Nevertheless, these two cases create a muddle in New York Eminent Domain law regarding blight and its use to acquire properties. A recent poll conducted by Crane’s New York finds public opinion mixed on which of these two court decisions is better for New York City. A majority voted: “Neither. Until it becomes more transparent, the eminent domain process is bad for the city, no matter what project it affects.”

Ten days later, on Thursday, December 3, 2009, the New York Appellate Division ruled 3-2 in favor of the property owners in the Columbia University project. In the Matter of Kaur v. New York State Urban Dev. Corp., the court rejected so called “underutilization” as a justification for a declaration of blight and condemnation of plaintiff’s properties. Download the decision. Judge Catterson, under a heading titled "The Folly of Underutilization," called for the removal of “underutilization” as a justification for blight:

The time has come to categorically reject eminent domain takings solely based on underutilization. This concept put forward by the respondent transforms the purpose of blight removal from the elimination of harmful social and economic conditions in a specific area to a policy affirmatively requiring the ultimate commercial development of all property regardless of the character of the community subject to such urban renewal. See Gallenthin Realty Dev. Inc. v. Borough of Paulsboro, 191 N.J. 344, 365, 924 A.2d 447, 460 (2007) ("Under that approach, any property that is operated in a less than optimal manner is arguably blighted.' If such an all-encompassing definition of "blight" were adopted, most property in the State would be eligible for redevelopment"); In re Condemnation by Redevelopment Authority of Lawrence County, 962 A.2d 1257, 1265 (Pa. 2008), appeal denied, 973 A.2d 1008 (Pa. 2009) (holding use to less than full potential does not constitute "economically undesirable" land use); Sweetwater Valley Civic Assoc. v. City of National City, 18 Cal.3d 270, 555 P.2d 1099 (1976); Southwestern Illinois Dev. [*14]Auth. v. National City Envtl., 304 Ill.App.3d 542, 556, 710 N.E.2d 896, 906 (1999), aff'd, 199 Ill2d 225, 768 N.E.2d 1 (2002), cert. denied, 537 U.S. 880, 123 S.Ct. 88, 154 L.Ed.2d 135 (2002) ("If a government agency can decide property ownership solely upon its view of who would put that property to more productive or attractive use, the inalienable right to own and enjoy property to the exclusion of others will pass to a privileged few who constitute society's elite"). (Slip opinion at 24-25)

In this regard, the Kaur opinion is in line with the New Jersey Supreme Court in Gallenthin v. Paulsboro. See our blog post, N.J. Supreme Court clarifies 'blight' meaning in Gallenthin eminent domain case (June 13, 2007.)

Another important aspect of Kaur is its examination of Justice Kennedy’s concurrence in Kelo, described by Prof. Patty Salkin in her blog, Law of the Land:

Perhaps the most important aspect of the decision is the Court’s careful examination of Justice Kennedy’s concurring opinion in Kelo, and the finding that this case is an example of what Kennedy warned about – situations where “improper motive in transfers to private parties with only discrete secondary benefits to the public.” Judge Catterson recounts Justice Kennedy’s test for pretext: 1) city’s awareness of a depressed condition; 2) formulation of a comprehensive development plan; 3) substantial commitment of public funds; 4) city’s review of a variety of development plans; and 5) city’s choice of a private developer from a group of applicants rather than picking a particular transferee beforehand. While all of these elements were present in the Kelo case, in the Columbia case, Judge Catterson finds that: 1) when the City and State started to look at the expansion project, the area was not depressed; 2) there was no comprehensive development plan to address area-wide economic depression; 3) no public funds were being used to support the project – Columbia is paying for 100% of the project; 4) no competing plans were submitted – although the community board submitted a 197-a plan that acknowledged the importance of the expansion project, the plan clearly indicated no support for the use of eminent domain; and 5) the ultimate beneficiary of the project was predetermined from the beginning – Columbia University.

