Archive for the 'Real Estate' Category

Contract purchaser cannot file tax appeal

SteveK November 17th, 2012

Presiding Tax Court Judge DeAlmeida rendered a very interesting decision in Omega Storage v Lawrence Township. In this case of first impression, Judge DeAlmeida ruled that a contract purchaser did not have standing to file a tax appeal.
In other words, a party who is the purchaser under a contract of sale of a property which did not close before the filing of the complaint did not have standing to file the complaint and the case was dismissed. In Omega Storage, at the time the Complaint was filed on March 29, 2012, the Plaintiff did not yet own the property and was only a contract purchaser. The Court held that being the contract purchaser was not enough of an interest in the property to file a tax appeal.
This certainly will have an effect upon appeals going forward. I am sure some of you will recollect appeals over the years by contract purchasers who filed petitions or complaints before they owned the property, but, before the hearing or trial acquired at closing the property. Based upon our reading of this new case, these petitioners or plaintiffs cases should be dismissed for lack of standing.
The case can be reviewed in detail at the Tax Court’s web site as follows:

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum, PC (www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in real estate tax appeals. For additional information about the matters in this bulletin or in the firm’s real estate tax appeal group, please contact Martin Allen, Esq

The information contained in this blog is intended solely for informational purposes; it is a advertising publication of DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum P.C.This publication is intended to alert recipients of developments in the law and is not intended to provide legal counsel, advice or opinion on any specific facts or circumstances. The contents are intended as general information only. You are urged to consult a member of this firm or your own attorney concerning your particular situation and any specific legal questions you might have.

 

 

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Too Many Appraisals, Too Little Credibility A Cautionary Tax Court Tale

SteveK December 6th, 2011

The Tax Court in a recent unreported decision allowed evidence, including adjustments to comparable sales by a pro se taxpayer at trial. However, the case, Kula v. Township of Downe, provides a more important strategic lessons to municipal attorneys and tax assessors. Sometimes it is better not to put a case on at all.
The pro se taxpayer did not have an appraiser. But, unlike the town’s appraiser she relied upon comparable sales in the subject municipality. A lay person generally is not permitted to provide expert testimony. But, it appears that the lack of credibility of the municipal appraiser may have influenced the court’s decision to reduce the assessment on the property and give more than the usual weight to valuation evidence provided by a lay person.
The pro se taxpayer effectively cross examined and apparently destroyed the town’s appraiser. The taxpayer was able to show that the appraiser for the municipality produced three different appraisal reports, first, at the County Tax Board, then secondly in Discovery, and then a third, at trial at the Tax Court. The appraiser made widely different adjustments on the same properties in each report. In addition, the appraiser used sales outside of the subject municipality. The Court therefore found that the town’s appraiser lacked credibility and relied upon the pro se taxpayer’s comparable sales and even her adjustments.
It is, of course, easier to criticize trial strategy after a case is over. But, perhaps in this instance, it would have been better for the town to leave well enough alone and not put on its case at all.
The case can be found at the Tax Court web site: http://www.judiciary.state.nj.us/taxcourt/tax_unpublished/13984-09opn.pdf

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum, PC (www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in real estate tax appeals. For additional information about the matters in this bulletin or in the firm’s real estate tax appeal group, please contact Martin Allen, Esq

The information contained in this blog is intended solely for informational purposes; it is a advertising publication of DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum P.C.This publication is intended to alert recipients of developments in the law and is not intended to provide legal counsel, advice or opinion on any specific facts or circumstances. The contents are intended as general information only. You are urged to consult a member of this firm or your own attorney concerning your particular situation and any specific legal questions you might have.

 

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Two Family Homes and Seasonal Rentals No Longer Considered to be Bulk Sales Transactions

SteveK October 24th, 2011

As a result of a recent legislative amendment, the New Jersey Bulk Sales Act (the Act) provisions, as they relate to real estate, are a lot clearer.  Prior to the amendment, there was some uncertainty as to whether or not the Act applied to certain types of residential real estate.

