some of Vee Jay's concerns. During the sixth day of

hearings, MEPT recalled two of its experts to testify about the recent

alterations to its plan. Both appellant and Vee Jay were unprepared to cross -

examine the experts, so the matter was scheduled to continue on another day in

January 2016 to permit the objectors to cross-examine and MEPT to conduct

redirect examination on these experts, as well as allow the objectors to

introduce evidence. Thereafter, at MEPT's request, that hearing was adjourned

to March 2016.

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        Meanwhile, in February 2016, MEPT sent a letter to NJSEA advising

that MEPT had decided to "evaluate alternative designs for the proposed

facility, which will necessitate submission of new plans and technical reports.

The     [a]pplicant   therefore   withdraws      without   prejudice   the    pending

applications, and will resubmit new plans and applications at a future date."

        Appellant then filed a motion with NJSEA requesting that MEPT's

withdrawal of its application be deemed with prejudice or, in the alternative,

that appellant be awarded the counsel and experts' fees and costs it incurred

objecting to MEPT's application.         Although NJSEA is a State agency,

appellant's principal argument was that it was entitled to such relief pursuant

to Rule 4:37-1(b).1 From what we can ascertain from the record, the gist of

appellant's argument was that MEPT withdrew its application because it feared

the application was going to be rejected.

1
    Rule 4:37-1(b) provides in pertinent part:

              Except as provided by paragraph (a) hereof, an action
              shall be dismissed at the plaintiff's instance only by
              leave of court and upon such terms and conditions as
              the court deems appropriate. . . . Unless otherwise
              specified in the order, a dismissal under this paragraph
              is without prejudice.

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                                        4
      In a resolution dated September 21, 2017, the Board denied the motion,

providing its reasons in a written decision attached to the resolution. 2

Although the Board found Rule 4:37-1(b) in part governed the resolution of

2
  In June 2017, MEPT filed a new application for a use variance. In its
moving brief before us, appellant contends the second application is identical
to the one MEPT initially submitted. In its brief in response, MEPT maintains
the application is different from the first in several material respects. In its
reply brief, appellant again argues the two applications are the same, and filed
a reply appendix that includes the transcripts of the hearings on the second
application.

      The hearings on the second application did not commence until April
2018. When it decided appellant's motion in September 2017, the second
application was not before the Board and, thus, it did not consider it. In its
reply brief, appellant argues the transcripts of the hearings on the second
application support its position such application was the same as the first. In a
motion MEPT filed to strike appellant's reply appendix and those portions of
the reply brief that refer to or rely upon the appendix, MEPT argued
appellant's position the two applications are the same is incorrect and the
product of "cherry-picking" from the extensive record on the second
application. MEPT further noted it cannot respond to the reply brief and
provide reasons why appellant's assertion the applications are the same are
unfounded by the record.

       We entered an order that strikes from the reply appendix the transcripts
of the hearings on the second application, as well as any arguments in the reply
brief that rely upon the evidence adduced at those hearings. The Board did not
take into consideration any of the evidence adduced during the hearings on the
second application when it decided appellant's motion in September 2017. In
fact, the hearings on the second application had not even concluded before
MEPT filed its response brief before us. We do not consider evidence that was
not presented to the Board and that was submitted by a party for the first time
on appeal. See Townsend v. Pierre, 221 N.J. 36, 45 n.2 (2015).

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the issue, after applying this Rule to the facts, the Board determined appellant

was not entitled to relief under this Rule. However, for reasons unrelated to

Rule 4:37-1(b), the Board found that MEPT's withdrawal of its application

without prejudice was an appropriate disposition, and that MEPT was not

obligated to compensate appellant for its fees and costs.

      When evaluating the application of Rule 4:37-1(b), the Board found that

when MEPT withdrew its application, the hearing on this matter was "far from

complete." The NJSEA staff had yet to hear the cross-examination of MEPT's

remaining witnesses, the testimony of the objectors' witnesses, the public's

comments on the application, and closing arguments. More important, the

Board observed that when MEPT withdrew its application, there was no

indication of how the Board was going to rule. The Board therefore rejected

appellant's claim that MEPT withdrew its application to preclude NJSEA from

making a decision that would have been adverse to it.