The Court of Appeals will hear the Kaur case based on the dissent (3-2) and its conflict with the Atlantic Yards case. Chief Judge Lippman, writing for the majority in the Atlantic Yards case, thinks the issue of blight is best addressed by the New York Legislature:

It may be that the bar has now been set too low – that what will now pass as "blight," as that expression has come to be understood and used by political appointees to public corporations relying upon studies paid for by developers, should not be permitted to constitute a predicate for the invasion of property rights and the razing of homes and businesses. But any such limitation upon the sovereign power of eminent domain as it has come to be defined in the urban renewal context is a matter for the Legislature, not the courts. Properly involved in redrawing the range of the sovereign prerogative would not be a simple return to the days when private property rights were viewed as virtually inviolable, even when they stood in the way of meeting compelling public needs, but a re-weighing of public as against private interests and a reassessment of the need for and public utility of what may now be out-moded approaches to the revivification of the urban landscape. These are not tasks courts are suited to perform. They are appropriately situated in the policy-making branches of government. (Slip opinion at 17-18)

In contrast, the New Jersey Supreme Court reiterated its standard of review in Gallenthin vs. Paulsboro: Blight has to be proved by substantial, credible evidence. The courts insist on more than a cursory review of the properties or a recitation without substantiation of the statutory blight criteria. Thus, there is a trend toward a more restrictive interpretation of the law. Chief Justice James Zazzali, writing for a unanimous court, said that while the New Jersey Legislature enlarged the power of eminent domain to include the taking of private property for redevelopment, the judiciary is the final arbiter. By placing the responsibility for defining the limitations of eminent domain primarily with the Legislature, the New York Court of Appeals abdicates its ultimate role.

Beaches in many states are the recipients of oceanfront accretion as a result of beach replenishment projects. Most states, including Florida and New Jersey, set the property boundary at the mean high water line: The state owns the area between the mean high water line and the low water line. Up to this point, any natural or man-made accretion that changes the mean high water line belonged to the riparian owner. The state of Florida wants to make this additional land public land. The Florida Supreme Court, in a 5-2 decision, agreed. See SCOTUS Wiki for all the documents in this case and our prior blog post, "SCOTUS grants cert in beachfront renourishment case."

In order to rule in favor of the Florida property owners, at least 5 of the 8 justices hearing the case need to agree with the position of the property owners who are contesting the Forida legislation and the Florida Supreme Court decision. This would require an in depth review of Florida law in order to overrule the Florida Supreme Court -- a big step, considering the deference usually accorded state courts in interpreting state law. But the Florida property owners argue that the court below misinterpreted long standing Florida law with respect to the ownership of beachfront property. 

The New Jersey case, City of Long Branch v. Liu concerns several issues. See blog post, "Eminent domain at the mean high water line." The New Jersey Supreme Court spent most of its time questioning Liu’s attorney, Peter Wegener, regarding the title to the additional 225 feet of beachfront land, which accrued to the property as a result of a 1998 beachfront replenishment project undertaken by the Army Corps of Engineers. Liu's property was condemned in 2001 as part of the Beachfront North redevelopment project implemented by Long Branch.The issue is whether this land belonged to Liu and should have been valued in the underlying condemnation case, or was this property “state land” belonging to the public and entitled to public use under the “public trust doctrine.” See our blog,"Eminent domain and the public trust doctrine."

New Jersey law until this point has held that the riparian owner owns to the mean high water line. The line changes over time due to erosion and accretion, both natural and man-made. Justices Rivera-Soto and Albin sharply questioned Mr. Wegener on this point. Wegener forcefully argued for Liu’s ownership of the property, subject only to the public access as established in prior court opinions. (See Bubis v. Kassin .) An opinion will mostly likely be decided after SCOTUS issues its opinion in the Florida case.

A centerpiece of the petitioners' argument was an attempt to convince the court that the term public use, as used in the New York State Constitution, should be limited to its original intent. This would necessitate overturning a long line of case law which has significantly broadened the concept of public use. The justices, questioning petitioners' lawyer Matthew Brinkerhoff, appeared to reject this argument; it is unlikely they will narrow the definition of public use in the opinion that results from this case.

