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Cotswold, LLC v. Renaud

A-5247-06T3 (N.J. Super. App. Div. 2008) (Unpublished)

HISTORIC SITES — Even though a fountain may not be mechanically attached to the land, it can still constitute an improvement governed by an historic designation ordinance and may not be removed from the property without appropriate approval.

A sprawling estate, existing in a municipality for at least eighty years, was designated as an historic site. The owner of the estate thereafter converted the property into condominium units and then removed a fountain from the property without obtaining a Certificate of Appropriateness as was required by the historic site designation ordinance. The property owner “took the position that since the fountain was not mechanically attached to the land, it was not fixture and hence was not encompassed within the historic site designation.” When the municipality directed that the fountain be put back, the developer brought a declaratory judgment action “seeking a finding that the fountain was not subject to the Ordinance.” The lower court held “that the fountain was an improvement governed by the historic designation and [had to] be returned to the historic site and remain there unless and until [the developer obtained] the requisite Certificate of Appropriateness.” The developer appealed, not contesting that the estate was an historic site, but arguing that the fountain was “not covered by that designation.” The Appellate Division rejected that argument, thereby upholding the lower court’s ruling.

One argument raised by the developer on the appeal was that the historic designation ordinance was unconstitutional “as applied because it effectively confiscate[d] the fountain.” The Court rejected that argument without discussion, but added “only that the Ordinance does nothing more than require that the fountain remain on the property where it [had] been for more than eighty years unless a Certificate of Appropriateness is obtained.” Consequently, the Court did not believe that the circumstances constituted a “governmental taking.” It pointed out that the municipality “neither physically took the property nor did it deny [the developer] all economic or beneficial use of the fountain.” It rejected the developer’s argument that if the fountain could not “be removed from the property, then [it would be] deprived of its economic value.” It pointed out that when a property is sold with a fountain, “whatever value the fountain adds to the property may be reflected in the sale price.” It didn’t matter that the developer had since sold the property because the developer was still required to return the fountain and any additional compensation that the developer might have received from the fountain because the fountain was not included in the sale was due to the developer’s “mistake and not any constitutional flaw in the Ordinance or its application” to this situation.

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