State v. Marlton Plaza Assocs., L.P., DOCKET NO. A-2164-10T4
| Court | New Jersey Superior Court – Appellate Division |
| Parties | STATE OF NEW JERSEY, BY THE COMMISSIONER OF TRANSPORTATION,Plaintiff-Appellant, v. MARLTON PLAZA ASSOCIATES, L.P., a Delaware Limited Partnership; and MARLTON PLAZA ASSOCIATES II, L.P., a Delaware Limited Partnership, Defendants-Respondents, and BANK OF AMERICA, NATIONAL ASSOCIATION, successor to Bank of New England, National Association, by various mergers and name changes; FREEDMAN AND LORRY RETIREMENT PLAN, Freedman and Lorry P.C. Retirement Plan, Components Corporation of America Pension Trust; JOHN HANCOCK LIFE INSURANCE COMPANY (U.S.A.), successor to The Manufacturers Life Insurance Company (U.S.A.), successor to The Manufacturers Life Insurance Company; LASALLE BANK, N.A., as Trustee for Bear Stearns Commercial Securities, Inc.; WELLS FARGO BANK, N.A., as Trustee for the benefit of the Registered Holders of J.P. Morgan Chase Commercial Mortgage Securities Corporation, Commercial Mortgage Pass-Through Certificates, Series 2006-LDP6; MARLTON CROSSING MAINTENANCE ASSOCIATION, a New Jersey Non-Profit Organization; THE TJX COMPANIES, INC., a Delaware Corporation doing business as T.J. Maxx; CARTER'S RETAIL, INC., a Delaware Corporation, doing business as Carter's; HOUSEHOLD FINANCE CORPORATION III, a Delaware Corporation; LEE TSUY, doing business as Oriental Nail Salon; SUPERCUTS, INC., a Delaware Corporation, doing business as Supercuts; HOMEGOODS, INC., a Delaware Corporation, doing business as HomeGoods; TWEEN BRANDS, INC., a Delaware Corporation, doing business as Justice for Girls; COSMETIC GALLERY, INC., a New Jersey Corporation, doing business as Image Cosmetics; BURLINGTON COAT FACTORY WAREHOUSE OF MONTVILLE, INC., a New Jersey Corporation; FIVE BELOW, INC., a Pennsylvania Corporation, doing business as Five Below; DIFILLIPPO X, INC., a New Jersey Corporation, doing business as Saladworks; BLINK HAIR/FACE/BODY INC., a New Jersey Corporation, doing business as Blink Spa; THE SPAGHETTI HOUSE, INC., a New Jersey Corporation, doing business as The Spaghetti House; TD AMERITRADE, INC., a New York Corporation, doing business as TD Waterhouse; PRG GROUP, INC., a New Jersey Corporation, doing business as Fleet Feet of Marlton; ANDREAS BOUTIQUE, INC., a New Jersey Corporation, doing business as Andrea's Boutique; BOB TIMMINS, doing business as Great Wraps; DONNA'S BAG, INC., a New Jersey Corporation, doing business as Donna's Bag; MARLTON CROSSING FITNESS, a New Jersey Limited Liability Company, doing business as Smart Bodies; THE LITTLE GYM INTERNATIONAL INC., a Delaware Corporation, doing business as The Little Gym of Marlton; GIADON CORPORATION, a New Jersey Corporation, doing business as Scruples Hair Salon; DISH IT OUT LTD., a New Jersey Corporation, doing business as Dish It Out; SOUTH JERSEY TANNING AND SPA, L.L.C., a New Jersey Limited Liability Company, doing business as Planet Beach Tanning Salon; PALZ FOODS, INC., a New Jersey Corporation, doing business as Food for Thought; CIRCLE CENTER CLEANERS, a New Jersey Limited Liability Company; SCRUBS & BEYOND, L.L.C., a Delaware Limited Liability Company, doing business as Scrubs & Beyond; GUITAR CENTER STORES, INC., a Delaware Corporation, doing business as Music & Arts; DANA'S HALLMARK; JOE'S PEKING DUCK HOUSE, INC., a New Jersey Corporation; NOPPAKAO OF MARLTON, INC., a New Jersey Corporation, doing business as Thai Taste; CLAUDIA HUGHES, doing business as Smoothie King; JOYCE LESLIE, INC.; JAY MADI, INC., a New Jersey Corporation, doing business as Quizno's Subs; PEARLE VISION, INC., a Delaware Corporation; THE PLAYING FIELD TOO, a New Jersey Limited Liability Company, doing business as The Playing Field; KAPLAN EDUCATIONAL CENTERS, INC., a Delaware Corporation, doing business as Kaplan Learning Center; JENNY CRAIG WEIGHT LOST CENTRE'S, INC., a Delaware Corporation; DSW SHOE WAREHOUSE, INC., a Missouri Corporation; CARRYL SLOBOTKIN, doing business as Jazz Unlimited Dance Studio; CHAMPPS OF MARLTON, INC., a New Jersey Corporation, doing business as Champps American Restaurant; and TOWNSHIP OF EVESHAM, in the County of Burlington, a Municipal Corporation of New Jersey, Defendants. |
| Docket Number | DOCKET NO. A-2164-10T4 |
| Decision Date | 08 June 2012 |
STATE OF NEW JERSEY,
BY THE COMMISSIONER OF TRANSPORTATION,Plaintiff-Appellant,
v.