There was a strong argument put forth by the respondents' attorney Phillip Karmel that the action in the state court presently before the court of appeals was not filed within the 30 day limitation contained in the statute, New York State’s Eminent Domain Procedure Law (EDPL). The petitioners rely on a six-month grace period to support their application that the action was timely filed. The petitioners initially pursued their remedies in the Federal Courts without success. They subsequently filed an action in the state court relying on the six month grace period to meet the procedural requirements of the statute. Respondents argue that this does not comport with the procedure set forth in the EDPL. The danger in this procedural argument is that, if the respondents position is adopted by the court, the case could be dismissed without addressing the underlying merits or substantive issues. We have seen appellate courts avoid controversial decisions by utilizing procedural devices to bypass the real issues at the heart of the case.

The justices seemed troubled over the possibility that public subsidies were made for market-rate housing, which as Chief Justice Lippman pointed out, appears to constitute the majority of the project. Article 18 section 6 permits public subsidies for low and moderate income housing:

No loan, or subsidy shall be made by the state to aid any project unless such project is in conformity with a plan or undertaking for the clearance, replanning and reconstruction or rehabilitation of a substandard and unsanitary area or areas and for recreational and other facilities incidental or appurtenant thereto. The legislature may provide additional conditions to the making of such loans or subsidies consistent with the purposes of this article. The occupancy of any such project shall be restricted to persons of low income as defined by law and preference shall be given to persons who live or shall have lived in such area or areas.

Mr. Karmel insisted that all of the $100M in state support of this project was for infrastructure for the arena site, and not for the market-rate housing. “Market-rate housing – this is the largest component, right?” the judge asked.

Karmel ducked the question by answering, “By acreage, I’m not sure.” Certainly 5000 market-rate units, which comprise the majority of units in this project, is significant; and this, not the arena for the Nets, is the clear objective of real estate developer Bruce Ratner.

Another issue that may result in a remand is the rebuttal argument made by petitioners’ attorney Matthew Brinckerhoff that there was no analysis of the balance between public and private benefit to the developer as required by New York law.

The hopes of the property owners rest with a court willing to make a ruling that restricts the use of eminent domain and sets forth precise guidelines that must be followed when private property is taken for a public use. Some might say, as Justice Lippman suggested during oral argument, “What is the role of the Legislature in all of this?” And the answer is that, in an ideal world, the Legislature should be the catalyst for eminent domain reform. But we have seen that legislators are too tied to developers to ever pass meaningful reform. So the courts have become the last, best hope for the property owner. 

Click here to view the video of the October 14 NY Court of Appeals oral argument in Goldstein  v. New York Urban Development Corp. 

Daniel Goldstein is the lead plaintiff as well as the catalyst and co-founder of Develop Don’t Destroy Brooklyn, the group that has been fighting developer Bruce Ratner’s efforts to condemn their neighborhood for an arena (the  proposed home for the New Jersey Nets), 16 towers with 5000 residential units, and retail and office uses.

Earlier efforts by the property owners in the Federal Court were dismissed. See Goldstein v. Pataki, 488 F. Supp. 2nd 254 (EDNY 2007). Aff’d 516 F 3d 50 (3nd Cir. 2008). At the heart of the petitioners’ state court action is the provision of the New York Constitution Article I, Paragraph 7, which states that “private property shall not be taken for public use without just compensation.”
 

The petitioners also urge the court to weigh the relative public vs. private benefits that would occur as a result of the project as called for in Aspen Creek v. Town of Brookhaven, 12 NY 3d 738. The City of New York has filed an amicus brief supporting the use of eminent domain to foster economic development. The Virginia based Institute for Justice has filed an amicus brief on behalf of the plaintiffs. The Insitute recently published Building Empires, Destroying Homes: Eminent Domain Abuse in New York. (Click on the link to download the PDF.)

In an article published today in Reason Magazine, Goldstein wrote: "We're simply asking for the state's constitutional Public Use Clause to be applied, which, despite the cries of the vested interests, will not stymie development in New York City. If it is not applied, then today our homes can be seized in an abusive manner, but tomorrow it will be your home just because some politically connected, backroom-dealing rich guy can get his cronies to determine that his enrichment is somehow for the public's use."

