ORESTE FANARO v. BOROUGH and COUNCIL OF SOUTH BOUND BROOK

(NOTE: The status of this decision is published.)
 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-2429-05T52429-05T5

A-2434-05T5

A-4019-05T5

A-4271-05T5

ORESTE and ERNA FANARO, Trustees

(ORESTE FANARO, Deceased),

Plaintiffs-Appellants,

and

FANARO PARTNERSHIP (ERNA FANARO,

Successor and Sole Partner),

Plaintiff,

v.

BOROUGH and COUNCIL OF SOUTH BOUND

BROOK, JOINT PLANNING BOARD/ZONING

BOARD OF ADJUSTMENT OF SOUTH BOUND

BROOK, MATZEL & MUMFORD AT SOUTH

BOUND BROOK URBAN RENEWAL, LLC, and

M&M INVESTMENTS, LLP,

Defendants-Respondents.

___________________________________

ORESTE and ERNA FANARO, Trustees

(ORESTE FANARO, Deceased),

Plaintiffs,

and

FANARO PARTNERSHIP (ERNA FANARO,

Successor and Sole Partner),

Plaintiff-Appellant,

v.

BOROUGH and COUNCIL OF SOUTH BOUND

BROOK, JOINT PLANNING BOARD/ZONING

BOARD OF ADJUSTMENT OF SOUTH BOUND

BROOK, MATZEL & MUMFORD AT SOUTH

BOUND BROOK URBAN RENEWAL, LLC, and

M&M INVESTMENTS, LLP,

Defendants-Respondents.

___________________________________

BOROUGH OF SOUTH BOUND BROOK, a

Municipal Corporation of the State

of New Jersey,

Plaintiff-Respondent,

v.

ORESTE FANARO and ERNA FANARO,

Trustees, or their Successors in

Trust under the Fanaro Living Trust,

JOHN FANARO, and FANARO PARTNERSHIP,

Defendants-Appellants,

and

STUART GREENWALD, his Heirs,

Successors, and Assigns, SHALOR S.

STRICKLAND, his Heirs, Executors,

and Assigns, LILLIAN EGANEY and

THOMAS EGANEY, KARL R. MEYERTONS,

ESQ., and UNITED STATES OF AMERICA,

Defendants.

___________________________________

BOROUGH OF SOUTH BOUND BROOK, a

Municipal Corporation of the State

of New Jersey,

Plaintiff-Respondent,

v.

ORESTE FANARO and ERNA FANARO,

Trustees, or their Successors in

Trust under the Fanaro Living Trust,

JOHN FANARO,

Defendants-Appellants,

and

STUART GREENWALD, his Heirs,

Successors, and Assigns, SHALOR S.

STRICKLAND, his Heirs, Executors,

and Assigns, LILLIAN EGANEY and

THOMAS EGANEY, KARL R. MEYERTONS,

ESQ., UNITED STATES OF AMERICA,

and FANARO PARTNERSHIP,

Defendants.

__________________________________________

 

Argued September 19, 2007 - Decided

Before Judges Axelrad, Sapp-Peterson, and Messano.

On appeal from the Superior Court of New Jersey, Law Division, Somerset County,

L-380-05.

Vincent J. Mangini argued the cause for appellants Oreste and Erna Fanaro, Trustees, in A-2429-05T5, and for appellants Oreste and Erna Fanaro, Trustees, or their Successors in Trust under the Fanaro Living Trust in A-4271-05T5 (Stark & Stark, and Joseph A. Dorta, attorneys; Mr. Dorta, on the brief in A-2429-05T5, on the letter in A-2434-05T5 relying on the brief filed on behalf of appellant Fanaro Partnership in A-2429-05T5 and A-2434-05T5, on the letter in A-4019-05T5 relying on his brief filed in A-4271-05T5, and on the brief in A-4271-05T5).

Vincent J. Mangini argued the cause for appellant Fanaro Partnership in A-2434-05T5 and A-4019-05T5 (Stark & Stark, and Joseph A. Dorta, attorneys; Mr. Mangini, on the letter in A-2429-05T5 relying on his brief filed in A-2434-05T5; Timothy P. Duggan and Mr. Mangini, of counsel and on the brief in A-2434-05T5 and A-4019-05T5; Mr. Mangini, on the letter in A-4271-05T5 relying on his brief filed in A-4019-05T5).

