Trishka Waterbury MASON, GRIFFIN & PIERSON, P.C. 101 Poor Farm Road Princeton, New Jersey 08540 (609) 436-1211 [email protected]

New Jersey League of Municipalities and New Jersey Institute of Local Government Attorneys Joint Session

CURRENT ISSUES THAT ELECTED AND APPOINTED OFFICIALS NEED TO KNOW: A SAMPLING OF 2009-2010 DECISIONS IMPACTING MUNICIPALITIES

New Jersey State League of Municipalities Annual Convention Atlantic City, New Jersey November 18, 2010 CASE SUMMARIES1

A Sampling of 2009-2010 Court Decisions Affecting Municipalities

AFFORDABLE HOUSING THIRD ROUND RULES (PART II)

In re Adoption of N.J.A.C. 5:96 and 5:97 by the New Jersey Council on Affordable Housing, ___ N.J. Super. ___ (App. Div. Oct. 8, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a5404-07.opn.html In response to multiple challenges to the Council on Affordable Housing (“COAH”)’s second set of third round rules, the Appellate Division invalidated COAH’s growth share methodology, directed COAH to adopt new third round rules that use a methodology for determining prospective need similar to the methodologies used in the first and second rounds, and required COAH to recalculate its projected state-wide need using up-to-date data. The court also ruled that municipally- sponsored 100% affordable housing site must show site control, site suitability, source of funding and a proposed developer; ruled that bright-line standards must be established to provide sufficient incentives for inclusionary developments; invalidated prior round rental bonuses for developments that were not built within a reasonable time frame; upheld bonuses for smart growth and redevelopment, but invalidated third round compliance bonuses; upheld COAH’s prior round numbers; upheld its prior ruling regarding the reallocation of present need from urban municipalities to suburban and other municipalities; and ruled that incidental impacts of inclusionary development on municipal finances do not constitute a mandatory expenditure of municipal funds in violation of the Fair Housing Act, nor do 100% municipally-sponsored affordable housing projects. Petitions for certification have been filed by the “Twenty Towns,” the New Jersey State League of Municipalities, Fair Share Housing Center, and ISP Management Company.

ALCOHOLIC BEVERAGES SPECIFIC PERFORMANCE

Kalogeras v. 239 Broad Avenue, LLC, 202 N.J. 349 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-42-09.opn.html The requirement for governmental approval is an implied condition in all agreements for the transfer of liquor licenses. Even if the contract does not contain an express provision to that effect, the contract can be specifically enforced but only to the extent that the parties would be required to act, in accordance with the implied covenant of good faith and fair dealing, with respect to the statutory condition of approval. To the extent that 73 Bowling Center v. Aristone, 192 N.J.Super. 80 (App.Div. 1983) is interpreted otherwise, it is disapproved.

1The case summaries contained in this outline were prepared by the editors of the Local Government Law Review, and have been reprinted here by permission of the Institute of Local Government Attorneys. The summaries cover decisions issued from October 2009 through September 2010, plus a few recent additions. The summaries are organized by topic and subtopic, in roughly alphabetical order.

-1- CIVIL RIGHTS FIRST AMENDMENT

Besler v. Board of Education of West Windsor-Plainsboro Regional School District, 201 N.J. 544 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-81-08.opn.html The Supreme Court found that the West Windsor-Plainsboro Board of Education had violated the First Amendment rights of an individual who repeatedly appeared at Board meetings. At eight meetings, plaintiff offered comments critical of the high school girls’ basketball coach and of the district’s failure to require accountability for unsportsmanlike conduct, including the use of profanity. At the ninth meeting, the board president asked members of the public to limit their comments to five minutes. Others were permitted to talk without interruption, and in some instances, their comments exceeded the five-minute limit. Plaintiff, on the other hand, was cut off after thirty seconds After trial on a civil rights complaint a jury awarded plaintiff $100,000 against the school district. Under the First Amendment to the United States Constitution, a governmental entity may impose reasonable time, place and manner restrictions on speech in a public forum, as long as the restrictions are justified without reference to the content of the regulated speech, are narrowly tailored to serve a significant governmental interest and leave open ample alternative channels for communication of the information. However, in this case, the restrictions against plaintiff were justifiably found to have been content oriented and therefore violated plaintiff’s rights. Because other board members had acquiesced when the president cut off plaintiff’s speech, the president was determined to be “the final policy maker” and, therefore, the board as an entity could be held liable. The jury verdict was upset because of lack of evidence as to damages.

CONSTITUTIONAL LAW FIRST AMENDMENT

Mazdabrook Commons Homeowners’ Assn. v. Khan (Unpub.App.Div. September 1, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a6106-08.opn.html A common interest community regulation that allows only one window sign advertising that the unit is for sale and barring all other signs violates the First Amendment right of the property owner to put up a political sign advocating his own candidacy. Unlike the regulation in Committee for a Better Twin Rivers v. Twin Rivers Homeowners' Association, 192 N.J. 344 (2007), the sign here was not “content neutral” because it favored commercial speech. The first amendment rights of a property owner overrode any interest of the community in banning all signs other than “for sale” signs. Reasonable time, place and manner sign regulations are not precluded.

CONSTITUTIONAL LAW ADMINISTRATIVE REGULATIONS

N.J. Ass’n. of School Administrators v. Schundler, 414 N.J.Super. 530 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2101-08.opn.html Plaintiffs challenged certain regulations (N.J.A.C. 6A:23A-1 to 22.15.) enacted by the Department of Education, intended to help limit local school budgets and thereby moderate tax increases, by reducing non-salary payments to Superintendents and Assistant Superintendents. While noting that regulations are accorded a presumption of validity (N.J. State League of Municipalities v. Dep't of Cmty. Affairs, 158 N.J. 211, 222, 1999), the court recognized that the presumption does not attach

-2- if the regulation on its face reveals that the agency exceeded the power delegated to it by the Legislature. (In re N.J. Individual Health Coverage Program's Readoption of N.J.A.C. 11:20-1 et seq., 179 N.J. 570, 579, 2004). After rejecting the broad constitutional and statutory challenges, the court upheld most of the regulations relating to Superintendents, who are contractual and not tenured, and non-tenured Assistant Superintendents. The court found that they have no vested right in most of the benefits being taken away. But, concerning tenured Assistant Superintendents, the court invalidated a number of the regulations, finding that they violated the provisions of the tenure law which prohibit a reduction in “compensation” during good behavior. The court did invalidate the regulation, as to all categories of plaintiffs, which limited the payment for previously accumulated sick leave, as taking away an accrued benefit, but did allow that section to be effective as to any future accumulated sick leave. There was a partial dissent as to the invalidation of the regulations concerning tenured Assistant Superintendents, and other issues.

CONSTITUTIONAL LAW EQUAL PROTECTION

New Jersey Law Enforcement Supervisors Association v. New Jersey, 414 N.J. Super. 111 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2839-08.opn.html The police and firefighters’ paid convention leave statute, N.J.S.A. 11A:6-10, applies only to members of employee organizations affiliated with the State's two largest police unions and two largest firefighter unions. The court upheld that law against a challenge to its constitutionality by two independent police unions. It found that the law is not prohibited “special legislation” and does not violate the equal protection rights of members of employee organizations not affiliated with the unions designated in the statute. According to the court, the legislature could reasonably have determined that the probable worth of the educational opportunities at a large convention would be qualitatively different than those offered at a small convention. The legislative dividing line drawn to conserve fiscal resources serves a valid state interest. The classification prescribed in the statute bears a rational and reasonable relationship to the educational purpose of the statute, so the presumption of validity had not been overcome, and the statute is not unconstitutional as special legislation.

CONSTITUTIONAL LAW FIRST AMENDMENT

Doe v. Reed, ___ U.S.___, 130 S. Ct. 2811; 177 L. Ed. 2d 493; 2010 U.S. LEXIS 5256 (2010) The State of Washington adopted a law allowing same-sex marriage. A referendum petition to set it aside was circulated, filed and declared to contain sufficient signatures. Persons opposed to the referendum filed a public records request to obtain copies of the petition under the Washington Public Records Act. The petition proponents objected and asserted that the records law was unconstitutional as applied to referendum petitions. The court found that the signers of the petition had First Amendment rights that would be infringed by nondisclosure. The State asserted legitimate and important interests in disclosure which included (1) preserving the integrity of the electoral process by combating fraud, detecting invalid signatures, and fostering government transparency and accountability; and (2) providing information to the electorate about who supported the petition. The court found that these interests far outweighed the modest burdens of potential for harassment that the petition proponents propounded. This was particularly so because the petitions had been

-3- made publicly available in many other referenda and initiatives over the years although most of them were less controversial. The vote on the decision was 8-1, with only Justice Thomas dissenting. There were five concurring opinions.

