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May 29, 1963

UNITED STATES of America, Plaintiff,

The opinion of the court was delivered by: MEANEY

Pursuant to the Second War Powers Act of 1942 § 201 (50 U.S.C.App. § 632) the United States Government instituted condemnation proceedings to obtain an easement for a pipeline that was to run and now does run from Texas to Bayonne, N.J.

Part of this pipeline, approximately a mile long, runs across the bed of Newark Bay, a navigable body of water located in the State of New Jersey. Title to this land is in the State of New Jersey except where transferred to the predecessors in title of the Bergen Point Iron Works, Bayonne, N.J. A short part of it runs across the uplands of the Bergen Point Iron Works (hereinafter referred to as Bergen Point). The State of New Jersey in open court withdrew its claim to compensation, leaving only Bergen Point claiming compensation for the taking of the easement over its riparian rights, alleging that the pipeline obstructs its access to the navigable channels of Newark Bay and that it, Bergen Point, is damaged thereby.

 A stipulation has been entered into by the Government and Bergen Point in substance as follows:

 By Declaration of Taking dated September 26, 1947, a perpetual right of way or servitude, in, over, and across certain tracts of land situate in the County of Hudson, State of New Jersey, was taken by the United States of America. The premises subject to the Declaration were actually taken in possession on September 13, 1943.

 Two grants of riparian lands were conveyed by the State of New Jersey to the Central Railroad of New Jersey and the Bayonne Improvement Co., respectively, and title to the lands contained in these two grants was, by mesne conveyances, eventually lodged in Bergen Point.

 The property of Bergen Point Iron Works contains 4.322 acres, of which 136,500 square feet or 3.13 acres of upland and 51,700 square feet or 1.12 acres of land are under water out to the pierhead line of 1923 (1929).

 A preliminary hearing was held on the question of whether Bergen Point was entitled to any compensation other than for the easement on its upland, and decision was reserved. Reference to this determinative question will be made hereafter.

 The court conducted a full hearing, considering the evidence of damage to Bergen Point, if it should be entitled to compensation for the damage resulting from the easement taken by the Government, affecting both the under water rights and the uplands, and, in the alternative, the damage resulting from the taking on the uplands alone.

 From the testimony adduced by the witnesses for Bergen Point, no use had been made of water facilities between 1928 and the date of taking, nor was any application made subsequent thereto to the appropriate Federal Government authorities for any alteration in the situation which might afford access for Bergen Point to deep water, though in 1959 inquiry was addressed to a New Jersey agency along that line. Moreover, between 1928 and 1943 no use was made of a pier which extended from the shore line of Bergen Point approximately 195 feet to the pierhead line. As a matter of fact the pier had been permitted to degenerate so that in 1943 it consisted of piles projecting upward from the water. Furthermore, silt had accumulated so that the river bottom at the Bergen Point property shelved from zero to 6 feet at the pier end. There was one occasion when a barge was brought up to the dilapidated and useless pier in or about 1957, being brought in at high water and resting on silt at low tide.

 It would seem that the easement on the uplands occupied about 1,481 square feet at the far end of the property of Bergen Point, and considered apart from whatever damage the under water taking may have caused, the actual value of the upland taken was agreed by both appraisers to be nominal, $ 500.00 by the Bergen Point appraiser, and $ 100.00 by the government appraiser.

 Each appraiser testified as to his opinion of the damage to Bergen Point if the effect of the under water easement is to be considered. There were no sales of exactly comparable properties at the time of taking, but Stewart, the appraiser for Bergen Point, testified as to a sale of water front property (Shiverick, seller) with riparian rights in Newark Bay in 1930, the sale price being $ 20,000.00 an acre, which he estimated to have decreased to $ 15,000.00 an acre in 1943. Another sale in 1937 on the same side of Newark Bay (Brown, seller) brought $ 18,000.00 an acre, but that too was subject to the general decline in value by 1943. Both of these properties had bulkheads, though on the Shiverick property the bulkhead had been built by the lessee.

 Mr. William C. Stewart appraised the 4.32 acres of land of Bergen Point, including under water lands, at $ 15,000.00 per acre, or $ 64,700.00 (as he testified). He appraised the buildings at $ 211,200.00 making a total valuation of the Bergen Point property at $ 275,900.00, this before the taking and including riparian rights. After the taking he appraised the land, including under water land, at $ 10,000.00 per acre, or $ 43,200.00. The improvements he valued at $ 209,800.00, deducting the utility damage to the dilapidated pier at $ 1,400.00. His appraisal of the total value of the property, after the taking, thus amounted to $ 253,000.00, with a net loss to Bergen Point of $ 22,900.00. His appraisal was based on his estimate of one-third of the value of all the lands due to the interference of the pipeline with access by Bergen Point to deep water, plus utility damage to the pier.

 In the course of his testimony he said that as conditions existed in 1943, if Bergen Point had decided to use water transportation it would have been necessary to dredge a channel which could have been done by suction dredging, and also to drive steel piling to 'hard pan' a depth of 20 to 25 feet. Evidently up to 1959 Bergen Point had been using rail and other methods of land transportation. It was only after the lapse of sixteen more years that Bergen Point took even tentative steps to ameliorate a condition which ...

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