TSI East Brunswick, L.L.C. v. Zoning Bd. of Adjustment of Twp. of East Brunswick, A-124 September Term 2011; Supreme Court; opinion by Hoens, J.; decided July 23, 2013. On certification to the Appellate Division. [Sat below: Judge Lihotz and Waugh in the Appellate Division.] DDS No. 26-1-0752 [33 pp.]

In this appeal, the court determines whether, in considering an application for a conditional-use variance under the Municipal Land Use Law (MLUL), the applicant must prove the negative criteria by the enhanced quality of proofs standard established in Medici v. BPR Co.

Defendant New Vornado/Saddle Brook, L.L.C., owns property on Route 18 in East Brunswick's General Highway Commercial District zone. The property includes a vacant free-standing building, which New Vornado sought to convert into a for-profit health club, LA Fitness. Because a for-profit health club is a conditional use in the zone, LA Fitness was required to comply with the conditions established in the zoning ordinance, including that the boundary of the lot cannot be located within 500 feet of any residence. On the other side of Route 18, and behind commercial buildings, there is a small residential neighborhood. Because the edge of New Vornado's tract of land is within 500 feet of one or more of the residential units, it filed an application seeking a conditional-use variance. Plaintiff TSI East Brunswick, L.L.C. (TSI), the owner of a health club across Route 18 from New Vornado's property, was the principal objector.

At the zoning board hearing, a professional planner testifying in support of New Vornado's application opined that, in evaluating the negative criteria for a conditional-use variance, the enhanced quality of proofs required for a use variance did not apply. The planner concluded that the proposed LA Fitness facility would not have any impact on the residences within the 500-foot radius. He also opined that the conditional use would not substantially impair the zone plan or the zoning ordinance.

Plaintiff's planning expert opined that the LA Fitness facility required a use variance rather than a conditional use variance and that New Vornado failed to satisfy the level of proof required for evaluating the negative criteria under the more rigorous standard applicable to a use variance.

The zoning board granted New Vornado's application for a conditional-use variance. The trial court upheld the board's decision, finding that New Vornado had met its burden of proving that its proposed plan satisfied both the positive and negative criteria and that TSI had failed to demonstrate that the board's grant of a conditional-use variance was arbitrary, capricious or unreasonable.

On appeal, plaintiff argued that the zoning board had erred by not requiring New Vornado to prove the negative criteria by enhanced quality of proofs. The Appellate Division affirmed without deciding the quality-of-proofs issue. The court granted TSI's petition for certification on that issue.

Held: The relaxed standard of proof established in Coventry Square Inc. v. Westwood Zoning Bd. of Adjustment applies to the evaluation of the negative criteria in an application for a conditional-use variance. The enhanced quality of proofs standard established in Medici v. BPR Co. governing use variances is inapplicable to an application for a conditional-use variance.

In Medici, in the context of a use variance, the court established that zoning boards must address the positive and the negative criteria found in the MLUL, and required that the negative criteria be demonstrated in accordance with an enhanced quality of proofs. The court recognized that granting a variance is inherently at odds with the uses permitted in the zone as established by the governing body.

In Coventry Square, the court found that the burden of proof required to sustain a use variance is too onerous for a conditional-use variance and fixed a less-stringent standard for conditional-use variances. However, Coventry Square only addressed the positive criteria.

An application for a use variance pursuant to the MLUL, also referred to as a (d)(1) variance, seeks permission from a zoning board to put property to a use that is prohibited by the zoning ordinance. Both the positive and negative criteria in such an application are tested in accordance with the Medici's enhanced standard. In contrast, a conditional use is a use that the zoning ordinance permits if the applicant meets all of the conditions in the ordinance. The use then becomes a permitted use in the sense that no variance is required. If a property owner seeking to devote the property to a conditional use cannot meet one or more of the conditions imposed by the zoning ordinance, the property owner must apply for a conditional-use variance pursuant to the MLUL, also referred to as (d)(3) variance.

The Medici enhanced standard has no application in the evaluation of an application for a conditional-use variance. The analyses of use variances and conditional-use variances are fundamentally different. The former proceeds in the context of a use that the governing body has prohibited, whereas the latter proceeds in the context of a use that, if it complies with certain conditions, is permitted. The inability to comply with one or more of the conditions does not convert the use into a prohibited one.

The test described by the court in Coventry Square is not consistent with the Medici enhanced standard. Were the court to require that the Medici standard be applied in the conditional-use context, rather than recognizing that the use is permitted with conditions, the court would be presuming that the use is prohibited unless the conditions are met or are proved in accordance with the standards ordinarily required to secure a use variance. The court would be transforming the (d)(3) analysis into a (d)(1) analysis.

Here, the board properly applied the test established in Coventry Square, weighing the proofs as to the negative criteria in order to determine whether, notwithstanding the failure of one of the conditions, the proposal was reconcilable with the zone. The court detects no error in the legal analysis or any failure of the requisite proofs. Because the decision of the board was not arbitrary, capricious or unreasonable, it must be sustained.

The judgment of the Appellate Division is affirmed.

Chief Justice Rabner; Justices LaVecchia, Albin and Patterson; and Judges Rodríguez and Cuff, both temporarily assigned, join in Justice Hoens' opinion.

For appellant — John J. Lamb (Beattie Padovano; Lamb, Ira E. Weiner and Daniel L. Steinhagen on the briefs). For respondents: New Vornado/Saddle Brook, L.L.C. — Kevin J. Moore (Sills Cummis & Gross; Moore and Peter M. Flannery on the brief); East Brunswick Zoning Board of Adjustment — James A. Tarella (Tarella & Liftman).