William T. Cooper, III argued the cause for respondent Borough and Council of South Bound Brook in A-2429-05T5, A-2434-05T5, A-4019-05T5, and A-4272-05T5 (Cooper & Cooper, attorneys; Mr. Cooper, on the letter in A-2429-05T5 relying on his brief filed in A-2434-05T5, on the letter in A-2429-05T5 relying on the brief filed on behalf of respondent Matzel & Mumford at South Bound Brook Urban Renewal, LLC and M&M Investments, LLP, on the brief in A-2434-05T5, of counsel and on the brief in A-4019-05T5, and on the letter in A-4272-05T5 relying on his brief filed in A-4019-05T5).

Albert E. Cruz argued the cause for respondent Joint Planning Board/Zoning Board of Adjustment of South Bound Brook in A-2429-05T5 and A-2434-05T5 (DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis & Lehrer, attorneys; Mr. Cruz, on the letter in A-2429-05T5 relying on his brief filed in A-2434-05T5, on the letter in A-2434-05T5 relying on the brief filed on behalf of respondent Matzel & Mumford at South Bound Brook Urban Renewal, LLC and M&M Investments, LLP, and of counsel and on the brief in A-2434-05T5).

Robert Beckelman argued the cause for respondents Matzel & Mumford at South Bound Brook Urban Renewal, LLC and M&M Investments, LLP in A-2429-05T5 and 2434-05T5 (Greenbaum, Rowe, Smith & Davis, attorneys; Mr. Beckelman, of counsel and on the brief).

PER CURIAM

These four appeals from judgments entered by the Law Division were argued before us back-to-back. We consolidate them for purposes of this opinion because they arise out of a challenge to a redevelopment plan in both a complaint in lieu of prerogative writs action and a condemnation proceeding. Plaintiffs are Oreste and Erna Fanaro, Trustees (Oreste Fanaro, Deceased) and Fanaro Partnership (Erna Fanaro, Successor and Sole Partner) (collectively plaintiffs). They appeal three orders entered December 2, 2005, granting summary judgment in favor of defendants Borough and Council of South Bound Brook (Borough), Joint Planning Board/Zoning Board of Adjustment of South Bound Brook (Joint Board), Matzel & Mumford at South Bound Brook Urban Renewal, LLC, and M&M Investments (M&M) (all defendants collectively known as defendants), and a fourth order entered April 4, 2006, denying their motion to vacate the August 23, 2005 order appointing condemnation commissioners. We affirm the orders granting summary judgment as well as the order denying plaintiffs' motion to vacate the order appointing the condemnation commissioners.

The events leading up to the entry of the summary judgment proceedings and the order denying plaintiffs' motion to vacate the order appointing the condemnation commissioners began nearly ten years ago. On December 18, 1997, the Joint Board held a public hearing to determine whether the GAF Industrial site and certain properties adjacent thereto located within the Borough should be classified as an area in need of redevelopment pursuant to the Local Redevelopment and Housing Law (LRHL), N.J.S.A. 40A:12A-1 to -73.

The specific area under review included portions of seven blocks. The area contained five underused industrial properties as the focus of the plan, as well as approximately two dozen well-maintained small business or residential properties which adjoin the arterial roadways that led to the industrial properties. The total area comprised a triangular parcel fronting Main and Washington Streets and the Delaware and Raritan Canal known as the Triangle Area. Plaintiffs own three properties located within the Triangle Area. Two lots (Lots 4.01 and 5.02) are owned by the plaintiff-trust and one lot (Lot 5.01) is owned by the plaintiff-partnership.

At the hearing, the Joint Board heard testimony from the Borough Planner, Dennis W. Hudacsko (Hudacsko); the Borough Code Enforcement Officer, William Boyle; and three property owners: Charles Egan, Al Doimi and Oreste Fanaro (Oreste). Oreste wanted to know what was going to happen with his property and was told by the Joint Board Chairman, "I think at this point nobody knows. It's going to be part of the planning process if this goes through tonight. I think we've already answered that we don't know at this point." Those in attendance at the hearing were also told that the area in question was in "desperate need of help[,]" the goal of the project was to "benefit the property owners who [were] responsible in the handling of their properties[,]" it was not the "intent of the Mayor and Council . . . [to] drive anybody out of town[,]" and that the process would be lengthy and subject to public hearings along the way. At the conclusion of the hearing, the Joint Board designated the Triangle Area, including plaintiffs' properties, as a redevelopment area.