 

In 2007, the notification requirements under the Act were changed, which resulted in the application of such requirements to a wider array of real estate transactions and, thus, a lot of uncertainty as to what was covered and required of real estate attorneys and other professionals.  Basically, under the 2007 law, the notification requirements applied to all transactions in which there was a sale, in bulk, of all or any part of a person’s business assets, except in the ordinary course of business.

 

For purposes of the 2007 law, “business” meant any endeavor from which revenue is realized for the purposes of generating a profit or a loss, and “business assets” included realty if the primary use of the realty is to support a business on its premises.  On its face, without any other clarification, the 2007 law had to be presumed to include any real estate transaction where the purpose of the real property was to support a business of any type from which a profit or loss could be obtained and for which the sale is not in the ordinary course of business.  This would likely encompass sales by single purpose entities where the sole asset is the subject property and the sole business is the leasing, operation or management of that property.  However, it could also be deemed to include any   other real estate transactions such as seasonal rentals, vacation homes, and timeshares.

 

Consequently, other than the sales of single family residences by the owners thereof, it was unclear whether or not sellers of real estate in New Jersey had to comply with the notification requirements under the Bulk Sales Act.  The uncertainty was risky, too, because the failure by the purchaser to file the requisite notices with the Division of Taxation meant that the purchaser was deemed, by statute, to have personally assumed all liability for the payment of the seller’s outstanding tax obligations to the State of New Jersey.

 

A recent amendment now resolves that uncertainty.  According to the revised  legislation, the Bulk Sales Act does not apply to the sale, transfer or assignment of a simple dwelling house if the seller, transferor or assignor is an individual, estate or trust, but it does still apply if the seller, transferor or assignor is a business entity, including a corporation or a partnership.  A “simple dwelling house” means a dwelling unit, attached or detached, and the land appurtenant thereto, including but not limited to (1) a one-family or two-family building or structure, (2) a cooperative unit, (3) a condominium unit, and (4) a unit in a horizontal property regime, but it does not include a structure containing more than two units of dwelling space or containing commercial property including, or in addition to, the units of dwelling space.

 

In addition, the Act does not apply to the sale, transfer or assignment of a seasonal rental unit or the sale, transfer or assignment of a lease for the seasonal use or rental of real property if the seller, transferor or assignor is an individual, estate or trust, but it does still apply if the seller, transferor or assignor is a business entity, including a corporation or a partnership.  A “seasonal rental unit” means a timeshare estate and a dwelling unit that is rented for a term of not more than 125 consecutive days for residential purposes by a person having a permanent residence elsewhere.  A “lease for the seasonal use or rental of real property” means a timeshare use and the use or rental for a term of not more than 125 consecutive days for residential purposes by a person having a permanent place of residence elsewhere.

 

In short, limited liability companies and other similar entities are still subject to the bulk sales notice requirements, as are all owners of multiple (more than two) dwelling properties and properties containing commercial units.  However, individuals, trusts and estates are not subject to the bulk sales requirements, if the property in question is a single-family of two-family residence, a coop or condo unit, a timeshare, or a seasonal rental unit.

 

Although this amendment clarifies the applicability of the Bulk Sales Act to certain real estate transactions, it remains important to review any sale of this nature with your counsel.

 

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis & Lehrer, PC (www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in real estate transactions. For additional information about the matters in this bulletin or in the firm’s real estate group, please contact Richard Ahsler, Esq.

 

The information contained in this blog is intended solely for informational purposes; it is a advertising publication of DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum P.C.This publication is intended to alert recipients of developments in the law and is not intended to provide legal counsel, advice or opinion on any specific facts or circumstances. The contents are intended as general information only. You are urged to consult a member of this firm or your own attorney concerning your particular situation and any specific legal questions you might have.

 

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Martin Allen obtains dismissal of tax appeal where property owner did not provide information in response to a “may dismiss” letter.