CONSTITUTIONAL LAW FREE SPEECH

Snyder v. Blue Mountain School District, 593 F.3d. 286 (3d. Cir. 2010) A Pennsylvania middle school student was suspended from school for ten days following her creation of a profane, fictitious “MySpace” profile depicting her school principal as a bisexual pedophile who, among other activities, engaged in sexual misconduct in school with students and their parents. The student’s parents filed an action in the federal court against the school district under 42 U.S.C. §1983, claiming that the discipline violated their daughter’s First Amendment rights and their 14th Amendment substantive due process right to direct the upbringing of their child free from government intervention. The court reviewed the body of constitutional law addressing student speech, in particular, Tinker v. Des Moines Independent Community School District, 393 U.S. 503 (1969) which held that student speech creating a significant threat of substantial disruption in the school may be restricted. Among other things, the plaintiffs argued that since the girl had created the profile off school grounds, the school could not regulate her conduct. In a thoughtfully reasoned decision, that considered the inherent modern-day potential of the Internet to allow rapid dissemination of material, the court held that Tinker applies to student speech, whether on- or off- campus, that causes or threatens to cause a substantial disruption of or material interference with school or invades the rights of other members of the school community. The court also dismissed the parents’ claim of interference with their child-raising rights, holding that the State’s interest in controlling the school environment was compelling. Layshock v. Hermitage School District, 593 F.3d. 249, 2010 U.S. App. LEXIS 2384 (3d. Cir. 2010) was distinguished by this panel because, it said in a footnote, that the school district in Layshock had not demonstrated a nexus between the speech and a substantial disruption of the school.

CONSTITUTIONAL LAW FREE SPEECH

Layshock v. Hermitage School District, 593 F.3d. 249 (3d. Cir. 2010) Plaintiffs’ were parents and a minor student who brought a action against a school district under 42 U.S.C. §1983. The student had created a “parody profile’ on “MySpace” of his high school principal. Although the profile was created using his grandmother’s computer off school property, did not involve any school resources and did not disrupt the school environment, the student was disciplined by the school district. The Third Circuit held: 1) the school district’s response to the student’s expressive conduct violated the First Amendment guarantee of free expression and would create an unseemly and dangerous precedent; 2) the school district cannot punish the student merely because his speech reached inside the school; and 3) the student’s parent failed to demonstrate their liberty interests had been infringed by the deprivation of their son’s First Amendment rights. This decision has been distinguished by Snyder v. Blue Mountain School District, 593 F.3d. 286 (3d. Cir. 2010) reported hereafter.

-4- DEFAMATION EXPUNGEMENT

G.D. v. Kenny, 411 N.J.Super.176 (App. Div. 2009) http://lawlibrary.rutgers.edu/courts/appellate/a3005-08.opn.html In this defamation case involving a Hudson County political campaign, the Appellate Division held, as a matter of law, that flyers referring to the plaintiff’s convictions on drug offenses were true, even though the convictions had been expunged. The court cited cases from Oregon, Kansas and Massachusetts in support of its conclusion.

DWUI NOTICE

State v. Marquez, 202 N.J. 485 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-35-09.opn.html In order to enforce the penalties for refusal to take a breath test when driving under the influence is suspected, N.J.S.A. 39:4-50.2 and N.J.S.A. 39:4-50.4a both require proof that an officer asked the motorist submit to a chemical breath test and informed the person of the consequences of refusing to do so. In this case, the statement was given to the motorist in a language which the officers knew he did not understand. The conviction was reversed and remanded. The motor vehicle license test is given in eight languages. For the future, officers will need to give the warnings in the language of the driver.

ELECTIONS CAMPAIGN FUNDS

In re Election Law Enforcement Commission Advisory Opinion No. 01-2008, 201 N.J. 254 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-83-08.opn.html Ruling in a highly publicized case, the Supreme Court upheld Advisory Opinion 01-2008 of the New Jersey Election Law Enforcement Commission (ELEC), dated January 28, 2008. The use of campaign funds to cover the costs of defense of a federal criminal indictment violates both N.J.S.A. 19:44A-11.2 and regulations promulgated thereunder, N.J.A.C. 19:25-6.5 to -6.10. Such costs are not an “ordinary and necessary expense” of an officeholder and therefore the payment of such costs is not a permissible use of campaign funds pursuant to N.J.S.A. 19:44A-11.2(a)(6). Inasmuch as courts typically should defer to a state agency's interpretation of statutes and implementing regulations, absent a finding that the interpretation is “plainly unreasonable," the court upheld the opinion, which it found to be both in line with a common sense interpretation of the statute and the legislative history.

ELECTIONS BALLOTS

Caldwell v. Griffin (Unpub.App.Div. September 2, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a0842-09.opn.html Petitioners were three unsuccessful Board of Education candidates. Though they received more votes cast at the polls than their opponents, the opponents received considerably more absentee votes. Petitioners claimed the election results were tainted by abuse and misuse of absentee ballots,

-5- particularly messenger ballots. The Appellate Division reversed the lower court’s decision dismissing petitioners’ claims, finding that the lower court erred by (1) not conducting the proceeding required by the applicable election statute, N.J.S.A. 19:29-5, and (2) dismissing the petition when the respondents had not filed a motion for dismissal.

ELECTIONS EXIT POLLING

In re: Attorney General's "Directive on Exit Polling: Media and Non-partisan Public Interest Groups", 200 N.J. 283 (2009) http://lawlibrary.rutgers.edu/courts/supreme/a-47-08.opn.html The New Jersey Elections Law (N.J.S.A. 19:34-6, 7 and 15) sets forth a comprehensive plan to bar all expressive activity within 100 feet of a polling place on election day so that voters will have unobstructed and free passage as they approach the polling place. Barred within that area are exit polling and handing out voter-rights cards, as well as speaking to voters on important issues of the day or making a commercial sales pitch. The New Jersey Supreme Court determined that these regulations do not violate the First Amendment free speech right guaranteed by the United States Constitution because the regulations are content neutral, reasonably restrict the time, place and manner of protected speech and are narrowly tailored to serve the significant governmental interest of insuring the unfettered right to vote. Further, the court found, there are ample alternative opportunities for the restricted communication. Note that this decision has been distinguished and criticized by the United States District Court for New Jersey (Sheridan, U.S.D.J.) in the course of granting an injunction allowing exit polling, under certain conditions, by news organizations in the 2009 gubernatorial election. American Broadcasting Companies, Inc. v. Wells, 2009 U.S. Dist. LEXIS 98804 (D.N.J. 2009).

ELECTIONS RECALL

In The Matter of the Petition for the Recall of Mayor Anthony Suarez of the Borough of Ridgefield (Law Div. Bergen BER-L-5202-10) An initiative in the Borough of Ridgefield was started to recall the mayor who had been charged with extortion in the United States Attorney’s corruption sweep of 2009. The mayor refused to resign the position. The recall election officer voided a number of signatures for a number of reasons, including the failure to affix a date after some signer’s names and failure of the of the circulator affirmation to bear the dates between which the signatures were collected, even though the voters had dated their signatures. The court found that the failure to affix a date next to the individual signer's name was merely a technical error and therefore improperly rejected. The court also found no valid reason for invalidating the pages on which the circulator had failed to provide a date since all individual signers provided a date next to their names. The court ultimately held that the petitioners had amply satisfied the requisite number of signatures required to compel the recall election. The court noted that New Jersey has a liberal approach towards enforcement of election law requirements and that '[t]echnical mistakes made in good faith pertaining to ministerial functions should not be permitted to deprive citizens of their franchise or render an election void for technical reasons.' Committee to Recall Casagrande from Office of Spring Lake Heights School Bd. Member v. Casagrande, 304 N.J. Super. 496, 506 (Law Div. 1997).

-6- ELECTIONS UNIFORM RECALL LAW

Committee to Recall Robert Menendez from the Office of United States Senator v. Wells, 413 N.J.Super. 435 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2254-09.opn.html The Secretary of State is obligated (under the Uniform Recall Election Law, N.J.S.A. 19:27A-1 to -18) to accept a notice of intention to begin a petition drive for the recall of a United States Senator. The Court left open, however, the issue of whether, (if and when a petition with the appropriate number of signatures is presented) the New Jersey Uniform Recall Election Law as applied to a United States Senator is constitutional under the United States Constitution: Article I, section 3, clause 1, Article I, section 5, clauses 1 and 2, or the Seventeenth Amendment.

EMPLOYMENT BOROUGH ADMINISTRATOR

Conway v. Borough of Florham Park (Unpub.App.Div. March 5, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2323-08.opn.html Conway was the Borough Administrator for the 2007 calendar year. On November 12, 2007 he was told by the mayor-elect that he would not be reappointed. At the end of the year he turned in his keys and did not return to work. There was no council action terminating his employment but on January 8, the council appointed someone else. On April 1, 2008 he got another job. The Appellate Division held that (1) the borough had violated N.J.S.A. 40A:9-138 when it purportedly terminated him without approval of two-thirds of the governing body; (2) the trial court erred when it granted him three months salary for the time he was unemployed plus three months salary that he would have been entitled to had he properly been removed under N.J.S.A. 40A:9-138 because he was entitled to the salary only for the unemployment period. The matter was remanded on the issue of potential mitigation. The Supreme Court has granted certification.

