Monarch Towers sparks legal arguments over automatic approvals, changed circumstances, etc.

By Ron Hine | FBW | March 1, 2017

On February 28, 2017, a three-judge Appellate Court panel in New Brunswick heard oral arguments in the six-year old legal battle over the Monarch Towers development proposed by the Shipyard Associates for a Hoboken pier. In 1997, the Hoboken Planning Board approved the 1160-unit Shipyard Planned Unit Development (PUD) on nine acres of prime real estate at Hoboken’s northeast waterfront. This project consisted of seven development blocks. The final parcel, nearly two acres, known as Block G, was designated as open space including tennis courts and the state-mandated Hudson River Waterfront Walkway.

But after completing the final residential units in 2011, the Shipyard Associates reneged on its agreement with the City to provide the open space on Block G and instead sought Planning Board approval to build two eleven-story towers. Five separate cases are now before the state courts, three of which were the subject of the February 28th oral arguments. The Fund for a Better Waterfront (FBW) has opposed this project from the start since it would privatize a portion of Hoboken’s waterfront that FBW has sought to keep public for its entire mile and a half length.

The judges spent an hour and a half listening to the arguments put forth by the attorneys and occasionally interjected with questions. Defending the Shipyard Associates were attorneys Kevin Coakley and Nicole Dory of Connell Foley. The City of Hoboken, represented by Joseph Maraziti of Maraziti & Falcon, the Hoboken Planning Board represented by Dennis Galvin of the Galvin Law Firm, the Hudson Tea Building Condo Association represented by Craig Hilliard and Eric Goldberg of Stark & Stark, and FBW represented by Renee Steinhagen of New Jersey Appleseed Public Interest Law Center made arguments in opposition to the Monarch project.

At one point, Judge Susan Reisner commented on the fierce opposition to this project. The City attorney argued to enforce the developer’s agreement but the judges did not appear receptive to that argument. FBW attorney Renee Steinhagen made the case for remanding to the Hoboken Planning Board for a hearing on “changed circumstances,” a decision that would appear to be a logical one. Yet, it was difficult to predict how the judges might decide these cases. Here are several of key issues that the Appellate Court must resolve:

Why no hearing on Shipyard’s application? This was the first question from Judge Rothstadt to the Planning Board attorney. Dennis Galvin’s response was that the Board did not have jurisdiction since the City of Hoboken had filed a suit to enforce the developer’s agreement thus putting the matter before the Court, not the Planning Board. FBW attorney Renee Steinhagen also argued that the Planning Board planner, Eileen Banyra, and the Board’s engineer sent memos to the Board stating that Shipyard had failed to apply for several required variances and thus, the application was incomplete. Shipyard was entitled to a decision but not necessarily a full hearing. The Hoboken Planning Board provided that decision when it denied the application in July 2012.

Automatic Approvals The Shipyard Associates successfully argued in lower court that the County and Hoboken Planning Boards failed to act within the statutory deadlines and thus the project was subject to automatic approval, also known as default approval. The New Jersey Supreme Court in the Amerada Hess Corp. v. Burlington County Planning Board 195 N.J. 616 (2008) decision determined that default approvals were required unless the government inaction is unintentional or inadvertent. But in this case, the Hoboken Planning Board did act, denying the application based on the rationale that it did not have jurisdiction and the Hudson County Planning Board rendered a decision on the merits.

Time of Decision In general, regulations that are in effect at the time of an application govern the review of that application. The exception is regulations pertaining to the public’s health and safety. In this case, the Hoboken Planning Board acted on this application in July 2012. Four months later, Superstorm Sandy hit the region, forcing all levels of government to take action to protect against future storm surges and flooding events. Hoboken was especially hard hit with 75% of the town under water for a number of days. A year later, the City of Hoboken amended its flood ordinance and corresponding zoning that included provisions for prohibiting residential development on piers over the Hudson River based on recommendations from its consultants, Princeton Hydro, and from state and federal authorities. Attorneys for the Planning Board and FBW argued that default approvals were unlawful because these new ordinances related to the public’s health and safety.

Renee Steinhagen, Executive Director of the NJ Appleseed Public Interest Law Center, is representing FBW in four of the court cases pertaining to the Monarch Towers.

Renee Steinhagen, Executive Director of the NJ Appleseed Public Interest Law Center, is representing FBW in four of the court cases pertaining to the Monarch Towers.

Changed Circumstances The New Jersey Supreme Court rendered its decision in Toll Brothers vs. Board of Chosen Freeholders of Burlington County 194 N.J. 223 in 2008. In his ruling of June 2013 dismissing the City’s lawsuit to enforce the Shipyard developers agreement, Judge Arre states: “Toll Brothers stands for the proposition that a developer may always as of right apply to the town and county planning boards for amendments to prior resolutions and site plan approvals based on changed circumstances. . . Pursuant to the Municipal Land Use Law and Toll Brothers, Shipyard has a right to move before the planning board seeking this amendment. . . The proper determination as to whether changed circumstances exist and to whether an amendment should be approved rests with the planning board, not the Superior Court.” Yet, Shipyard never requested a “changed circumstances” hearing before the Board. The facts relating to the Toll Brothers case were dramatically different from Shipyards. There were no significant changes to the Shipyard project since it was approved in 1997 and unlike the Toll Brothers case, no requirements for offsite improvements. Unless Shipyard Associates can prove that there were changed circumstances beyond its control, the 1997 Developers’ Agreement that it signed with the City of Hoboken, should be a legally enforceable obligation. Shipyard would also need permission from the City to amend its 1997 developer agreement which it failed to obtain.

Last month, another Appellate Court panel upheld the New Jersey Department of Environmental Protection’s waterfront permit granted Shipyard Associates for the Monarch Towers. The City of Hoboken has requested that the New Jersey Supreme Court accept an appeal of this decision.

Last month, Hudson County Assignment Judge Bariso held a case management conference in the Shipyard’s challenge to the Hoboken amended flood and zoning ordinances. A schedule for briefs will be determined shortly on the issue of whether the ordinances apply if the Appellate Court remands the Monarch project to the Hoboken Planning Board. This case was originally before federal court but Shipyard withdrew the case and refiled in state court after the federal magistrate ruled against them in several motions.

Renee Steinhagen is one of New Jersey’s leading public interest attorneys and her organization, New Jersey Appleseed concentrates its efforts on empowering citizen groups regarding government and corporate accountability, election process reform and health care reform. For over five years, working pro bono, she defended FBW against a SLAPP (strategic litigation against public participation) suit. When Hoboken voters were denied the right to initiative and referendum, repeatedly, Ms. Steinhagen appeared in court to defend this right. She also played an instrumental role in assisting Hoboken residents who successfully gained passage of local laws to ban pay-to-play.

Related links

Appellate Court will hear appeal of 3 Monarch Towers cases
City settlement would shower tens of millions in benefits on Shipyard developers
FBW letter to Mayor and Council 9-20-2016
Settlement proposed to end 5 year legal battle over Monarch Towers
Did NJDEP ignore its own coastal zone regs in granting permit? Appellate Court to decide
‘Rapacious’ developer must defend broken agreement in Appellate Court
Monarch towers case goes to Appellate Court
Monarch Towers litigation grinds on as public opposition persists
Federal judge grants FBW opportunity to help defend Hoboken’s flood ordinances
Developers challenge Hoboken flood ordinance in federal court
Judge grants automatic approval for controversial Monarch Towers
Monarch Towers described as classic case of bait and switch
Shipyard’s plan to privatize pier