      As stated, the Board found reasons unrelated to the application of Rule

4:37-1(b) to support the withdrawal of MEPT's application without prejudice.

The Board noted that permitting applicants to amend or resubmit applications

to address concerns raised by objectors or by the Board should be encouraged.

In its written decision attached to the resolution, the Board stated:

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           While [appellant] might have expected a conclusion to
           this matter and some semblance of finality, at this
           stage of the proceedings such expectations are
           unreasonable. Often in land use hearings such as this,
           applicants amend and/or withdraw and resubmit
           applications to address concerns raised by objectors
           and/or the governing authority. Such cooperation is
           encouraged and allows the concerns of the objectors to
           be addressed while at the same time protecting the
           rights of property owners. To suggest that an
           applicant may not withdraw an application to address
           such concerns would discourage cooperation and
           defeat NJSEA's ability to perform its stated mission.

                 As the hearing was not complete and the
           procedures set forth in N.J.A.C. 19:4-4.14 had not
           concluded, MEPT's application was properly
           withdrawn without prejudice.

     Although the Board did not specifically identify what its "mission" is,

N.J.S.A. 5:10A-2(h) provides that one of NJSEA's goals or interests is to

promote the economic growth of the meadowlands and northern New Jersey.

Further, in February 2015, NJSEA and the New Jersey Meadowlands

Commission merged and became collectively known as the New Jersey Sports

and Exposition Authority.    N.J.S.A. 5:10A-1 to -68.      N.J.S.A. 5:10A-6

provides that, in addition to dissolving the New Jersey Meadowlands

Commission and vesting in NJSEA the Commission's property, funds and

assets, NJSEA shall carry out the purposes of N.J.S.A. 13:17-1. The latter

statute declares that one of the purposes of the Hackensack Meadowlands

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Reclamation and Development Act, N.J.S.A. 13:17-1 to -3.1, is "to reclaim,

plan, develop and redevelop the Hackensack meadowlands." N.J.S.A. 13:17-1.

                                     II

      On appeal, appellant asserts the following arguments for our

consideration:

            POINT I: THE NEW JERSEY SPORTS AND
            EXPOSITION AUTHORITY ACTED
            ARBITRARILY, CAPRICIOUSLY, AND
            UNREASONABLY IN DENYING TOWERS
            ASSOCIATES' MOTION TO TREAT MEPT
            LINCOLN CROSSING'S WITHDRAWAL OF ITS
            VARIANCE APPLICATION AS WITH PREJUDICE.

            POINT II: ALTERNATIVELY, HAVING FAILED
            TO DISMISS MEPT'S APPLICATION WITH
            PREJUDICE, THE POLICY CONCERNS OF
            FINALITY, AVOIDANCE OF DUPLICATION,
            REDUCTION OF UNNECESSARY BURDENS,
            PREVENTION OF NEEDLESS LITIGATION, AND
            BASIC FAIRNESS UNDERPINNING RULE 4:37-
            1(b) REQUIRED THE BOARD TO GRANT
            TOWERS' MOTION FOR ATTORNEY AND
            EXPERT WITNESS FEES.

      Our review of the subject resolution is limited. "A strong presumption

of reasonableness accompanies an administrative agency's exercise of

statutorily-delegated responsibility." In re Proposed Xanadu Redevelopment

Project, 402 N.J. Super. 607, 632 (App. Div. 2008) (quoting Gloucester Cty.

Welfare Bd. v. State Civil Serv. Comm'n., 93 N.J. 384, 390 (1983)). A court

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                                    8
may reverse an agency's decision only if it "conclude[s] that the decision of the

administrative agency is arbitrary, capricious, or unreasonable, or is not

supported by substantial credible evidence in the record as a whole." J.D. v.

N.J. Div. of Developmental Disabilities, 329 N.J. Super. 516, 521 (App. Div.