EMPLOYMENT DELIBERATIVE PROCESS PRIVILEGE

Shanahan v. New Jersey Transit Corporation (Law Div., Essex County, ESX-L-7409-08, February 5, 2010, Vena, J.S.C.) Plaintiff, in a case alleging employment discrimination, sought in discovery certain studies or reports that analyzed whether New Jersey Transit (NJT) and its employee, Bober, had engaged in discriminatory and disparate discipline of NJT police officers and other studies that address the rise in EEOC complaints during Bober’s tenure. NJT claimed the “deliberative process privilege,” first announced by the Supreme Court in In re Liquidation of Integrity Ins. Co., 154 N.J. 75 (2000). The trial judge here, however, held that Integrity did not apply in employment discrimination cases. Rather the rule in those cases is governed by Payton v. New Jersey Turnpike Authority, 148 N.J. 524 (1997) which held that, in employment discriminations, reports that may be deliberative are presumed to be discoverable unless they are of such limited relevance or high sensitivity that the balance will favor non disclosure.” Here, the court found that the reports were relevant and therefore were discoverable. The court went on to find that even under the standards of Integrity the reports were discoverable here.

-7- EMPLOYMENT FORFEITURE

State v. Hupka, 203 N.J. 222 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-36-09.opn.html A sheriff’s officer and part-time police officer, was convicted of 4th degree criminal sexual contact as a result of an off-duty encounter with a female acquaintance. At issue was whether the offense “involved or touched upon his office” under the forfeiture statute, N.J.S.A. 2C:51-2. If so he would forfeit his office and be permanently barred from holding public office in the future. In a comprehensive opinion, the court reviewed earlier cases and the 2007 amendments to the forfeiture statute, holding that the offense did not involve or touch upon his holding of office, nor did it relate to circumstances flowing from his positions.

LAND USE AGE RESTRICTED HOUSING: CONVERSION APPLICATION

Kaplan at Helmetta, LLC v. Borough of Helmetta (Law Div. Middlesex, L-2068-10, June 28, 2010, Hurley, J.S.C.) In a redevelopment area, Helmetta entered into an agreement with Kaplan a redeveloper to develop a project that included age-restricted housing. Under N.J.S.A. 45:22A-46.3 et seq. to convert the age- restricted units to non age-restricted housing. The planning board, after a hearing, denied the application. Relying primarily upon the contractual nature of the matter, Judge Hurley upheld the planning board. The court analyzed the standard of review in the matter and concluded that it was the arbitrary, capricious and unreasonable standard normally applied in land use prerogative writs. The opinion is published in the October 2010 edition of the Local Government Law Review.

LAND USE AGE RESTRICTED HOUSING: CONVERSION APPLICATION

Heritage at Town Lake, LLC v. Sayreville Planning Board (Law Div., Middlesex, MID-L-2522- 10,July 23, 2010,Hurley, J.S.C.) In this age restricted housing conversion case under N.J.S.A. 45:22A-46.3 et seq Judge Hurley set aside a denial of an application for such a conversion by the Sayreville Planning Board. He held that the board had acted unreasonably because the application met all of the statutory criteria of the conversion act and the “negative criteria.” The court held that the balancing test of Sica v. Bd. of Adj. of Twp. of Wall, 127 N.J. 152 (1992) is “distinguishable and not applicable” in these cases. The opinion is published in the October 2010 issue of the Local Government Law Review.

LAND USE ENFORCEMENT OF CONDITION (VARIANCE APPROVAL)

Washington Commons, LLC v. City of Jersey City, ___ N.J. Super. ___ (App. Div. Nov. 12, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a0779-09.opn.html Violation of a condition of a variance constitutes a violation of the zoning ordinance itself, which is enforceable by the municipality by way of complaint for injunctive relief, specific performance or other appropriate action.

-8- LAND USE ETHICS

Newman-Steele v. Mayor and Council of Tinton Falls (Unpub.App.Div. August 17, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a1812-08.opn.html Tinton Falls sought to redevelop a parcel known as the CECOM site. During the process, a member of the planning board who also served as a member of the zoning board as well as the environmental commission entered into an agreement to serve as a real estate consultant for the CECOM tract. The member first recused from participating in any discussions about amendments to the master plan relating to the site and then resigned from the planning board altogether. The Township brought an action seeking disgorgement of all fees accepted by the member arguing that his conduct was contrary to public policy and unethical. A subsequent investigation by the Monmouth County Prosecutor’s office found no criminal conduct. After reviewing the Municipal Land Use Law, N.J.S.A. 40:55D-23, the Local Government Ethics Law, N.J.S.A. 40A:9-22.1 to 22.25, and the common law, the Appellate Division held the board member never acted as a member of the planning board on any matter involving CECOM. The court therefore held that there had been no breach of ethical conduct; that the municipality had not suffered an economic loss; and that the complaint had therefore been properly dismissed.

LAND USE NONCONFORMING USE

Berkeley Square Association Inc. v. Zoning Board of Adjustment of the City of Trenton, 410 N.J.Super. 255 (App. Div. 2009) http://lawlibrary.rutgers.edu/courts/appellate/a2389-08.opn.html A neighborhood association challenged a zoning officer’s issuance of permits to rehabilitate a twenty-one unit residential apartment. Plaintiff alleged that the nonconforming use had been abandoned as a result of a tax foreclosure and the building’s subsequent vacancy and disrepair. On an appeal under N.J.S.A. 40:55D-70(a) the zoning board of adjustment left the zoning officer’s decision intact by a 3-3 vote. The trial court subsequently granted the property owner’s summary judgment motion and dismissed the complaint. The Appellate Division remanded the case with instructions as to the burden of proof to be applied. In these nonconforming use cases, the property owner must first satisfy its burden of proving the existence of a nonconforming use. Then the objecting party has the burden of coming forward with sufficient evidence of temporal or physical abandonment. The property owner must then meet its burden as to the continuation of the nonconforming use.

LAND USE ORDINANCE VALIDITY

Jackson Holdings, L.L.C. v. Jackson Township Planning Board, 414 N.J. Super. 342 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a3435-08.opn.html “[I]f a trial court hearing an action challenging a planning board decision on an application for a land use approval under a section of a zoning ordinance authorizing conditional uses perceives a substantial question concerning the validity of this provision, it must determine whether the conditional use ordinance is valid before undertaking to review the board’s decision and must join

-9- the municipal governing body as a defendant.” Plaintiff had applied for major subdivision approval to subdivide a 303-acre tract into 493 building lots. The zoning ordinance required a minimum lot size of 3.2 acres or 1 acre depending on the type of septic system used to serve the development, but authorized the Planning Board to approve a higher density in any part of the zoning district served by public sewers, provided the Board found that “(a) [t]he proposal is not inconsistent with and will not create traffic hazards or adversely affect traffic patterns established by surrounding development; and (b) [t]he proposal is consistent with the intent and purpose of the Master Plan and Pinelands Comprehensive Management Plan.” Following a series of hearings, the Board concluded that plaintiff had not satisfied either of these conditions, and denied the application. Plaintiff appealed the denial but did not challenge the underlying ordinance. The trial court expressed substantial doubt as to the validity of the ordinance on the ground that the ordinance was entirely devoid of standards or specifications to guide the Planning Board’s review. Nonetheless, the court did not invalidate the ordinance or require that the governing body be joined as a defendant, but instead granted plaintiff’s application. The Appellate Division reversed but warned that “a court is only required to compel joinder of the governing body if it makes a preliminary determination . . . that there is a substantial question as to the validity of the part of the zoning ordinance under which the challenged land use approval was granted.”

