TRENTON – The state Supreme Court Monday sided against a Long Beach Island couple who sued over compensation because their ocean view was lost due to dune construction.
The court said that Harvey and Phyllis Karan – who won $375,000 in a lower court case – should have their case heard in a new trial.
The court ordered a new trial, saying that a property’s fair market value should be used as the benchmark in computing “just compensation” in a partial-takings case.
It said that “non-speculative, reasonably calculable benefits that increase the property’s value at the time of the taking should be considered in determining just compensation regardless of whether those benefits are enjoyed to a lesser or greater degree by others in the community.
“Because the Borough was prohibited from presenting evidence of such benefits, and the trial court erroneously charged the jury as to the calculation method for just compensation, a new trial is required.”
The town of Harvey Cedars built the dunes in 2010, pre-Superstorm Sandy, to protect the shore from just such massive storm systems, and it appealed the Karans’ jury award. The Karans’ home did survive the storm last year.
The case will have ramifications up and down the Jersey Shore, because the state wants to build more dunes to protect its coast from future hurricanes.
In this case, the town used condemnation procedures on part of the beach, and the Army Corps of Engineers built a 22-foot-high dune.
The couple went to court, claiming the value of their approximately $2 million property had been damaged.
In its ruling, the court said that the right of ‘just compensation’ is an essential guarantee of the Constitution.
“That the Karans are entitled to ‘just compensation’ for the taking of a portion of their property for this public project is not in question. Instead, the focus here is on how to calculate ‘just compensation’ when the taking of a portion of the property for a public project may lessen in part and enhance in part the value of the remaining property,” the court said.
The court ruled that while the trial judge allowed the homeowners to present evidence of how their property value was diminished, the court did not allow Harvey Cedars to present evidence of how the dune projection project would improve the value of their property.
The decision to order a new trial was made by Justices Albin, LaVecchia, Hoens, Patterson and temporary assignment justice Rodriguez. Chief Justice Rabner and another temporary assignee, Justice Cuff, did not take part in the case.