State public advocate weighs in on the side of MTOTSA
REGIONAL INTEREST
BY CHRISTINE VARNO
Staff Writer

Ronald K. Chen

The state public advocate has asked the Appellate Court to allow a group of Long Branch residents to have their day in court to challenge the city's use of eminent domain to condemn their oceanfront homes.

Public Advocate Ronald K. Chen filed an amicus curiae brief as a "friend of the court" in the state Appellate Division of the Superior Court on Jan. 11.

The brief supports an appeal by residents in the Beachfront North phase II redevelopment zone challenging a state Superior Court decision that upheld the city of Long Branch's right to condemn their neighborhood for a private redevelopment project.

In asking the court to reverse the lower court ruling, Chen said further discovery is needed to resolve facts that remain in dispute in three areas: conflicts of interest during the redevelopment process; the blight designation of the properties; and proper notification of the condemnation of their properties to the affected residents.

"We want to know, is the use of eminent domain in this case appropriate?" said Chen in an interview Friday. "We cannot come to that conclusion based on what the trial judged allowed.

"We did not come to any conclusions in the brief," Chen said, adding, "What we did say is the limited records that this trial court allowed did not permit for the development of a full record."

In the brief, Chen urges the Appellate Divi-sion to reverse the June 22 decision by Judge Lawrence M. Lawson that permits the city to use eminent domain to acquire the properties of some 38 residents in the Marine and Ocean terraces and Seaview Avenue neighborhood known as MTOTSA.

Chen also urges the Appellate Court to grant the homeowners their request for full discovery and a hearing, both of which were denied by Lawson.

"These condemnation cases against the owners of small seaside houses in Long Branch raise serious issues about the fairness, thoroughness and legality of the process by which longtime residents may lose their homes to private redevelopment," Chen said in a press release last Thursday.

City Attorney James Aaron said Monday that he does not feel that Chen's brief will play any bigger role in the case than amicus briefs filed in favor of the city.

"Right now we are working with the League of Municipalities on an [amicus] brief and several others," Aaron said, adding that no briefs have been filed on behalf of the city at this time.

Aaron said the city's brief in the MTOTSA case is due in April, at which time the city will address all the arguments raised by the property owners in MTOTSA.

"The city believes firmly that Lawson covered all the issues in his opinion and Judge Lawson's opinion must be affirmed according to the law," Aaron said.

Chen explained that by filing the amicus brief, his office is able to weigh in on an issue that could potentially affect the public at large.

"We are not a party to the action," he said in an interview. "We have no personal stake, nor are we representing any client in the matter.

"When a court is about to decide on an issue of public importance, this is our way to chime in and express our views," he said.

Within days of Chen's appointment to the Department of the Public Advocate last January by Gov. Jon Corzine, he pledged to take on the issue of eminent domain through an extensive study of its uses throughout the state.

In May, after a thorough investigation, Chen issued a report calling for changes that would narrow the definition of blight and protect the rights of property owners and tenants.

Chen recommended several reforms in the report, including narrowing the statuary criteria for designating an area as blighted and to make the entire redevelopment process transparent by instituting reforms to notify tenants and property owners in proposed redevelopment zones of public hearing.

The report cites research gained in several towns, including the redevelopment project in Long Branch. The MTOTSA area is one of six redevelopment zones designated in the city.

Attorneys Peter H. Wegener, of Bathgate Wegener and Wolf, Lakewood, and William J. Ward, of Carlin & Ward, Florham Park, are representing the homeowners in the appeal. The public interest law firm Institute For Justice (IJ), Arlington, Va., has joined the legal battle to act as co-counsel with Wegener.

Plans for the three-street MTOTSA neighborhood call for developer MM Beachfront North II - consisting of co-developers Matzel & Mumford, a division of K. Hovnanian, and the Applied Cos., Hoboken - to raze the modest neighborhood and construct a luxury condominium project in its place.

Chen said MTOTSA residents were denied their fair day in court when Lawson ruled in favor of the city after hearing a motion by Ward and Wegener to dismiss the condemnation complaints served upon their residents.

"The homeowners contesting the condemnation are asking for full discovery and a hearing, and we are urging the court to grant their request," he said.

"The appellants submitted evidence of potential conflicts of interest that, if ultimately proven, would call into question the impartiality of the blight designation. Yet, the trial court dismissed the evidence as somehow unrelated to 'the rights of the condemnees,' " Chen said in the brief.