2000). That said, we are not in any way "bound by the agency's interpretation

of a statute or its determination of a strictly legal issue." Mayflower Sec. Co.

v. Bureau of Sec., 64 N.J. 85, 93 (1973).

      The term "arbitrary and capricious" in the law means having no rational

basis. Bayshore Sewerage Co. v. Dep't of Envtl. Prot., 122 N.J. Super. 184,

199 (Ch. Div.1973), aff'd., 131 N.J. Super. 37 (App. Div.1974). In connection

with administrative bodies, the term "means willful and unreasoning action,

without consideration and in disregard of circumstances." Ibid.

      Having considered the record, the parties' arguments and the applicable

law, we reject the premise Rule 4:37-1(b) governs the outcome here.

Appellant did not provide and we are unable to find any authority binding

upon this court that supports its argument Rule 4:37-1(b) applies in an

administrative proceeding. Moreover, Rule 4:1 instructs that "[t]he rules in

Part IV, insofar as applicable, govern the practice and procedure of civil

actions in the Superior Court, Law and Chancery Divisions, and the surrogate's

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                                       9
courts and the Tax Court . . . ." The decision under review here was made by a

State agency in an administrative proceeding, not by the Superior Court in a

civil action in the Law or Chancery Division, or by the surrogate's court or Tax

Court.

      Second, we are unable to find any authority that supports the premise

NJSEA must order the withdrawal of an application of the kind here with

prejudice, or that NJSEA has the authority to order a party to pay the counsel

and experts' fees and costs of another.

      We affirm NJSEA substantially for the alternate reason the Board

provided in the resolution to deny appellant's motion. As the Board noted,

often in land use hearings applicants amend, withdraw and resubmit

applications in order to address concerns raised by others.         The Board

observed that such action allows the concerns of the objectors to be addressed

while at the same time protecting the rights of property owners, and "to

suggest that an applicant may not withdraw an application to address such

concerns would discourage cooperation and defeat NJSEA's ability to perform

its stated mission."

      Here, MEPT advised the Board and the objectors that it withdrew its

application because it wanted to evaluate alternative designs for the proposed

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                                      10
facility and, as it stated to the NJSEA staff and the objectors, voiced the

concern such evaluation might require the "submission of new plans and

technical reports."   Considering the facts as they existed when the Board

denied appellant's motion in September 2017, appellant provides no reasonable

basis to preclude MEPT from withdrawing the first application without

prejudice and submitting a new one, or to compel MEPT to pay for appellant's

fees and costs.

      One of the NJSEA's statutory goals is to promote development in the

meadowlands. See N.J.S.A. 5:10A-6 and N.J.S.A. 13:17-1. NJSEA's essential

finding is that appellant's position would be antithetical to development.

Problems with an application are often discovered and exposed during the

hearing process. After all, the fundamental purpose of a hearing is to examine

an application and determine if there are any flaws that will make its approval

problematic.

      An applicant will be deterred from submitting an application for

development if it knows that, if a problem is discovered during the hearing and

the only remedy is to withdraw the application, the applicant must bear the

fees and costs of another party, or be precluded from filing a new application if

the original one is deemed withdrawn with prejudice. Even if there are no

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                                     11
problems with an application, an applicant may have sound reasons to alter its

plans and wish to withdraw its application and file a new one. An applicant

will be deterred from filing an application under such circumstances, as well.

      We are not unmindful of appellant's contention that it was unfairly

caused to expend its resources a second time in order to object to the second

application because, according to appellant, the second application was the

same as the first. However, that issue is not before us. The Board did not

make nor could it have made the determination whether the first and second

applications were the same but, even if it determined they were, the Board is

not precluded from considering other reasons bearing on the question whether

appellant is entitled to the relief it seeks.

      Accordingly, under the specific factual circumstances presented here, we

discern no reason to conclude the Board's ultimate decision to deny appellant's

motion was arbitrary, capricious or unreasonable.

      Affirmed.

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