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Iron Mountain Information Management, Inc. v. The City of Newark

202 N.J. 74, 995 A.2d 841 (2010)

CONDEMNATION; NOTICES —Tenants of properties subject to taking by eminent domain do not have the right to actual notice of a blight designation because the New Jersey legislature intended that such notices are only required to be sent to owners of record and to those whose names are listed on the tax assessor’s records.

A commercial tenant sued to invalidate a municipal resolution that had declared the area where its premises were located to be blighted and in need of redevelopment. The tenant also challenged the validity of the ordinance adopting the redevelopment plan. The lower court found that the tenant was precluded from challenging the municipality’s blight designation because it did not file its suit within the forty-five day time limit required by Court Rule 4:69-6(a). In doing so, the lower court rejected the tenant’s arguments that it was entitled to receive personal notice of the hearings, just as the property owner was entitled to receive.

The tenant appealed, but the Appellate Division affirmed. The Appellate Division rejected the tenant’s claim that it was entitled to individualized personal notice of the hearings, and that since it did not receive such notice, the forty-five day time limit should not have barred its challenge. The Appellate Division noted that the United States Supreme Court adopted a three-prong test to determine whether a commercial tenant is entitled to enhanced notice. First, a court needs to determine if a tenant has protectible property interest (as opposed to a contractual right under a lease). Then, a court must determine if there is such a significant risk that a tenant would be erroneously deprived of it’s property interest and that additional notice would eliminate that risk. Third, a court must weigh the fiscal and administrative burdens on a municipality if it were required to notify both property owners and tenants. The Appellate Division concluded that commercial tenants do not have a protectible interest requiring enhanced notice of a blight designation. It found that commercial tenants have ample protections by being able to challenge the condemnation and receive compensation. It also found that enhanced notice requirements would unreasonably burden a municipality. The tenant appealed further.

The Supreme Court affirmed, but found that the Appellate Division decision included a discussion on an entirely different question than posed in this case. The case cited by the Appellate Division focused on what information must be given to a property owner to withstand constitutional muster, whereas this case addressed the question of who was entitled to notice. The Court noted that, although due process considerations were discussed, the Appellate Division ultimately concluded that neither the United States nor New Jersey Constitutions grant a tenant the right to notice before a property is deemed in need of redevelopment. The Court found that the legislature intended to limit the right to actual notice of a blight designation to owners of record and to those whose names are listed on the tax assessor’s records. The Court agreed that, in this case, the tenant was not deprived of any due process protections.

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