LEGAL NOTICES “PRINTED AND PUBLISHED”

Courier-Post Newspaper v. County of Camden, 413 N.J.Super. 372 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2993-08.opn.html Camden County sent out a request for proposals (RFP) seeking to designate an official newspaper pursuant to N.J.S.A. 40:23-13. The RFP specifically sought discounted rates for legal advertisements. The Philadelphia Inquirer responded to the RFP and proposed a rate below the statutory minimum set forth in N.J.S.A. 35:2-1. The county subsequently designated the Philadelphia Inquirer as the official newspaper and entered into a two year contract. The Courier Post , a newspaper printed an published in Camden County, which who had not responded to the RFP, challenged the Inquirer contract in an action in lieu of prerogative writs. Shortly after that litigation began, the Sheriff of Camden County stopped publishing his notices of public sales of real estate under N.J.S.A. 2A:61-1 in the Courier Post and began to publish them in the Philadelphia Inquirer. The litigation brought by the Courier Post against the sheriff was consolidated with the action against the county. The Appellate Division held: (1) the Courier Post had standing to challenge the award of the contract; (2) the Philadelphia Inquirer is not “printed and published in the State of New Jersey” as defined in N.J.S.A. 35:1-2.2, applicable to the county, and N.J.S.A. 2A:61-1, applicable to the sheriff, because the home office of the Inquirer is located in Pennsylvania and the newspaper is physically printed on newsprint there. It may not be considered “printed and published in New Jersey even though its newspaper is available on the Internet and may be viewed and printed by readers on their computers in New Jersey. (3) The county and the sheriff were without statutory authority to contract for lower rates than enumerated in N.J.S.A. 35:2-1; and (4) the requirement of in state publication did not violate the Commerce Clause of the U.S. Constitution, Art. I, par. 8, clause 3 because when a state acts as a market participant it is not bound by the constraints of the Commerce Clause. Republication of notices previously published in the Inquirer was not required.

-10- ORDINANCES IMMIGRATION

Lozano v. City of Hazleton, 620 F.3d. 170 (3d. Cir. 2010) Hazleton, Pennsylvania adopted ordinances which regulated the employment and rental of housing to undocumented aliens. Among other things, a business licensing ordinance prohibited any employer from hiring an unauthorized worker, which included an “unauthorized alien.” If a complaint of violation was filed, an employer could have its business license in the city suspended until the violation had been remedied. The ordinance also created a private cause of action for an employee who was wrongfully discharged as an unauthorized worker. .Similar provisions apply, by another ordinance, to a rental property owner who “harbors” an unauthorized alien knowing, or in reckless disregard, of the alien’s illegal status. The Third Circuit upheld an injunction against enforcement of the ordinances, even though it found that none of the plaintiffs had standing to bring the private causes of action under it. In an exhaustive opinion, the court found that this ordinance was preempted by federal immigration law.

ORDINANCES PREEMPTION; RENT CONTROL

Lake Valley Associates, L.L.C. v. Township of Pemberton, 411 N.J.Super. 501 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a4040-07.opn.html Plaintiff, the owner of a large apartment complex, challenged a local landlord registration ordinance on a number of grounds, including an assertion that the ordinance had been pre-empted by the New Jersey Hotel and Multiple Dwelling Law (HMDL) (N.J.S.A. 55:13A-1 et seq.). After rejecting the constitutional claims, the court then bypassed the usual analysis on the issue of preemption set forth in Overlook Terrace Mgmt. Corp. v. Rent Control Bd. of West New York, 71 N.J. 451 (1976), and rejected the challenge. In doing so, the court relied upon the plain language of the HMDL, which grants municipalities the right to “adopt and enforce ordinances, or regulations, more restrictive than this act or any rules or regulations promulgated thereunder,” (N.J.S.A. 55:13A-25(b)), and upon general law granting such authority to the municipality (N.J.S.A. 40 48-2.12(m)).

PUBLIC MEETINGS DISORDERLY ASSEMBLAGE; DE MINIMIS DISMISSAL

State v. Schwalb (Law Div., Bergen, July 9, 2010, Doyne, A.J.S.C.) Five days after an incident, a school principal filed a disorderly person’s complaint against a parent who had become abusive in a public meeting dealing with bullying and intimidation. She complained in a strident, aggressive way about the failure of the school to deal with “pantsing” and used extreme profane language to describe the principal and the school. The police officer on duty at the meeting asked her several times to moderate her behavior and after the end of the meeting she apologized to those concerned. The Assignment Judge refused to exercise his discretion to dismiss the case under the “de minimis” statute, N.J.S.A. 2C:2-11.

-11- PUBLIC MEETINGS LIBEL, SLANDER

Den Hollander v. Township of Franklin (Law Div. Hunterdon County, HNT-L-190-09, January 22, 2010, Buchsbaum, J.S.C.) This defamation action sought damages against Franklin Township and the members of the governing body for statements made, primarily by the Township attorney, at meeting of the governing body. The alleged falsehoods were (1) plaintiff removed soil in violation of an easement; (2) plaintiff erected a greenhouse in violation of a resolution of the Hunterdon County Agricultural Development Board (HCADB); (3) plaintiff put pipes under a road without a permit; (4) plaintiff’s farm operations violated a HCADB resolution; and (5) plaintiffs withdrew an appeal of the resolution based upon the Township’s threat to enforce it. The transcripts of the tapes of the meeting did not bear out some of plaintiffs allegations; most of the alleged untruths were statements of opinion that were not defamation; some, in context, were not subject to defamatory meaning. The trial court therefore dismissed the entire complaint as a matter of law, including conspiracy counts that fell when the defamation counts were stricken.

PUBLIC OFFICIALS FORFEITURE OF OFFICE

State v. Rone, 410 N.J.Super. 589 (App. Div. 2009) A Newark city council person was convicted of the disorderly person offense of obstruction of justice. She had intervened in a traffic stop of her nephew by a Rutgers police officer and, in the course of doing so, had told the arresting officer that she was a council member. She announced that she was going to call the “real police” and then proceeded to call the Newark City Police Department, asked them to respond and told them she was a councilperson. The Essex County Prosecutor, although first seeking forfeiture of her office, later moved, after advice from the Attorney General’s office, to waive the forfeiture provision of N.J.S.A. 2C:51-2 and, thus, to allow her to retain her seat on the council. The trial court refused the waiver and the Appellate Division affirmed. Because of the conduct of the councilperson, the offense was found to be one “touching [her] office” under the forfeiture statute. Unlike a discretionary determination by the prosecutor for admission to pretrial intervention (which is entitled to enhanced deference on judicial review), it is up to the judiciary in forfeiture cases to determine whether “good cause” exists for the waiver of the forfeiture. The grant of this type of waiver is not a prosecutorial function.

PUBLIC OFFICIALS INCOMPATIBILITY OF OFFICE

City of Wildwood v. DeMarzo, 412 N.J.Super. 105 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a5250-08.opn.html Under the Walsh Act Commission form of government, the offices of commissioner and police officer are incompatible. The court required a police officer elected to the position of commissioner to choose between the two offices, and held that he could not simultaneously hold both positions. The Appellate Division rejected the trial court’s contrived efforts to circumscribe the individual’s activities as a commissioner, finding that such limitations were “akin to judicial micromanagement of a coordinate branch of government.”

-12- PUBLIC RECORDS ATTORNEY-CLIENT PRIVILEGE

Paff v. Division of Law, 412 N.J.Super. 140 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a3007-08.opn.html Unpublished Administrative Agency Advice (AAA) letters issued by the Division of Law are not “government records” for purposes of the Open Public Records Act (OPRA) N.J.S.A. 47:1A-1 to -13. Instead, they are records protected by the attorney-client privilege. N.J.S.A. 47:1A-1.1. According to the Division of Law Handbook, the AAA letters serve as legal opinions from the Attorney General, acting as sole legal advisor, to various state agencies. The Appellate Division noted that New Jersey has a more generous view of the attorney-client privilege than that of the District of Columbia, which had reached a contrary result in two cases. So long as the attorney is rendering advice, no matter the form the advice takes, it is subject to the privilege. State agencies are entitled to confidential advice from their counsel; therefore, the AAA letters are privileged.

PUBLIC RECORDS ATTORNEYS FEES

Paff v. West Deptford Twp. (Unpub.App.Div. February 18, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a3195-08.opn.html Plaintiff obtained a court order requiring the municipality to provide him access to specified police department internal affairs summary reports and awarding him reasonable counsel fees and costs under the Open Public Records Act (OPRA), N.J.S.A. 47:1A-1 to -13. The municipality opposed the plaintiff’s fee application, arguing that it should not have to pay attorney's fees because it was merely complying with a federal court confidentiality order when it had declined to disclose the records requested. The trial court awarded to plaintiff’s attorney fees of $15,837.50 and costs of $330. The Appellate Division agreed with the trial judge and rejected the town’s argument. A municipality cannot exempt itself from the requirements of OPRA, or other State law, by entering into a consent order in federal court to maintain confidentiality of discovery materials. The confidentiality order did not nullify the municipality’s obligations under OPRA. The court noted that if the municipality had any doubts about its recourse, it should have obtained leave or clarification from the federal court to meet its statutory obligations under OPRA.

PUBLIC RECORDS CONFIDENTIALITY OF SETTLEMENTS

Asbury Park Press v. County of Monmouth, 201 N.J. 5 (2010) affirming 406 N.J.Super. 1 (App. Div. 2009) http://lawlibrary.rutgers.edu/courts/supreme/a-8-09.opn.htmlaffirming http://lawlibrary.rutgers.edu/courts/appellate/a3567-07.opn.html The Supreme Court affirmed the Appellate Division’s decision (abstracted in 32 Municipal Law Review 88, June 2009) that Monmouth County was required to release a settlement agreement resolving a sexual harassment lawsuit. The court also agreed that the plaintiffs were entitled to reasonable attorneys fees. Finally, the court rejected the county’s argument that the plaintiffs’ request under the Open Public Records Act (OPRA), N.J.S.A. 47:1A-1 et seq. should be evaluated

-13- in the context of Burnett v. County of Bergen, 198 N.J. 408 (2009), imposing a 7-point balancing test when an OPRA request implicates privacy. Here, there could be no reasonable expectation of privacy when the underlying sexual harassment lawsuit against the county was filed in Superior Court.

