New Jersey Lawyer & Attorney : Stark & Stark Law Firm : New Jersey Law Blog

Vincent J. Mangini, Shareholder in Stark & Stark’s Real Estate, Zoning & Land Use group, will present a seminar entitled How to Immediately Cut Your Company’s Energy Costs and Control Energy Expenses in the Future in conjunction with New Jersey’s Clean Energy Program and its New Jersey SmartStart Buildings program. The seminar is hosted by CrunchEnergy, an energy services company dedicated to helping businesses reduce energy costs.
 

 
The seminar will be presented from 8:00 AM – 12:30 PM September 9, 2009 and September 10, 2009. The September 9th event will be held at The Villa in Mountain Lakes, New Jersey, and the September 10th event will be held at the Sheraton in Eatontown, New Jersey.

 

The seminar will provide actionable recommendations to cut energy costs immediately, while providing the insight to prepare for upcoming regulations and impending laws and current initiatives, like New Jersey’s Energy Master Plan. The material shared at the event will benefit New Jersey-based building owners, business owners, CFOs, energy managers and facilities managers - anyone who makes decisions about energy for buildings of 20K square feet or more.
Topics to be discussed include:

• Quick and no-cost building upgrades to reduce energy consumption
• Reducing peak demand
• Emerging technologies and incentive opportunities
• State Renewable Energy Tax Exemption
• Grants and loans for energy efficient projects
• Energy audits
• NJ Smart Start Buildings Pay-for-Performance Programs
• And other related topics.

Mr. Mangini will present the seminar with Joseph Carlamere of New Jersey SmartStart Buildings. Mr. Carlamere is involved in environmental consulting, company TRC’s design and development of the sector initiative of New Jersey’s Clean Energy Program as part of the team developing programmatic strategies that resonate to the following sectors: industrial, institutional, multi-family, higher education and hospitality. He also manages the Local Government Energy Audit Program for the NJOCE and the BPU.
 

Additional information and details on how to register for the events is available online here.
 

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Under N.J.S.A. 40:55D-21, if a developer is “barred or prevented, directly or indirectly,” from moving forward with an approval obtained pursuant to the Municipal Land Use Law (MLUL) “during the period of approval” on account of the institution of “a legal action” or the issuance of “a directive or order” by, among other government actors, a “political subdivision” for the purpose of “protect[ing] the public health or welfare” at a time when “the developer is otherwise ready, able and willing to proceed[,]” then - in such instance - the period of approval shall be suspended for so long as “said legal action is pending or such directive or order is in effect.”

Recently, in the matter of Friends of Peapack-Gladstone v. Borough of Peapack-Gladstone Land Use Board, et al., the Appellate Division of the New Jersey Superior Court interpreted this provision of the MLUL and decided, among other things, that the running of the period of approval for 18 golf cottages was tolled when a zoning officer declined to issue a building permit for the construction of the second such cottage, “because of his perception that the project was being advertised in a manner contrary to the Board’s prior approvals.”  In the Court’s view, the zoning officer was “plainly” acting as an agent of the Borough, a political subdivision, in rendering this decision which, according to the Court, “was manifestly an effort on his part . . . to ‘protect the public health and welfare’ in the Borough [and] . . . had the direct and indirect effect of halting the developer’s work on the project, at a time at which the developer was evidently ‘ready, willing and able to proceed’ with the building of the next dwelling.”

The Appellate Division’s decision in Friends of Peapack-Gladstone v. Borough of Peapack-Gladstone Land Use Board, et al. may be viewed on WestLaw at 2009 WL 1643315 (N.J.Super. A.D.) and has been approved for publication.