Other relevant publications on this topic:
Atlantic Yards Report by Norman Oder: The eminent domain battle Wednesday: an easy call for the Court of Appeals or a fresh look at blight, "public purpose," and relative benefits?

The Volokh Conspiracy by Ilya Somin: New York's Highest Court to Hear Important Eminent Domain Case

Law of the Land by Patty Salkin: Atlantic Yards Eminent Domain Case Heads to NY High Court Tomorrow.

Previous posts on this blog:
Proponents of Atlantic Yards win Appellate round 

Brooklyn's Eminent Domain: Henry & Daniel v. Goliath 

Brooklyn's Eminent Domain: DDDB v. ESDC 

A comprehensive review and amendments to the statutes governing eminent domain in New Jersey are needed, including the Eminent Domain Act of 1971, the Local Redevelopment and Housing Law and the Relocation Assistance Act and regulations.

These laws form the statutory framework governing the acquisition of property by state agencies and local government. They also provide protections to the owners and occupants of real estate acquired for a public project.

On June 15, a draft eminent domain bill was voted out of the Senate Community and Urban Affairs Committee, three years after the Assembly passed its version. Five years after the U.S. Supreme Court's decision in Kelo v. City of New London, which called for the states to enact their own legislation, 43 states have passed eminent domain reform. New Jersey has not. Senate President Richard Codey needs to move the eminent domain reform bill to a vote.

Right now, the law stands as written, with piecemeal relief provided by judicial decisions in New Jersey courts. Case by case, property owners are forced to overcome the presumption of validity of the statutes and municipal actions taken in designating their properties in need of redevelopment. This is a difficult and expensive burden for the average residential or small business owner.

The Local Redevelopment Law must address the definition of blight, the notice given to the property owners including tenants, and the time frame for filing a prerogative writ case contesting the blight designation. The Legislature must cap blight designations — seven years is sufficient to implement a project. A municipality should be able to develop plans, designate developers, acquire properties necessary for redevelopment and start construction within that time frame.

Blight designations that linger create the very conditions the municipality seeks to address. Asbury Park is a perfect example: blighted in 1984, two redevelopers have missed the market in 25 years. This must not be repeated.

Property owners under a blight designation remain under the threat of condemnation. They are reluctant to invest in their real estate and often are prohibited from redeveloping their own properties by the plan and the exclusive designation of one redeveloper. Property owners have difficulty obtaining loans, and sell at a discount because of the threat of eminent domain.

The Relocation Assistance Act and regulations are administered by the same agency displacing the owners and occupants. The same agency has full say over any decision by the Office of Administrative Law and can reverse an administrative law judge who finds the displaced owner is entitled to benefits. This is a blatant conflict of interest. Instead, the decision of the judge should be final and appealed in the courts. Owners forced to litigate to obtain benefits should be awarded reasonable counsel fees and costs if they are successful. Otherwise, the legal costs necessary to obtain statutory rights can exceed the benefits being sought.

Displaced residential owners are given many benefits — rental supplements, reimbursement of closing costs and attorneys' fees, which are not provided to businesses. Businesses need equal benefits. The business discontinuance allowance is capped at $10,000. This is a miniscule amount for most businesses, which may be put out of business after acquisition or relocation to another community. Business discontinuance allowance should be expanded to compensate the dislocated owner adequately for a business that becomes defunct.

Ed. Note: The op-ed, Time to act on eminent domain reform was published in the opinion section of the  Asbury Park Press on September 23, 2009 and can be found online at this link. 

On Tuesday, attorneys for the majority of property owners in the Marine Terrace, Ocean Terrace, Seaview Avenue (MTOTSA) neighborhood in Long Branch signed a final consent order of settlement in their long-standing eminent domain case. As the attorney for homeowner Louis Anzalone, I was one of them. Peter Wegener represented the other homeowners, and Scott Bullock and the Institute for Justice joined the case on appeal. Together we formed a united front on behalf of the property owners. Still, it was the participation of New Jersey’s Public Advocate Ronald Chen that made the difference, not only in this case but in all the important cases that are redefining the way we view eminent domain in New Jersey.

