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City of East Orange v. Board of Chosen Freeholders

Decided: December 13, 1965.


Conford, Kilkenny and Leonard. The opinion of the court was delivered by Leonard, J.A.D.


Plaintiff appeals from a summary judgment entered by the Essex County Court, in favor of defendant and against plaintiff, denying plaintiff's demand for interest on the sum of $85,000, paid by defendant to plaintiff for two parcels of land acquired by deeds from plaintiff for improvement purposes. Interest was claimed for the period between August 1, 1962, when defendant went into possession and the deeds were delivered, and August 13, 1963, when the purchase price was paid. Plaintiff also appeals from the court's denial of its alternate claim for damages for use and occupancy of the land during the period in issue. The opinion of the County Court is reported at 84 N.J. Super. 242 (1964).

This matter was submitted to the trial court upon an agreed statement of facts, which, as supplemented by exhibits, constitutes the factual record on this appeal.

Defendant initiated its proceeding to secure real estate for highway purposes pursuant to N.J.S.A. 27:16-54 et seq. On July 26, 1961, the Board of Water Commissioners of the City of East Orange (Water Board), by two separate letters, agreed with the Essex County Highway Right of Way Commission (Right of Way Commission), to accept $70,000 for a portion of the premises in question and $15,000 for the balance. On September 28, 1961 the Right of Way Commission rendered an award in the foregoing stipulated amounts, which award was filed with the Register of Essex County on September 29, 1961.

On June 7, 1962 the county engineer sent to the Water Board, for its approval, two forms of deeds necessary to consummate the agreement. On June 18, 1962 the Water Board,

by resolution, authorized the mayor and city clerk of plaintiff to execute the same. By similar resolution, dated July 17, 1962, plaintiff authorized execution thereof by these officials. Thus, these city officials were authorized to act for both plaintiff and the Water Board. Pursuant thereto, the two deeds, dated July 31, 1962 were executed and, on August 2, 1962, sent to the county engineer. Plaintiff City of East Orange was therein designated as the grantor.

Defendant went into possession of the subject premises and commenced construction of the proposed improvement on or about August 1, 1962.

On December 27, 1962 defendant was advised by Lawyers Clinton Title Insurance Company, from whom it sought title insurance, that it would not insure title based upon the aforementioned deeds, but that it required an additional deed executed by the Water Board. This demand was made as a result of an appeal pending in the litigation between plaintiff and the Water Board. See City of East Orange v. Board of Water Commissioners of City of East Orange, 73 N.J. Super. 440 (Law Div. 1962), affirmed 40 N.J. 334 (1963).*fn1

Sometime after December 27, 1962 and prior to April 3, 1963 plaintiff was advised of the position taken by defendant's title insurer, and on the latter date appropriate resolutions of the Water Board were forwarded to defendant's counsel. On April 18, 1963 plaintiff's counsel was sent a copy of a letter sent by the title company to defendant's counsel in which the company stated that in addition to the two city deeds it required two quitclaim deeds from the Water Board. The requested deeds were forwarded to defendant the next day. On June 6, 1963 defendant returned the deeds to plaintiff for changes and additions, and on June 21, 1963 plaintiff

returned them as modified, together with an appropriate resolution by the Water Board. Thereafter, voucher forms were sent to and returned by plaintiff, and on August 13, 1963 a check in the amount of $85,000 was forwarded to plaintiff which was accepted without prejudice to its claim for interest on that sum from August 1, 1962 until August 13, 1963.

Plaintiff contends that there was a taking of the property involved herein, by defendant, on August 1, 1962 under eminent domain proceedings, and therefore plaintiff is entitled to interest from that date by virtue of N.J.S.A. 27:16-65, or upon general equitable principles usually applicable in such proceedings. Defendant denies that there was a proceeding in eminent domain involved herein, but, to the contrary, asserts that defendant acquired title by virtue of a voluntary agreement as to purchase price and, therefore, plaintiff is not entitled to interest for either of the reasons it alleges. Defendant, in the alternative, asserts that, even ...

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