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Recently, in the matter of Schmidhausler v. Planning Board of Borough of Lake Como, the Appellate Division of the New Jersey Superior Court addressed, among other issues, what the remedy for an aggrieved party should be when a municipal board renders a decision on an application for development under the Municipal Land Use Law that is tainted by the failure of one of its members to read or listen to the testimony presented on the matter during a prior meeting in violation of N.J.S.A. 40:55D-10.2.  In this case, the planning board voted to approve an application for a subdivision with variance relief by a narrow one-vote margin.  The plaintiffs argued that the remedy in such instance should be the striking of the disobedient board member’s vote.  The Appellate Division, however, was not persuaded by plaintiffs’ suggestion, especially here, where such action “would result in a tie vote and . . . an automatic denial of the application.”  Instead, the Court opted to remand the matter to the planning board for another round of deliberation and a new vote after “those who had not attended one or all of the hearings in this matter review the transcript of any meeting or meetings that they may have missed[ and] certify they have done so[.]” According to the Court, this course of action was preferable to “denying the application outright or putting all of the parties to the cost and expense of an entire new hearing[.]”

By this case, the Appellate Division has provided a clear message to all parties involved in the prosecution and disposition of applications for development under the MLUL that a failure on the part of municipal board members to abide by N.J.S.A. 40:55D-10.2 - while not triggering a new hearing - will likely cause the board’s decision to be deliberated and voted on anew.  The Appellate Division’s decision in Schmidhausler v. Planning Board of Borough of Lake Como may be viewed on WestLaw at 2009 WL 1491306 (N.J.Super. A.D.) and has been approved for publication.

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What recourse, if any, does a property owner have when the government relocates a tenant to a new property in anticipation of acquiring the first property by eminent domain, but subsequently decides not to take the property?  The answer depends on the length and terms of the lease.
 

The Appellate Division of the Superior Court of New Jersey recently affirmed a trial court’s decision finding that the property owner was without recourse when its tenant was relocated and the New Jersey School Construction Corporation (“NJSCC”) decided not to acquire the property.  R.A.R. Development v. Associates v. New Jersey Schools Constr. Corp., 2008 WL 2663403 (N.J. Super. A.D. 2009).  In this particular case, NJSCC targeted a property for acquisition in order to build a new school.  After making an offer to acquire the property but before filing a condemnation complaint, NJSCC agreed to relocate a commercial tenant located at the property in question.  Since the relocation was going to take more than one year at a cost of approximately $5 million, NJSCC did not want to wait for the condemnation complaint to be filed before starting the relocation process.  When the move was almost complete, NJSCC decided not to acquire the property.  The property owner was extremely upset since it lost a tenant occupying over 100,000 square feet of space.
 

The property owner filed a lawsuit against the NJSCC alleging several causes of action, including tortuous interference with contractual and economic advantage, estoppel and inverse condemnation.  In terms of the tortuous interference claims, the court found that the NJSCC acted in good faith and pursuant to its statutory rights since New Jersey law permits the relocation of tenants prior to acquiring property by eminent domain (subject to certain requirements).  In terms of the estoppel argument, the court found that the property owner did not rely to its detriment on any representations of the NJSCC concerning the relocation of its tenants.  Finally, the court dismissed the inverse condemnation claim finding that the lease was at the end of its term (1 month remaining at the time the tenant completed its move) and the tenant had paid all rent due through the term of the lease.  In rejecting the property owner’s agreement that it was entitled to compensation for the taking of its renewal option, the court held that a “landlord’s expectation that the tenant will exercise the right of renewal does not confer on the landlord a recognized property interest subject to just compensation for its taking.”
 

The property owner in this case was harmed, but without recourse.  When negotiating with a condemning authority, one must keep in mind that New jersey law allows a condemning authority to change its mind at various stages of the process with little regard for the property owner’s rights.

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Stark & Stark Real Estate, Zoning & Land Use Shareholder, Vincent J. Mangini, was a featured panelist for the New Jersey Law Journal's May 4, 2009 Green Building in New Jersey Roundtbale discussion. Green building is a rapidly growing, complex and evolving field which requires hard-to-come-by expertise. Mr. Mangini joined with several real estate and green building attorneys who understand these issues, and joined together in order to offer their insights.

Mr. Mangini states, "Green building is defined in a number of ways, depending on the context. The Environmental Protection Agency defines it as “creating structures and using processes that are environmentally responsible and resource-efficient throughout a building’s life cycle, from siting to design, construction, operation, maintenance, renovation, and deconstruction.”

