In ongoing Merck property battle, judge reserves judgement until later date

File Photo Kean University has been trying to exercise a right of first refusal to buy the former Merck property located adjecent to the campus, but a local developer has been bringing the school to court, claiming the right of first refusal is ‘a sham.’
File Photo
Kean University has been trying to exercise a right of first refusal to buy the former Merck property located adjecent to the campus, but a local developer has been bringing the school to court, claiming the right of first refusal is ‘a sham.’

UNION – Although a private developer, who spent a year working on a deal to buy Merck’s property fronting Morris Avenue, went back to court last week with the hope of knocking out Kean’s right to buy the 50-acre site, a superior court judge reserved any decision on the matter until a later date.

At issue this time around was developer John Russo’s argument that Kean University has failed to produce any written legal substantiation proving the Kean family had the right to transfer the “right of first refusal,” to the university. In fact, the university admitted as much in court documents, according to township sources.

In question is the complicated issue of whether the Kean family had the legal right to transfer “the right of first refusal” to Kean University.

At the core of this legal argument is whether there needs to be written conveyance from the Kean family back in 1925, or if there is case law to support dismissal of the entire matter.

According to Kean University’s legal representation, the only documentation required was contained in the last will and testament of John Kean, Stewart B. Kean and Mary Alice Reynolds, dated Jan. 16, 1925. A covenant in that will, they said, indicated the “right of first refusal” fell back to the Kean family any time the property is sold in the future. However, Richard Berger, general counsel for Russo, argued in court that the “right of first refusal” ended with the expiration of a Kean trust in 1927.

In 1986 the Kean Family sold the 50-acre tract of land to the Schering Plough Corporation, which eventually became Merck when the corporations merged in 2009.

On Nov. 5, Berger told Judge Katherine Dupuis the university did not have the right of first refusal to buy the Merck property and their entire legal fight was “a sham claim to a right of first refusal.”

The attorney based this on the fact neither the university nor the Kean family has been able to come up with written documentation to substantiate their claim.

Benjamin Clark, representing Union’s legal interest in ensuring the property is not handed over to the university, said Kean University was making a “phantom claim” for the right of first refusal.

The township became involved in this legal battle because the municipality and county stand to lose millions in property tax if Kean obtains the right since state colleges and universities are not required to pay property taxes.

According to sources attending the hearing, lawyers for Russo, Kean University and the township argued their respective points for two hours before Dupuis, but a final decision was not forthcoming. This means the judge will review both legal arguments and make a decision at a future date. When that will be, though, is unknown.

John Schmidt, an attorney representing the university, maintained in court that John Kean, a surviving descendant, retained the right of first refusal through his family.

The Kean family has maintained throughout months of legal wrangling that they had every right to transfer the right of first refusal to the university and the court should uphold the university’s legal right to buy the land.

Dupuis previously heard motions involving this legal matter and initially put a halt on the university going any further with the purchase until the matter went to trial. Three weeks later, however, when Kean again came before the court, Dupuis explained this halt was not what she had meant, and instead permitting the university to move forward with all efforts to buy the Merck property except the final step – closing the deal legally.