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J & M Land Company v. First Union National Bank

A-829-98T3, 1999 WL 1272576 (N.J. Super. App. Div. 1999)

ADVERSE POSSESSION; MARSHLANDS—The presence of billboards as the only improvement on a large tract of not otherwise developed marshland does not change the land’s character from “uncultivated” land for which a sixty-year adverse possession period applies.

This is an appeal that required the Court to determine the limitations that govern a claim of title by adverse possession to part of a tract of open marshland. The owner of one of two adjacent tracts of marshland along the highway leased three sites along the highway to a company that erected and maintained billboards. Unnoticed to that tract owner or its lessee, one of the three sites was located on the adjacent neighbor’s property. For over forty years, the lessee paid rent to its landlord. During the same period of time, the neighbor had paid all taxes on its property. Eventually, the local tax assessor notified the neighbor that its tax assessment had been increased because billboards were located on its property. Prior to receiving that notification, it had no knowledge of the billboards’ presence. Unable to work out the problem, the tract owner that had leased the billboard sites brought an action for declaratory judgment for what it characterized as a “prescriptive easement” over the area where the billboards were located as well as over adjacent land used for maintenance of the billboards. The lower court held that the owner-landlord had not established its claim. Its decision rested on two alternative grounds. First, it held that the claim was governed by the sixty-year limitations period for adverse claims pertaining to “uncultivated tracts; and, second, that possession of the area where the billboards were located had not been “notorious"because the boundary line between the two properties was not visible to the naked eye. The lower court further held that the neighbor on whose property the billboard had been located was only entitled to rents from the billboards for the period subsequent to its demand letter. The Appellate Division agreed with the lower courts’ conclusion that the claim was governed by the sixty-year limitations period and this conclusion made it unnecessary to consider the alternative holding. The Court also concluded that the lower court was in error when it limited damages to the period following the demand letter. Instead, it held that the rents should be turned over for an entire six-year period. The applicable statute of limitations requires “[t]hirty years’ actual possession of any real estate excepting woodlands or uncultivated tracts, and 60 years’ actual possession of woodlands or uncultivated tracts, uninterruptedly continued by occupancy, descent, conveyance or otherwise… .” Here, the property claimed was open marshland that had never been cultivated and was apparently not suitable for any form of cultivation or development. Most importantly, the two billboards along the highway were only “limited” improvements that did not alter the basic character of the large open tract as uncultivated land. The landlord-tract owners’ contention and it could rely on a shorter twenty year limitations period was rejected by the Court, because the statute relied upon by that owner was only available to record owners to defend their own possession. The Court also rejected an argument that the applicable limitations period was only twenty years because the claim was to a prescriptive easement rather than a fee. “Even assuming that the limitations period for acquisition of a prescriptive easement in this State is only twenty years, regardless of the nature of the land to which the claim is made, ... [the claimant’s] use of [the adjacent] property was possessory in nature rather than merely an easement. The characteristics of an easement that distinguish it from a possessory interest are that an easement constitutes ‛a limited use or enjoyment of the land’ and ‛is not a normal incident of a possessory land interest.’” Here, the billboards were more than a limited use or enjoyment of the land. They were substantial structures connected to power lines that provided electricity required to illuminate them. In addition, it would have been impossible to make any use of the land in the vicinity of the billboards and the billboards were, in fact, the only practical use that could be made of any part of the property. Further, as a matter of equity, the Court felt that if it were to recognize a prescriptive easement, the encroached-upon property owner would remain liable for the taxes but, at the same time, its neighboring property owner “that had leased the billboards, would continue to reap the profits from the lease of the billboard site in perpetuity.” The Court was unwilling to sanction a claim that could lead to “such an unfair resolution of this case.”

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