On January 10, 1998, the Borough adopted a resolution designating the Triangle Area as the area comprising the geographic boundaries proposed for redevelopment known as the Industrial District Redevelopment Area (IDRA). N.J.S.A. 40A:12A-5. Thereafter, on June 9, 1998, the Borough passed Ordinance 8-98, which adopted the Preliminary Plan prepared by Hudacsko dated February 10, 1998 and the May 1998 revised version. The Preliminary Plan did not include the acquisition of plaintiffs' properties. Rather, the plan called for the acquisition of the four underused properties. Although the Preliminary Plan stated that the "remaining properties . . . can be expected to prosper without any redevelopment action[,]" it also made clear that the plan is strictly "preliminary in nature" and would be "refined and replaced" once a developer was selected. Plaintiffs, at that time, did not appeal the designation of their properties as part of the IDRA under the newly-adopted Ordinance 8-98.

At some point in 2003, defendant M&M, a development company, became involved in the redevelopment project and eventually took over as its designated developer, under the direction of David Fisher, M&M's Vice-President. On January 18, 2005, the Joint Board held a public hearing to (1) address proposed amendments to the Borough's "Master Plan," (2) determine whether the amended Preliminary Plan was consistent with the Master Plan, and (3) determine whether the proposed zoning plan was also consistent with the Master Plan. Although notice of the January 18, 2005 hearing was duly published, when the presentations on the Master Plan Triangle Redevelopment Amendment commenced, no member from the general public was present. Later, when the public was invited to comment on the proposed amendments, no one stood to speak, and the Joint Board then unanimously voted to approve the proposed amendment resolutions (Final Plan). The Final Plan expanded the redevelopment area "beyond the original underused parcels to include the entirety of Block 57 . . . in order to address parking and circulation design issues." The Final Plan also called for acquisition of certain small businesses in the area referred to as "Parcel F," which included plaintiffs' properties:

The new Parcel F is a group of four properties (Block 57, Lots 4.01, 5.01, 5.02 and 6[)]. These properties were cited as lacking sufficient off-street parking. Unless these properties are redeveloped, the continued parking deficiencies will have a detrimental effect on the pattern of land use proposed by this sub-plan.

On January 25, 2005, the Borough adopted the Final Plan through the passage of Ordinance 05-01.

On February 3, 2005, M&M applied to the Joint Board for certain approvals related to the Final Plan, which included acquisition of plaintiffs' properties. The hearing for this application was scheduled for February 15, 2005, but was rescheduled to March 15, 2005. On March 14, 2005, plaintiffs filed a Complaint in Lieu of Prerogative Writs in the Law Division (first action). The complaint alleged that inclusion of plaintiffs' properties in the redevelopment plan was unnecessary (First Count); economic development was not a valid public purpose for acquisition of their properties (Second Count); the manner in which the redevelopment lands were selected violated the New Jersey State Constitution (Third Count); and M&M tortiously interfered with plaintiffs' contractual relationships (Fourth Count). In May 2005, defendants filed their answers to the complaint.

On June 3, 2005, the Borough filed a verified complaint in the Law Division (second action) instituting condemnation proceedings against plaintiffs. On June 8, 2005, Judge Ross issued an order granting the Borough immediate possession of plaintiffs' properties, directing that the estimated compensation of $841,000 be deposited into court, and permitting the Borough to deposit additional compensation upon filing of an Amended Declaration of Taking. In a separate order signed the same date, the judge issued an order to show cause related to the condemnation that was returnable July 22, 2005.

Meanwhile, on July 15, 2005, Judge Fred H. Kumpf, who was presiding over the first action, conducted a case management conference that resulted in the issuance of a Case Management Order dated July 28, 2005. In that order, Judge Kumpf set a schedule for the submission of trial documents, including trial briefs, and set the trial date for November 9, 2005. The order specifically indicated that issues [] not briefed in the trial brief "shall be deemed abandoned."