 In the Long Branch matter, the mediation process went on for months after an August 2008 Appellate Court decision, which reversed in part and remanded the case to the same trial court that ruled against the property owners in June 2006. Monmouth County Assignment Judge Lawrence Lawson wisely placed the mediation process in the hands of Superior Court Judge Thomas W. Cavanagh, Jr., who brought negotiations to fruition. On Tuesday evening, the Long Branch City Council voted 4-1 on the resolution to accept the consent order and the terms of settlement. So the litigation is over.

Blight is not in the eye of the beholder, contrary to a statement made by Justice Kennedy during the oral arguments in the U.S. Supreme Court case, Kelo v. New London. In New Jersey, it is a word that has specific meaning and a public purpose as set forth in the 1947 Constitution. In 1992, the Local Redevelopment Housing Law developed criteria to determine blight that could result in a condemnation of almost any property.

And that was where the Public Advocate came in, as a friend of the court in support of the property owner’s position in the 2007 N.J. Supreme Court case, Gallethin Realty v. Borough of Paulsboro. Blight has to be proved by substantial, credible evidence. The courts insist on more than a cursory review of the properties or a recitation without substantiation of the statutory blight criteria; thus, there is a trend toward a more restrictive interpretation of the law. But it is apparent that many experts presented by the municipalities do not provide substantial, credible evidence to support a conclusion that the study area is in need of redevelopment. That’s what happened in Long Branch, and that’s why the Appellate Division reversed the blight designation in 2008.

But victory has no time to waste, resting on laurels. Gallenthin Realty v. Borough of Paulsboro reminds us that, while the New Jersey Legislature enlarged the power of eminent domain to include the taking of private property for redevelopment purposes, the judiciary is the final arbiter. The City of Long Branch v. Anzalone case is a reminder of what remains undone. We gain a piece here and a piece there through case law, but what is required is a comprehensive review of the statutory structure.

The New Jersey Legislature has been considering eminent domain reform for more than 4 years and has yet to pass a bill addressing substantive changes to the Eminent Domain Act of 1971, the Local Redevelopment Housing Law, and the Relocation Assistance Act and Regulations. A reform bill was voted out of the Senator Ronald Rice’s Community and Urban Affairs Committee, but has not moved. According to the Institute for Justice, 43 states have passed significant eminent domain reform since the Kelo case in 2005. Not New Jersey. Without statutory reform, the potential for eminent domain abuse will continue. And New Jersey’s property owners will fight city hall, case by case, for their homes, their farms, relocation for their small businesses, and their right to redevelop their own property.
 

Ed. Note: This op-ed piece was originally published in the New Jersey section of The Star-Ledger on September 18, 2009, under the title, "New Jersey still needs eminent domain reform."  The online version can be found at NJ Voices. The video by Mia Song was filmed by the Star-Ledger on the same day the Appellate Court issued its opinion on August 7, 2008. One month later, Lillian Anzalone died peacefully on the front porch of her beachfront home.

Also, see blog post of September 15, Settlement ends eminent domain saga for Long Branch MTOTSA homeowners
 

"To the outside world, my home may have been just wood and concrete, but to me, it is my whole existence...a little piece of heaven with my wife..." - Louis Anzalone, Long Branch, N.J. 

One year and seven days after his wife, Lillian, quietly slipped away on the porch of their beachfront home, Louis Anzalone, 92, and his neighbors on Marine Terrace, Ocean Terrace, and Seaview Avenue - MTOTSA - in Long Branch, N.J., settled their long-standing eminent domain battle with the city. Today in open court, in Freehold, most of the property owners signed releases, and attorneys for the city, developer, and property owners finalized a consent order, bringing closure to the case. Download the final order.

City of Long Branch v. Anzalone, and its companion cases, were reversed and remanded to the trial court in part on August 7, 2008. Today's settlement, which resulted from lengthy negotiations and mediations with Judge Thomas W. Cavenagh, dismisses the eminent domain complaints against all defendants. In addition, the city of Long Branch and the developer are paying aproximately 60 percent of the legal fees and costs of the defendants. The property owners are now free to continue to live in their homes, or to rebuild in compliance with the amended redevelopment plan. If they choose to rebuild, they can be designated as redevelopers and receive the same tax benefits as the designated developers did for Phase I of the Beachfront North project. This is a big win for the property owners and property rights advocates.