SteveK October 20th, 2011

In James Dale Enterprises v. Berkeley Heights, 26 N. J. Tax 117 (Tax 2011), Martin Allen, chairman of the firm’s Real Estate Tax Department successfully argued that a tax assessor’s request for income and expense information pursuant to Chapter 91 (N.J.S.A.54:4-34) does not require an unequivocal statement that a tax appeal will be dismissed. The inclusion of a copy of the law with the request is adequate notice to the property owner of the possible consequences of non-compliance. The assessor’s letter to the property owner stated that a failure to provide income and expense information “may” result in the taxpayer’s tax appeal being dismissed.

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis & Lehrer, PC (www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in real estate tax appeals. For additional information about the matters in this bulletin or in the firm’s real estate tax appeal group, please contact Martin Allen, Esq

The information contained in this blog is intended solely for informational purposes; it is a advertising publication of DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum P.C.This publication is intended to alert recipients of developments in the law and is not intended to provide legal counsel, advice or opinion on any specific facts or circumstances. The contents are intended as general information only. You are urged to consult a member of this firm or your own attorney concerning your particular situation and any specific legal questions you might have.


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NJ Federal District Court dismisses CERCLA Section 113 and private nuisance claim by subsequent property owner that conducted voluntary cleanup.

SteveK September 2nd, 2011

On August 13, 2011, the Federal District Court for the District of New Jersey continued to clarify the limits of Section 113 claims under CERCLA and  also addressed common law claims of a subsequent property owner in Queens West Development Corporation v. Honeywell International, Inc. Plaintiff acquired property formerly operated by Warren Chemical Works, which was subsequently acquired by Honeywell. The property was contaminated from discharges of substantial amounts of creosote, coal tar, and related substances. The property was to be redeveloped by plaintiff for residential, commercial and recreational uses. Plaintiff claimed to have incurred over $16 million in investigation and remediation costs, and anticipated total response costs that would be equal to or exceed $20 million. Defendant moved for dismissal of various counts of the complaint including claims in Count Two of the Complaint, under Section 113 of CERCLA, claims in Count Three for common law private nuisance, and claims in Count Four for restitution.  In deciding the case, the Court addressed the intersection between claims under ‘ 107 of CERCLA and Section 113. The Court noted that the case presented a unique issue: “whether a party that voluntarily undertakes a cleanup action can maintain a claim for contribution under § 113(f)(3)(B), when it has simultaneously asserted a claim for cost recovery under § 107(a).” The Court noted that courts have explained that Section 107 “authorizes the United States, a state, or `any other person’ to seek reimbursement for all removal or remedial costs associated with the hazardous materials on the property, provided that those actions are consistent with the National Contingency Plan, and that the United States Supreme Court held in Atlantic Research that the “plain language” of § 107 “authorizes cost-recovery action by any private party, including PRPs.” As a result, a private party is not required to establish its own liability in order to assert a claim under  Section 107. Section 113(f)(3)(B), however, allows the assertion of a right of contribution only “to PRPs that have settled their CERCLA liability with a [S]tate or the United States through either an administrative or judicially approved settlement.” Since Plaintiff had voluntarily incurred the response costs, is not a PRP, and did not enter into an approved settlement or resolved all their liability to the U.S. or the State of New York, they could not maintain the  Section 113 claim. Thus, the Court dismissed the  Section 113 claim contained in the Second Count.

The Court next addressed the claims for private nuisance. As the proceeding was in New Jersey, but involved New York property, the Court considered the law of private nuisance in both jurisdictions. The Court concluded that the law was the same, and that although a private nuisance “consists of an interference with one’s interest in the private use and enjoyment of land” it only applies to interference with use of adjoining land, not to subsequent owners of the same property.

Finally, the Court refused to dismiss the restitution claim. Defendants argued that it should be dismissed since it is preempted by CERCLA. The Court refused to dismiss the claim, however, since it remained an alternative common law claim that would survive if the Plaintiff fails to prove the claim under  Section 107 of CERCLA.

