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Bergman v. City of Atlantic City

argued: July 26, 1988.


On Appeal from the United States District Court for the District of New Jersey, D.C. Civil No. 86-3507.

Higginbotham, Becker and Cowen, Circuit Judges.

Author: Cowen


COWEN, Circuit Judge.

Appellants Edward and Gilda Bergman seek reversal of the district court's order granting summary judgment in favor of defendants and denying the Bergmans' motion for leave to amend their complaint. The Bergmans are the plaintiffs in one of two actions consolidated for discovery and trial by the district court; the other action is still pending. At issue in both actions is the validity of amendments made to an Urban Renewal Plan ("the Plan") which regulates the development of an area in Atlantic City. Within that area is the Beachgate condominium complex; the Bergmans own one of the Beachgate units. At the heart of the Bergmans' claim is their assertion that the Plan was impermissibly amended without their written consent. A preliminary issue for this court, before we can adjudicate the merits of the Bergmans' appeal, is whether appellate jurisdiction exists despite the pendency of the consolidated action in the district court. Because we hold that it does not, we need not decide at this time whether the district court properly granted summary judgment and denied the Bergmans leave to amend their complaint.


In 1965, an 80-acre tract of land bordering the Atlantic City boardwalk ("the Tract") was declared an Urban Renewal Area pursuant to 42 U.S.C. § 1452 (1982), and the Plan was adopted to regulate development of the Tract. The Plan was amended in 1973, and recorded in the Clerk's Office of Atlantic City. This amended version of the Plan was in effect in 1976 when the Bergmans purchased a condominium in the Beachgate complex, situated in the Tract governed by the Plan. The portion of the Plan at issue in this case is Paragraph F, which allows for amendment of the Plan

upon compliance with the requirements of all applicable laws by the Housing Authority of the City of Atlantic City, with the approval of the Board of Commissioners of the City of Atlantic City, provided, however, that the amendment must be consented to in writing by the purchaser lessee, their successor or assigns of any land in the project area, previously acquired or agreed to be acquired in accordance with the Urban Renewal Plan, whose interests therein are materially affected by such amendment.

App. at 68.

Shortly after the Bergmans purchased their condominium, the New Jersey Constitution was amended to allow for gambling casinos in Atlantic City. Some two years later, appellee Resorts International, Inc. ("Resorts") began construction of the first casino. On June 15, 1983, appellees the City of Atlantic City ("the City") and the Housing Authority and Urban Development Agency of the City of Atlantic City ("the Housing Authority") amended the Plan to allow for more and larger hotels along the boardwalk.*fn1 Neither the City nor the Housing Authority notified the Bergmans of the planned amendment, and the Bergmans never consented to it in writing.

On June 1, 1985, Edward Bergman wrote to the Housing Authority expressing his concern that the Plan not be changed without his knowledge. App. at 73. Over the course of the next few months, Bergman corresponded with the Housing Authority about the 1983 amendment to the Plan, with Bergman objecting to the lack of notice and insisting upon the necessity of his consent. The Housing Authority took the position that his consent was not required. Not satisfied with the responses from the Housing Authority or, later, from the City, Bergman initiated the current lawsuit.

The Bergmans filed a six-count complaint in the district court on September 3, 1986, and amended it on November 14, 1986. The amended complaint sought to represent a class of similarly situated purchasers and owners of condominiums in the Beachgate complex. The complaint named the City and the Housing Authority as defendants and alleged an unconstitutional taking of property without due process in violation of the fifth and fourteenth amendments and 42 U.S.C § 1983. Other counts alleged breach of contract, a violation of the New Jersey Constitution, and sought to prevent any further amendment of the Plan absent the Bergmans' consent. Count Six, which also named Resorts as a defendant, alleged a conspiracy to violate the Bergmans' rights under the Plan in violation of 42 U.S.C. § 1985.

On January 14, 1987, the section 1985 count was dismissed for failure to state a claim, thus effectively ending Resorts' participation in the Bergmans' action. Although the district court did not certify the dismissal order for appeal under Fed.R.Civ.P. 54(b), the Bergmans filed a notice of appeal to this court on February 9, 1987. That appeal was withdrawn five days later, and the dismissal is not challenged in the current appeal.

On February 24, 1987, the Association of Owners of the Courts at Beachgate (the condominium owners' association) filed suit in the New Jersey Superior Court of Atlantic County against Resorts, Showboat, Inc., the City, and the Housing Authority ("the Beachgate action"). The central issue in the Beachgate action, like that in Bergman, is whether the 1983 amendment to the Plan was valid absent the condominium owners consent. The Beachgate action was removed to the district court on April 17, 1987. Upon removal, Resorts moved to consolidate the Bergman and Beachgate actions. The motion ...

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