MARLTON PLAZA ASSOCIATES, L.P., a Delaware Limited Partnership; and
MARLTON PLAZA ASSOCIATES II, L.P., a Delaware Limited Partnership,
Defendants-Respondents, and BANK OF AMERICA,
NATIONAL ASSOCIATION, successor to Bank of New England,
National Association, by various mergers and name changes;
FREEDMAN AND LORRY RETIREMENT PLAN, Freedman and
Lorry P.C. Retirement Plan, Components Corporation of
America Pension Trust; JOHN HANCOCK LIFE INSURANCE COMPANY (U.S.A.),
successor to The Manufacturers Life Insurance Company (U.S.A.),
successor to The Manufacturers Life Insurance Company; LASALLE BANK,
N.A., as Trustee for Bear Stearns Commercial Securities, Inc.;
WELLS FARGO BANK, N.A., as Trustee for the benefit of
the Registered Holders of J.P. Morgan Chase Commercial Mortgage Securities Corporation,
Commercial Mortgage Pass-Through Certificates, Series 2006-LDP6;
MARLTON CROSSING MAINTENANCE ASSOCIATION, a New Jersey Non-Profit Organization;
THE TJX COMPANIES, INC., a Delaware Corporation doing business as T.J. Maxx;
CARTER'S RETAIL, INC., a Delaware Corporation, doing business as Carter's;
HOUSEHOLD FINANCE CORPORATION III, a Delaware Corporation; LEE TSUY,
doing business as Oriental Nail Salon; SUPERCUTS, INC., a Delaware Corporation,
doing business as Supercuts; HOMEGOODS, INC., a Delaware Corporation,
doing business as HomeGoods; TWEEN BRANDS, INC., a Delaware Corporation,
doing business as Justice for Girls; COSMETIC GALLERY, INC., a New Jersey Corporation,
doing business as Image Cosmetics; BURLINGTON COAT FACTORY WAREHOUSE OF MONTVILLE, INC.,
a New Jersey Corporation; FIVE BELOW, INC., a Pennsylvania Corporation,
doing business as Five Below; DIFILLIPPO X, INC., a New Jersey Corporation,
doing business as Saladworks; BLINK HAIR/FACE/BODY INC., a New Jersey Corporation,
doing business as Blink Spa; THE SPAGHETTI HOUSE, INC., a New Jersey Corporation,
doing business as The Spaghetti House; TD AMERITRADE, INC., a New York Corporation,
doing business as TD Waterhouse; PRG GROUP, INC., a New Jersey Corporation,
doing business as Fleet Feet of Marlton; ANDREAS BOUTIQUE, INC., a New Jersey Corporation,
doing business as Andrea's Boutique; BOB TIMMINS, doing business as Great Wraps;
DONNA'S BAG, INC., a New Jersey Corporation, doing business as Donna's Bag;
MARLTON CROSSING FITNESS, a New Jersey Limited Liability Company,
doing business as Smart Bodies; THE LITTLE GYM INTERNATIONAL INC., a Delaware Corporation,
doing business as The Little Gym of Marlton; GIADON CORPORATION, a New Jersey Corporation,
doing business as Scruples Hair Salon; DISH IT OUT LTD., a New Jersey Corporation,
doing business as Dish It Out; SOUTH JERSEY TANNING AND SPA, L.L.C., a New Jersey Limited Liability Company,
doing business as Planet Beach Tanning Salon; PALZ FOODS, INC., a New Jersey Corporation,
doing business as Food for Thought; CIRCLE CENTER CLEANERS, a New Jersey Limited Liability Company;
SCRUBS & BEYOND, L.L.C., a Delaware Limited Liability Company,
doing business as Scrubs & Beyond; GUITAR CENTER STORES, INC., a Delaware Corporation,
doing business as Music & Arts; DANA'S HALLMARK; JOE'S PEKING DUCK HOUSE, INC., a New Jersey Corporation;
NOPPAKAO OF MARLTON, INC., a New Jersey Corporation, doing business as Thai Taste; CLAUDIA HUGHES,
doing business as Smoothie King; JOYCE LESLIE, INC.; JAY MADI, INC., a New Jersey Corporation,
doing business as Quizno's Subs; PEARLE VISION, INC., a Delaware Corporation;
THE PLAYING FIELD TOO, a New Jersey Limited Liability Company,
doing business as The Playing Field; KAPLAN EDUCATIONAL CENTERS, INC., a Delaware Corporation,
doing business as Kaplan Learning Center; JENNY CRAIG WEIGHT LOST CENTRE'S, INC., a Delaware Corporation;
DSW SHOE WAREHOUSE, INC., a Missouri Corporation; CARRYL SLOBOTKIN,
doing business as Jazz Unlimited Dance Studio; CHAMPPS OF MARLTON, INC., a New Jersey Corporation,
doing business as Champps American Restaurant; and TOWNSHIP OF EVESHAM,
in the County of Burlington, a Municipal Corporation of New Jersey, Defendants.