On July 29, 2005, plaintiffs filed a motion on short notice to amend their complaint in the first action and consolidate the first and second actions. A proposed amended complaint alleging that the Borough's condemnation action implicated state and federal constitutional violations, as well as a violation of N.J.S.A. 40A:12A-1, was attached to the filing. On that same date, plaintiffs also filed a motion on short notice in the second action to dissolve the court's June 8, 2005 order granting the Borough possession of their properties and a stay of the condemnation proceedings until resolution of the first action. Judge Ross addressed the matters on August 19, 2005, and denied both motions. On August 23, 2005, Judge Ross signed an order appointing condemnation commissioners. Plaintiffs never sought reconsideration of that order; nor did they file an appeal.

Plaintiffs did, however, seek reconsideration of the court's August 19, 2005 order. On September 28, 2005, Judge Ross denied reconsideration. On October 13, 2005, plaintiffs sought leave to appeal the August 19 and September 28, 2005 orders. At the same time, plaintiffs advised Judge Kumpf that they would rely upon their appellate brief as their trial brief in the first action that was scheduled for trial the following month. In their appellate brief, plaintiffs essentially argued that their properties were not necessary for inclusion in the Final Plan. The brief also addressed the August 19th and September 28th orders. On October 20, 2005, we denied plaintiffs' emergent application.

On October 27, 2005, M&M filed a motion for summary judgment in lieu of a trial brief in the first action, arguing that plaintiffs had not raised any factual issues which required resolution in a trial. The Borough and Joint Board joined in the motion. Advising the court that they would rely upon the brief they submitted in support of their emergent appeal and a letter memorandum, plaintiffs opposed the motions, arguing that there were substantial factual issues as to whether inclusion of their property was necessary to accomplish the Borough's redevelopment plan. They also argued that the criteria set forth in the LRHL for designating parcels for inclusion in an area in need of redevelopment did not apply to their property. Finally, plaintiffs argued that as private property owners, they could "challenge a redevelopment where the redevelopment plan is of primary benefit to the developer and private business."

On December 2, 2005, Judge Kumpf granted defendants' summary judgment motions in three separate orders. He issued a written statement of reasons in which he found,

Plaintiffs allege in their complaint that the inclusion of Plaintiffs' properties in the Borough's Redevelopment Area is unnecessary and that the adoption of the Amended Plan (Plan) that requires the taking of Plaintiffs' properties is improper. In order for the Plaintiffs to be successful in their complaint, they must show that the municipality's action was unreasonable or in bad faith. Absent a finding of unreasonableness, abuse of power or bad faith, a court will not second-guess the legislature or an agency when it adopts a redevelopment plan requiring the taking of property.

Plaintiffs have not provided opposition to this instant motion for summary judgment. Defendants contend that Plaintiffs have failed to provide any evidence of unreasonableness or bad faith on the part of the Borough in adopting the Plan. Plaintiffs' expert has provided a report suggesting other possibilities for the redevelopment area. Defendants contend that the existence of other possibilities is not enough for a court to set aside the determinations made by the Borough when it adopted the Plan.

As a reminder, the Court held in a proceeding related to this instant matter before the Honorable Graham T. Ross, A.J.S.C., that according to N.J.S.A. 40A:12A-3, "a redevelopment area may include lands, buildings, or improvements which of themselves are not detrimental to the public health, safety or welfare, but the inclusion of which is found necessary, with or without change in their condition, for the effective redevelopment of the area of which they are a part." The Borough has not violated the Local Redevelopment and Housing Law (LRHL) with its decision to include Petitioners' property in its Redevelopment Area. Thus, Plaintiffs cannot argue that their property is improperly included in the Plan. Plaintiffs must demonstrate that the Borough's act of adopting the Plan was improper or in bad faith.

Here, the record shows that the Borough of South Bound Brook Planning Board of Adjustment held meetings for seven years, the outcome of these meetings being the Plan which encompasses the Plaintiffs' properties. The Borough in turn attempted to negotiate with Plaintiffs to purchase the properties pursuant to the Eminent Domain Act, N.J.S.A. 20:3-6. The Plaintiffs rejected the Borough's offers. The Borough then proceeded to file a condemnation action to acquire the properties and to have commissioners appointed to determine the just compensation to be paid to Plaintiffs. Pursuant to the LRHL, N.J.S.A. 40A:12A-8(c), Effectuation of redevelopment plan, the redevelopment entity may "acquire, by condemnation, any land or building which is necessary for the redevelopment project, pursuant to the provisions of the Eminent Domain Act of 1971[.]" The Borough's actions in regard to Plaintiffs' properties are in accordance with the LRHL.

