Society Hill at Piscataway Condominium Ass'n v. Township of Piscataway

138 A.3d 596, 445 N.J. Super. 435, 2016 N.J. Super. LEXIS 73
CourtNew Jersey Superior Court Appellate Division
DecidedFebruary 8, 2016
StatusPublished
Cited by1 cases

This text of 138 A.3d 596 (Society Hill at Piscataway Condominium Ass'n v. Township of Piscataway) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Society Hill at Piscataway Condominium Ass'n v. Township of Piscataway, 138 A.3d 596, 445 N.J. Super. 435, 2016 N.J. Super. LEXIS 73 (N.J. Ct. App. 2016).

Opinion

WOLFSON, J.S.C.

1. Statement of the Case

In this action, plaintiffs Society Hill at Piscataway Condominium Association, Inc. (“Society Hill”) and five individual owners of real property at Society Hill (collectively, “plaintiffs”) filed this motion for summary judgment against defendant Township of Piscataway (“Piscataway”), claiming that its unilateral extension of existing thirty-year deed restrictions, which sought to regulate the resale and rental prices of low and moderate income units identified in and governed by a consent order in the Urban League litigation1 was unlawful. These restrictions and covenants were, by their express terms, contained in Piscataway’s affordable housing plan (the “Affordable Housing Plan” or “Plan”), the Master Deed and Declaration of Restrictive and Protective Covenants of Society Hill at Piscataway Condominium (the “Master Deed”) as well in each of the individual unit deeds. For the reasons set forth below, these deed restrictions, by their express terms, have expired, and as such, plaintiffs’ motions for summary judgment to nullify Piscataway’s unilateral attempt to extend them for an additional thirty years, is granted.

2. Background Information

Society Hill is an inclusionary development that was constructed more than thirty years ago pursuant to Piscataway’s partial [439]*439settlement of the Urban League litigation. The development includes 109 low and moderate income units. With the exception of the Patels, the individual plaintiffs were deeded their respective units (each of which contained a thirty-year deed restriction limiting the resale or rental price of those units to affordable low and moderate income persons) in either 1985 or 1986.2 In order to fully assess the various rights and obligations applicable to the owners of these units, I must first examine the procedural and legal processes that resulted in their construction.

Following the Supreme Court’s remand in the Urban League case, various properties were rezoned throughout Middlesex County. In particular, one of these sites, in Piscataway, was acquired by K. Hovnanian, which sought site plan approval to build an inclusionary development. As a condition of site plan approval, an Affordable Housing Plan was adopted which, in pertinent part, stated:

Covenants Running With Land. The provisions of this Affordable Housing Plan shall constitute covenants running with the land with respect to each Affordable Condominium affected hereby, and shall bind all purchasers of each such Unit, their heirs, assigns and all persons claiming by, through or under their heirs, executors, administrators and assigns. The terms, restrictions and covenants of this Plan shall, however, automatically expire and terminate at the earliest of the following: (1) thirty (30) years from the date hereof; and (2) the date upon which the event set forth in paragraph 13 hereinafter shall occur; and (3) the date upon which the association dissolves or ceases to exist for any period of time for any reason, in which ease, an instrument executed by the Association evidencing same must be duly recorded with the Office of the Clerk of Middlesex County.

That Affordable Housing Plan required that the Master Deed, and each of the individual deeds transferring ownership rights to any of the 109 affordable housing units, incorporate that same covenant, and required further that every prospective buyer be given a disclosure statement informing them of the specific terms, restrictions, provisions, and covenants referenced in the Plan and in the Master Deed.

[440]*440After the Affordable Housing Plan was fully implemented, Judge Serpentelli (one of the three trial judges specifically appointed by the Chief Justice to handle all Mt. Laurel litigation), memorialized Piscataway’s settlement with the Urban League in an order dated July 17, 1985. As a consequence, Piscataway received, and has continued to receive, credit for each of the 109 affordable housing units against its then extant fair share: “The Township of Piscataway shall receive full credit towards its fair share obligation for the fifty-five moderate income homes and the fifty-four low income homes which are to be built as part of the development known as Society Hill.”

Thereafter, the builder executed and recorded a Master Deed, which expressly incorporated by reference the thirty-year deed restriction and covenant limiting the resale and rental prices on those units so as to maintain their continued occupancy by low and moderate income persons:

The terms, restrictions, provisions and covenants of the Affordable Housing Plan, and the provisions of the Master Deed referring to and incorporating the Affordable Housing Plan, shall automatically expire and terminate at the earliest of the following: (1) — thirty (30) years from the date of the Affordable Housing Plan; and (2) the date upon which the right of redemption expires with respect to the foreclosure of the first mortgage lien upon an Affordable Condominium by the first mortgagee of the Affordable Condominium as the Plan applies to the specific unit which is subjected to a foreclosure pursuant to this provision; and (3) the date upon which the Society Hill at Piscataway Condominium Association, Inc. creases [sic] to exist or dissolve for any reason and for any period of time. Neither the Developer, the Owner, the Association nor the Agency shall amend or alter the provisions of this paragraph without first obtaining the approval of both the Agency and the Planning Board of the Township of Piscataway. Any such approved amendments or modifications of this plan shall be in writing and shall contain proof of Planning Board approval and shall not be effective unless and until recorded with the Middlesex County Clerk.

Consistent with these restrictions, each deed of conveyance, likewise referred to, incorporated by reference, and included that thirty-year deed restriction:

WHEREAS, certain specified condominium (hereinafter ‘Affordable Condominiums’) within Society Hill at Piscataway Condominiums are subject to the terms, provisions and restrictions contained in both the Master Deed and Declaration of Restrictive and Protective Covenants of Society Hill at Piscataway Condominiums, recorded on October 15,1985, in the Middlesex County Clerk’s Office in Deed Book [441]*4413468, Page 774 et seq. and the terms, provisions and restrictions contained in the Affordable Housing Plan for Society Hill at Piscataway (hereinafter ‘Plan’) recorded on Oct. 15, 1985, in the Middlesex County Clerk’s Office in Deed Book 3468, Page 891 et seq.

On July 17, 1989, the Council on Affordable Housing (COAH) adopted its first recapture regulation (the “95/5 Rule”) preventing the purchaser of an affordable housing unit from reaping a windfall after the expiration of their respective controls, and that recapture mechanism has remained in place through COAH’s adoption of the 2001 Uniform Housing Affordability Controls (UHAC) regulations and its 2004 amendments.3 See 21 N.J.R. 2021 (July 17, 1989) (“In reviewing the rules as proposed, the Council has determined a need for clarification of proposed N.J.A.C. 5:92-12.1. As the section heading indicates, this rule applies to newly constructed sales units.

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138 A.3d 596, 445 N.J. Super. 435, 2016 N.J. Super. LEXIS 73, Counsel Stack Legal Research, https://law.counselstack.com/opinion/society-hill-at-piscataway-condominium-assn-v-township-of-piscataway-njsuperctappdiv-2016.