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Magic Touch Construction Company v. Borough of Keyport

A-4304-03T2 (N.J. Super. App. Div. 2006) (Unpublished)

CONDEMNATION; STATUTE OF LIMITATIONS — Depositing of fill and subsequent development by a municipality of a landowner’s property constitutes a taking, but claims for damages, trespass or inverse condemnation must be filed within the six year statute of limitations.

During a project in 1964 to reclaim land under a bay, the municipality deposited fill along the rear line of a privately owned upland parcel down to the high water line. On top of the fill, the municipality constructed a bulkhead, a road, and a parking lot. Part of the parking lot rested on a privately owned parcel. An old tax map showed the high water line to be the same as the rear line of that privately owned parcel. A newer tax map showed approximately an eight foot wide gap between the end of that property and the high water line. The municipality never acquired title to this swath of land. Because of this construction, the private landowner claimed damages, trespass, and inverse condemnation. Additionally, the private landowner based its claims of ownership to the disputed swath as follows: (i) it was the owner of the upland parcel and because the municipality never obtained title to the disputed swath; (ii) it had a longtime use of the parcel for parking purposes; (iii) there was no signage restricting parking on the disputed land; (iv) it had continuously maintained the upland parcel, including by doing trash collection, snow removal, repaving, and repairing parking bumpers; and (v) the municipality’s failure to affirm its ownership, including by not requiring removal of a “No Trespassing” sign, failure to assert ownership until this action began, the failure to object for a period of more than ten years to a riparian rights application before the Bureau of Tidelands Management; and (iv) whenever the municipal fire department held its annual fair on the parking lot, always naming the private owner as an additional insured on its insurance policy. In addition to damages, the private landowner sought possession of the land and a judgment quieting title in its favor. The municipality claimed ownership by virtue of adverse possession dating back to 1964 when it deposited the fill during the reclamation project.

The depositing of the fill and its subsequent development in 1964 constituted a taking. The redevelopment project itself put the then-owner of the privately owned parcel on notice that the municipality had seized its land. Because no claim for damages, trespass or inverse condemnation had been filed within the six year statute of limitations, those claims were dismissed by the lower court. The private landowner’s remaining claims for possession and title were not limited by the six year statute of limitations. Therefore, according to the Appellate Division, the lower court wrongly dismissed the private landowner’s claims of possession and title. As to these two issues, the Appellate Division ordered reversal of the lower court’s summary judgment in favor of the municipality. And, because these issues involved ownership of the disputed swath, summary judgment in favor of the municipality’s adverse possession claim also had to be reversed. These remaining issues were remanded.

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