"The proper scope of judicial review is not to suggest a decision that may [be] better than the one made by the board . . ., but to determine whether the board could reasonabl[y] have reached this decision." Allen v. Hopewell Township Zoning Board, 227 N.J. Super. [574, certif.] denied, 113 N.J. 655 (1988) (citing Davis Enterprises v. Karpf, 105 N.J. 476 (1987)[)]. The plaintiffs provide other avenues that the Borough could have followed in its Redevelopment Area. However, this Court may not evaluate other possibilities; it may only evaluate the decision made to determine if it was reasonable and in good faith. There is no basis on which to set aside the Borough's Plan.

On December 20, 2005, Judge Ross entered an order in the second action granting the Borough possession of plaintiffs' properties within ninety days. On January 10, 2006, he issued an order authorizing the Borough to enter upon the properties for inspection and testing purposes.

Plaintiffs filed a Notice of Appeal of Judge Kumpf's summary judgment orders on January 17, 2006. One month later, while their appeal in the first action was pending, plaintiffs filed a motion in the second action seeking to vacate the August 23, 2005 order that appointed the condemnation commissioners. Among the arguments advanced by plaintiffs was that their successful appeal of the orders granting defendants' summary judgment motions would result in inconsistent judgments and that such a result constituted exceptional circumstances justifying relief pursuant to Rule 4:50-1(e) and (f). Additionally, they argued that Judge Kumpf lacked a complete record when he considered defendants' summary judgment motions, the Borough failed to name indispensable parties in the verified complaint, and the trial court erred in denying plaintiffs additional time to occupy the property. In a written opinion that accompanied the April 4, 2006 order, Judge Ross denied the motion, finding that relief from judgment was not warranted and the Borough was entitled to possession of the properties. Further, Judge Ross concluded that because the motion to vacate addressed whether "vacation of [his August 23, 2005] Order is necessary," he declined to "discuss the merits of [plaintiffs'] appeal of their Prerogative Writs Action as it [was] essentially a tangential issue." Plaintiffs filed their Notice of Appeal of the April 6, 2006 order on April 12, 2006.

I.

In their appeal of the summary judgment orders, plaintiffs contend the court (1) erred in finding that the inclusion of their properties in the IDRA was lawful; (2) reached its decision affirming the action of the defendants based upon an incomplete record, without any evidence that their properties were in need of redevelopment; (3) disregarded the requirement that the redevelopment designations be based upon substantial evidence and that the Joint Board's decision was not entitled to a "presumption of infallibility," but only a "presumption of validity"; and (4) erred in ruling that the validity of the IDRA, as applied to their properties, was barred by the statute of limitations.

We have considered these contentions in light of the record and applicable principles of law, and we reject them. We affirm substantially for the reasons set forth in Judge Kumpf's thorough and well-reasoned written statement of reasons issued December 2, 2005. We add the following comments.

"Redevelopment designations, like all municipal actions, are vested with a presumption of validity." Downtown Residents for Sane Dev. v. City of Hoboken, 242 N.J. Super. 329, 332 (App. Div. 1990). Moreover, it is presumed that redevelopment determinations are accompanied by adequate factual support. Hutton Park Gardens v. Town Council of W. Orange, 68 N.J. 543, 564-65 (1975). "[A]bsent a sufficient showing to the contrary, it will be assumed that [municipalities make redevelopment decisions] upon some [presumed] rational basis within their knowledge and experience." Ibid.; see also Gallenthin Realty Dev., Inc. v. Borough of Paulsboro, 191 N.J. 344, 373 (2007). Additionally, any challenge to municipal redevelopment actions are typically commenced in the Superior Court, Law Division, Civil Part, as an action in lieu of prerogative writs within forty-five days after the accrual of the right to review the particular municipal action. R. 4:69-1 and R. 4:69-6. The underlying purpose of the forty-five-day rule is to "give an essential measure of repose to actions taken against public bodies[;] [i]t is aimed at those who slumber on their rights." Tri-State Ship Repair & Dry Dock Co. v. City of Perth Amboy, 349 N.J. Super. 418, 423 (App. Div.), certif. denied, 174 N.J. 458 (2002).

