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Baker v. The County of Middlesex

A-7055-96T1 (N.J. Super. App. Div. 1998) (Unpublished)

LOCAL LANDS AND BUILDINGS LAW—Conveyances to contiguous property owners of undersized lots that were acquired by condemnation need only substantially comply with the statute, read sensibly, not literally.

A County acquired property through condemnation proceedings. Part of the acquisition included two small lots. Seventeen years later, a developer purchased a contiguous parcel from a private landowner and contracted to purchase the two small lots. Residents of the municipality in which the land was located challenged the sale, alleging the county did not contract with an owner of land contiguous to the property being sold. Under the Local Lands and Buildings Law (LLBL), public property may be sold at private sale under the following conditions: (1) the property is undersized for development, (2) it is sold to the highest bidder among contiguous landowners, and (3) it be sold for at least fair market value. While the action was pending, the County contacted the two contiguous landowners. One indicated it had no desire to purchase the property. The other, which had already contracted to sell its own property to the developer, expressed a special interest in buying the undersized parcel and the land was then sold to that contiguous landowner. The manner in which the sale took place was by assignment of the developer’s original contractual rights to the contiguous landowner. The complainants, on appeal, contended that the County’s sale to the developer and the subsequent assignment to the contiguous landowner violated the LLBL in four respects: (1) the sale was not to a contiguous landowner; (2) the LLBL does not allow for assignments of contract rights; (3) the property was not sold by public bidding as required by the LLBL; and (4) the county did not receive fair market value for the property. The Appellate Division was not persuaded by any of those contentions. It found that although the proposed sale to the developer would have been in violation of the LLBL, the actual sale met the conditions set forth by the LLBL. It found nothing in the statute’s language or purpose that precluded a sale to a contiguous owner just because there was a prior, aborted sale to a non-contiguous owner. Nor did it find a statutory prohibition against assignment of contractual rights as a means of converting an unauthorized private sale into an authorized private one. In the Court’s words, “[s]tatutes should be read sensibly not literally.” With respect to the public bidding requirements, the statute requires bidding only when there is more than one contiguous landowner. Although there were two such owners here, one had unequivocally expressed no interest in the property. In such a circumstance, the Court thought that a sensible reading under the statute would not require a bidding from the sole interested party. In essence, a sale to the sole interested contiguous owner may proceed as a private sale without bidding as long as the remaining requirements of the LLBL are met.


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