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum, PC (www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in environmental and defense of toxic exposure matters. For additional information about the matters in this bulletin or in the firm’s environmental practice, please contactSteven A. Kunzman, Esq. who heads our Environmental and Latent Injury Litigation Department.

 

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NJ App. Div. dismisses Spill Act contribution claim due to primary jurisdiction of NJDEP.

SteveK September 1st, 2011

In Magic Petroleum, Inc. v. Exxon Mobil, the New Jersey Appellate Division dismissed, without prejudice, Magic’s claim for contribution of remedial costs against Exxon due to NJDEP’s primary jurisdiction of the remedial investigation at the plaintiff’s property. Plaintiff had been the subject of an administrative consent order (ACO) to investigate and remediate contamination at its property resulting from leaking underground storage tanks.  Plaintiff contended that the majority of the contamination came from the neighboring Exxon station and refused to comply with its obligations under the ACO until the NJDEP required Exxon to participate in the investigation. Magic litigated its obligations under the ACO through administrative proceedings, and was required to follow the order. Magic, however,  continued to refuse to conduct the investigation, insisting that the investigation should be imposed upon and shared by Exxon. The NJDEP eventually took over the investigation of the plaintiff’s property. Magic then commenced a contribution action against Exxon.

Exxon filed a motion to stay or dismiss the proceedings, without prejudice, pending the NJDEP’s investigation and remediation of the Magic property, arguing that the NJDEP’s efforts must precede any decision by the court. The trial judge dismissed the case, deferring to the NJDEP’s primary jurisdiction. The Appellate Division affirmed.  The Appellate Court noted that under the doctrine of “primary jurisdiction” a court may defer to an agency where the resolution of an issue is within the special competence of the agency. The court further noted that private contribution rights under the Spill Act require the court to allocate responsibility for remediation costs, but that the initial determination of whether a party is responsible can be decided by the NJDEP, and that “only the DEP can define the contaminants, determine the extent of the discharge, identify the authorized forms of investigative testing, and permissive methodology of cleanup.” Furthermore, “to be entitled to reimbursement and contribution under the Spill Act, a party must obtain written approval under from the DEP of the investigation and proposed remedial action.”  Accordingly, the court concluded that these decisions were within the scope of the special expertise of the DEP and should be determined prior to the case being able to proceed.

This decision demonstrates that a responsible party under the Spill Act that does not conduct investigation and remediation, but allows it to be done by the State, does so at its peril. To do so may have a significant impact in the party’s ability to pursue a contribution claim against other responsible parties, as it allows the NJDEP to determine and define the scope of the investigation, remediation, and possibly to potentially influence any future contribution claim or allocation. It is interesting to consider the effect of the Site Remediation Reform Act (SRRA) on the statements by the court that the DEP will define the contaminants, the extent of the discharge, the forms of investigation and the method of cleanup. Under the SRRA these determinations can be made by a Licensed Site Remediation Professional (LSRP), in accordance with the regulations for site investigation and remediation, referred to the Tech. Regs.  Accordingly, it is may not be that the DEP has to make these decisions. This points, again, to the importance of the party seeking contribution to address and control the response to be able to develop the information, and assert and control the contribution claim.

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis, Lehrer & Flaum, PC (www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in environmental and defense of toxic exposure matters. For additional information about the matters in this bulletin or in the firm’s environmental practice, please contactSteven A. Kunzman, Esq. who heads our Environmental and Latent Injury Litigation Department.

 

 

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Martin Allen Panelist for Upcoming Municipal Tax Appeal Programs

SteveK August 18th, 2011

Martin Allen, partner in the firm, will be a panelist on “A Mock County Board Hearing” at the Annual Meeting of the  New Jersey Association of County Tax Boards. Friday, September 2, 2011 at 9:00 am at The Grand Hotel, Cape May. Martin will be acting the role of municipal defense attorney on the panel.