The role of the trial court in reviewing municipal actions is limited to determining whether such actions are supported by substantial credible evidence. See Levin v. Twp. Comm. of Twp. of Bridgewater, 57 N.J. 506, 537-39 (1971). It is not the province of the trial court to "second guess" municipal action, "which bears with it a presumption of regularity." Forbes v. Bd. of Trs. of South Orange Village, 312 N.J. Super. 519, 532 (App. Div.), certif. denied, 156 N.J. 411 (1998). Instead, the burden is on the party challenging the municipal action to demonstrate that the action was "not supported by substantial evidence, but rather is the result of arbitrary or capricious conduct on the part of the municipal authorities. Absent such a demonstration [by] the objector, sufficient to raise a material factual dispute, summary judgment must be granted in favor of [the municipal authority]." Concerned Citizens of Princeton, Inc. v. Mayor and Council of Borough of Princeton, 370 N.J. Super. 429, 453 (App. Div.), certif. denied, 182 N.J. 139 (2004) (citations omitted). Likewise, when reviewing the decision of a trial court that has reviewed municipal action, we are bound by the same standards as that of the trial court. Fred McDowell, Inc. v. Bd. of Adjustment of Township of Wall, 334 N.J. Super. 201, 212 (App. Div. 2000), certif. denied, 167 N.J. 88 (2001).

With these standards in mind, we initially note that plaintiffs' claim that summary judgment was granted without Judge Kumpf having the benefit of a complete record is unavailing. As defendants point out, the July 28, 2005 Case Management Order required plaintiffs to provide the record to the court:

TRANSCRIPTS: The attorney for Plaintiff certifies that all necessary transcripts will be requested by July 22, 2005 and that deposits therefore will have been paid. If the transcripts have not been provided as of today's date, the attorney for Plaintiff shall undertake to ensure completion of the transcripts as soon as possible. In the event a transcript is not provided to opposing counsel at least 14 days prior to the date Plaintiff's Initial Trial Brief is due, the Plaintiff's pleadings may be stricken.

In our view, the language of the order makes clear that plaintiffs were directed to provide the "necessary transcripts." To now argue that a dismissal of plaintiffs' pleading was unwarranted because the record was incomplete is disingenuous.

Nonetheless, even in the absence of a complete record, we are satisfied that there was substantial evidence in the record before Judge Kumpf to support his conclusion that the municipal action was not arbitrary, capricious, or unreasonable. The court specifically found that defendants engaged in seven years of meetings concerning the plan and concluded that "[t]here is no basis on which to set aside the Borough's Plan." Judge Kumpf also noted that plaintiffs' challenge to the redevelopment plan "provide[d] other avenues that the Borough could have followed in its Redevelopment Area." He then correctly concluded that as a reviewing court, however, the court "may not evaluate other possibilities; it may only evaluate the decision made to determine if it was reasonable and in good faith." Vineland Constr. Co., Inc. v. Township of Pennsauken, 395 N.J. Super. 230 (App. Div. 2007) (holding the judicial prerogative does not allow for second guessing the decisions of legislative bodies). Hence, Judge Kumpf properly concluded that plaintiffs failed to raise a material factual dispute sufficient to defeat summary judgment. Concerned Citizens of Princeton, Inc., supra, 370 N.J. Super. at 453.

Plaintiffs' additional claim that the forty-five-day time constraints set forth under Rule 4:69-6 do not apply because their complaint and/or appeal is not an "offensive challenge" to the redevelopment designation and plan but a defense to the condemnation proceedings is equally unavailing. There is no dispute that the first action was filed nearly three months before the Borough commenced condemnation proceedings. Further, the first action directly challenges "The Redevelopment Plan." The relief sought was a judgment "[e]njoining the Defendants from implementing the Redevelopment Plan for the 'The Triangle' to include Plaintiffs' property." Additionally, plaintiffs lodged no objection to that portion of the Case Management Order entered by Judge Kumpf that characterized the first action as a challenge to "the redevelopment plan of certain properties by Plaintiffs within a duly designated redevelopment area."

