Eminent domain, special benefits, and beach replenishment
The New Jersey Supreme Court has granted Certification to the Borough of Harvey Cedars in the case of Harvey Cedars v. Karan (A. 120-11). At issue in the case is the longstanding policy in eminent domain cases that does not permit off-setting general benefits against damages that ensue from easement takings for dune replenishment and blocking ocean views from the beachfront homes. See Borough of Ridgewood v. Sreel Investment Co., 28 N.J. 121 (1958). In the Karan case, the Borough acquired an easement over one-third of Karans' property and constructed a 22-foot high dune which blocked the ocean views. The Borough, through its expert Donald Molliver, MAI, offered $300.00 as compensation for the taking and damages. Molliver opined that the damages were offset by the special benefit to the property for the project.
At trial the Ocean County Superior Court Judge David Millard ruled in Karans’ favor that the dune offered no special benefit to the property but rather a general benefit that inured to the entire group of property owners on the island. Accordingly, the trial judge instructed the jury that they could not offset a general benefit against the damages to the Karan property. The jury awarded the Karans $375,000 in compensation for the taking and damages. On March 26, 2012, in an unanimous opinion, Borough of Harvey Cedars v. Harvey Karan and Phyllis Karan (A-4555-10T3), the Appellate Division affirmed the lower court ruling. The court called beach replenishment a classic example of a “general benefit.”
The central question on this appeal is whether public construction of an enormous oceanfront beach dune, for which plaintiff condemned an easement on defendants' land, conferred a special benefit on defendants' beach front property in Harvey Cedars. The dune is one part of a line of dunes, created by the Army Corps of Engineers (Corps), that will eventually run the length of the ocean side of Long Beach Island (LBI).The formerly-spectacular ocean view from defendants' house is now partially blocked by the twenty-two-foot high dune, which occupies one-third of their land. However, their house is now safer from storm damage because the dune was constructed. Judge E. David Millard concluded that construction of the dune did not confer a special benefit on the property. Instead, he found that the only benefit conferred was the general benefit for which the dune was constructed, i.e., to protect the island and its inhabitants from the destructive impact of hurricanes and nor’easters. We find no legal error in that ruling, which is consistent with established case law.
Peter Wegener of Bathgate Wegener in Lakewood represents the Karans and Lawrence Shapiro of Ansell, Grimm and Aaron represents Harvey Cedars. The ruling on the case will affect many of the beach replenishment cases not yet filed on Long Beach Island. Funding for the project comes primarily from the U.S. Army Corps of Engineers, the federal agency in charge of beach replenishment projects. Smaller portions are paid by the NJDEP and the smallest portion by the Borough of Harvey Cedars. Nevertheless, in true Cassandra fashion, Mayor Oldman of Harvey Cedars and Attorney Shapiro opined that these projects will not happen if the verdict is allowed to stand. Mr. Shapiro would like to change the law regarding the general benefits. As reported in the Asbury Park Press, Mayor Oldman said, “I don’t think the lower courts looked at it correctly....For us and the Army Corps of Engineers, this has a lot to do with the beach replenishment and the future of it.’’
See our previous blog entry Court upholds eminent domain award for beach replenishment project for related information.