Property Owner is Injured But Has No Remedy at Law

by: Joseph Grather
1 Aug 2013

Berardi I (Tp of Pemberton v. Berardi, 378 N.J. Super 430 (App. Div. 2005)).

On September 30, 2002, the Township of Pemberton commenced a condemnation action to acquire property owned by the Berardis within a designated redevelopment zone in the municipality.  Contemporaneous with the commencement of the action, the Berardis filed an applications with the planning board to make substantial improvements to the site (to “redevelop” the property and cure alleged building code violations that apparently  fomented the blight designation).

In June of 2003, the Court appointed Commissioners to value the property, and a hearing for that purpose was held on November 6, 2003.  The Commissioners awarded the owners $2,270,000 and the owners immediately appealed requesting a trial in the Superior Court to determine just compensation.

In March of 2004, the owners filed a motion to compel the municipality to take title to the property (i.e. file a declaration of taking) or abandon the action as authorized by the Eminent Domain Act.  The trial court denied the motion, but ordered the municipality to deposit the amount of the Commissioners’ award with the clerk of the court.  The municipality deposited the $2,270,000 in May of 2004.  The property owner appealed the denial of their motion to compel a taking or abandon the action.

After an exhaustive analysis of the relevant case-law and the policy considerations behind the Eminent Domain Act, the appellate court agreed with the property owners and held:

“We hold that the word “may” used in N.J.S.A. 20:3-25 is mandatory and not permissive, as evidenced by its legislative history and by the application of well-established principles of statutory construction. A condemnor, on a condemnee’s application to the court, must either [***32]  (1) file a declaration of taking and make the required deposit of compensation offered the condemnee pursuant to N.J.S.A.20:3-18 or (2) abandon the proceedings pursuant to N.J.S.A. 20:3-35. The court retains discretion to extend the time for the filing of the declaration of taking for up to three months from the date the condemnee files the application.”

Accordingly, on June 16, 2005, the court “reverse[d] the decision of the trial court and order[ed] that within thirty days of the date of this opinion, Pemberton shall either file a declaration of taking or abandon the property in accordance with N.J.S.A. 20:3-35.”

Berardi II (Berardi v. Tp of Pemberton, Docket A-1973-11T2 (App. Div. July 25, 2013)):

Eight years later, the Appellate Division issued its second opinion (link here) in a case with origins dating to the complaint filed eleven years ago.  This most recent decision was not favorable to the owners.  The appellate court affirmed a decision of the trial court dismissing their claim against Pemberton for damages caused by an alleged temporary taking.

After Berardi I was decided, the municipality filed a Notice of Abandonment of Proceedings.  In November of 2005, the trial court ordered that the $2,270,000 be returned to the municipality.

Almost three years later, on August 18, 2005, the owners filed a separate action against the municipality  “‘seeking the recovery of fees, costs and damages resulting from the abandonment of the antecedent condemnation case.’ Count Four of the complaint sought damages for the “temporary taking” of the Berardis’ lots.   Pemberton filed a motion for partial summary judgment, seeking dismissal of Count Four of the complaint, and the Berardis filed a cross-motion for partial summary judgment on that count. A hearing on the cross-motions for summary judgment took place before the motion judge and she granted partial summary judgment in favor of Pemberton, dismissing Count Four of the Berardis’ complaint. Thereafter, a consent order and final judgment granting attorneys’ fees and disbursements to the Berardis was entered on November 14, 2011.”

The Berardis appealed dismissal of their claim for damages caused by an alleged temporary taking of their property during the pendency of the ultimately abandoned condemnation action.

In the end, the appellate court agreed with the trial judge:

“We discern no reason to disagree with the decision of Judge M. Patricia Richmond, as expressed in her comprehensive written opinion, “that ‘all property is owned subject to the power of eminent domain and that damages which a landowner suffers as an incident to such proceedings and the subsequent abandonment thereof are damnum absque injuria, the condemnor being in the exercise of a legal right.'” (quoting 92 A.L.R.2d 355 §2). The motion judge concluded “that Pemberton did not commit a constitutional taking of the Berardis’ property.” We agree.” (Slip op. at 16).

Since law school, I have always questioned judicial use of the ancient “damnum absque injuria” (a “loss or injury that does not give rise to an action for damages against the person causing it.” Blacks Law Dictionary 393 (6th Ed 1990)) doctrine because in my view, the law should always provide redress for an injury caused by another person or entity.  This is especially true when the thing injured is one’s constitutionally protected property rights.

Maybe the owners will seek redress in the Supreme Court, or perhaps they just want to see the end of this long saga, and who could blame them?