You can read the full roundtable discussion online here. (PDF)

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On March 2, 2009 I wrote a blog discussing the Senate Economic Growth Committee's approval of a bill for conversion of Age-Restricted Communities. As expected over the past several weeks, Governor Corzine conditionally vetoed the bill providing for conversion of age-restricted residential properties (commonly referred to as the 55+ bill). The conditional veto would adopt the bill upon 2 conditions:
 

1) Amend the bill to require a firm 20% set-aside for affordable housing (COAH or Mt. Laurel Housing) as opposed to the 20% being a cap on the amount of affordable housing; and
 

2) Granting municipal boards discretion to decline a conversion if they are not satisfied that the conversion will not cause substantial detriment to the public good and will not substantially impair the intent and purpose of the zone plan and zone ordinance. 
 

The bill now requires the legislature to amend the bill in accordance with the foregoing requirements.  A copy of the Governor's Conditional Veto is available online here.

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On April 9, 2009, the  New Jersey Supreme Court reversed the decision of the Appellate Division in a case analyzing a condemning authority’s obligation to reimburse a property owner for legal fees and expenses in a condemnation case.  Township of West Orange v. 769 Associates, LLC, ___, N.J. __  WL. 962687 (2009).  The New Jersey Supreme Court held that a property owner is entitled to reimbursement of his or her attorney fees and expenses as a matter of right once a condemnation complaint is filed and later abandoned by the condemning authority.  More importantly, New Jersey Supreme Court held that the property owner may recover attorney fees and other professional fees incurred  prior to the complaint being filed providing the attorney fees and expenses are directly related to the government’s efforts to acquire the property.  In this particular case, the Court found that the date of the accrual of the right to recover attorney fees and expenses was the date the Township adopted an ordinance authorizing the municipality to acquire the property by eminent domain.  The New Jersey Supreme Court also discussed the criteria to be used by a court in evaluating the amount of attorney fees and expenses to be awarded.
 

This is a very important case for property owners since it makes it clear that attorney fees and expenses can be recovered in the event the government files a condemnation action and later abandons the taking.  However, if a property owner spends a substantial amount of time and money negotiating with the condemning authority and the complaint is never filed, there is no right to recover attorney fees and expenses.  A complaint must be filed.  In addition, property owners may now look to recover attorney fees and expenses incurred prior to the filing of the complaint providing the attorney fees and expenses are directly related to the taking of the property and are incurred after the property is targeted for condemnation.

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Many commercial tenants are facing a severe downturn in revenue, which often equates to not paying their monthly rent.  Sometimes, commercial landlords can work with a delinquent tenant by offering more favorable terms or concessions.  Reduction in the cost per square foot or placing rental arrears on the backend of a lease can be solutions to keeping a store active by that tenant.  However, sometimes legal action is required to protect a commercial landlord's rights and value of the space.

Suing a tenant to retake possession of the premises is only half the battle.  In New Jersey, commercial landlords can evict a tenant through a summary dispossess action (aka "eviction") for non-payment of rent or other covenant defaults.  Once a judgment of possession is entered, the next step is to actually evict the tenant.  If the tenant will not peaceable move after entry of the judgment of possession, then a landlord can request a warrant for removal be issued by the sheriff. 

Once the warrant is issued, the commercial landlord needs to be prepared to fulfill the eviction process.  Often this means figuring out what to do with "stuff" left behind at the store.  Tenants sometimes leave everything from trash to copiers to inventory to personal items. But what exactly can the commercial landlord do with these items?  Can you simply toss out this "stuff"?  Can you sell these items? What if the tenant shows up and demands its items back a month or two after the tenant has been evicted?

The New Jersey Abandoned Tenant Property Act (N.J.S.A. 2A:18-74) is a commercial landlord's solution for disposing, selling and/or returning items left by a tenant.  Under the New Jersey Abandoned Tenant Property Act, a commercial landlord is required to give written notice before disposing or selling a tenant's left over items.  

Following is a quick list of questions to ask your attorney about adherence to the New Jersey Abandoned Tenant Property Act, as well as some other issues to address.
 

