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Township of Piscataway v. South Washington Avenue, L.L.C.

A-2741-02T5 (N.J. Super. App. Div. 2004) (Unpublished)

EMINENT DOMAIN; PUBLIC PURPOSE—Using the power of eminent domain to acquire a farm for passive recreational use so as to preserve open space in accordance with a municipality’s Open Space Plan is a valid public purpose even if an enabling ordinance appears to have been adopted when the farm owner would not voluntarily sell its property.

A farm owner was offered $12.3 million by one developer and $13.8 million by a second developer. Both wanted to build high-density single-family housing on his farm. Such a use was not permitted by the local zoning regulations. Three years after receipt of those offers, the municipality’s improvement association expressed an interest in the farm so that it could extend a local park. The association told the owner that it had hired an appraisal company to estimate the land’s fair market value. After receiving the appraisal, the association told the owner that it would not purchase the property itself; instead, the municipality would. The owner’s attorney unsuccessfully requested a copy of the appraisal. Instead, the municipality obtained a new appraisal, and sent that one to the owner. The appraiser estimated the farm’s value at $4.3 million. The association attributed the discrepancy with the earlier offers on the absence of the needed variance, meaning that the earlier offers were not considered as a measure of true value.

The farmer refused to sell for $4.3 million unless the municipality agreed to change its zoning regulations applicable to an unrelated parcel he owned. The municipality refused, but said that it was willing to explore options other than an outright taking of the farm.

Later that year, the municipality warned the owner that it was passing an ordinance to allow it to condemn the farm. It assured the owner that the ordinance would not take effect unless it became impossible to reach an agreement. An agreement was never reached. So, the municipality filed a condemnation complaint. In response, the owner argued that the ordinance was invalid and that the municipality had failed to tell him of available relocation assistance for the farm’s tenants. He also claimed that failure to provide the first appraisal evidenced a failure to engage in fair negotiations.

The lower court found a legitimate public purpose for the ordinance because the farm was being acquired for “passive recreational use so as to preserve open space in accordance with [the municipality’s] Open Space Plan.” It also held that the failure to provide relocation assistance was the farmer’s fault for refusing to provide the names and addresses of his tenants. Finally, it determined that although the farmer was entitled to both appraisals, the second one was merely an extension of the first. Thus, according to the lower court, the municipality had complied with the disclosure requirements.

On appeal, the farmer again raised the first two issues, and also claimed that the municipality’s “Open Space Plan,” on which the taking was based, was inconsistent with the municipality’s Master Plan and was inadequate to justify the taking. The Appellate Division disagreed, and affirmed the decision. First, the farmer contended, in response to the holding that he refused to provide the information of his tenants, that the municipality had the power to enter the land without consent to determine who lived on the farm. The Court pointed out, however, that even if that were true, the owner had in fact refused to allow the municipality to access the farm. The Court held that such hostile action on the farmer’s part defeated the purpose of the Eminent Domain Act, which is to promote the amicable resolution of condemnation actions without resort to litigation.

The farmer also raised a new argument, claiming that the municipality did not seek to condemn the farm for a public purpose. “Public use” had been defined by prior case law to refer to any use that enlarges the general welfare and benefits the community. Other than in the most extreme situations, such a determination is beyond the scope of judicial review. A decision by a state or local government that condemnation would further the public good can be reversed only when there is an abuse of discretion. Based on this standard, the Appellate Division held that the farm was taken for a legitimate purpose.

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