Two recent decisions in New Jersey once again addressed good faith negotiations that are required of condemning authorities prior to commencing condemnation litigation. In County of Morris v. Randolph Town Center Assocs., L.P., the property owner appealed the lower’s court’s decision arguing that the condemning authority failed to fully disclose certain aspects of the project in its appraisal, and also violated the duty to negotiate in good faith. A copy of the Appellate Division’s decision in Randolph may be found here.
Similarly, in County of Bergen v. Rosemarie Arnold (available here), defendant Rosemarie Arnold (“Arnold”) alleged that the County’s (“Bergen”) “take it or leave it” offer failed to constitute as a bona fide negotiation, and thus Bergen was abusing its power of eminent domain. Nevertheless, the trial court in Arnold and the Appellate Division in Randolph each concluded that the condemning authorities fully complied with the requirements of bona fide negotiations, and thus were entitled to duly exercise its’ power of eminent domain.
In Randolph, the County of Morris (“Morris”) proposed to take an easement on a strip of undeveloped land for road widening and drainage. Morris gave notice to Randolph of the proposed taking and thereafter forwarded its constructions plans to Randolph. Morris conducted an inspection of the property conducted, which Randolph declined to attend. Morris thereafter completed its appraisal, and made its offer of compensation to the property owner.
Meanwhile, in Arnold, Bergen initially sought a temporary easement of one year for use of Arnold’s property during the reconstruction of a bridge nearby. Arnold alleged that despite having not entered into any agreement for the temporary easement, Bergen entered onto her property to proceed with the project, and during the process damaged her property. In response to Arnold’s complaints, Bergen requested and later received from Arnold an invoice of the damages claimed. Thereafter, Bergen offered to compensate her for the damages and also made an offer for three (3) permanent easements. It was determined by Bergen after the project that permanent easements were necessary for ongoing maintenance and repairs of the bridge in the future.
The negotiation processes in both cases were different. In Randolph, the property owner waited nearly five (5) months to respond directly to Morris’ initial offer for the easement. When Randolph did respond, it initially provided a memorandum that addressed concerns about the impact of the proposed taking on the remainder of the property and, after consideration, Morris concluded that the proposals by Randolph were not feasible due to pre-existing requirements on the land set forth by the NJDEP. In the end, a compromise between Morris and Randolph could not be reached and Morris thereafter proceeded with the condemnation action.
In determining whether a condemning authority satisfied the good faith negotiation requirement of N.J.S.A. 20:3-6, the Appellate Division in Randolph stated that the analysis was “a context-sensitive inquiry.” Comparing the facts here to prior cases such as County of Morris v. Weiner, the Appellate Division examined the actions of both parties during the negotiation process. Unlike in Wiener, the facts of Randolph demonstrated Morris’ diligence and willingness to negotiate a settlement with Randolph. The Appellate Division in Weiner rejected the condemnor’s actions of an “offer on a take-it-or-leave-it basis,” and stated that to require nothing more than an offer and a time period for acceptance or rejection “would simply eviscerate the bona fide negotiations requirement from the statute.” Here, the Appellate Division found that Randolph “was generally unresponsive to the County’s advances,” while Morris complied promptly with Randolph’s’ requests and provided articulated reasons for rejecting Randolph’s counteroffers. The court went further stating that Randolph did not even address the material issue (i.e. valuation) but “instead raised concerns about the underlying construction, which could have been raised at the planning stage of the project.” In light of these facts, the Appellate Division concluded that Morris satisfied the bona fide negotiation requirement and affirmed the lower court’s ruling.
In contrast to Randolph, prompt communications went back and forth between the two parties in Arnold. In response to Bergen’s offer, Arnold twice timely requested an opportunity to hire an independent appraiser, and twice requested an explanation as to Bergen’s necessity of the easements. The rift between the parties was the fact that Arnold was not satisfied by Bergen’s explanation with respect to its necessity for the easements. Although Bergen responded and explained its position, Arnold contended that the explanation given was insufficient. Two months after their last correspondence to this effect, Bergen filed a condemnation action.
The trial court in Arnold likewise concluded that Bergen “entered into and maintained bona fide negotiations.” Similar to the findings of the Appellate Division in Randolph, the trial court here indicated that Arnold failed to provide any evidence of value to counter Bergen’s offer, and concluded that although Arnold had the right to retain her own appraiser, “she does not have the right to enjoin [Bergen] from initiating a condemnation action indefinitely while she contemplates getting an independent appraisal.” In addition, the court deemed Arnold’s continued refusal to accept Bergen’s explanation of the necessity of the easements even after Bergen “proffered a rational, competent response” as an indication of “[d]efendant’s failure to cooperate.” In light of the court’s determination that Bergen engaged satisfactorily in bona fide negotiations, the court found that Bergen did not act in bad faith in its institution and litigation of the condemnation action.
Going forward, are these two decisions a sign of courts shifting the burden to the condemnees during the negotiation process once an offer is made by the condemnor? Or were the facts of these cases sufficient to hold that the condemnors did enough to engage in bona fide negotiations? Where should the line be drawn in the future?