Thus, there is no question that through the first action, plaintiffs launched a direct challenge to the redevelopment plan's inclusion of their properties in the IDRA. The redevelopment plan was adopted in 1998 and, although it initially did not call for acquisition of plaintiffs' properties, plaintiffs were well aware that the properties were designated as part of the IDRA and therefore subject to acquisition at some point in the future. Their opportunity to challenge the inclusion of their properties in the IDRA through a prerogative writs action accrued in 1998 when the designation was made with the passage of Ordinance 8-98. To permit an action in lieu of prerogative writs after the municipality adopted the ordinance is contrary to the principle that there must be repose in challenges to municipal action. Tri-State, supra, 349 N.J. Super. at 423. Moreover, plaintiffs' approach encourages piecemeal challenges to redevelopment designations, an approach that unquestionably has the potential to undermine municipal redevelopment objectives. See Berman v. Parker, 348 U.S. 26, 35, 75 S. Ct. 98, 104, 99 L. Ed. 27, 39 (1954) (stating "community redevelopment programs need not, by force of the Constitution, be on a piecemeal basis -- lot by lot, building by building."). Finally, summary judgment was granted not based upon the forty-five-day procedural constraints of Rule 4:69-6, but on the substantive basis that plaintiffs failed to raise a material factual dispute to support their claim that the IDRA designation was unsupported by substantial credible evidence. Levin, supra, 57 N.J. at 537-39.

II.

Plaintiffs, in appealing the denial of their motion to vacate the August 23, 2005 order appointing condemnation commissioners, urge that the court erred in denying relief pursuant to Rule 4:50-1(e) and (f). Plaintiffs contend that relief was appropriate on equitable grounds and because of the overriding public interest in safeguarding the rights of property owners whose properties are subject to a governmental taking. Further, they contend that relief should have been granted because they were entitled to an evidentiary hearing on the necessity of taking their properties for a redevelopment project since the actions of the municipal governing body in designating the properties as part of the redevelopment project were arbitrary, unreasonable, and capricious.

Rule 4:50-1 permits the court to relieve a party from a judgment or order where "(e) it is no longer equitable that the judgment or order should have prospective application; or (f) any other reason justifying relief from the operation of the judgment or order." Whether a court should grant a motion to vacate a judgment is committed to the court's sound discretion, and the decision to grant or deny relief under Rule 4:50-1 is guided by equitable principles. Hous. Auth. of Morristown v. Little, 135 N.J. 274, 283 (1994); Hodgson v. Applegate, 31 N.J. 29, 37 (1959); Shammas v. Shammas, 9 N.J. 321, 328 (1952). The court's decision will be left undisturbed unless it represents a clear abuse of discretion. Mancini v. EDS, 132 N.J. 330, 334 (1993); Court Inv. Co. v. Perillo, 48 N.J. 334, 341 (1966); Hodgson, supra, 31 N.J. at 37; Pressler, Current N.J. Court Rules, comment 1 on R. 4:50-1 (1993). Bank v. Kim, 361 N.J. Super. 331, 336 (App. Div. 2003) (citing In re Guardianship of J.N.H., 172 N.J. 440, 473 (2002)).

Changed circumstances sufficient to justify relief for a judgment or order under subparagraph (e) have included cases where the "underlying basis for the judgment has been satisfied and it was no longer equitable that it have prospective application." Jersey City Mgmt. v. Garcia, 321 N.J. Super. 543, 546 (App. Div. 1999). See id. (denying immediate removal of tenant where there was a bona fide dispute and tenant had a legal right to contest the reasonableness of a lease term); Ross v. Rupert, 384 N.J. Super. 1, 8 (App. Div. 2006) (finding plaintiff was not entitled to relief from a final judgment under a more lenient verbal threshold requirement that was adopted after the time for plaintiff's appeal had expired). Relief under subparagraph (e) is rarely granted and requires evidence of changed circumstances. Morristown, supra, 135 N.J. at 285; United States v. Swift & Co., 286 U.S. 106, 114-15, 52 S. Ct. 460, 462, 76 L. Ed. 999, 1005-06 (1932). The party seeking relief under subparagraph (e) bears the burden of proving that events have occurred subsequent to the entry of a judgment that, absent the relief requested, will result in "extreme" and "unexpected" hardship. Morristown, supra, 135 N.J. at 285-86 (citing Swift, supra, 286 U.S. at 119, 52 S. Ct. at 464, 76 L. Ed. at 1008). This burden is imposed in order to overcome the courts' interests in orderly procedures and the finality of judgments. Ibid.

