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Corrugated Metals, Inc. v. City of Jersey City

A-937-96T5 (N.J. Super. App. Div. 1998) (Unpublished)

CONDEMNATION; DELAYS—Although a property owner was held in “limbo” while waiting for the municipality to act on its announced taking by eminent domain, the owner retained beneficial use of its property. Therefore, it was not entitled to damages because no compensable taking took place.

In 1990, a company received notice that plans were being made by the municipality to acquire its property for construction of a public street. The municipality took no affirmative action for the next two years. In April, 1992, the company brought an action to hasten condemnation of its property and demanded damages for the violation of its rights caused by the delay in condemnation. Alternatively, the company sought to compel the municipality to abandon its condemnation plans. While the company’s summary judgment motion was pending, the municipality approved the making of an offer in lieu of condemnation. In June, 1992, the company accepted the municipality’s offer and conveyed the property, but continued its action for damages as a result of the delay.

The Appellate Division held that the municipality’s inaction did not give rise to a compensable taking. Since there was no physical invasion of the property, the company was not deprived of its use and the value of the property was not diminished by the announced condemnation plans. Additionally, the company was unable to meet the New Jersey Supreme Court standard that the beneficial use of the property must be “destroyed” to the point where its value was reduced to “near zero.” Littman v. Gimello, 115 N.J. 154, 166 (1989). The Appellate Division went on to cite from that opinion to the effect that mere planning without appropriation or interference does not constitute a taking of property, nor does lost economic opportunity allegedly caused by pre-taking government action. Although the company was held in limbo, it still had beneficial use of its property. In the absence of a de facto taking without compensation, the company had no claim for damages. Consequently, it affirmed the lower court’s dismissal of the company’s claim.


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