Category Archives: NJ Law

Board Member Representation Of Personal Interests: Need For Reform

By Christopher Norman, Esq. and Erin Campbell, Esq.

To what extent can a land use board member represent his/her own interests: (a) on his/her development application? or (b) on a development application by his/her neighbor? These questions are vexing, not only for planning and zoning board members, but very much so for board solicitors as well. The provisions of the New Jersey Local Governmental Ethics Law, N.J.S.A. 40A:9-22 et seq. only complicate the matter further. On the one hand, N.J.S.A. 40A:9-22.5k provides that nothing shall prohibit a governmental officer from representing his/her own or family’s interests before the agency. On the other hand, N.J.S.A. 40A:9-22.5h bars a governmental official from representing private interests before his/her agency. And N.J.S.A. 40A:9-22.5c prohibits a local government official from “using his official position to secure unwarranted privileges or advantages for himself or others.”

Apparently, even our New Jersey Courts have struggled with the tug and pull of these seemingly conflicting statutory provisions. Further adding to the confusion, the New Jersey Courts must also weigh, in the overall equation, the long established “potential conflict of interest” and “appearance of impropriety” standards developed under the common law.

So how have these apparently conflicting legal principles been reconciled over the years? Not very well in these authors’ opinion.

The Local Governmental Official – Applicant

In Wyzykowski v. Rizas, 132 N.J. 509 (1993), our Supreme Court held that a mayor could represent his own personal interests on his development application before his local planning board to develop vacant land for mixed-use development of eleven residential units and office space. The Supreme Court, in its effort to balance the conflicting provisions of the Ethics Law, tipped the scales in favor of protecting the individual property rights of governmental officials. Wyzykowski was a close call: three (3) dissenting justices opined that the “appearance of impropriety” should bar a Mayor from representing his own real estate development interests in his municipality for pecuniary gain. In its Opinion, the Supreme Court sidestepped its prior decision in Place v. Board of Adjust. Of Saddle River, 42 N.J. 324 (1964), where a Mayor was disqualified, and found to have engaged in “influence peddling”, for serving in his professional capacity as attorney for an applicant before his planning board. The authors here suppose the point to be gleaned from these two New Jersey Supreme Court opinions is that if the governmental official is the owner of real property, he/she can represent himself to develop it for profit. But if the property is owned by someone else, the local governmental official must yield and cannot serve in a “professional capacity” (i.e. as lawyer, planner, engineer, etc.) advocating for or against the application.

Is it really that simple? Guess again. In Jock v. Shire Realty, Inc., 295 N.J. Super. 67 (App. Div. 1996), certif. den. 148 N.J. 462 (1997), the Appellate Panel, “considered the propriety of a zoning board member’s testimony as an expert witness before his board in favor of a variance that would benefit his own corporation.” Cox & Koenig, New Jersey Zoning & Land Use Administration, 5-1.3 at 94 (Gann 2015). That particular board member was the controlling shareholder of the company/applicant (i.e. a property owner representing his own development interests). The Appellate Panel held this property owner/board member had a disqualifying conflict-of-interest. Was this judicial outcome reached because the board’s member participation as a “professional” trumped the representation of his own personal interests in his real property? The Jock opinion only adds to the legal confusion. Its result has been criticized in Cox & Koenig. Id. at 94.

Now are you more confused that when you began to read to this article? There is more where that came from.

The Interested Board Member – Residing Within 200 Feet of Application

To what extent can a board member represent his own personal interests when his neighbor is the applicant for development?

This particular question was confronted in Szoke v. Zoning Bd. of Adjustment., 260 N.J. Super. 341 (1992). There, a board member was held to have a disqualifying conflict-of-interest because of his participation from the audience, wherein the substance of his comments appeared to support the granting of variance relief. The Appellate Panel broadly found disqualification, based on the potential for the board member to affect the board’s “deliberative process” from the audience.

However, the 2006 Appellate Panel opinion in Murtagh v. Borough of Park Ridge, et al., 2006 N.J. Super. Unpub. Lexis 1158 refused to follow Szoke’s strict prohibition of participation. While Murtagh is unpublished, these authors are aware of its citation by many land use practitioners before land use boards.

In Murtagh, the planning board member resided within 200 feet of the applicant seeking a variance on an abutting property. The board member appropriately disqualified himself from sitting on the application as a board member, but then participated from the audience to represent his real property interests. The board member objected to the granting of his neighbor’s variance application.

The Appellate Panel held that the board member could represent his own interests in asking the Board to uniformly enforce the zoning ordinance, rather than grant an exception (by variance). The Appellate Panel found, in this particular circumstance, that the board member derived no “special treatment” or benefit from this participation. The board member simply asked the Board to hold his neighbor to the same standards as everyone else within the zoning district.