As to subparagraph (f), the Court in Court Inv. Co., supra, 48 N.J. 334, noted that "[n]o categorization can be made of the situations which would warrant redress under subsection (f). . . . [T]he very essence of (f) is its capacity for relief in exceptional situations. And in such exceptional cases its boundaries are as expansive as the need to achieve equity and justice." Id. at 341. Thus, the requisite exceptional circumstances standards are contemplated whether relief is sought under subparagraph (e) or (f) of Rule 4:50-1.

Exceptional circumstances warranting relief from a judgment or order have been interpreted to mean circumstances where enforcement of the judgment or order would be unjust, oppressive, or inequitable. Quagliato v. Bodner, 115 N.J. Super. 133, 138 (App. Div. 1971). See also Manning Eng'g, Inc. v. Hudson County Park Comm'n, 74 N.J. 113, 123-25 (1977) (finding reopening of judgment under Rule 4:50-1(f) warranted because of public policy to prevent recovery of damages for breach of illegal public contract); Court Inv. Co., supra, 48 N.J. at 344-47 (granting relief under Rule 4:50-1(f) where defendant's attorney in mortgage-foreclosure suit was subject to disciplinary proceedings that led to disbarment at time he falsely assured defendants that suit had been taken care of but default judgment was entered against them). Each case is analyzed and resolved based upon its own particular facts, with the court mindful of the well-settled principle that finality should attach to judgments. Morristown, supra, 135 N.J. at 292.

Here, the essence of the plaintiffs' argument for relief from judgment is that given the existence of the prerogative writs action, which plaintiffs claim is an affirmative defense to the condemnation action, there is the potential of inconsistent results. They urge further, relying upon City of East Orange v. Kynor, 383 N.J. Super. 639 (App. Div. 2006), that the Borough seeks to deprive them of their property without due process, that is, without demonstrating that their property is actually necessary for the redevelopment project, a condition precedent to acquisition of property pursuant to the LRHL. They also claim that relief is appropriate because they face displacement by virtue of the court's December 20, 2005 order granting the Borough possession of the properties and that the Borough also failed to provide notice to an indispensable party. Finally, they urge that the court's April 4, 2006 order denying their motion to vacate the August 23, 2005 order appointing commissioners is "contrary to the broad public interest in having genuine issues of material fact . . . resolved by way of a plenary hearing."

We find none of plaintiffs' contentions, nor the cases upon which they rely as support for their arguments, persuasive. If plaintiffs had prevailed in their appeal of the grant of the summary judgment orders, the prerogative writs action would have been returned to the trial calendar for trial on all issues. Further, contrary to plaintiffs' interpretation of N.J.S.A. 40A:12A-8(c) as requiring the Borough to present affirmative proofs that the property being acquired by eminent domain is not more than necessary to effectuate the municipal action, plaintiffs, as challengers to the municipal action, bear the burden of demonstrating that the redevelopment plan or designation was "not supported by substantial evidence, and instead is the result of arbitrary or capricious conduct on the part of the municipal authorities[.]" Concerned Citizens of Princeton, supra, 370 N.J. Super. at 453. Likewise, the fact that plaintiffs face displacement is neither changed nor exceptional circumstances. They have faced displacement from the time the properties were designated as part of the IDRA in Ordinance 8-98. Moreover, just compensation through condemnation proceedings is the remedy contemplated for plaintiffs' displacement. Finally, plaintiffs do not allege or present any proof that the Borough engaged in illegal activity. Manning, supra, 74 N.J. at 142 (plaintiff's judgment against defendants vacated on grounds that plaintiff had been awarded contract in return for its role as a conduit for illegal kickbacks). In the absence of an affirmative showing of "fraud, bad faith or manifest abuse," courts will not disturb municipal condemnation actions. See City of Trenton V. Lenzner, 16 N.J. 465, 473 (1954).

To the extent we have not specifically discussed the remaining arguments advanced by plaintiffs in support of their appeal of the December 2, 2005 orders entered by Judge Kumpf granting summary judgment, and the September 28, 2005 order entered by Judge Ross denying reconsideration of the June 18 and August 19, 2005 orders, we conclude they are without merit to warrant discussion in the opinion. R. 2:11-3(e)(1)(E).

Affirmed.

Although plaintiffs are properly designated as plaintiffs in the prerogative writs action, they are the defendants in the condemnation action. However, to avoid confusion, they are referenced throughout this opinion as "plaintiffs."

The Master Plan is not part of the record on appeal.

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A-2429-05T5

November 14, 2007