State v. Testa

589 A.2d 190, 247 N.J. Super. 335, 1991 N.J. Super. LEXIS 121
CourtNew Jersey Superior Court Appellate Division
DecidedApril 17, 1991
StatusPublished
Cited by2 cases

This text of 589 A.2d 190 (State v. Testa) 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 v. Testa, 589 A.2d 190, 247 N.J. Super. 335, 1991 N.J. Super. LEXIS 121 (N.J. Ct. App. 1991).

Opinion

The opinion of the court was delivered by

SHEBELL, J.A.D.

This appeal raises anew the issue of the extent of disclosure required by N.J.S.A. 20:3-6, which directs that the condemning authority, prior to instituting an action to condemn, engage in bona fide negotiations with the property owner, including “an offer in writing ... setting forth ... 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 added). The State maintains that “N.J. S.A. 20:3-6 does not require disclosure during prelitigation negotiations of appraisal reports which are not approved by a condemnor nor relied upon in arriving at the offer of compensation.”

The State urges that we reject the holding of the Law Division in State, by the Comm’r of Transp. v. D’Onofrio, 235 N.J.Super. 348, 562 A.2d 267 (Law Div.1989), from which the State did not then appeal. D’Onofrio held that the reasonable disclosure aspect of bona fide negotiations under N.J.S.A. 20:3-6 requires a condemnor to provide a prospective condemnee with all appraisals obtained as part of the process in making its offer to purchase the property. Id. at 355, 562 A.2d 267. The State asserts that it did not appeal from the D’Onofrio decision because the condemnee did not seek dismissal and the State needed immediate possession of the property in order to proceed with a multimillion dollar highway improvement project.

[337]*337In the present case, the Department of Transportation (Department), prior to filing its complaint in condemnation, retained two appraisers to determine the value of the .592 acre parcel to be taken and to assess any damages to the remainder of the property. The Department acknowledges that it “subsequently received appraisals from both men and approved the appraisal of John Borden as its estimate of just compensation.” The Department negotiators then met with the property owners and presented them with a copy of the Borden appraisal plus an offer equal to that appraised value of the taking and damages in the amount of $511,000.

Negotiations were not successful; therefore, a complaint in condemnation was filed. An order to show cause for possession and appointment of commissioners was issued; however, the property owners obtained an adjournment of the return date and moved to dismiss the State’s complaint on the ground, among others, that the State did not engage in bona fide negotiations pursuant to N.J.S.A. 20:3-6 in that it failed to provide the owners with a copy of the appraisal report of Harry Renwick, an appraisal upon which the State contends it did not base its offer of compensation.

The Law Division judge, by order of July 5,1990, directed the State to provide the property owner with the Renwick appraisal within twenty days or face dismissal of the condemnation complaint. On August 1,1990, the property owners supplied an affidavit verifying that the State had not supplied a copy of the appraisal; whereupon, the court entered an order dismissing the State’s complaint. We affirm.

In this appeal the State raises no meaningful arguments that were not previously presented to the Law Division in D’Onofrio, 235 N.J.Super. at 348, 562 A.2d 267. Judge Serpentelli, in D’Onofrio, fully explored the various arguments pro and con on this issue in light of the relevant statutory authority and case law. He appropriately and articulately disposed of the State’s arguments against disclosure and concluded “that the [338]*338reasonable disclosure aspect of bona fide negotiations requires the condemnor to provide the prospective condemnee with all appraisals in its possession which have been obtained for the purposes of making its condemnation offer.” Id. at 355, 562 A.2d 267.

We are persuaded that fair dealing by the State requires disclosure of all appraisals of the subject property undertaken pursuant to the Eminent Domain Act, N.J.S.A. 20:1-1 to -36. Significantly, the Act requires notice of appraisals and provides that “the owners shall be given an opportunity to accompany the appraiser during inspection of the property.” N.J.S.A. 20:3-6. It would ill-serve the appearance of fair dealing if the landowners were then told they could not have pre-negotiation access to the report of an appraiser that they had accompanied on an inspection of their property.

The Legislature has expressly mandated that the condemnor undertake bona fide negotiations with the property owner and that the State’s offer may not be less than its “approved appraisal.” Id. We are satisfied.it intended that the State’s offer reflect the State’s good faith estimate of the full fair market value of the taking. See N.J.S.A. 20:3-6; R. 4:73-1. Thus, we are'convinced that the statutory mandate of “reasonable disclosure of the manner in which the amount of such offered compensation has been calculated” logically includes turnover of all appraisals as we are unable to perceive how the State’s calculation of the compensation to be offered would not of necessity include consideration of all appraisals which it had obtained in an effort to arrive at its good faith determination of full fair market value.

We are mindful, as the Supreme Court noted in its recent decision of State, by Comm’r of Transp. v. Carroll, 123 N.J. 308, 587 A.2d 260 (1991), that reasonable disclosure under N.J.S.A. 20:3-6 “would ordinarily not be as extensive as discovery during litigation.” Carroll, 123 N.J. at 320, 587 A.2d 260; see also R. 4:10-2(d)(3) and R. 4:73-11. This State, how[339]*339ever, has adopted a one-figure valuation procedure and has as its objective “prevent[ing] the State from making low offers to gain a bargaining advantage, forcing owners into adversarial positions in order to secure the full market values of their properties.” Carroll, 123 N.J. at 318, 587 A.2d 260; see also N.J.A.C. 16:5-2.1(d). “Indeed, the whole thrust of the eminent-domain process is that the State should operate differently from an open-market, arms-length buyer.” Carroll, 123 N.J. at 319, 587 A.2d 260 (citing State, by Comm’r of Transp. v. Siris, 191 N.J.Super. 261, 266-67, 466 A.2d 96 (Law Div.1983)). It is in furtherance of this policy that we conclude that “reasonable disclosure” must include the report of an appraiser engaged by the State even if the State does not intend to call the appraiser as an expert. The issue is quite different from that involved with disclosure during litigation.

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Cite This Page — Counsel Stack

Bluebook (online)
589 A.2d 190, 247 N.J. Super. 335, 1991 N.J. Super. LEXIS 121, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-v-testa-njsuperctappdiv-1991.