Ward and Wegener plan to argue in the appeal that conflicts of interest existed between City Attorney James Aaron's law firm, Ansell, Zaro, Grimm and Aaron, Ocean Township; the Greenbaum Rowe Smith and Davis law firm; City Council members; developer K. Hovnanian and the Monmouth Community Bank.

On the issue of conflicts of interest, Chen's brief states that the bank provided a line of credit to the developer and employed Councilmen Anthony Giordano and David Brown, both of whom are shareholders in the bank. Councilman Michael DeStefano is also a shareholder in the bank.

Additionally, senior attorney Arthur Greenbaum's firm represented the city in condemnation proceedings while he was a director and shareholder of developer K. Hovnanian, according to the brief. Also, while Aaron was representing the city, his firm represented developer K. Hovnanian.

"A conflict of interest, if established, would invalidate the proceedings that led to the condemnation," Chen said in the brief.

"There are also some things we know with the posed conflicts," Chen said in an interview. "We also don't know some things. We don't know the chronology of what they knew and when they knew it."

In the brief, Chen states, "Appellants should have been allowed to explore through discovery the scope and timing of these overlapping relationships."

He continued, "Only such investigations would permit a full and fair record to be developed on whether these relationships would, in the perception of a reasonable citizen, create a substantial risk of impairing the city's independence of judgment in crafting and implementing the redevelopment."

Chen also argues in the brief that the record contains no evidence that the homeowners were given meaningful notice that their homes might be subject to condemnation.

"If you take a home for redevelopment, there has to be a complete and transparent process, and the record reflects something far from that," he said in an interview.

In the brief, he states, "For their part, the appellants maintain that they received no express notice that the redevelopment process could result in the condemnation of their homes but were instead led to believe their homes would survive in tact.

"If in fact they did receive such notice, then they had no real opportunity to contest the condemnation in the municipal hearings."

Chen said this is a "fairly common sense" procedure.

"Before you take someone's home, you have to give them notice," he said in an interview. "There is some question as to whether this happened and as to what [the city] did tell [MTOTSA] and when.

"The actual notice is not in the record," he said.

Lastly, Chen said that after an exhaustive review of the records in the case, there is still question as to whether the homes are actually blighted.

"A blight designation has to be a thought-out and comprehensive process and not just making notes on peeling paint outside of houses," Chen said in an interview.

Chen argues in the brief that the blight designation was based on a "cursory and superficial review" of the area.

"The initial determination of blight is a question of historical fact regarding the condition of properties in question," according to the brief.

It continues, "The city did not provide evidence under any legally established criteria that appellants' homes are either blighted or a detriment to the community."

In the brief, Chen states, "The exercise of eminent domain in this case raises a number of procedural and substantive questions that are of critical interest to the people of New Jersey."

Chen said his hope is that the court reads the amicus brief and that it has some impact.

"An amicus brief at best is purely measured by how persuasive it is," he said in an interview. "I imagine that this will be well received.

"There is great public interest in this case," he said, adding, "A fair process is absolutely vital in this case."

Long Branch Mayor Adam Schneider said Tuesday the amicus brief will have "very little impact in the case."

"I think Mr. Chen has remained curiously and deliberately uninformed of what we are doing here in Long Branch," Schneider said.

"He decided to go into the case without meeting with any officials in Long Branch," Schneider continued, adding, "Two of his attorneys met with us after I made an issue out of it.

"Mr. Chen has never accurately reviewed the redevelopment process in Long Branch," he said.

Schneider said he asked Chen if he read Lawson's opinion at the League of Municipalities conference in November and Chen replied that he could not remember.

"I did not believe that for a second," Schneider said. "He knows he did not read it. Mr. Chen has a serious credibility problem.

"[Eminent domain] is a critical issue. If it is so important to [Chen], why didn't he meet with [city officials] and ask us what we are doing here and why didn't he read the opinion?" Schneider said.

But Chen said he first took interest in MTOTSA after reading Lawson's opinion in the spring.

"I read it," Chen said in an interview. "I read it the day it came out."

In the brief, Chen said the amicus brief is the result of an exhaustive review of the records in the case.

"Any person's modest home in theory could be replaced with a more expensive house that would yield greater tax revenue; however, our state Constitution does not allow the use of eminent domain merely to replace middle-income homeowners with richer ones," Chen states in the report.

Attorneys for MTOTSA are expected to file its opening brief for the appeal next month, and the oral arguments before the Appellate Division have not yet been scheduled.