For affirmance -- Chief Justice Weintraub, and Justices Wachenfeld, Burling, Jacobs, Francis and Proctor. For reversal -- Justice Heher. The opinion of the court was delivered by Jacobs, J. Burling, J. (concurring).
[27 NJ Page 258] The Law Division, on an appeal from an award by condemnation commissioners, determined that the just compensation to be paid for the taking of property of
the respondent J. William Jones was $15,000 plus interest. The plaintiff appealed to the Appellate Division and we certified under R.R. 1:10-1(a).
The respondent J. William Jones owned land in the Borough of West Long Branch which had a frontage of 100 feet on the northerly side of Oceanport Avenue. The easterly side of the property ran parallel to Salem Avenue which intersected Oceanport Avenue. A corner lot with a frontage of 50 feet on Oceanport Avenue, owned by the Monmouth Park Jockey Club, separated Salem Avenue from the Jones property. On or about June 13, 1955 the State Highway Department began construction of a connecting highway known as "Route 36 -- Joline Avenue Connection." This construction was through and over the Monmouth Park Jockey Club property and part of Salem Avenue, and in its latter stages it entailed physical entry onto a minor portion of the Jones property at its northwest corner where a curb was built by the Highway Department. As a result the Jones property was converted from an inside lot into a corner lot. The Joline Avenue Connection was completed and opened to public use on October 14, 1955. Mr. Erb, principal engineer of the Highway Department, testified that so far as he knew nothing was done between June 13, 1955 and October 14, 1955 to the Jones property except the curbing "at the lower left-hand corner of the Jones property and some grading around the sidewalk area in connection therewith." Mr. Gill, a right-of-way negotiator employed by the Highway Department, testified that Mr. Jones had told him that he would give the corner of his land to the Highway Department if it would forego taking the remainder of his property. Mr. Gill also testified that following discussion with Mr. Jones a signboard on the Jones property extending into the adjacent property which the Highway Department had taken was reduced in size so that it stood entirely within the confines of the Jones property.
On January 3, 1956 the plaintiff State Highway Commissioner filed a condemnation complaint alleging that he had determined to acquire the Jones property for state highway
purposes and seeking the appointment of condemnation commissioners to fix the compensation to be paid for the taking of the property. An order to show cause was issued and on February 27, 1956 commissioners were appointed. On August 27, 1956 the commissioners fixed the compensation to be paid by the plaintiff at the sum of $15,000. On October 2, 1956 the plaintiff filed notice of appeal and on November 2, 1956 Judge Ewart signed an order which provided that the issue to be tried was the value of the lands taken and the damages if any resulting from such taking to any remaining property "as of January 3, 1956." On March 5, 1957 a pretrial order was prepared and signed by Judge Ascher and counsel for the parties; this order set forth that the plaintiff "demanded trial to determine the issue between the parties hereto as to the value of lands taken and damages if any resulting from such taking to any remaining property as of January 3, 1956." The trial was held before Judge Ewart, sitting without a jury, on June 4-6, 1957 and at its commencement, counsel for the plaintiff stated that the date of the filing of the complaint was controlling and that the trial judge was correct in his view that the proceeding on appeal was "to determine the fair value of the property as of January 3rd, 1956."
During the course of the trial, counsel for the plaintiff suggested that there had actually been a taking of the entire Jones property on June 13, 1955 and that compensation should be fixed on the basis of the condition of the property at that time when it was an inside lot rather than on January 3, 1956 when it was a corner lot. The court ruled that January 3, 1956 was the controlling date but it also stated: "I can't say that I think there is any testimony before me that the State Highway Department took possession of this Jones property in June nor at any time during 1955." In response to this, counsel for the plaintiff urged that the "over-all project," including the curbing at the northwest corner of the Jones property, was completed in 1955 and that there was a taking of the "whole property" at that time. But he made no offer to introduce any additional
testimony to support his position and gave no indication that there was any further supporting evidence available to him. The record fairly indicates that the trial court did not preclude the plaintiff from introducing evidence that there was a taking in 1955. On July 8, 1957 Judge Ewart addressed a letter opinion to counsel in which he advised that he was valuing the property as of January 3, 1956 and that he had fixed its valuation at the sum of $15,000. The plaintiff's appeal from the ensuing judgment rests on the single point that "reversible error was committed by the trial court in failing to determine the value of the defendant's land in the condition it was when the property was taken on June 13, 1955."
Where the State Highway Commissioner condemns land for highway purposes he must pay compensation in accordance with constitutional and statutory requirements. See Constitution 1947, Art. I, par. 20; R.S. 20:1-1 et seq. The proper measure of compensation is generally said to be the fair market value at the time of the institution of his condemnation proceeding. See R.S. 20:1-9; State by State Highway Com'r. v. Cooper, 24 N.J. 261, 268 (1957), certiorari denied 355 U.S. 829, 78 S. Ct. 41, 2 L. Ed. 2 d 42 (1957); New Jersey Highway Authority v. Wood, 39 N.J. Super. 575, 579 (App. Div. 1956), certification denied 21 N.J. 551 (1956). Where the taking coincides with the institution of the condemnation proceeding, this measure of compensation operates justly insofar as both the condemnor and condemnee are concerned. However, where there is a taking followed by a change in the condition of the property before the institution of the condemnation proceeding, different considerations apply. See North Hudson County R. Co. v. Booraem, 28 N.J. Eq. 450, 455 (E. & A. 1877). Under R.S. 27:7-22 the State Highway Commissioner is authorized to enter upon and take property in advance of the institution of his condemnation action (see Abbott v. Beth Israel Cemetery Ass'n. of Woodbridge, 13 N.J. 528, 549 (1953)), although the statute would seem to contemplate no significant delay between the taking and the legal
proceeding. If, after the taking and before the condemnation action, the property is reduced in value because of alterations by the Commissioner or otherwise, the condemnee would justly be entitled to the higher valuation as of the date of taking; this is the view which prevails generally throughout the country (3 Nichols, Eminent Domain § 8.5 (3 d ed. 1950)), and it may well be compelled by the constitutional guaranty of just compensation. On the other hand if, after the taking and before the condemnation action, the land increases in value because of alterations by the Commissioner or otherwise, the condemnee would not justly be entitled to the higher valuation; as Nichols puts it, any changes in the conditions of the property which take place after the taking "whether they result in an increase or a decrease in the value thereof, cannot affect the amount of the compensation to be paid." See State by State Highway Com'r. v. Gorga, 26 N.J. 113, 115 (1958). In the Booraem case, supra, the Court of Errors and Appeals ...