Appellate Division Rules NJ Planning Board Litigation Is Not Moot

In 800 Sylvan Ave. LLC v. Planning Bd. of Borough of Englewood Cliffs, the Appellate Division addressed one of several land disputes involving the former Unilever campus in Englewood Cliffs…

In 800 Sylvan Ave. LLC v. Planning Bd. of Borough of Englewood Cliffs, the Appellate Division addressed one of several land disputes involving the former Unilever campus in Englewood Cliffs. In a per curium opinion, the appeals court held that the planning board litigation was not moot even though the court had previously approved a settlement agreement in affordable housing litigation involving the same property.

Land Use Dispute

The land use dispute centers on Plaintiff 800 Sylvan Avenue LLC’s twenty-eight-acre property located at 800 Sylvan Avenue in the Borough of Englewood Cliffs (Borough), consisting of three multipurpose interconnected buildings (“A,” “B-2,” and “B-3”). The property, which is the site of the former Unilever corporate campus, is currently used for general office space, research, and storage, and is located in the B-2 Limited Business District zone.

According to court documents, on May 17, 2017, the Plaintiff applied for a preliminary and final major site plan and subdivision approval with variances, pursuant to N.J.S.A. 40:55D- 70(c) and (d). The Plaintiff specifically sought to: (1) subdivide the property into two lots with proposed Lot 1 comprising of the new office building (building A and B-3) and approximately 20.039 acres and proposed Lot 1.01 comprising of buildings B-1 and C and approximately 8.332 acres; (2) demolish building B-2 and demolish portions of other structures on the lot to create two separate buildings; and (3) refurbish and rebuild approximately 266,655 square feet and construct an additional 26,069 square feet of office space and construct two new parking structures on proposed Lot 1. The Plaintiff’s application sought multiple (c) variances, as well as one (d)(6) variance.

The Board ultimately denied the application. Among other findings, it concluded that the Plaintiff “did not demonstrate that the public benefits of the subdivision outweigh the detriments.” Regarding the off-site parking, the Board’s resolution found that the Plaintiff did not “meet its burden of demonstrating the ‘positive’ and ‘negative’ criteria to justify granting of the variances as is required by N.J.S.A. 40:55D-70(c)(2).” Regarding the second proposed parking structure, the Board also found that the Plaintiff failed to demonstrate the benefits outweighed the detriments.

The Plaintiff subsequently filed suit, arguing that the Board’s denial was arbitrary, capricious, and unreasonable. The trial court reversed the Board’s denial and entered an order approving the Plaintiff’s application in part. The trial court also remanded one of the Plaintiff’s variance applications to the Board for consideration as to whether the Plaintiff could demonstrate special reasons required for a variance under N.J.S.A. 40:55D-70(d). When both parties sought reconsideration of the initial order, the trial court denied it, finding the matter was moot because the Plaintiff had reached a settlement agreement with the Borough to construct several hundred units of affordable housing on the property.

Appellate Division’s Decision

The Appellate Division affirmed in part and vacated in part. After concluding the appeal was not moot, it upheld the trial court’s subdivision approval as well as its application of a (d) variance standard to its proposed accessory parking structure variance standard.

The appeals court first concluded that the appeal was not moot, citing that the housing settlement agreement was not conditioned on the Plaintiff relinquishing its rights in the litigation.

“It is undisputed that plaintiff cannot proceed with both projects. However, the presence of the ongoing affordable housing litigation does not mean plaintiff has forfeited the approval of its site plan and variance application as memorialized it the trial court’s March 2019 order,” the Appellate Division explained. “The housing settlement agreement was not conditioned on plaintiff relinquishing its rights in this litigation. The settlement agreement also contains a provision acknowledging this litigation and agreeing to relinquish all appellate rights arising out of the affordable housing litigation. There are no other references to this matter in the settlement agreement.”

The Appellate Division next turned to whether the trial court erred in approving the subdivision of the property. As the court explained, if a subdivision application meets the local ordinances and provisions of the MLUL, the Planning Board must approve it. In this case, the Appellate Division found that the record supported the trial court’s findings.

“The Board hearing record contains more than sufficient evidence demonstrating the benefits of plaintiff’s proposal, including: aesthetic improvement along Sylvan Avenue; modernization of the property; a net increase of trees and green space to the site; and improved circulation throughout the property,” the court wrote. 

The Appellate Division also found that the Board’s concern that the Plaintiff did not propose to improve Lot 1.01 was not dispositive. In support, it cited that Unilever will occupy the property for another 14 years, and the Plaintiff “cannot modernize a structure it does not control.” The court also noted that the Plaintiff’s proposal also included a reciprocal easement agreement, which would keep the current parking arrangements in place.

Finally, the Appellate Division rejected the Plaintiff’s argument that the trial court erred by applying a (d) variance standard to its proposed accessory parking structure variance standard. As noted by the appeals court, the trial court found a plain reading of Zoning Ordinance § 30- 7.2(a)(4) prohibited parking structures and further mandated that the surface parking be at grade level.

“Given the language of the ordinance, the court correctly concluded that plaintiff’s application for a proposed accessory parking structure required a (d) variance analysis, including a showing of ‘special reasons,’” the court wrote. “The trial court’s analysis was sound, and we see no basis under our standard of review to disturb its order on this question.”

Key Takeaway

As the Appellate Division’s decision makes clear, it is possible for developers to pursue two different plans for a property — even during litigation. However, to ensure that your legal rights are preserved, it is imperative that any settlement agreement clearly states what matters are being resolved.

If you have questions, please contact us

If you have any questions or if you would like to discuss the matter further, please contact me, Patrick J. McNamara, or the Scarinci Hollenbeck attorney with whom you work, at 201-896-4100.