A developer suing the township over his property in the Princeton Junction redevelopment area is calling for town officials to negotiate with him now that a state Superior Court judge has reaffirmed a ruling in his lawsuit that could overturn the redevelopment zoning.
Steven Goldin, the president and CEO of InterCap Holdings, which owns 25 acres on Washington Road in the redevelopment area, called for a “reasonable settlement.” This after Judge Linda Feinberg denied a motion by West Windsor to reconsider her recent ruling that allows InterCap to pursue a lawsuit against the township on the basis that the town used a faulty process to determine that a 350-acre area surrounding the Princeton Junction train station was in need of redevelopment.
The township had argued that InterCap missed the 45-day deadline to challenge the redevelopment area when it was designated by the planning board in 2005. It also argued that InterCap participated fully in the creation of the redevelopment plan — adopted in 2009 — and could not turn around now and challenge it.
However, Feinberg said the township did not bring anything new to the table in arguing for reconsideration. She explained in her decision, handed down on April 7, that reconsideration should only be used for cases in which the court made a decision based upon an incorrect or irrational basis or that the court failed to consider significant evidence.
“With respect to the motion for reconsideration, defendants failed to set forth new facts or allegations of error underlying the court’s order warranting the court to reverse itself,” Feinberg wrote. “Indeed, the motion largely recounts the same arguments set forth in the extensive briefing in support of the defendants’ motion for summary judgment and in opposition to plaintiff’s motion for summary judgment.”
In her original ruling in January, Feinberg allowed InterCap to challenge the designation and even acknowledged that allowing the argument “creates the possibility that the designation will be invalidated.” That would, in turn, nullify the redevelopment plan.
“The court’s initial reaction… is that the Redevelopment Study on which the in need designation was based is ripe with constitutional infirmities,” she said then.
She recalled this opinion further in her April 7 ruling. “The court also rejects the defendants’ argument that no novel constitutional issues are implicated in the present case,” she wrote. “As discussed at length in the opinion, the court found that such `constitutional issues did arise, warranting enlargement of the 45-day time limit for filing action.”
Those constitutional issues pointed out by Feinberg include that West Windsor may have violated the notice requirement because it did not describe the condemnation implications of a blight designation. In her January decision, Feinberg said that there were “significant issues regarding the propriety of the in-need designation” in that half of the redevelopment area that was deemed to fall under the “underutilization” category — one that has been challenged and struck down in other cases.
In her April 7 ruling, she said: “The hearing transcripts on their face raise questions regarding the sufficiency of the evidence presented to support an in need designation.”
And, “the conclusory language contained in the redevelopment study in the present case mirrors what the Gallenthin court struck down,” Feinberg wrote.
Feinberg also acknowledges that InterCap purchased all of its property after the in-need designation was adopted, and even that Goldin was attempting to garner public support for redevelopment while the township was trying to form its redevelopment plan. Still, “that the plaintiff may be a sophisticated party or one that originally supported the designation and early stages of the redevelopment plan also does not diminish the importance of the issues involved. Accordingly, the plaintiff may proceed with this late challenge to the in-need designation.”
Upon receiving the decision, Goldin said that “InterCap Holdings is pleased the court has re-affirmed its earlier decision that West Windsor violated the law in establishing an area in need of redevelopment at the Princeton Junction Train Station.”
“We continue to be open to a reasonable settlement with the township,” Goldin said. “In fact, we have recently proposed a significant solution to move this redevelopment designation forward, despite the fact that West Windsor has failed to respond to two prior settlement offers. But we are unwilling to conduct a one-sided settlement discussion. The resolution of this matter now lies in the hands of the mayor and council.”
In her ruling, Feinberg established a discovery schedule for both the township and InterCap and will allow both to supplement the record, including with expert reports. Future proceedings will be held before the Law Division, the opinion stated.
Township Attorney Michael Herbert said the ruling was not unexpected because it is rare that a judge will reconsider an earlier decision. “What we wanted to do was to frame it as best as we could to make it certain that the record reflects that Mr. Goldin is fully aware of the area designation, which was made in December, 2005, and that he bought the property because it was designated as a redevelopment area, and participated fully in the redevelopment plan process,” said Herbert. “Only when he didn’t get 1,400 units of housing in the plan did he turn around and sue the township.”
Herbert said the judge took note of the fact that he fully engaged in the process, which was “only to be undertaken with a proper designation” in the first place.
“We obviously disagree with her decision not to reconsider it,” Herbert added. “We have the highest regard for Judge Feinberg. We think the decision was made in error. We’ve been instructed to protect the rights of the township and planning board,” which will most likely come in an appeal to the Appellate Division, Herbert said.
Herbert said her decision is unprecedented and that the statutes and rules are in place to protect municipalities from claims like InterCap’s, “which are being used really to try to leverage a town to succumb to a developer. It shouldn’t be allowed.”
Herbert also reiterated that this was only the first round and only deals with the township’s argument that the designation cannot be challenged because it is untimely. He pointed to the three and a half years that lapsed before the lawsuit was filed and “over 100 meetings” that occurred since that. “We don’t think this kind of tactic should be allowed.”
In response to Goldin’s statement, Herbert said he was surprised Goldin would reference negotiations between the township and InterCap that “are under strict confidentiality.”
“All we know is he is well beyond any reasonable position and just wants to bludgeon the town by this lawsuit,” he said. “The township is always willing to discuss a reasonable settlement. Without getting into specifics, he’s not close to it being reasonable.”
Herbert said the appeal would be filed within the next month.
In its lawsuit, InterCap charges that prior to the Planning Board’s adoption of the redevelopment study in 2005, it failed notify property owners in the study area that they could be subject to condemnation. The lawsuit alleged that the state requires notification even if the township’s intention is not to do so.
The township argues that neither InterCap’s property nor any other property in the redevelopment area would be subject to condemnation, unless there is a need for road widening.
The notification requirement is the result of a 2008 court decision that was not in effect when the planning board was conducting its redevelopment hearings. Town officials believe it’s unfair to enforce the requirement on the township retroactively.
Feinberg ruled in January that the timeliness of InterCap’s challenge and the question about the township’s notification of property owners “are the only two issues that warrant extended discussion at present, as their disposition resolves or renders the other issues moot for the time being” because they could invalidate the redevelopment designation if she rules in Intercap’s favor.
On the challenge issue, Feinberg agreed that InterCap did not file an objection to the Planning Board’s redevelopment designation within 45 days, as required by state law. However, she found that “the court may enlarge the 45-day time period where the interest of justice manifestly requires such an extension.”
Feinberg also gave indications in her ruling that even if the township is upheld on the notification issue, there may be other problems with its redevelopment plan.
She wrote that there were “significant issues regarding the propriety of the in-need designation” in that half of the redevelopment area was deemed to fall under the “underutilization” category – one that has been challenged and struck down in other cases.
In the township’s own redevelopment study, some of the parcels were designated as “in need of redevelopment” by using just the word “underutilization” and nothing else, she pointed out.
InterCap claims that West Windsor’s findings that InterCap’s property and other properties in the redevelopment area “were in collective need of redevelopment were not supported by substantial credible evidence as required by redevelopment law.”