PUBLIC RECORDS CONFIDENTIALITY OF SETTLEMENTS

Burnett v. County of Gloucester, 415 N.J. Super. 506 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a4329-08.opn.html Settlements executed by third parties (such as lawyers or insurance companies) on behalf of a governmental entity are government records as defined in the Open Public Records Act, N.J.S.A. 47:1A-1 to 13 (OPRA). A request for “any and all settlements, releases or similar documents entered into, approved or accepted from 1/1/2006 to present” is not a request for information obtained through research as to which OPRA is inapplicable, but rather a request for specific documents, as to which OPRA does apply The county was not excused from its OPRA obligations because the documents were not in its possession. Thus the Appellate Division reversed a summary judgment in favor of the county and remanded for further proceedings.

PUBLIC RECORDS COPYING FEES

Smith v. Hudson County Register, 411 N.J.Super. 538 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2518-08.opn.html This is an important decision with potentially serious budgetary and administrative impacts on how counties and other local governments charge for copies under N.J.S.A. 47:1A-5(b) of the Open Public Records Act. Plaintiffs asserted in three lawsuits that the County Clerks had overcharged them and other members of the public for copying government records maintained at county offices. The trial courts entered orders dismissing the complaints because the charges levied did not exceed those set forth in the second sentence of the statute ( i.e. $0.75per page for the first to tenth pages;$0.50 per page for the eleventh through 20th and $0.25 per page for all pages over 20). However, on appeal, the Appellate Division reversed and held that the counties must charge no more than the reasonably-approximated “actual costs” of copying government records. The court adopted a burden shifting approach and held that if charges imposed are equal to or less than those stated in the second sentence of Section 1A-5(b), a challenger would have the burden of demonstrating that the agency’s actual costs were indeed lower. If the challenger failed to sustain that burden, the agency will prevail and may continue to charge its existing rates. If the agency’s charges exceed the rates stated in the second sentence, then the burden is on the agency to demonstrate that its actual costs are higher than those enumerated rates and are therefore justified. If the proofs are inconclusive or in equipoise, the outcome shall be in favor of the party who does not have the burden of persuasion. Because of the likely budgetary and administrative impacts of the court’s holding, the court made the decision prospective, effective on July 1, 2010.

Note: On November 9, 2010, legislation went into effect that amends OPRA’s fee schedule to establish a charge of $0.05 per letter size page or smaller, and $0.07 per legal size page or larger, unless the public agency can demonstrate that its actual costs for duplication exceed these rates, in which case it can charge for the actual cost of duplicating the record.

-14- PUBLIC RECORDS DELIBERATIVE PROCESS PRIVILEGE

Tractenberg v. Township of West Orange, 416 N.J.Super. 354 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2556-08.opn.html In a case of first impression, property appraisals performed by a private appraiser on behalf of a municipality did not fall within the deliberative process exemption of the Open Public Records Act (OPRA), N.J.S.A. 47:1A-1 to -13. The court applied Education Law Center v. New Jersey Department of Education, 198 N.J. 274 (2009) and found that, in this case, (1) the appraisals have not been used in the "decision making process" and (2) their disclosure will not "reveal deliberations that occurred during [the decision making process]." The ruling of the Government Records Council in Murray v. Twp. of Warren, GRC Complaint No. 2006-169 http://www.state.nj.us/ grc/decisions/pdf/2006-169.pdf (February 27, 2008) was distinguished. In that case, the attorney for a property owner whose property was under consideration for eminent domain was denied the appraisals under the “competitive advantage” exemption of N.J.S.A. 47:1A-1.1. Here the plaintiff was a representative of a group that was trying to persuade the governing body to acquire land it had previously rejected as too costly.

PUBLIC RECORDS EMAIL ADDRESSES

Geier v. Township of Plumsted (Law Div., Ocean County, Docket No. OCN-L-3718-09, October 27, 2009, Grasso, A.J.S.C.) Judge Grasso held that email addresses given to the Township of Plumsted by persons interested in receiving a “Township Alert” electronically were public records and needed to be provided to a candidate for township office. The court also held that the address of a person who had filed a tort claim against the township could not be redacted from a complaint before delivery as a public record. Note: A copy of the opinion is published in the January 2010 issues of the Local Government Law Review.

PUBLIC RECORDS INVESTIGATORY RECORDS

O'Shea v. Township of West Milford, 410 N.J.Super. 371 (App. Div. 2009) http://lawlibrary.rutgers.edu/courts/appellate/a1185-08.opn.html Use of Force Reports that are required to be made, maintained and kept on file under the Attorney General’s Use of Force Policy (revised 2000) (http://www.state.nj.us/lps/dcj/agguide /useofforce2001.pdf)are not investigatory records and thus are subject to disclosure under the Open Public Records Act, N.J.S.A. 47:1-1 et seq. Those records are not created as part of an investigation, and it is only speculative that they might be used in an investigation in the future. Accordingly, they do not constitute criminal investigatory records under N.J.S.A. 47:1-1.1, nor do they constitute records of an “investigation in progress by any public agency” under N.J.S.A. 47:1-3.

-15- PUBLIC RECORDS MEDIUM OF RECORDS

Gannett Satellite Information Network, Inc. v. Borough of Raritan (Law Div, Somerset Docket No. SOM-L1789-09, December 15, 2009, Ciccone, A.J.S.C.) The Law Division denied an order to show cause to a media company that sought to require the Borough of Raritan to produce records in a non-PDF format, when the borough had them available only in PDF format and would require additional programming and charges to convert them to the format requested.

PUBLIC RECORDS TEMPORARY EXECUTIVE ORDER

Slaughter v. Government Records Council, 413 N.J.Super. 544 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a0163-08.opn.html Executive Order 21 issued by Governor McGreevy contemporaneously with the effective date of the Open Public Records Act, N.J.S.A. 47:1A-1 to 13 (OPRA), was intended solely to preserve, on a temporary basis, the confidentiality of government records that State agencies proposed to exempt from disclosure under OPRA by administrative rules that had been published but not yet finally adopted prior to the effective date of OPRA. One of the proposed rules that had been published, but not finally adopted, under the executive order was N.J.A.C. 13:1E-3.2(a) (2), which would exempt from OPRA any “standard operating procedures” of the Department of Law and Public Safety. The rule was never adopted. A prisoner sought documents under OPRA relating to certain standard operating procedures relating to the handling of blood test analysis. The Appellate Division reversed a decision of the Government Records Council that exempted these documents from disclosure because of the Executive Order, but delayed the effectiveness of its decision until November 5, 2010 to allow the Department of Law and Public Safety to determine whether it would adopt the proposed rule.

REFERENDUM

In re Petition for Referendum on City of Trenton Ordinance 09-02, 201 N.J. 349 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-70-09.opn.html The City of Trenton, a Faulkner Act municipality, controls a water distribution system which it negotiated in 2007 to sell, in part, to the New Jersey-American Water Company (NJAW). The Municipal Utilities Law (MUL), N.J.S.A. 40:62-5, provides that a municipality may sell a public utility system to a non-public entity upon the adoption of an ordinance and upon the approval of the sale by a majority of the municipality’s voters in a general election. Thus, an ordinance authorizing a transfer of an entire water utility to a non-public entity cannot become effective without prior voter approval. That required voter approval immunizes the ordinance from a later referendum petition under the Faulkner Act. However, the MUL contains an exception to the required mandatory prior voter approval. N.J.S.A. 40:62-3.1 provides that where a municipality deems it in the public interest to transfer a water utility serving less than five percent of the municipal population, it may do so without the prior voter approval ordinarily required under N.J.S.A. 40:62-5. Instead, the ordinance is subject to review by the Board of Public Utilities (BPU). Here, shortly after an administrative law judge recommended that the agreement for sale of the partial water system be approved by the BPU, a group of Trenton citizens filed a petition for referendum pursuant to the Faulkner Act, N.J.S.A.

-16- 40:69A-185. The Supreme Court reversed the decisions of the Appellate Division and trial court and held that the ordinance authorizing the sale was subject to a Faulkner Act referendum. The Court held that the relevant provision of the MUL, N.J.S.A. 40:62-3.1, eliminated only the mandatory requirement of a referendum but it did not affect the citizens’ right to contest an ordinance as provided by the Faulkner Act. Section 3.1 does not say that a less-than-five-percent sale may take place “without any referendum.” Nor does it say that such a sale “shall not be subject to referendum.” Rather, in a narrow and precise way, it excepts a less-than-five-percent sale only from the mandatory provisions of N.J.S.A. 40:62-4 and -5. The Court noted that there was simply nothing in the words the Legislature chose in section 3.1 that would suggest, even obliquely, an intention to take away the right of citizens to protest an ordinance under the Faulkner Act.