1.  What Type of Notice Needs to be Provided?   The New Jersey Abandoned Tenant Property Act provides specific provisions for sending written notice to tenants before disposing or selling items.  Failure to adhere to these strict guidelines could leave the commercial landlord with liability to not only the tenant, but also third parties who may possess liens or have an interest in the abandoned property (i.e. equipment leases).  But, which address does notice need to be sent - the premises? the tenant's prior address? Further, is the landlord required to conduct a search for other addresses?
2. Does Notice Have to be Sent to Third Parties?  Beside the tenant's property left at the premises, there may be other entities with an interest in the property, including employees, creditors, financial institutions or leasing companies.  Has your attorney conducted a UCC search to determine if there are liens on these items?  If so, have you provided these entities appropriate notice?   Further, has the notice directed the tenant to inform third parties of the abandonment?
3. Can You Just Sell Valuable Abandoned Property? Although the New Jersey Abandoned Tenant Property Act provides for disposition of the tenant's property after appropriate notice, can the landlord collect any removal, storage, attorney fees, and/or other costs associated with the items?
4. What About Perishable Items or Trash?  Often upon re-entry, commercial landlords  find the premises with trash or perishable items.  Can the landlord simply throw these items away or does notice need to be sent first?
5. Do any Federal or State Statutes Preempt the Commercial Landlord's Actions?  Your attorney should be able to advise if any Federal or other State statutes effect your rights. For instance, are there any environmental issues that need to be addressed prior to disposal of the left over items?
6. What if the Tenant Shows Up During the Notice Period?  Often tenants will just leave the items left over for the commercial landlord to handle.  But what if the tenant shows up?  Can the commercial landlord charge them storage fees before the remove the items?  What about collecting all rents due and owing, including attorneys fees?

Prior to disposing, selling or giving the left over items back to the tenant or third parties, it is advisable that a commercial landlord review these and many more questions with a licenced New Jersey attorney.  Answering these questions beforehand can help you with the proper strategy to deal with troublesome tenants and keep your commercial property(s) profitable in these cautious economic times.

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Although municipal boards are not bound by the strict rules of evidence during the conduct of proceedings, their findings and determinations must be based upon substantial credible evidence created in the record. This applies when a municipal board acts in a quasi-judicial capacity during the review of applications for development under the Municipal Land Use Law, N.J.S.A. 40:55D-1, et seq. (“MLUL”), and when a municipal board (specifically, a planning board) acts in a quasi-legislative capacity during a preliminary investigation into whether certain properties are in need of redevelopment pursuant to the Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1, et seq. (“LRHL”).

In order to meet the substantial evidence standard an adequate record must exist. This requires a verbatim recording of the proceedings. The MLUL expressly requires that “[t]he municipal agency shall provide for the verbatim recording of the proceedings by either stenographer, mechanical or electronic means.” N.J.S.A. 40:55D-10f. Although there is no comparable provision in the LRHL, the Appellate Division in Concerned Citizens v. Mayor implied that the minimum procedures required for hearings on applications set forth in the MLUL applies equally to the conduct of proceedings by municipal agencies under the LRHL. 370 N.J.Super. 429, 463 certif. denied 182 N.J . 139 (2004). The application of the MLUL in this regard is reasonable in light of the importance a written record plays in memorializing issues, concerns and policy considerations that were relevant when the municipal board made its determination. A written record of proceedings also provides the judiciary with a basis for evaluating the validity of a determination when it is challenged on appeal.

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On March 31, 2009, Governor Jon Corzine signed into law new legislation known as the Residential Development Solar Energy Systems Act. (P.L. 2009, c.33) codified at N.J.S.A. 52:27D-141.1, et seq.. The Act requires developers of residential developments containing 25 or more single-family dwelling units to disclose in advertising and offer to install solar energy systems. The act requires the Department of Community Affairs (DCA) in consultation with the Board of Public Utilities to adopt regulations respecting the technical sufficiency of solar energy systems to be installed pursuant the act and prescribes certain minimum standards.  For example, a solar energy system installed under the act shall have components that are new and shall have a manufacturer’s warranty of not less than 10 years.

Although the Residential Development Solar Energy Systems Act became effective immediately, in actuality, it shall apply only to dwelling units that have received a construction permit on or after the 90th day following the DCA’s promulgation of the aforesaid technical sufficiency regulations for solar energy systems.

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