Toms River Mayor Deliberately Delayed Development, Lawsuit Alleges

TOMS RIVER, NJ — The developer of a proposed downtown apartment complex has filed a 10-count lawsuit against Toms River and Mayor Daniel Rodrick over the town's termination of the project, alleging Rodrick deliberately obstructed the project to create grounds to terminate it.

Capodagli Property Group filed the lawsuit a day after Rodrick announced the termination of the redeveloper agreement with the company over the Meridia Toms River 40 project, which was slated to build 281 apartments plus retail at the site of the former Red Carpet Inn.

It alleges "various breaches of contract, tortious interference, and violations of Meridia's constitutional and civil rights," in what the developer called "Mayor Rodrick's illegal crusade to stop this project."

"Since his inauguration, Mayor Rodrick and the Township have repeatedly breached the Redevelopment Agreement and have engaged in a course of conduct intended to delay and obstruct the project," the developer said in a news release. "The resulting delay was relied upon by Mayor Rodrick and the township as the basis to illegally and improperly terminate the parties' redevelopment agreement."

In announcing the termination of the agreement, Rodrick said Capodagli repeatedly missed deadlines, including ones for obtaining permits and for ensuring financing for the project was in place.

"Capodagli missed all of their deadlines last year," Rodrick reiterated in a response to a request for comment about the lawsuit. "The prior administration extended those deadlines by one year, and they blew the extended deadlines as well."

"In fact, the developer didn't even apply for CAFRA approval until after the permit was due, 2 months after we had already put them into default. CAFRA typically takes one year for approval," Rodrick said.

The project had received a Coastal Area Facilities Review Act permit in January 2023, and on May 28, 2024, the developer submitted a proposal to modify the CAFRA permit to reflect the change from 10 stories to six, said Caryn Shinske, a spokesperson for the state Department of Environmental Protection.

"Capodagli also missed this year's financing deadline and notified the township that they would not be able to obtain financing," he said. "It is Capodagli that has dragged its feet! We are simply exercising our contractual right to pull out of this deal."

Rodrick also commented on bulkheading work underway along the edge of the Toms River on the site at Water Street and Route 166.

"As for the bulkheading, they began work after we notified them that we were pulling out of the contract," he said. "It appears they are attempting to make it look like they are ready to go and that they have losses, but a judge will see right through that. As I said, we are very confident in the township's legal position. We did nothing to impede their process. The developer is just incompetent."

"Their lawsuit is without merit, and it will not be successful," Rodrick said.

In the lawsuit, Capodagli says it received a building permit from the township on Feb. 29, 2024, to do the bulkheading work.

Capodagli seeks a court order directing Toms River to honor the contractual obligations of the redevelopment agreement along with damages. The company has spent more than $3.2 million obtaining permits and approvals, according to the lawsuit.

The lawsuit alleges Toms River officials refused to provide Capodagli with "necessary information to complete certain requests by the Township Planning Board and Ocean County; took "excessive and unreasonably delayed time in responding to the Redeveloper's Resolution compliance submissions; and delayed or outright refused to respond to requests and inquiries from Capodagli, "including request for calculations to post performance guarantees and inspection fees."

Capodagli alleges the town "failed to hire professionals who were required for approvals of the project," including replacing Township Engineer Wendy Birkhead after she resigned and township planner, after Robert Hudak was fired on Jan. 1 along with former engineer Robert Chankalian.

The lawsuit alleges Toms River officials failed to identify the town's flood plain manager, "who was required to provide the flood mitigation approval for the project," and added "requirements unsupported by township ordinance to which no other development or Planning Board application has ever been subject."

Capodagli also pointed to the town's withdrawal from the $5.6 million federal BUILD grant for the Toms River Downtown Loop project as interfering in the project. The town's withdrawal from the grant resulted in the Ocean County Planning Board adding a traffic impact analysis to its conditional approval of the Meridia Toms River 40 project.

Capodagli Lawsuit vs Toms River by Karen Wall on Scribd