Looking for more clarity on this subject matter? You won’t find it here. Cox & Koenig, supra, 5-1.3 at 94 cites a third opinion on the topic with yet another different outcome: the unreported opinion in Riviera v. Planning Board of Roselle, not officially reported but published in full, 25 Mun. Law. Rev., No. 1, page 3 (March 2002). There, the board secretary, who resided within 200 feet of the applicant’s property, offered adverse testimony to the applicant, which application was thereafter denied by the planning board. The Trial Court and Appellate Panel both affirmed, but the Appellate Panel remanded it with instructions that each board member should explain on the record his/her own personal assessment whether he/she perceived him/herself to have a conflict, due to the board secretary’s participation.

CONCLUSION

A lack of clarity exists in the law on land use board member’s personal participation in land use applications, as an applicant or an interested party to a development application by a neighbor. Laws are intended to promote fundamental fairness and must do so through uniformity and predictability. In these authors’ opinions, the status quo only promotes confusion and uncertainty. Legislature reform of the Ethics Law is needed.

FAIR SHARE HOUSING CENTER EMPLOYS FULL COURT PRESS ON NEW JERSEY MUNICIPALITIES

New Jersey municipalities have been digesting our Supreme Court’s latest ruling, which now has our Courts substituting in the role of the Council on Affordable Housing (COAH). In re Adoption of N.J.A.C. 5:96 and 5:97 by N.J. Council on Affordable Housing, 221 N.J. 1 (2015).  Now, they may have a bigger problem.  Fair Share Housing Center (FSHC) has appointed itself the de facto statewide enforcer of the Mount Laurel Doctrine and the non-profit appears highly motivated to seek results.

Starting with the very first trial court decision on five-month temporary immunity (in Monroe Township, Middlesex County), FSHC has unveiled its plan to litigate and compel municipalities to get everything accomplished to meet the Supreme Court’s directives within 150 days.  FSHC wants municipalities to calculate their own respective fair share obligation and adopt a housing element and fair share plan, all within five (5) months.  In pursuing this fast-track compliance, FSHC has filed (or threatened) motions to intervene in a plethora of declaratory actions filed by municipalities, particularly those in which municipalities are requesting for the Supreme Court’s “five-month clock” to commence after the municipal fair share obligation is determined by the trial court.

Where it has elected to intervene, FSHC is pushing its own projected fair share calculation for municipalities, prepared by David Kinsey, P.P., whose has been a long-time critic of COAH and, to this author’s recollection, has made claims that COAH has long underestimated the need for affordable housing in New Jersey.  FSHC’s projected affordable housing numbers have caused bewilderment in the municipal community.  The disparity between FSHC’s numbers and municipal projections (from this author’s particular experience in representing two municipalities on motions for temporary Mount Laurel immunity) is so significant that compromise is not part of the conversation.

Complicating the Mount Laurel roadmap further, FSHC has supplemented its intervention motions with counterclaims against municipalities pressing for an entirely new remedy that any violation of the Mount Laurel Doctrine implicates a corresponding violation of the New Jersey Civil Rights Act, entitling the affordable non-profit to attorney’s fees as a prevailing party.

In the unpublished opinion of In the Matter of the Application of Borough of Pine Beach, County of Ocean, (Docket No. OCN-L-1687, decided August 7, 2015), this particular issue was adjudicated for the first time.  The trial court judge concluded that if the granting of temporary immunity from builder’s remedy litigation (as contemplated by our Supreme Court) is to have any meaning, no counterclaim may be pursued at this time by FSHC (or any other third-party) for constitutional violations under the New Jersey Civil Rights Act.

However, the trial court in Pine Beach did not rule out the possibility of attorney-fee shifting liability to municipalities in the event temporary Mount Laurel immunity later expires or is pierced by a successful litigation attack.  The genesis of this new potential litigation tool of FSHC is the New Jersey Supreme Court’s decision last year in Tumpson v. Farina, 218 N.J. 450 (2014).  In this very important, yet less heralded opinion, our Supreme Court held that a violation of a substantive right under New Jersey’s Constitution amounts to a violation of the New Jersey Civil Rights Act.  In Tumpson, the Supreme Court found that a municipal clerk’s improper denial of a referendum petition violated a resident’s substantive rights under the New Jersey Constitution and warranted the imposition of attorney’s fees against the municipality.

The underpinnings of the Mount Laurel Doctrine stem directly from our Supreme Court’s interpretation of the New Jersey Constitution guaranteeing the right of citizens to pursue a realistic opportunity for affordable housing.  If this legal issue is successfully litigated by FSHC, New Jersey municipalities may be susceptible to a floodgate of new Mount Laurel litigation.  A new incentive will exist to pursue such lawsuits by developers and affordable non-profits.

Particularly vulnerable would be remote and lesser developed municipalities, which have relied upon fortuitous demographics (e.g. lack of public sewer and/or outside path of State’s targeted growth areas) to not pursue Mount Laurel compliance.  Other municipalities, pursuing declaratory relief for temporary immunity to amend their housing plans, should be aware that if their efforts at adopting a compliance plan fall short of the constitutional mark, they could be paying the legal fees for both sides.

FAIR SHARE HOUSING CENTER – njpo.