Tonight in a Special Meeting of the Long Branch City Council, resolutions memorializing the settlement agreement are on the agenda. Download the Long Branch Agenda here.

“He may be 92, but my father made all the major decisions,” said Tom Anzalone. “I respected him. It’s his house. He has that World War II fighting ethic, fighting for his rights. He knew what they were doing was wrong. Even my mother said, ‘They can’t take my house.’ He ended up saving his home. He’s extremely happy that he can live here for the rest of his life.”

A long, protracted case requires property owners to persevere and make sacrifices to protect their rights. Louis Anzalone, at 92, personifies the fighting spirit of all the homeowners in the MTOTSA neighborhood who spent time, money and energy – more than seven years of their lives -- to prevail against the power of eminent domain and keep their beachfront homes.

Related links:

Asbury Park Press, Settlement could come today in Long Branch eminent domain case (Sept. 15., 2009)

Insitutute for Justice, Victory for Homeowners in Long Branch, NJ Eminent Domain Battle (Sept. 15, 2009)
 

TIME/DATE:
1:30p.m./Tuesday, September 15, 2009

PLACE:
Courtroom of Hon. Thomas W. Cavanagh
Hall of Records
One East Main Street
Freehold, New Jersey 07728

PARTICIPANTS:
Scott Bullock, Senior Attorney, Institute for Justice
Jeff Rowes, Staff Attorney, Institute for Justice
Peter H. Wegener, Bathgate, Wegener & Wolf
William Ward, Carlin & Ward
Property Owners in the MTOTSA (Marine Terrace, Ocean Terrace, Seaview Avenue) neighborhood

SUMMARY:
On Tuesday, September 15, 2009, at 1:30 p.m., the long-running fight to protect the homes in the MTOTSA neighborhood of Long Branch, N.J., against eminent domain for private gain could come to end. An agreement will be discussed in the courtroom of Judge Thomas Cavenaugh, who has presided over discussions between the parties for the past several months.

The Institute for Justice—a public interest law firm based in Arlington, Va., that litigated the Kelo v. New London eminent domain case before the U.S. Supreme Court—represents the homeowners along with New Jersey eminent domain attorneys Peter Wegener of Bathgate Wegener & Wolf and William J. Ward of Carlin & Ward.

In August 2008, a three-judge panel of the New Jersey Appellate Division unanimously reversed and remanded the June 2006 decision of Superior Court Judge Lawrence Lawson, which had allowed Long Branch to condemn a charming seaside neighborhood known as MTOTSA for a luxury condominium development. (Read the opinion and our blog post of August 7, 2008, on City of Long Branch v. Anzalone. )

After the case was sent back to the trial court and the city announced that it was willing to drop the eminent domain actions, the parties began discussing how to resolve the remaining issues in the case. If the case resolves, attorneys along with MTOTSA property owners will speak with the media immediately after the hearing in the courtyard in front of the Hall of Records in downtown Freehold, New Jersey.

# # #

CONTACT:

To arrange interviews with William J. Ward  or property owner Louis Anzalone, please contact Susan Ward at 973-377-3350, ext. 106 or 973-464-5669, evening/weekends.

To arrange interviews with the Institute for Justice, call John Kramer, vice president for communications, at 703-682-9320 ext. 205 or in the evening/weekend at 703-587-1992.

BACKGROUND INFORMATION:
See links to relevant blog posts and court opinions.

The property in question consists of 726 acres, located in Readington Township, Hunterdon County, and enjoys a farmland assessment. A portion of the property, approximately 100 acres, is devoted to the Solberg Airport, a local airport serving businesses and recreational clients. The airport is also famous for the annual hot air balloon festival held every summer. In 2006, the Township of Readington authorized acquisition for open space preservation, recreation and farmland preservation. The ordinance authorized fee acquisition of all the land outside the 100 acres devoted to airport use, as well as the development rights to the 100 acres. The trial court was presented with cross-motions for summary judgment. The trial judge, relying principally on the New Jersey Supeme Court decision in Mt. Laurel Twp. v. Mi Pro Homes , (see our blog post of December 8, 2006), ruled that the acquisition was valid as a means of preserving open space.
 

