SQUIRETOWN PROPERTIES, LLC VS. TOWNSHIP OF LIVINGSTON(L-9785-07 AND L-326-15, ESSEX COUNTY AND STATEWIDE), A-0528-15T3

Background

Squiretown received a 2010 builder's‑remedy re‑zoning directing an inclusionary development (220 units, 20% affordable) after Livingston failed Mount Laurel obligations. A court‑approved MOU (2014) addressed water capacity and a sewer study; Squiretown agreed to pay study costs and certain short‑term water contract costs needed for its connections.
In August–December 2014 Livingston adopted Ordinances 18‑2014 and 19‑2014, substantially increasing water and sewer connection and inspection fees; the ordinances say increases were based on a CPA study and statutory formulas in N.J.S.A. 40A:26A‑11 and 40A:31‑11.
Squiretown objected at the public hearing and then filed a challenge alleging defective notice, arbitrary/unreasonable fees, statutory noncompliance, bad faith and that the increases were an unnecessary cost‑generative feature in violation of the builder’s‑remedy and MOU orders.
Squiretown moved in aid of litigant’s rights under Rule 1:10‑3 in the Mount Laurel case requesting the ordinances be voided or that its project be grandfathered; the trial court granted relief, declaring the ordinances invalid as applied to Squiretown.
Livingston appealed, arguing the court ignored the ordinances’ presumption of validity, made factual findings without a developed record, and should have allowed discovery and a plenary hearing.
The Appellate Division vacated and remanded for discovery and an evidentiary hearing, holding the trial court erred by resolving contested factual issues without according the ordinances their statutory presumption of validity and without a developed record.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Validity presumption of municipal ordinances adopted under statute	Squiretown argued the ordinances were invalid as applied because increases were arbitrary, not tied to statutory cost formulas, and targeted its project	Livingston argued ordinances adopted under statutory authority carry a presumption of validity and require proof to overturn	Court: Ordinances are presumptively valid; trial court erred by invalidating them without requiring Squiretown to prove statutory noncompliance or arbitrariness and without hearing evidence
"As‑applied" challenge and need to prove statutory calculation	Squiretown contended an as‑applied challenge is permissible because the fee hike doubled its connection costs and is an unnecessary cost‑generative feature	Livingston stressed fees are set by statute/formula, uniformity is required, and exemptions undermine legislative intent	Court: As‑applied challenge may be viable but requires detailed proof (calculation, comparability, market impact); Squiretown was not put to that proof and must do so on remand
Relief under Rule 1:10‑3 (motion in aid of litigant's rights) based on alleged MOU or court‑order violation	Squiretown asserted Livingston’s failure to disclose planned fee increases during MOU negotiations and mediation amounted to bad faith and violated the MOU/court orders, justifying relief under Rule 1:10‑3	Livingston argued no specific, unequivocal court order provision was identified that was violated and Rule 1:10‑3 relief is limited to remediation of clear order violations	Court: Rule 1:10‑3 relief inappropriate here because Squiretown failed to identify a specific provision of the MOU/order that was violated; bad‑faith allegation alone insufficient for Rule 1:10‑3 relief without evidentiary support
Builder's‑remedy prohibition on "unnecessary cost‑generative features"	Squiretown argued increased fees became an unnecessary cost‑generative feature contrary to the builder’s‑remedy order and justification for exemption	Livingston noted the builder’s‑remedy and special master previously considered fees, and later statutory fee increases do not automatically render them unnecessary cost features	Court: Possible claim but factual; trial court could not find ordinance increases violated the builder’s remedy without evidence; remand for discovery and hearing to assess whether increases are an unnecessary cost‑generative feature as applied

Key Cases Cited

S. Burlington Cnty. N.A.A.C.P. v. Twp. of Mt. Laurel, 92 N.J. 158 (1983) (establishes Mount Laurel builder's‑remedy doctrine)
Dial, Inc. v. City of Passaic, 443 N.J. Super. 492 (App. Div. 2016) (municipal ordinances adopted under statutory authority carry a presumption of validity)
N.J. Shore Builders Ass'n v. Twp. of Jackson, 199 N.J. 38 (2009) (burden on party seeking to overturn municipal fee or ordinance)
Meglino v. Twp. Comm. of Eagleswood, 103 N.J. 144 (1986) (limited judicial role reviewing municipal rates)
612 Assocs., L.L.C. v. N. Bergen Mun. Utils. Auth., 215 N.J. 3 (2013) (connection fees must fairly spread system capital costs among users)
Harvard Enters., Inc. v. Bd. of Adjustment, 56 N.J. 362 (1970) (ordinance not void if reasonable under most circumstances; as‑applied challenges require factual evaluation)
Abbott v. Burke, 206 N.J. 332 (2011) (scope of relief in compulsion of court orders limited to remediation of order violation)
Abbott v. Burke, 170 N.J. 537 (2002) (Rule 1:10‑3 relief requires a specific and unequivocal order)
Urban League v. Mahwah, 207 N.J. Super. 169 (Law Div. 1984) (framework for as‑applied challenges to municipal ordinances)