Court upholds eminent domain award for beach replenishment project

Borough of Harvey Cedars v. Harvey Karan and Phyllis Karan,
Superior Court of New Jersey Appellate Division - A-4555-10T3
Decided March 26, 2012

by Scott A. Heiart, Esq.

Yesterday the New Jersey Appellate Division affirmed a jury award in the amount of $375,000 for the acquisition of an easement in order to construct a dune in conjunction with a beach replenishment project.  Download the decision.

In 1973, Harvey and Phyllis Karan built their “dream house” on the New Jersey shore in Harvey Cedars. Their home was uniquely situated with sweeping views of the beach, shoreline, and ocean. The Borough of Harvey Cedars, as part of a large-scale beach replenishment project in 2008, used eminent domain to take numerous easements from beach-front property owners to construct an enormous dune.

Harvey Cedars offered the Karans $300 for the taking, arguing any loss of views was de minimus and that they would receive a “special benefit” due to the added protection against beach erosion and future storm damage. The Karans argued the loss of view was so significant it reduced the value of their property by $500,000.

The trial court heard arguments on whether the dune project constituted a “general benefit” versus a “special benefit.” General benefits are benefits that all property owners share in common with respect to a project. These benefits may not be deducted from a property owner’s just compensation.

In contrast, a special benefit is one that cannot be shared by the general public and can serve as an offset that lowers the amount of just compensation owed to a property owner. See Village of Ridgewood v. Sreel Inv. Corp., 28 N.J. 121, 131-32 (1958).

The trial court in Karan held that  the project constituted a general benefit and prevented Harvey Cedars from presenting evidence to the contrary. The Appellate Division affirmed, holding that “the protection offered to defendants’ property by the dune construction is a classic example of a ‘general benefit’” and no offset is warranted. The court continued, “while defendants’ property may be benefited in somewhat greater degree than its inland neighbors” such a fact is not a legally cognizable “special benefit” for purposes of valuation in a condemnation case.

Harvey Cedars has 20 days to file notice in order to petition the New Jersey Supreme Court for certification on this critical issue. For now, yesterday’s ruling stands as another victory for property owners in their fight to be adequately compensated for the taking of their property.

See our previous blog post on Harvey Cedars beach replenishment cases.

See Appeals panel awards Ocean County couple $375K in sand dune replenishment dispute published Tuesday, March 27, 2012, in The Star-Ledger.

Scott A. Heiart, Esq. is a partner with Carlin & Ward, P.C. in Florham Park, New Jersey.