DOCKET NO. A-2164-10T4
SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION
Argued February 14, 2012
Decided June 8, 2012
Page 2
Before Judges Parrillo, Skillman and Hoffman.
On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Docket No. L-2388-07.
David R. Patterson, Deputy Attorney General, argued the cause for appellant (Jeffrey S. Chiesa, Attorney General, attorney; Melissa H. Raksa, Assistant Attorney General, of counsel; Nonee Lee Wagner, Deputy Attorney General, on the brief).
David B. Snyder argued the cause for respondents (Fox Rothschild LLP, attorneys; Mr. Snyder, of counsel and on the brief).
Jamie M. Bennett argued the cause for amicus curiae New Jersey Coalition of Automotive Retailers, Inc. (Wilentz, Goldman & Spitzer, attorneys; Marvin Brauth, of counsel and on the brief; Ms. Bennett, on the brief).
Drew K. Kapur argued the cause for amicus curiae Maple Shade Properties, LLC (Duane Morris LLP, attorneys; Mr. Kapur, of counsel and on the brief; Michael J. McCalley, on the brief).
The opinion of the court was delivered by PARRILLO, P.J.A.D.
Page 3
At issue is the scope of damages awardable to condemnees at a just compensation trial where a highway improvement project involves both a modification of access and a condemnation.
Pursuant to its authority under the State Highway Access Management Act, N.J.S.A. 27:7-89 to -98 (Access Act), the New Jersey Department of Transportation (DOT) closed one of several access driveways leading into defendants' shopping center. Later, in an eminent domain proceeding, it condemned a small strip of land, a slope easement, and a temporary work area within the shopping center in the vicinity of the former driveway.
At the just compensation trial, defendants claimed that they were entitled to damages not only for the value of the condemned land and easements, but also for losses in property value allegedly caused by the closure of the access driveway. The trial court agreed and allowed defendants to present expert testimony concerning internal traffic congestion that would result from the driveway closure and the impact of such congestion on the shopping center's value. The jury accepted this testimony, at least in part, as it awarded defendants considerably more compensation than a taking of the land and easements alone would warrant.
Page 4
The State now appeals the order for judgment and fixing just compensation at $1,607,000. For reasons that follow, we reverse and remand for a new trial.
Due to congestion in the area, in 2001 DOT moved forward with the Marlton Circle Project, which would eliminate the traffic circle created by the confluence of Routes 70 and 73 in Evesham Township and replace it with a flyover so that Route 73 would cross Route 70 on an overpass. The project affected the roadways around defendants' property, the thirty-two acre Marlton Crossing Shopping Center (Center).
The Center lies on two irregularly-shaped parcels of land, close to where Route 73 crosses Route 70. The north parcel consists of 16.8 acres with 956 feet of frontage along Route 73. The south parcel consists of 15.3 acres, with 786 feet of frontage along Route 73. An internal connector road lies between the two parcels.
The Center originally had three access driveways that provided ingress and egress onto Route 73: the northern driveway, the central driveway leading to the connector road, and the southern driveway. The Center could also be accessed through driveways on Old Marlton Pike, Lippincott Drive, and Centre Boulevard.
Page 5
Construction of the new overpass/underpass interchange required that a traffic ramp be built directly in front of the north parcel. Because the northern-most of the Center's three access driveways on Route 73 would intersect Route 73 at the point where cars were merging from the traffic ramp, DOT determined to close that driveway1 and notified defendants of the proposed closing sometime in the Fall of 2003.
Defendants submitted a counter-proposal, which DOT incorporated into a new access modification plan. When defendants objected to the modified plan, a meeting was held between defendants and representatives of DOT. As the result of that meeting, defendants submitted a second counter-proposal that included the closure of the northern driveway. This counter-proposal was discussed at a second meeting with representatives of DOT on April 6, 2005. At that time, DOT agreed to defendants' alternate proposal and also agreed to make parking lot improvements necessary to remediate the closure. Revised plans reflecting the agreed-upon modifications were completed on April 11, 2005, and copies were sent to defendants' consultant. Defendants did not appeal from, or seek further DOT review of, the access modification determination depicted in
Page 6
those plans, see N.J.A.C. 16:27-4.33, which ultimately became part of the final construction package. Consequently, as part of the construction project, the State removed the driveway, replaced it with new curbing and pavement and striped the pavement for parking spaces.
In order to construct the new interchange, the State condemned a small strip of land (.23 acres or 10,021 square feet) along the Center's frontage on Route 73. It also condemned a slope easement (.179 acres or 7,807 square feet) so that it could level the grade between the parking lot and the traffic ramp. Finally, it condemned a temporary work easement so that it could make the improvements necessitated by the removal of the driveway. Interestingly, due to a straightening of the property line, the takings actually increased the Center's road frontage on Route 73 from 1,731 feet to 1,748 feet.
On August 25, 2006, DOT formally offered defendants $179,600 for the land taken in fee and slope easement. One year later, on August 23...
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