SIGNS FIRST AMENDMENT

Melrose, Inc. v. City of Pittsburgh, 613 F.3d. 380 (3d. Cir. 2010) The owner of five buildings in Pittsburgh applied to change the signage on some of the buildings that were formerly known by names such as the Caskey Limited, the Ram Steiger Building, the Three Rivers Building, and the Cole Building. The new signage would call the building names such as the “wehirenurses.com building,” the “paralegal help.com building” and “Baruch Atah Hashem”,(a Hebrew expression that means “Blessed be God.”) The sign ordinance of Pittsburgh identified three classes of signs: business signs, advertising signs and identification signs. Advertising signs were prohibited in the zoning districts in which the buildings were located and the zoning board of adjustment so ruled in denying the sign permits. The Board had previously approved the renaming of a stadium as the “Heinz Field” under a sponsorship agreement between H.J. Heinz & Co. and the Pittsburgh Steelers and, in doing so, had utilized criteria for that naming to justify the signs an identification sign rather than an advertising sign. The signs at issue did not meet those criteria. The District Court denied the injunction based upon the standards of Central Hudson Gas & Electric Corp. v. Public Commission of New York, 447 U.S. 557 (1980). The Third Circuit panel disagreed with that analysis but rather upheld the denial of the injunction by applying its own standards in Rappa v. New Castle County, 18 F.3d. 1043 (3d. Cir. 1994). The Board of Adjustment’s criteria were a permissible “context-sensitive” analysis which made the criteria “content neutral” and therefore permitted by the First Amendment.

TAX ASSESSOR SALARY

Carlson v. City of Hackensack, 410 N.J.Super. 491 (App. Div. 2009) http://lawlibrary.rutgers.edu/courts/appellate/a2898-08.opn.html The court determined that, as part of the statutory framework established to protect the independence of the local tax assessor, the language of N.J.S.A. 40A:9-165 was clear and unambiguous and prevents a municipality from reducing the salary of a tax assessor, even if there is a concurrent reduction in the assessor’s hours of work, or other good cause.

-17- TAX COLLECTOR SALARY AND BENEFITS

Hyland v. Township of Lebanon A tax collector is a statutory officer whose appointment and compensation is determined by N.J.S.A. 40A:9. That statute prohibits a reduction in salary during the term of the collector. Judge Buchsbaum interpreted that statute to include contractual “sick days” within the term “salary.” Thus the attempt by the Township of Lebanon to eliminate sick days in accordance with a collective bargaining agreement – which the court found to be inapplicable because of the statute creating the collector’s office – was set aside. The court relied on the law division decision in Carlson v. City of Hackensack, (Law Div. 2008), BER-L-326-08, Harris, J.S.C. which has been affirmed in Carlson v. City of Hackensack, 410 N.J.Super. 491 (App. Div. 2009).

TAXATION ATTORNEYS; CONFLICT OF INTEREST

City of Atlantic City v. Trupos, 201 N.J. 447 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-23-09.opn.html Did a law firm violate Rule 1.9(a) of the Rules of Professional Conduct (R.P.C.) by acting as attorney for individual taxpayers in 2009 real estate tax appeals against the Atlantic City, when the firm had represented the city in defense of tax appeals for the 2006 and 2007 tax years, even though a city wide revaluation had occurred between the two representations? To answer this question, the Supreme Court established a test for determining what constitutes a “same or substantially related matter” under R.P.C. 1.9. The Court held that “for purposes of R.P.C. 1.9, matters are deemed to be ‘substantially related’ if (1) the lawyer for whom disqualification is sought received confidential information from the former client that can be used against that client in the subsequent representation of parties adverse to the former client, or (2) facts relevant to the prior representation are both relevant and material to the subsequent representation.” On the specific facts the firm did not violate R.P.C. 1.9(a) and was thus free to represent taxpayers in the 2009 challenges. Thus the trial court and appellate division judgments were reversed. The Court found that the City’s “… sole complaint – and the basis on which it sought the law firm’s disqualification – arises from plaintiff’s concern that the law firm may have acquired otherwise privileged information when it participated, on a non-voting basis, in the selection of the revaluation company that produced the assessments subject to the 2009 tax appeals. On this record, that is far too slender a reed to support a disqualification order.”

TAXATION CHAPTER 91

Lucent Technologies, Inc. v. Township of Berkeley Heights, 201 N.J. 237 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-95-08.opn.html Even though a taxpayer has filed a false and fraudulent statement of income and expense which makes its appeal subject to dismissal under N.J.S.A. 54:4-34, nevertheless Ocean Pines, Ltd. v. Borough of Point Pleasant, 112 N.J. 1 (1988) requires that the taxpayer be afforded a hearing on the reasonableness of the assessment. This hearing focuses on the knowledge the assessor had at the time of imposing the assessment and, in such a hearing, the information which the taxpayer should have produced under the statute is not admissible in support of the taxpayer’s position. When a

-18- taxpayer fails to provide information at all, Rule 8:7(e) requires that the municipality’s motion to dismiss the tax appeal be made no later than the earlier of (1) 180 days after the filing of the complaint or (2) 30 days before the trial date. Rule 8:7(e) does not apply, however, by its terms, to cases in which the taxpayer has filed false and fraudulent information, so there is no limit as to when such a motion can be filed.

TAXATION CHAPTER 91; EIGHTH AMENDMENT

Davanne Realty v. Edison Township, 201 N.J. 280 (2010) http://lawlibrary.rutgers.edu/courts/supreme/a-25-09.opn.html At 32 Municipal Law Review137, October 2009 we reported on the Appellate Division opinion in Davanne Realty v. Edison Township, 408 N.J.Super. 15 (App. Div. 2009) holding that a tax appeal had been properly dismissed because the taxpayer had failed to provide income and loss information to the assessor and had thereafter failed to produce any evidence to dispute the reasonableness of the imposed assessment. The Appellate Division held that the tax imposed as a result of the dismissal did not violate the “Excessive Fines” Clause of the Eighth Amendment to the United States Constitution. The Supreme Court summarily affirmed the Appellate Division judgment substantially for the reasons set forth in Judge Grall's thorough and thoughtful opinion at 408 N.J.Super. 15 (App. Div. 2009). The Eighth Amendment limits only the government’s powers to extract payments in punishment for some offense. If a provision is partially remedial and not exclusively punitive the Eighth Amendment does not apply. The appeal-dismissal sanction imposed by N.J.S.A. 54:4-34 is not a punishment because it is a rational and reasonable remedy justified by the need to assess and collect property taxes efficiently.

TAXATION CHAPTER 91; EIGHTH AMENDMENT

1717 Realty Associates, LLC v. Borough of Fair Lawn, 201 N.J. 275 (2010) The judgment of the Appellate Division was affirmed based on the Court's judgment in Davanne Realty v. Edison Township, decided on the same day.

TAXATION EXEMPTION

Hunterdon Medical Center v. Readington Township, 416 N.J.Super. 127 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a4262-08.opn.html In this long-litigated case, Tax Court, the Appellate Division and the Supreme Court have been struggling with the real estate tax exemption for “hospital purposes” in N.J.S.A. 54:4-3.6. The property at issue is an off-site facility in Readington Township operated by Hunterdon Medical Center, which has its main facility in Whitehouse Station. The facility has a physical fitness center, a cardiopulmonary rehabilitation service, a physical therapy service, and a hospital and pediatric practice. Specifically in this case, the court was asked to determines whether the physical therapy service met the standards for an exemption set forth in Hunterdon Med. Ctr. v. Twp. of Readington, 195 N.J. 5 (2008). The Tax Court denied the exemption but the Appellate Division reversed based upon the detailed factual circumstances.

-19- TAXATION EXEMPTION

International Schools Services v. West Windsor Township, 412 N.J.Super. 511 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a4911-08.opn.html Plaintiff, a non-profit school, filed a tax appeal seeking an exemption under N.J.S.A. 54:4-32.6. Under the three-prong statutory test for exemption articulated in Paper Mill Playhouse v. Millburn Township, 95 N.J. 503 (1984), a claimant must demonstrate: (1) it is organized exclusively for the moral and mental improvement of men, women and children; (2) the property must be actually used for the tax exempt purpose; and (3) the operation and use of the property must not be conducted for profit. Plaintiff met the first and second prongs because they advanced the educational mission of American-style international schools by providing services that improve the quality of their education and serve the valuable public purpose of assisting in the education of American students and other foreign nationals abroad. Nonetheless, the court denied the exemption, determining that a portion of plaintiff's profit was being used to subsidize the operations of its profit-making affiliates by providing professional services that were not "charged back," charging below-market rents, and making unsecured loans that did not appear to have been timely repaid. In addition, although plaintiff had an educational mission, it had lent its name and reputation to promote joint profit- making ventures, as evidenced, in part, by its creation of profit making affiliates which operated out of the same building with shared officers and staff.

