A developer has sued Morristown officials and the town for “ongoing, continual and massive breaches of contract” related to a Speedwell Avenue redevelopment project a few blocks from the historic Morristown Green.
Filed in U.S. District Court, the 91-page civil suit contends municipal officials in effect moved the goalposts, by drastically reducing the allowable development on Paul Marshall’s property after Marshall had forked over an interest in an adjoining parcel, which enabled another developer to erect hundreds of units in what is now the Modera apartment complex.
Marshall anticipated building up to 156 apartments and 25,000 square feet of commercial space on his tract. But the town rezoned that portion of the redevelopment to allow only 27 units and 5,000 square feet of retail, according to his lawsuit.
The change violated Marshall’s due process rights, amounting to “a taking of the owner’s property without just compensation,” alleges the suit, which asks a judge to order Morristown to approve Marshall’s plans and slap the defendants with damages and legal costs.
Marshall’s Speedwell Associates and Speedwell LLC name the town as a defendant, along with Mayor Tim Dougherty; town planner Phil Abramson and his firm, Topology Inc.; town redevelopment Special Counsel John Inglesino; and the Modera developers.
Marshall also levels a defamation charge against Inglesino, who at an August council meeting asserted greed was Marshall’s “one consistent virtue.”
“It’s a bunch of nonsense,” Inglesino told MorristownGreen.com on Friday when asked about the lawsuit.
Dougherty echoed Inglesino’s public remarks, accusing Marshall’s group of greed and incompetence and asserting the lawsuit is retaliation for the town’s refusal to grant special tax breaks.
“Paul Marshall’s entities have made good on their threat to sue the Town of Morristown, including the Mayor and many of Morristown’s professionals because the Town won’t give Marshall special tax breaks in the form of a tax abatement, also known as a PILOT,” the mayor said in a statement.
“For years, Paul Marshall has demonstrated a lack of competence in his attempts to develop this property. More recently, he finally contracted with a reputable developer. That developer and Morristown agreed on a sixty-five (65) unit project that makes sense for this location,” Dougherty stated.
He referred to Claremont Companies, a Far Hills developer now separately pursuing approvals for apartments on Schuyler Place.
“But the (Speedwell) project can’t move forward because of Paul Marshall’s greed,” Dougherty’s statement continued.
“He is insisting on a tax abatement from the Town to artificially increase the money he makes on the deal. Tax abatements are only granted where project need is demonstrated or public benefit is established, not to line the pockets of a greedy developer with taxpayer dollars.”
Abramson, the town planner, declined to comment.
Marshall’s company, Marshall & Moran, has developed Morristown properties including the Swiss Chalet bakery and a Remax office.
At least two other developers are suing the town.
Jimmy Cavanaugh, owner of the Iron Bar and the Revolution beer hall, filed a federal suit on April Fool’s Day accusing the mayor, his former friend, of thwarting his expansion plans ever since Cavanaugh rebuffed him as an investor. Dougherty has called the accusation “a work of fiction.”
Councilman Stefan Armington, who was council president when curfews were imposed on Revolution, also is named as a defendant, along with the town. Armington has declined to comment. State officials and the courts have overturned the curfews repeatedly.
Developer Blake Silverman, meanwhile, is suing Dougherty for allegedly scuttling his plans to convert storefronts he owns on South Street into a 110,000-square-foot corporate headquarters.
The mayor has labeled the civil suit as “frivolous and inaccurate,” and called the Silverman Group a “bully developer” trying to ram through a project that would ruin the character of the downtown.
Marshall’s lawsuit focuses on what was intended to be the third of four stages to transform an area designated by the town for redevelopment in 2004. The other phases are complete: Some 453 apartments in buildings called Modera 44 and Modera 55 for the first two stages, and a CVS pharmacy for Phase Four.
But Marshall says his piece won’t advance under present conditions. His team had promised to “enhance and beautify” the town with more apartments on about three-quarters of an acre at Speedwell and Clinton Place, near the Modera buildings.
The dispute also has delayed completion of a park that is part of the Speedwell redevelopment.
Marshall’s complaint cites a January 2015 settlement agreement in which Morristown officials pledged to “diligently work in good faith,” in a timely manner, to flesh out Phase Three plans and name Marshall or his designee as redeveloper.
Two years earlier, the town and the Morristown Parking Authority had sued Marshall, attempting to nullify his lease of parking space on Phase Two land.
In the 2015 settlement, Marshall relinquished his 99-year lease interest– enabling the parking authority to sell that property to the developer of Modera 55, according to the suit.
Marshall also spent nearly $1 million acquiring a pair of street front properties from the town, as part of the settlement. He claims the redevelopment has cost him another $300,000 annually in lost rental income.
A few months after the settlement, the town amended its redevelopment plan with greatly reduced density numbers for Phase Three.
Yet for the next four years, town officials kept “falsely inducing the owner to believe that the town would allow more than 100 residential units to be developed,” according to attorney Linda Cahn, who filed the lawsuit with lawyer Philip Rosenbach. Cahn is married to Marshall.
Things boiled over in August. Addressing the council at a public meeting, Cahn and Rosenbach vowed to sue within four months if the town did not review Marshall’s revised proposal for a four-story, 83-unit apartment complex with 8,000 square feet of retail space.
Inglesino, the town’s redevelopment attorney, fired back a week later by reading aloud his scathing four-page response during a public meeting.