Appellate Division Underscores Need for Findings, and Potentially More Testimony, to Approve Reduction of Variance

It’s a common scenario: after a series of public hearings, the scope of variance relief sought is reduced by the applicant or at the direction of the board, and the board then approves the application. A recent unreported opinion from New Jersey’s Appellate Division underscores that the resolution of approval must explain how and why the reduced scope of relief satisfies the variance criteria when the original proposal did not. This may require presentation of additional testimony by the applicant in support of the modifications.

In 440 Company-Carriage House, LP v. Zoning Bd. of Adjustment for the Borough of Palisades Park, the Zoning Board of Adjustment for the Borough of Palisades Park (“Board”) granted three use variances (along with final site plan approval and certain bulk variance relief) to enable the construction of a 14-story, 121-unit, residential building. The relief granted by the Board represented a substantial reduction from what the applicant-developer had actually sought and presented testimony in support of over the course of a public hearing which extended for nine meetings. The developer had originally applied for use variances to permit a 17-story building, with 154 units. Rather than approving the project as presented, or denying it, the Board, acting on its own, voted to grant the variances with a reduction from 17 stories to 14 stories, and from 154 units to 121 units. The trial court overturned the Board’s approval, and the Appellate Division subsequently affirmed the trial court’s determination.

Both the trial court and the Appellate Division determined that the decision to grant the relief in reduced form, the basis for which was apparently not explained or justified in the resolution of approval, was arbitrary and capricious. More particularly, the Appellate Division noted that the Board’s decision effectively denied the relief requested in the applicant’s plan (without explanation or justification by the Board) but then granted relief based on a “substantially modified plan of [the Board’s] own devise,” without any explanation as to either decision.

This case – while unpublished – offers something of a “precautionary tale” for applicants and practitioners, as the practice of land use boards imposing (or perhaps more often, requesting consent for) modifications to plans following the close of testimony is certainly not unusual. In summarizing the trial court’s decision, the Appellate Division noted that “because the Board relied upon testimony presented in support of the application to both deny and grant the application as modified, without any explanation,” the trial court was unable to analyze what the Board’s resolution actually permitted or whether the applicable criteria were actually satisfied. Clearly, more detailed findings were required in order to explain why the grant of lesser relief satisfied the variance criteria, when the application as submitted did not. In order to make such findings, evidence in the record is required to support them. Therefore, applicants and their attorneys should exercise caution in such situations, particularly where changes requested (or imposed) by a board are substantial or come immediately prior to a vote. In such cases, a firm request from counsel to provide limited additional testimony may be warranted to ensure that the record contains adequate support for the changes and the manner in which they satisfy the variance criteria. As a practical matter, however, additional testimony may not be well received given that modifications which come about during discussions leading up to the vote typically occur at a time when the Board wants to decide the application and move on to other business. Often, it will be late in the evening, and there may have been multiple hearings over an extended period of time, causing the Board to view additional testimony as unnecessary. Ultimately, however, the risk is on the applicant should there be an appeal challenging the findings in the resolution of approval.

Perhaps the more straightforward and practical lesson to be taken from the court’s decision in 440 Company Carriage House is a reminder of just how important it is to have a well-written, and well-reasoned, resolution of approval that adequately outlines the basis for a land use board’s decision. More than a lack of new testimony at the hearing, the court’s opinion emphasizes that the Board’s decision and resolution lacked meaningful explanation or analysis of how the relief, in reduced form, would satisfy the relevant criteria while the relief applied for and testified to would not. Applicants’ attorneys must be vigilant and proactive in requesting to review draft resolutions before adoption and, where necessary, advocating for appropriate additions and justifications on behalf of their client. Experienced land use attorneys, like the members of the Gibbons Real Property Department, are well-versed in this practice.