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June 2006

Appellate Appellate Ruling Ruling Upholds Upholds Decision Decision

Against Against Mount Mount Olive Olive Planning Planning Board Board

In a legal victory for ARD Mount Olive Associates, L.P. and Flaster/ Greenberg, the Superior Court of New Jersey, Appellate Division, upheld the decision of the Honorable B. Theodore Bozonelis, A.J.S.C., that the Planning Board of the Township of Mount Olive, in Morris County, New Jersey had acted in a “capricious” and “arbitrary” manner amounting to an abuse of discretion when it denied extension applications of the developers for a multi-phased housing development. Finding that the two projects were to be viewed as a single development for pur- poses of balancing due diligence because of the interdependent nature, in terms of satisfying regulatory and local requirements and approvals, the Court stated that the vesting period of the Phase II preliminary approval should have been extended based on the diligent actions of Toll Brothers on the Phase I project.

Despite the overwhelming evidence to the contrary, the Mount Olive Planning Board denied Toll Brothers’ Extension Application for Final Major Subdivision Approval for Phase I, finding that Toll failed to diligently pursue activities needed for the completion of the project. The Planning Board also denied ARD’s Extension Application for Preliminary Major Subdivision Approval for Phase II, citing ARD’s failure to diligently seek permits necessary to com- mence work on Phase II, even though Phase II could not begin until Phase I was completed.

This case is significant in its treat- ment of a multi-phased development. The Appellate Court recognized that the Planning Board granted the preliminary approval for the phasing of the development and therefore understood that the Phase II project could not go forward unless and until the construction of the Phase I project was complete. Therefore,

there was nothing that ARD, as the Phase II owner/developer, could do within the initial vesting period to move the Phase II project forward. Under such circumstances, the Court held that ARD, in seeking an extension of vesting for Phase II, could rely on the diligent actions of Toll Brothers to perfect the Phase I approvals and to move forward with the Phase I project.

This decision by the Appellate Court Division of the Superior Court, presided over by Judges Wecker, Fuentes, and Graves was upheld on April 26, 2006.

Flaster/Greenberg shareholders Carl S. Bisgaier and Richard J. Hoff repre- sented ARD Mount Olive Associates. Mr. Bisgaier can be reached at carl.bisgaier@flastergreenberg.com and at 856-661-2269. Mr. Hoff can be reached at richard.hoff@flastergreenberg.com and at 856-382-2249.

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