“The fact that the condemnation of development rights to the airport will not achieve its stated purposes indicates that the true purpose of the condemnation was to secure a greater measure of land use authority over the airport than the Township currently enjoys. Further, objective evidence suggests that the condemnation was initiated to secure Township control over airport operations. These are improper purposes in that they subvert the commissioner’s ultimate authority over aeronautical facilities.” (Slip opinion at p. 44)

The court concluded the township abused its power of eminent domain “to avoid the limitations on municipal zoning power imposed by State airport statutes and regulations,” and “is not within the police powers delegated to the municipalities by the Legislature. (Slip opinion at pp. 44 and 48.)

The Appellate Court agreed on both counts:

We find that Judge Perskie’s conclusions were supported by substantial and credible evidence in the record. Inverse condemnation occurred here by both the Borough’s physical occupation of plaintiffs’ property for public use and its adoption of the regulatory scheme to support the protection of the engineered sand dune. A regulatory taking of the property occurred as well. (Slip opinion, p. 14)

Download the per curiam opinion in Klumpp v. Borough of Avalon.

According to Peter Wegener of Bathgate Wegner, who represents the property owner, the New Jersey Supreme Court has certified two questions on two of the points decided adverse to Liu by the court below:

POINT I
WHETHER THE JURY'S DETERMINATION TO MAKE NO AWARD FOR THE ENHANCEMENT VALUE REPRESENTED BY THE FURNITURE, FIXTURES AND EQUIPMENT FUNCTIONALLY RELATED TO THE BUSINESS WAS AGAINST THE WEIGHT OF THE EVIDENCE AND WAS A MISCARRIAGE OF JUSTICE?
1. THE PROBLEM OF AUTHENTICATION UNDER N.J.R.E. 901
2. THE VIDEO SHOULD HAVE BEEN EXCLUDED UNDER RULE 403
3. THE ENTIRE LINE OF TESTIMONY RELATING TO RELOCATION SHOULD HAVE BEEN EXCLUDED FROM THE CASE [Slip opinion, at p.3)

POINT IV
WHETHER THE MOTION JUDGE ERRED IN FAILING TO REQUIRE THAT THE CITY'S VALUATION OF THE PROPERTY INCLUDE PROPERTY THAT CAME INTO EXISTENCE THROUGH THE BEACH REPLENISHMENT EFFORTS OF THE U.S. ARMY CORPS OF ENGINEERS?
1. The Lius' Property Extends to Mean High Water
2. The High Water Mark Delineates Ownership of Lands Along the Atlantic Ocean
4 [sic]. Artificial Changes to the Shoreline Inure to the Benefit of the
Littoral Owner Provided the Changes Were Not in Aid of Navigation and Were Not Implemented by the Littoral Owner Himself
5 [sic]. The Motion Judge Incorrectly Interpreted The Law To Determine That The State of New Jersey Owned The Artificially Created Property [Slip opinion, at p.4]
 

The other issue concerns the title to the enhanced beachfront area after the Army Corp of Engineers replenished the beach in 1998. The question of beach replenishment and title is clearly one of national interest. Under New Jersey law, Liu owned the property to the mean high water line, and thus the valuation should have included the beach replenishment, which was an Army Corp of Engineer project that preceded and was not part of the redevelopment efforts of the city of Long Branch. The U.S. Supreme Court’s resolution of this issue could influence what the New Jersey Supreme Court decides in the Liu case.
 

On the issue of beach replenishment, the New Jersey Appellate court wrote:

When plaintiff filed its complaint, it described the property to be taken as having a depth of 125 feet to the high water mark of the Atlantic Ocean. Defendants filed a motion to amend the complaint to enlarge the description of defendants' property to include an additional 93,393 square feet of beach upland, created as a result of a beach replenishment project undertaken by the Army Corps of Engineers and funded by the federal government, the State of New Jersey and the City of Long Branch. At the completion of this project, the mean high watermark of the Atlantic Ocean had moved 256 feet eastward from the point at which it had existed previously. The trial court rejected defendants' pretrial motion to include this extra land within the property being taken. City of Long Branch v. Liu, 363 N.J. Super. 411 (Law Div. 2003). Defendants argue on appeal this was wrong.