TAXATION EXEMPTION

AHS Hospital Corp. v. Town of Morristown, 25 N.J. TAX 374 (Tax Ct. 2010) http://lawlibrary.rutgers.edu/courts/tax/10900-07.opn.html A non-profit corporation that operated a hospital was the owner of certain properties and for the relevant tax years claimed an exemption for the property under N.J.S.A. 54:4-3.6. The hospital had various office spaces that were used by private physicians, who were also members of the hospital staff. Also, the hospital rented an area to Au Bon Pain café. On summary judgment these were declared to be profit making facilities and therefore were not exempt. In addition, there was a genuine issue of material fact as to whether some uses of the main hospital building, a cardiovascular institute and a garage were being conducted for profit, so the hospital’s motion for summary judgment on those uses was denied. Much of the evidence of the potential profit making portions of the hospital presented by the municipality on the motion for summary judgment came from the hospital’s Form 990 filed pursuant to the Internal Revenue Code, including executive salaries. The court said that this “raises a genuine issue as to the actual operation of the Hospital and whether profit can be traced to someone’s personal pocket.”

TAXATION REDUCTION IN TAXES PENDING APPEAL

Sun Pipe Line Co. v. Township of West Deptford, ___ N.J. Tax. ___ 2010 N.J. TAX LEXIS 17 (Tax Ct. 2010) Sun Pipe Line Company shut down its oil refinery and argued that it should receive an immediate reduction in its taxes, pending its tax appeal. Reviewing the provisions of N.J.S.A. 54:3-27 and 54:1A-1, the Tax Court held that they did not give the court authority to reduce the taxes to be paid

-20- by the taxpayer while an appeal is pending or to insulate the taxpayer from interest and penalties. The statutes merely give the court limited authority to fix terms for the payment of taxes that are due and owing at the time a tax appeal is filed. Otherwise the legislative scheme would be upended. “The rule has always been that the public interest in an uninterrupted and predictable flow of tax revenue to municipalities outweighs a taxpayer’s claim to be entitled to a reduction in taxes. Until the taxpayer proves that the assessment on its property is excessive, the taxpayer must pay the full amount of tax due. Overpayments as a result of a successful claim are addressed through refunds by the taxing district . . . . Plaintiffs, however, ask that the burden in these appeals be shifted to the municipality in that [they] seek to reduce their tax payment obligations immediately even though they have not proven their claims. If plaintiffs ultimately are not successful in reducing the assessment on the subject property, they presumably would be liable for the unpaid balance of the tax, but free from any interest and penalties. The Legislature and Governor certainly did not envision this approach.”

TAXATION REFUNDS

DSC Newark Enterprises Inc. v. South Plainfield Borough, 25 N.J. Tax 120 (Tax Ct. 2009) http://lawlibrary.rutgers.edu/courts/tax/05609-03opn.opn.html Plaintiff and Scotch Plains Borough settled tax appeals on a Superfund site for years 2002 – 2007 resulting in a refund owed to the plaintiff. The terms of the settlement provided that plaintiff would waive payment of interest on the refund provided it received the refund within 60 days of the Tax Court’s judgment. Those judgment dates ranged from March 16 to April 13, 2007. Following settlement, a dispute arose as to the proper amount of the refund. Despite the requirements of N.J.S.A. 54:3-27 that taxpayers pay at least the first quarter taxes in order to appeal their assessment for that year, plaintiff had not paid the 2006 taxes. As a result, during the pendency of the appeals the property was sold at tax sale to a third party. The borough sought to deduct interest and costs associated with the redemption of the tax sale certificate. The court held that the borough was entitled to deduct from the refund the interest and costs the borough had occurred in redeeming the tax sale certificate. However, the court also held that the undisputed amount of the refund should have been paid to plaintiff within 60 days of the judgment and, because it had not been, plaintiff was entitled to interest on the refund.

TAXATION REVALUATION

Keane v. Township of Monroe, ___ N.J. Tax ____ (Tax Ct. Nov. 4, 2010) http://lawlibrary.rutgers.edu/courts/tax/01147-07.opn.html After the county board of taxation refused to act, the court ordered the municipality to conduct a complete revaluation of real property in the municipality, concluding that several of the criteria set forth at N.J.A.C. 18:12A-1.14(b) had been met.

-21- TAXATION TAX LIENS; BANKRUPTCY

In re Princeton Office Park, 423 B.R. 795 (Bankr.Ct., D.N.J. 2010) If a creditor holds a “tax claim” under the Bankruptcy Code, 11 U.S.C. § 511 (a) then the Bankruptcy Court may not modify the interest rate and payment terms on that claim. In this case the creditor was the holder of a tax sale certificate from a New Jersey tax sale and sought interest at the rate provided by New Jersey statute (18 per cent). The Bankruptcy Court held that a holder of a tax lien in New Jersey did not have a “tax claim” under the bankruptcy code and was, therefore, not entitled to the expected 18% interest but rather to some other interest rate to be fixed by the court. This case is on appeal and the New Jersey League of Municipalities, represented by the Institute, has intervened on behalf of the creditor. The concern is that this decision, if upheld, will have a chilling effect on the sale of tax liens because the creditors will not be able to rely on the 18% interest rate in determining the value of their investment.

TAXATION TIME BAR

O’Rourke v. Twp of Fredon, 25 N.J. Tax 443 (Tax Ct. 2010) Practice before the county boards of taxation is governed by an extensive statutory and regulatory scheme. (N.J.S.A. 54:3-1 to -31 and N.J.A.C. 18:12A-1.1 to -1.20.) Although the statute and the regulations set forth an April 1 deadline for filing a tax appeal, neither the statute nor the regulations impose a deadline for service of a petition of appeal upon the tax assessor or municipal clerk. Therefore, the court held that the county board had overstepped its authority when it had promulgated its own rule requiring an April 1 postmark deadline for service upon the clerk and assessor. Whether there should be such a deadline or postmark requirement is a question for the Legislature. A two day delay in service upon the municipal clerk and assessor is not grounds for dismissal, there being no prejudice in the delay.

TAXATION TIMELINESS

Bear's Nest Condominium Association v. Bergen County Board of Taxation, 25 N.J. TAX 237 (Tax Ct. 2009) Park Ridge sought to reassess all the condominium units in a complex and sought approval of the Bergen County Board of Taxation pursuant to N.J.S.A. 54:4-23 which governs the procedure for partial reassessments. The county board gave its approval and the affected unit owners were given a formal notice of their reassessment under N.J.S.A. 54:4-38.1 (commonly known as the “Chapter 75 Notice”) in February 2006 so that the time for filing a conventional tax appeal expired on April 3, 2006. No individual appeals were filed by that date. The condominium association sought to have the county board reverse its approval of the reassessment order. This was denied on March 8, 2006 and the association sought relief in the Tax Court within 45 days of that ruling. The Tax Court held that tax appeals related to this reassessment were untimely because they had not been filed by the individual taxpayers within 45 days of the Chapter 75 Notice. The informal determination of the County Tax Board not to reverse its prior determination to allow the reassessment was not an appealable action.

-22- TAXATION TIMELINESS; FILING WITH ASSESSOR AND CLERK

Hopatcong Fuel on You, LLC v. Borough of Hopatcong, 25 N.J. Tax 389 (Tax Ct. 2010) O’Rourke v. Fredon, supra, dealt with the timely filing and service of a tax appeal with the county board. The same result applies to a filing in the tax court. Though N.J.S.A. 54:3-21(a) imposes a strict deadline – April 1 – on the filing of complaint with the tax court, it does not impose the same strict deadline on the filing or service of the complaint with or upon the municipal clerk and assessor. Here, the taxpayer filed the complaint in tax court by the April 1 deadline, but the assessor did not receive it until approximately a week later and the clerk never received it. The court denied the borough’s motion to dismiss the complaint, finding, under the circumstances presented, that the borough was not prejudiced by the delay.

