By Lea Kahn, Staff Writer
The battle over a proposed drug and alcohol detoxification center, proposed for an office park at 100 Federal City Road, has heated up as the would-be operator has filed a lawsuit against the Simone Investment Group LLC, the property owner, and LLC managing member John Simone.
The 14-count lawsuit, filed by Sunrise Detox II, LLC in Mercer County state Superior Court in October 2012, seeks compensatory and punitive damages, as well as a court order requiring the Simone Investment Group to honor its lease agreement with Sunrise Detox II.
The lawsuit also seeks a court order to force the Simone Investment Group to continue its legal challenge to the Zoning Board of Adjustment’s denial of a use variance application, which would permit the residential drug and alcohol detoxification center to be located at the office park. The proposed use is not permitted in the Professional Office zone.
But Mr. Simone and the Simone Investment Group have fired back, filing a lawsuit against Sunrise Detox II Superior Court in December 2012. The seven-count lawsuit seeks compensatory and punitive damages against the Florida-based detox center operator, alleging among other claims that Sunrise Detox did not negotiate in good faith and never intended to sign a lease.
In the meantime, the Simone Investment Group has signed a lease with an unnamed tenant to operate a residential drug and alcohol detoxification center in Building B at the office park provided that the property owner prevails in court and the township is directed to permit the proposed use.
Sunrise Detox Center sought a use variance to allow for a 38-bed residential drug and alcohol detoxification center in Building B of the office park at 100 Federal City Road, but the Zoning Board of Adjustment denied the application in June 2011.
The Simone Investment Group LLC, which filed the use variance application, appealed the zoning board’s denial in Mercer County state Superior Court. Mercer County Superior Court Judge Mary Jacobson ordered the zoning board to reconsider the application, but the zoning board denied it again in November 2012. The matter is back in court before Judge Jacobson, but no date has been set for oral arguments.
In the October 2012 lawsuit, Sunrise Detox II is claiming breach of contract against the Simone Investment Group by alleging that the property owner advised Sunrise that it had signed a lease with another company to operate a detoxification center in Building B.
Sunrise Detox II claims that it had “entered into an agreement (with the Simone Investment Group) for the lease upon the Simone Investment Group’s obtaining a use variance” permitting the proposed use, and that leasing the property to another operator constitutes a breach of contract.
Bur Mr. Simone disputes that the Simone Investment Group has a lease with Sunrise Detox II.
”We never had a lease. It’s not like I violated (the terms of the lease) or defaulted (on it),” Mr. Simone said. “We agreed we could not come to terms with Sunrise on the really important parts of the lease. There was a long period of time when we never heard anything from Sunrise.”
Sunrise Detox II also seeks “specific performance” against the Simone Investment Group, which means it wants the property owner to continue to seek a use variance for the residential drug and alcohol detoxification center. Sunrise Detox II claims in the lawsuit that it has spent “substantial resources” toward obtaining approval, in partnership with the Simone Investment Group.
Also, Sunrise Detox II is alleging fraud because the Simone Investment Group led Sunrise to believe it would lease Building B to Sunrise. As a result, Sunrise Detox II did not take steps to find another location in southern New Jersey or the Philadelphia area, according to the lawsuit.
And Sunrise Detox II wants an injunction, or court order, against the Simone Investment Group that would prevent it from renting the space to the unnamed tenant, as well as an injunction against the unnamed tenant to prevent its occupying the space.
Mr. Simone said that because the Simone Investment Group had not heard from Sunrise Detox for several months, the decision was made to seek another tenant for the space.
”We felt we needed a back-up tenant. We were approached (by a prospective tenant). We sat down and worked out the terms of the lease with them (and signed it). This happens a lot. There are negotiations, but they never come to fruition,” Mr. Simone said.
”There comes a time in one’s business judgement (when) there is a deal or no deal. We did what we always do. We got another tenant. (Sunrise) doesn’t see it that way. The lease (negotiations) went back and forth. They think they are entitled to infer that they have a lease,” he said.
But Sunrise Detox II does not have a signed lease with the Simone Investment Group, Mr. Simone said, adding that “it looks like to me” that the lawsuit is an attempt to stifle competition. He said he has a signed lease with the tenant whose name he declined to reveal and that “as far as I know, it will withstand a (legal) challenge.”
Mr. Simone said that the Uniform Commercial Code requires all real estate contracts to be made in writing in order to be enforced. Sunrise Detox II is “trying to get around it and disregard it,” he said of the lack of a lease.