Martin will also be participating in a similar program at the League of Municipalities convention on Thursday, November 17th at 9 am  at the Convention Center in Atlantic City.

The title of that program is: “League Tandem Session with the Association of Municipal Assessors of New Jersey and the New Jersey Institute of Local Government Attorneys: Tax Appeals – Trials and Tribulations.” The League program is described as: “Being ‘Trial-Ready’ is a crucial strength in the appeal process as, unfortunately, not all cases are resolved through ‘negotiation’. Join this experienced panel and explore the process through a mock trial which resolves the appeal of a ‘trophy’ single family residence.” Martin is one of the experienced panelists for this program.

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Steven Kunzman to Co-Chair Seminar on Groundwater Contamination

SteveK August 15th, 2011

Steve Kunzman, partner in the firm, will be a co-chair of a comprehensive conference:

Groundwater Contamination and Vapor Intrusion Cases

The seminar, which will be put on by Law Seminars International, will take place at the Sheraton Newark Airport Hotel on September 15 and 16.

For more information and to register go to: http://www.lawseminars.com/seminars/11GWATNJ.php

The speakers include noted attorneys, remediation consultants and and other noted experts in the field. The seminar is co-chaired by Ira Gottlieb of McCarter & English. Steven and Ira will also be speaking on insurance coverage issues relating to groundwater claims.

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Developers benefit from “Time of Application” law passed on May 5.

SteveK May 6th, 2011

On May 5, 2010, Governor Christie signed into law P.L. 2010, Chapter 9, known as the “Time of Application” law, which protects the rights of a developer by requiring the municipality to apply the zoning in place when application is filed.  The law does away with the “Time of Decision” rule, which has been in place since the 1995 decision by the New Jersey Supreme Court in Manalapan Realty v. Township Committee, which allowed a municipality to change its zoning to negatively affect or prohibit a project which was already under review by a planning board.

 

The “Time of Application” law, effective May 5, 2011, requires that the development regulations in effect at the time a developer submits an application to a municipal land use board apply to that particular project.  The only exception would be where a municipality makes changes to a development ordinance involving the issues of health and public safety, whereby such changed health and public safety ordinance would apply to the filed application.

 

As New Jersey and our Nation begin to rebound from the economic crisis that has slowed development, this law enhances the climate for developers to begin constructing projects in New Jersey. This change provides land use developer a better ability to plan its development applications.

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis & Lehrer, PC ( http://www.dbnjlawblog.com) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of parties in zoning, land use and local government matters. For additional information about the matters in this bulletin or in the firm’s land use, zoning and municipal please contact Jeffrey B. Lehrer, Esq.

 

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Tax Court Developments

SteveK April 12th, 2010

In Davanne v. Edison, (see previous blog entry of Feb. 19,2010) Martin Allen successfully argued before the New Jersey Supreme Court that the 8th Amendment prohibition against unreasonable and excessive fines does not apply to a dismissal of a tax appeal because of an income producing property owner’s failure to respond to a request from a tax assessor for income and expense information.

More recently, in Stellakis v South Plainfield, an unreported decision of the Tax Court, we argued, and the Court determined that taxpayer’s counsel failed to present any evidence at the County Tax Board despite calling the Assessor as his witness and referring him to comparable sales referred to in a settlement letter. The Tax Court, after reviewing an audio recording of the County Board hearing, held that the hearing was a sham and dismissed the Tax Court appeal pursuant to N.J.S.A. 54:51A-1(c), which precludes review by the Tax Court if the County Board matter was dismissed for lack of prosecution.

DiFrancesco, Bateman, Coley, Yospin, Kunzman, Davis & Lehrer, PC (www.dbnjlaw.com ) is a full service law firm in New Jersey which provides a broad range of legal services, including the representation of clients in real estate tax appeals. For additional information about the matters in this bulletin or in the firm’s real estate tax appeal group, please contact Martin Allen, Esq

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