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Case Studies: Eminent Domain & Takings

Kelo v. City of New London, 545 U.S. 469 (2005)

U.S. Supreme Court case decided in 2005 which allows cities and municipalities to condemn and seize properties through eminent domain to support a redevelopment plan. The defendants in this case were nine property owners who refused to sell their properties to a private developer. The private developer, working with the City of New London, had created a plan of economic redevelopment which included a waterfront hotel, restaurants, retail stores, residences, office spaces and a marina. The court granted wide deference to the City’s decision to seize the property, in order to facilitate the redevelopment plan.

D&M Asbury Realty, LLC v. City of Asbury Park, 2006 N.J. Super. Unpub. LEXIS 716 (App.Div. Jan. 24, 2006)

In this unpublished opinion, the City of Asbury Park created a development plan for the waterfront community to create a mixed use community that modeled more of a traditional city, with retail, entertainment and cultural facilities. The City approved the attempt by the private developer to purchase needed properties from private parties and authorized the use of eminent domain for the remaining properties whose owners refused to sell.

Several plaintiffs challenged the City asserting many causes of action, including the City’s right to take property by eminent domain. The City relied upon the holding from New London, and the courts agreed. The courts looked to case law and statutory interpretation in finding that the “redevelopment area may include lands, buildings, or improvements which of themselves are not detrimental to the public health, safety or welfare, but the inclusion of which is found necessary, with or without change in their condition, for the effective redevelopment of the area of which they are a part." N.J.S.A. 40A:12A-3.

City of S. Amboy v. Great Lakes Dredge & Dock Co. 2007 N.J. Super. Unpub. LEXIS 1810 (App.Div. July 17, 2007)

Two companies appeal from a ruling declaring the City’s use of eminent domain to condemn their property for purposes of a waterfront redevelopment project. The court upholds the city’s statutory right to use their authority for redevelopment of a blighted part of the city. The defendants raise a common argument in eminent domain cases that the true purpose of the project is to benefit a private party rather than the public good. A municipality may not take private property for the purpose of conferring a private benefit on a private party, nor could a municipality "be allowed to take property under the mere pretext of a public purpose, when its actual purpose was to bestow a private benefit." Kelo v. City of New London, 545 U.S. 469, 478, 125 S. Ct. 2655, 2661, 162 L. Ed. 2d 439, 450 (2005)

The court finds no merit in that argument stating that "the fact that a private party may benefit from the taking does not render the taking private and not for 'public use.'" Twp. of W. Orange, supra, 172 N.J. at 573. The court was convinced that the city had met its burden in proving the strong public policy of redeveloping the waterfront area, specifically by the need to build a public transportation center, schools and a mixed use residential community.

National Ass’n of Homebuilders v. State, Dept. of Envt’l Protect., 64 F. Supp. 2d. 354 (1999)

Case History: In 1988 a rule was promulgated that required all owners of property with the Hudson River Waterfront Area to comply without compensation the construction and maintenance of a 30 foot walkway along the entire waterfront (according to NJDEP specifications), to convey to the NJDEP a conservation restriction (easement) for the walkway in question, and allow perpendicular access to the public for the walkway.

Ten years later in 1998, Plaintiffs challenged this rule as an unconstitutional taking of property. The defense is that the property is subject to the Public Trust Doctrine.

Holding: Federal Court held that the requirements to build and maintain walkways (under N.J.A.C. 7:7E-3.48), did not constitute a “taking” and are supported by the Public Trust Doctrine.