TORTS DUTY TO INSPECT

Polzo v. County of Essex (Unpub.App.Div. August 24, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a1553-09.opn.html Plaintiff’s decedent died in a cycling accident on a county road. She fell off her bicycle after traveling over a circular depression in the shoulder of the road approximately one and one-half inches deep, and two-feet wide. The matter has been in the courts over several years, including Polzo v. County of Essex, 196 N.J. 569 (2008), reported in the 32 Municipal Law Review 3 (March 2009) In this decision the Appellate Division, addressed two theories of liability for maintenance of a dangerous property condition under the Tort Claims Act. It first held that the County was not under constructive notice of the depression, and therefore, was not liable for the incident under N.J.S.A. 59:4-2(4)(b). In a rather astonishing opinion, however, it held, under N.J.S.A. 59:4-2(a), that it would be possible for a jury to conclude that the County’s failure to have a proactive pothole inspection program was a negligent or wrongful act or omission, and further that the failure to have such a program was palpably unreasonable. Accordingly, the court remanded the matter to the trial court for trial on those issues. Because of the far-ranging implications of this decision upon money- strapped public works departments, the League of Municipalities has intervened in a petition for certification to the Supreme Court.

TORTS EXCULPATORY AGREEMENT

Marcinczyk v. State of N.J. Police Training Cmss’n, ___ N.J. ___ (Oct. 18, 2010) http://lawlibrary.rutgers.edu/courts/supreme/a-19-09.opn.html A police trainee sustained injuries during the course of training at the Somerset County police academy filed a negligence action against the State Police Training Commission, Somerset County, the Somerset County police academy, the community college at which the academy was operated, the academy director, and supervisors of police training. The lower courts granted summary judgment to the defendants, but the Supreme Court reversed and remanded, finding that the exculpatory agreement entered into by the trainee was invalid because the agreement granted the Academy greater immunity than afforded by the Legislature under the Tort Claims Act.

-23- TORTS IMMUNITY

Wilson v. City of Jersey City, 415 N.J.Super. 138 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a4044-08.opn.html This is one of two cases abstracted in this issue involving immunity for 9-1-1 calls, plaintiffs were victims of an attack by a family member which left three fatalities and only one survivor. An individual visiting a neighbor used his cell phone to call 9-1-1 during the attack. Because a cell phone was used, it was routed to the state police who then re-routed the call to the Jersey City Police Department. The caller provided the incorrect address, however, the call taker also failed to follow proper procedure in processing the call. The police officers were unsuccessful in finding the location. A call back to the caller, which also failed to follow proper procedure, was unsuccessful. The caller once again called 9-1-1 the next morning because the police had failed to arrive. The caller, however, was directed to a non-emergency number. The sole survivor eventually regained consciousness and called 9-1-1 after more than 30 hours had elapsed. Defendants brought an action against Jersey City as well as all actors employed by Jersey City and the New Jersey State Police and all actors employed by the New Jersey State Police. The trial judge dismissed the complaint against all public entities and employees on the grounds of immunity. The Appellate Division first recognized that the Tort Claims Act does not provide immunity where police officers negligently perform ministerial duties, N.J.S.A. 59:5-4; N.J.S.A. 59:3-2(d) and N.J.S.A. 59:2-3(d). The actions of the dispatchers and police officers were non-ministerial. The actions of the police officers were held to be reasonable, discretionary and immune from liability. N.J.S.A. 59:5-4. The actions of the Jersey City call takers and Jersey City itself were not entitled to immunity and the issue of proximate cause could still be pursued. The state police dispatcher as well as the state police were found to have exercised their ministerial duties pursuant to all regulations and were therefore entitled to immunity. The appellate division further held the there was no immunity pursuant to N.J.S.A. 52:17C-10(e) because the dispatchers were not assisting police officers. The one exception was the attempt at a call back while the police were attempting to find the address. The Court further held that all claims of improper training against Jersey City were properly dismissed as lacking any evidential support.

TORTS IMMUNITY

Massachi v. City of Newark Police Department, 415 N.J.Super. 518 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a5252-07.opn.html In this significant decision, the Appellate Division held that the immunity provisions in N.J.S.A. 52:17C-10 of the Tort Claims Act (and its subsequent amendments) establishing the 9-1-1 system do not confer immunity upon an emergency communications center and dispatchers for the negligent handling of 9-1-1 calls. Plaintiff’s decedent was the victim of a murder. The murderer was observed pulling the decedent into a car. A description of that incident, the car and the car’s direction of travel was called into the City’s 9-1-1 center. The dispatcher bungled the call in several respects, including misidentifying the vehicle and dispatching officers to an incorrect location. Another dispatcher who ran the plates on the vehicle failed to issue a general alert to all City police units and contact

-24- neighboring municipalities, contrary to required procedures. The court analyzed the legislative history of N.J.S.A. 52:17C-10 and determined that the intent of the legislation was to afford immunity for mechanical failures in the communication systems, but not for the bungling of a call by a dispatcher.

TORTS PREMISES LIABILITY

Pote v. Atlantic City, 411 N.J.Super. 354 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a2544-08.opn.html The City of Atlantic City owns and controls the boardwalk and has undertaken full responsibility for the removal of snow and ice from the boardwalk. While waiting in line to enter Boardwalk Hall—a commercial establishment situated adjacent to the boardwalk and whose only public entrance is from the boardwalk—plaintiff slipped and fell on a patch of ice that was located on the boardwalk itself rather than Boardwalk Hall’s property. Plaintiff nevertheless sought to hold Boardwalk Hall liable for not removing the ice from the boardwalk. The Appellate Division, sustaining the trial court’s grant of summary judgment against plaintiff, declined to extend the current case law of premises liability to impose a duty on the proprietor of commercial premises to clear the abutting public thoroughfare of ice and snow, when the public thoroughfare is owned and maintained by a public entity that has accepted full responsibility for such snow and ice removal.

TORTS SIDEWALK LIABILITY

Luchejko v. City of Hoboken, 414 N.J. Super. 302 (App. Div. 2010) http://lawlibrary.rutgers.edu/courts/appellate/a5702-07.opn.html As a novel issue, the Appellate Division decided that a condominium association does not have the obligation to remove snow from an abutting public sidewalk as a commercial owner would. The condominium complex included only dwellings and no commercial enterprises. The court analyzed the following factors in concluding that the property was residential not commercial: (1) there was no capacity to generate profits, thus the condominium is different from a rental apartment complex; (2) the trustees do not earn income for their services; (3) the condominium association does have the ability to spread the risk but not from higher charges for the goods and services of the enterprise; (4) the sidewalk was not part of the common elements so the association’s policy, paid for from the common charges of the owners, would not cover this occurrence; (4) a property should not be considered commercial if it is owner-occupied.

TORTS USE OF SIRENS

DiLeone v. Township of Mahwah (Unpub.App.Div. March 9, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a1204-08.opn.html Plaintiffs sought to restrain the use of sirens to notify volunteer firemen that their services were required. Plaintiffs stated that the sirens amounted to an actionable nuisance. They also argued that the sound of the sirens was noise pollution and actionable under N.J.S.A. 2A:35A-4 of New Jersey's Environmental Rights Act, N.J.S.A. 2A:35A-1 to -14. The municipality had looked into alternatives and found that the sirens were the most effective and most economic choice. The appellate division

-25- affirmed, finding that plaintiffs had failed to prove by clear and convincing evidence the unreasonableness of the sirens under all circumstances,. Plaintiffs had also failed to prove their claim under the New Jersey's Environmental Rights Act because they could not prove that silencing the fire alarms was necessary to protect the environment or the public from pollution, impairment or destruction.

UTILITIES TREE CUTTING

Public Service Electric and Gas Co. v. N.J. Power Line Neighbors Coalition (Unpub.App.Div. March 15, 2010) http://lawlibrary.rutgers.edu/courts/appellate/a6439-08.opn.html Municipal bodies sometimes are asked to get involved in the disputes between a utility and local landowners over the right of the utility to cut the trees or to remove structures in its right of way. As the result of the August 2003 multi-state power failure that had resulted, it is said, from a tree coming into contact with an electric transmission line and had left more than 50 million people in the United States without electric power, the New Jersey Board of Public Utilities (BPU) adopted stringent vegetation management regulations in 2009. (N.J.A.C. 14:5-9.1 et seq.). Two crucial aspects of these regulations prohibit woody plants that mature above 3 feet tall in the “wire zone” and implement integrated vegetation management in the “border zone” so that no vegetation or parts of vegetation will grow or fall into the transmission lines. (N.J.A.C. 14:5-9.6) However, the regulations do not apply to those property owners that have a written “land right.” N.J.A.C. 14:5- 9.6(f)(1). In this case, the Township of Cinnaminson and a coalition of landowners had entered into a consent order in 2002 --before the adoption of the current vegetation management regulations-- that governed the cutting of vegetation in certain easements in the Township. The court found that this was a written “land right” but found sufficient factual and legal issues as to the meaning of the consent order to justify a remand to the BPU for a determination as to whether it prohibited Public Service Electric & Gas Company (PSE&G) from applying the new vegetation management regulations. In the meantime, all stays granted in the trial court and the Appellate Division were dissolved upon the assumption that neither the BPU nor PSE&G would “act precipitously” and, instead envisioned a that a dialogue among all parties on a “case-by-case (and perhaps in some instances, a tree-by-tree and bush-by bush) basis” would continue.

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