PEAPACK AND GLADSTONE NJ - On Tuesday, a three-judge panel of the Appellate Division of the Superior Court issued a written opinion that will likely be the last word in the land use dispute with Matheny Medical and Educational Center that has shaped the politics of the borough since 2008.

In a carefully worded 37-page opinion, the Appellate Division rejected Matheny's two major claims against the Peapack-Gladstone. The first claim that the court rejected was that the Land Use Board did not comply with New Jersey land use law when it denied Matheny's 2008 expansion plan. The second claim that the court rejected was that the Land Use Board discriminated against Matheny based on its students' disabilities.

In most appeals, the Appellate Division decision is the last word in a case.

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The dispute dates back to May 2008, when Matheny filed an application for preliminary and final major site plan approval for the construction of a nearly 50,000-square-foot building addition. Matheny proposed to increase the number of hospital beds from 102 to 140 and the number of on-site parking spaces from 227 to 315. The school also proposed a new gymnasium that would have included an indoor therapeutic pool.

Like many major expansion applications, the Matheny application drew opposition. Borough residents who expressed concern about increased traffic on Highland Avenue, and the effect that increased traffic would have on safety.

The Land Use Board heard extensive testimony from both sides over the course of three years, before denying the application in a 38-page resolution.

Matheny representatives filed suit in Superior Court against the Land Use Board and the Borough Council seeking to overturn the Land Use Board decision. In two separate decisions, the trial court dismissed Matheny's suit.  The Appellate Division upheld the trial court, holding that the Land Use Board complied with New Jersey land use law, and did not violated the New Jersey Law Against Discrimination.

In addition to the Superior Court claim against the borough, there is another pending lawsuit. Matheny sued the borough in federal court, alleging that the Land Use Board violated federal anti-discrimination laws when it denied the application.

Attempts to negotiate settlement

The borough and Matheny continue to negotiate in an attempt to work out an amicable settlement, according to sources.

The hospital, which serves adults and children with developmental disabilities on both an inpatient and outpatient basis, had been at its location since the middle of the 20th century. Its activities and public events such as "Miles for Matheny" draw volunteers from throughout the Somerset Hills area.

- with Linda Sadlouskos