TRENTON – What is the value of an ocean view? The Appellate Court of New Jersey published an opinion and order on back-to-back appeals Oct 28. The opinion, rendered by Judge Anthony J. Parrillo began, “These appeals, consolidated for purposes of this opinion, present recurrent issues facing shore communities and their residents.”
The issues boil down to the very human desire to live by the water, especially the ocean. As nice as that view is and as healing the proximity, it also presents a risk. Superstorm Sandy was certainly evidence of that. Barriers are often erected in an attempt to mitigate those risks. At its heart this case is about views (aesthetics) versus security and who is responsible for it.
Before 1987, Ocean City did not have a dune system to speak of to provide shore protection. Ocean City relied upon dunes that were naturally created. Property owners along the water enjoyed an unobstructed view. In 1989, Ocean City participated in a beach replenishment program and dunes restoration work. The state and federal governments also participated.
In 1991, Ocean City proposed easements with property owners. An easement is a legal right to use real property of another without owning it. Ocean City agreed under the easement to construct and maintain a dune system with a height limitation of no greater than three feet above the average elevation of the bulkhead (usually 12 feet in the property block). That was a contract between the property owners and Ocean City. All went well until the state inserted itself into the process through legislation known as the Coastal Area Facility Review Act (CAFRA) and agreements with the Department of Environmental Protection (DEP).
The plaintiffs’ position was that Ocean City was basically in concert with the state and should not be left off the hook.
However, according to the court opinion, “The 1994 CAFRA amendments rendered impossible Ocean City’s performance under the easement agreements pre-dating the effective date of those amendments and, therefore, relieved the municipality of its contractual obligations. The plaintiff’s cry of ‘Breach of Contract’ was dismissed because the court ruled that the intervening actions of the state made it impossible for Ocean City to hold up its end of the deal regarding the dunes.
The Appeals Court also held that Ocean City did not have to compensate plaintiffs for that breach since it was both impossible and unforeseeable when the contract was made. In addition, the court ruled that the property owners had received the benefit of storm protection which added to the value of their properties.
The other claim of the plaintiffs was that of “inverse condemnation.” Inverse condemnation is when a government agency takes private property and destroys its value or use which is the equivalent to an actual condemnation. Their claim was based on the principle of fairness or equity.
The Appeals Court decided multiple claims for multiple plaintiffs (the original complaint in 2002 had nearly 100), and in the end it decided for four.
Those plaintiffs had entered into agreement with Ocean City after July 19, 1994 by which time the city knew of the CAFRA amendments. Ocean City knew it could not maintain the dunes to conserve the property owners’ views. So to allow Ocean City off scot-free would amount to unjust enrichment.
The final issue was: What is a room with a view of the ocean worth? Is it a $1 million, $100 or priceless? And while in theory and on TV commercials a beautiful view may be priceless the law deals with more concrete evaluations.
The Appeals Court opinion states, “The core issue at trial was loss of view and its valuation. Actually, it was undisputed that these plaintiffs suffered a loss of view, as the trial judge observed firsthand in his two visits to the site in question. “But that is where agreement ended. So the Appeals Court sent that small section of its ruling back to the trial court to decide the amount because the plaintiffs have riparian rights (riparian rights are the rights of the owner of land forming the bank of a waterway to use the water and its benefits) including a view. “Because the trial court here failed to make specific findings as to its damages awards, we are constrained to remand the matter for further explication of its fact determinations and conclusions of law.”
To contact Helen McCaffrey, email hmccaffrey@cmcherald.com.
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