Appeal of train station property is under way

BLOOMFIELD, NJ — An appeal by the township of a June 3, 2016, jury verdict which valued the historic train station property on Lackawanna Place at $2.9 million commenced in Trenton this past Tuesday morning, Feb. 13. The appeal was heard at the Superior Court of NJ, Appellate Division.

The township, which condemned the property and took title, has yet to pay the previous owner in full and contends that the site is worth far less than what the six-member jury determined.

Anthony Della Pelle, the attorney for the previous owner, said in an email to the Independent Press that three judges were assigned to hear the case.

“The decision will either be 3-0 or 2-1, he said. “If it is 3-0, the losing party does not automatically have the right to a further appeal. They must obtain ‘certification’ from the NJ Supreme Court, which is difficult to obtain. If the decision is 2-1, the losing party has a right to automatic appeal to the NJ Supreme Court.”

He said the hearing would last an hour or two, but he did not expect a ruling from the panel.
In court papers for its appeal, the township says that it could have provided the jury with information that the site was not worth nearly $3 million. It could not because the trial judge, Judge Robert Gardner, would not permit it. The township, in its appeal, said this testimony would have explained that the site could not be developed profitably as the previous owner proposed. In its appeal, the township also contends that Gardner prohibited testimony that the development proposal was actually illegal because of parking restrictions. The township is being represented by Kevin McManimon, of McManimon, Scotland and Baumann.

The site of the historic train station is a .62-acre, ribbon-shaped parcel. It is steeply embanked and contains a locked and unused walkway beneath the NJT station at Bloomfield Center. It was owned by Howard Haberman, an investor who proposed developing the site. Haberman had the property appraised for $3.2 million based on a development of 34 residential apartments, 12,500 square-feet of retail space and no on-site parking.

But Bloomfield had the property appraised at $440,000 based on it having limited development potential, but greater public use with a reopened pedestrian tunnel to eastbound Midtown Direct trains. The township then condemned the property and took ownership. But as a consequence of the 5-1 jury verdict, the town is now required to pay interest to Haberman from the day condemnation proceedings began, June 26, 2012. Interest is approximately 2.25 percent annually.

In its appeal, the township said it had engaged an expert whose testimony was prohibited, but who would have provided the jury with information that Haberman’s proposal was financially infeasible based on projected costs to develop the site and the income it might eventually generate.

But in court papers for the appeal, Della Pelle said the this expert witness “relied upon hypothetical rents and expense information in arriving at an opinion to develop the hypothetical project and its value.” Determining the financial feasibility of a proposal in this way, Della Pelle said, is generally not admissible in court because it was too speculative, and that was why Gardner would not let the jury hear it.

According to court papers for the appeal, an expert witness for Haberman, however, said the proposal would be financially feasible because applicable Bloomfield zoning regulation allowed tenants in Haberman’s proposed building to park across the street in a proposed township-owned parking deck to have either 1,142 or 923 spaces. A parking deck with 468 spaces was subsequently built and is part of Glenwood Village.

Court papers said that it was the understanding of this expert witness that the township decided to construct a smaller parking deck after it decided to condemn Haberman’s property. The expert also based their opinion on the financial feasibility of the proposal because historically, shared parking arrangements were made in the downtown Bloomfield area to accommodate developments.

But in its appeal, the township contends that since the development proposal did not follow applicable zoning laws adopted Feb. 7, 2011, by having onsite parking, it was illegal. The township was argued that Haberman’s witness testified about a 2008 parking plan, and that should not have been allowed.

In court papers, Della Pelle said the argument about the 2011 zoning laws was without merit because not only did Bloomfield zoning permit the proposed development, but was adopted specifically for it.

“The zoning for this property was set forth in the redevelopment plan,” according to court papers. “The proposed development was ‘as of right’ under the applicable zoning.”

In his email to this paper, Della Pelle said he did not know how long it would take to receive a decision but that would be delivered in writing.
The $440,000 at which the township had the property appraised was initially deposited with Newark Superior Court and withdrawn by Haberman. This amount was to be subtracted from the $2.9 million the jury awarded him so should the township lose its appeal, interest would be paid on this decreased amount.

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