We do not find it necessary in order to resolve this issue that we delve into the distinctions drawn by the common law with respect to boundary lines between accretion (a gradual, imperceptible buildup of land caused by natural forces), Hous. Auth. of Atlantic City v. State, 193 N.J. Super. 176, 179 (App. Div. 1984), and avulsion (a sudden removal or addition to land as a result of either natural or manmade forces), Garrett v. State, 118 N.J. Super. 594, 601 (Ch. Div. 1972).

It is undisputed that the enhanced beachland to which defendants seek to lay claim and for which they seek compensation was the result of a public agency spending public funds. We can perceive no policy justification which would permit defendants to reap such a private monetary benefit from those public efforts. (Slip opinion, at p. 25- 26)

One of the troubling results of the New Jersey Appellate Division’s decision, which was not discussed in the opinion, is redevelopment mechanism itself. Long Branch condemned Liu’s property for its redevelopment project. Long Branch has a contract with Applied Management, its designated redeveloper, whereby Long Branch conveyed the interests acquired from Liu to the redeveloper. This interest included all of the land formerly owned by Liu up to the mean high water line. The mean high water line is the demarcation line for the ownership of riparian rights by the state of New Jersey. By denying Liu the benefit of ownership of the additional property up to the mean high water line, the trial court and the Appellate court have denied Liu the full measure of just compensation and given an unintended benefit to the redeveloper. This issue should be clarified by the New Jersey Supreme Court.

See previous blog post, Eminent Domain Valuation: Payment in Liu (March 17, 2006), discussing the condemnation jury trial.

Download the New Jersey Appellate Court opinion in City of Long Branch v. Liu  (May 20, 2009).

This is a regulatory takings case where the Florida Supreme Court, in a 5-2 decision, rejected the beachfront property owners’ challenge to a state law authorizing beach replenishment through creation of sand dunes and asserting public ownership to the created land area. The Florida Supreme Court concluded that the law did not constitute a compensable taking. See Robert H. Thomas' post at Inverse Condemnation blog:

In Walton County v. Stop the Beach Renourishment, Inc., 998 So.2d 1102 (Fla. Sep. 29, 2008), the Florida Supreme Court held that a state statute which prohibits "beach renourishment" without a permit did not effect a taking of littoral (beachfront) property, even though it altered the long-standing rights of the owners to accretion on their land and direct access to the ocean. The cert petition presents these questions:

The Florida Supreme Court invoked "nonexistent rules of state substantive law" to reverse 100 years of uniform holdings that littoral rights are constitutionally protected. In doing so, did the Florida Court's decision cause a "judicial taking" proscribed by the Fifth and Fourteenth Amendments to the United States Constitution?

Is the Florida Supreme Court's approval of a legislative scheme that eliminates constitutional littoral rights and replaces them with statutory rights a violation of the due process clauses of the Fifth and Fourteenth Amendments to the United States Constitution?

Is the Florida Supreme Court's approval of a legislative scheme that allows an executive agency to unilaterally modify a private landowner's property boundary without a judicial hearing or the payment of just compensation a violation of the due process clauses of the Fifth and Fourteenth Amendments to the United States Constitution?

The case has interesting implications in many states, and specifically New Jersey,  where the Army Corps of Engineers, operating through local municipalities, is seeking to accomplish beach replenishment along the entire length of Long Beach Island. See our January 29 post, "Eminent domain in Harvey Cedars."
 

Stop the Beach Renourishment, Inc. v. Florida Department of Environmental Protection, et al. Docket: 08-1151

• Opinion below (Supreme Court of Florida)
• Petition for certiorari
• Brief in opposition for respondent Florida Department of Environmental Protection
• Brief in opposition for respondents Walton County and City of Destin
• Petitioner’s reply
• Brief amicus curiae of Pacific Legal Foundation (in support of petitioner)