STATE, BY COMM'R OF TRANSPORTATION v. Hancock

506 A.2d 855, 208 N.J. Super. 737
CourtNew Jersey Superior Court Appellate Division
DecidedAugust 29, 1985
StatusPublished
Cited by14 cases

This text of 506 A.2d 855 (STATE, BY COMM'R OF TRANSPORTATION v. Hancock) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
STATE, BY COMM'R OF TRANSPORTATION v. Hancock, 506 A.2d 855, 208 N.J. Super. 737 (N.J. Ct. App. 1985).

Opinion

208 N.J. Super. 737 (1985)
506 A.2d 855

STATE OF NEW JERSEY, BY THE COMMISSIONER OF TRANSPORTATION, PLAINTIFF,
v.
H. EDWARD HANCOCK AND WALTER W. HANCOCK, ET ALS., DEFENDANTS.

Superior Court of New Jersey, Law Division Burlington County.

Decided August 29, 1985.

*738 John J. Franzini for plaintiff (Irwin I. Kimmelman, Attorney General of New Jersey, attorney).

S. David Brandt for defendants (Brandt, Haughey, Penberthy, Lewis & Hyland, attorney).

HAINES, A.J.S.C.

Our condemnation statute, N.J.S.A. 20:3-6, provides that

... no action to condemn shall be instituted unless the condemnor is unable to acquire such title or possession through bona fide negotiations with the prospective condemnee, which negotiations shall include an offer in writing by the condemnor to the prospective condemnee holding the title of record to the property being condemned, setting forth the property and interest therein to be acquired, the compensation offered to be paid and a reasonable disclosure of the manner in which the amount of such offered compensation has been calculated. ...
[Emphasis supplied]

Defendant Hancock claims that the State has failed to comply with these requirements. This opinion agrees with that contention and sustains an objection to the appointment of condemnation commissioners.

This matter does not involve substantial money. The State's offer of compensation totals $9550. The fact that the amount is modest highlights the significance of the principle involved. The statutory requirements of "bona fide negotiations" and "reasonable disclosure" are particularly important when minor property interests are being acquired by an exercise of the power of eminent domain. Condemnees subject to these takings can ill afford to hire attorneys and appraisers whose fees are not recoverable in a condemnation proceeding (except in circumstances not relevant here). They must be given every assurance that their government, spending, in part, their money, is treating them with absolute candor and fairness. Such assurance can be provided only if the government, when undertaking negotiations, fully discloses all of the information upon which it relies in making its offer. How else can its negotiations be "bona fide"?

*739 In the present case Hancock hired an attorney but has not incurred the expense of an appraisal. The taking is partial, requiring payment of fair market value for the land taken plus damages caused to the remaining portion. The State's appraiser has advised counsel for Hancock (1) that the $9550 offer represents $4700 for the land taken and $4850 for damages to the remainder, and (2) as the locations, dates and amounts of the three comparable sales used to establish these figures, the names of the buyers and sellers involved in each and the recording data for the deeds delivered. The appraiser has also provided the attorney with a "confirmation of offer letter," said by the State to detail the valuation methods used in its appraisal. The attorney's request for a copy of the State's appraisal was refused.

The "confirmation of offer" letter, after identifying the property, states in full the following:

Confirming my personal negotiations discussion with you of today, the State has had your property appraised so as to estimate the offer of compensation to be paid to you for the land to be acquired and all legal compensable damages to any remainder.
For your analysis and to assist you in a better understanding of the value offer, the following is a summary of the total amount offered as just compensation without prejudice:
    1. Value of all property in the taking
       area                            $4700           -0-         $4700
                                                                   _____
                                        Land      Improvements       Total
    2. Loss of value (damages) to remaining property outside
       the taking area                                             $4850
                                                                   _____
         Total estimate of just compensation for property
         taken and damages, if applicable                          $9550
                                                                   _____
Before initiating these negotiations, careful property inspections were accomplished at which time you were provided an opportunity to accompany the appraisers on their inspection of your property in accordance with the provisions of the Eminent Domain Act of the State of New Jersey. One or more appraisal reports were secured from professional appraisers who considered the Market sales, Income and Cost approaches to value. The appraisals were then *740 reviewed by a reviewing appraiser specialist who, after also personally inspecting your property and then considering the total available information and the above mentioned appraisal methods, established the appraised fair market value estimate as being the State's opinion of just compensation and registered same in the Transportation Department Headquarters in Trenton as the offer to be made to you.
The proposed taking is as indicated on the attached map we mutually reviewed. It is (partial) and in fee or such lesser interests as are shown on the map. The following improvements are considered to be realty and having been evaluated as such, they are to be acquired by the State:
None
It is trusted that you will find this meets with your approval and that an amicable agreement mutually satisfactory will be achieved. I am available for further discussion or to assist as requested.
Frank A. Jarnecki 9-12-84 Right of Way Negotiator

This is not an informative document. Its self-serving references to "careful property inspections," "professional appraisers" and "a reviewing appraiser specialist," without any supporting facts, are salesmen's ploys. The representation that "Market sales, Income and Cost approaches to value" were considered is apparently incorrect. The representation to counsel was that only comparable sales were considered.

The information provided by the State, verbally and in writing, falls far short of satisfying the statute. The use of comparable sales for appraisal purposes invariably involves the adjustment of the sales figures in order to make them comparable. American Institute of Real Estate Appraisers, The Appraisal of Real Estate (8 ed. 1983) at 330-331. Adjustments, which depend upon different factors, such as time of sale, distance from the property taken, and financing terms, may increase or decrease these figures and are based upon the frequently differing opinions of experts. Despite the fact that adjustments made or not made by the State's appraiser significantly affect the validity of the offer, no information concerning adjustments has been provided to Hancock or his attorney. The State's appraisal would have supplied this information and more. Without it, neither Hancock nor his attorney had any meaningful way to check the validity of the State's figures. *741 They could not, for example, perform the most elementary check: adding, subtracting and multiplying figures to insure arithmetical accuracy. They could not test the validity of the verbal information supplied by the appraiser.

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Bluebook (online)
506 A.2d 855, 208 N.J. Super. 737, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-by-commr-of-transportation-v-hancock-njsuperctappdiv-1985.