Conford, Matthews and Fritz.
The principal question here presented is whether the Commissioner of the Department of Environmental Protection has absolute discretion to cancel and revoke, prior to payment by the grantee and actual delivery of a deed, a prior resolution fully implemented by the appropriate agencies of the Department and state officials to grant a riparian interest to a qualified upland owner. We resolve that question in the affirmative.
Appellant owns a group of several small islands called collectively Flat Island, situated in Manahawken Bay and lying about 600 feet west of Long Beach Island. Her late husband, who died in July 1970, wrote to the then Division of Resource Development in the Department of Conversation and Economic Development*fn1 in April 1966 informally applying on behalf of himself and others for a grant of riparian title in connection with the proposed residential development of the island. On receiving informal approval, he submitted a formal application in July 1966 for a riparian lease or grant. A substantial expansion of the island by fill was contemplated. In September 1966 the Council advised Taylor that it had voted to issue the grant at $10 per front foot
for 4,825.44 feet and $7.50 for 9,747.19 feet along the waterways. At request, Taylor forwarded $500 to the Council for preparation of the instrument.
The then Commissioner remained undecided about the matter for three years. But on November 21, 1969 a copy of the deed was submitted to Taylor for review and he was informed that if satisfactory the deed would be executed. On November 28, 1969 Taylor signified accord. On December 17, 1969 the deed was signed by then Governor Hughes, the then Commissioner of the Department and the appropriate subordinate agency heads and it was duly attested and acknowledged. On January 27, 1970 (after inauguration of Governor Cahill) the supervisor of grants and leases informed Taylor that the grant was ready for delivery and requested payment in the sum of $121,373.15, advising him that payment had to be made by April 27, 1970.
On April 8, 1970 the Council voted to grant joint requests by Taylor and the Mayor of Long Beach Township for a six months' extension to October 27, 1970 for payment for the grant, Taylor having agreed to sell the island to the township and the extension being needed to afford the township voters time to approve the purchase by referendum. (Commissioner Sullivan took office April 22, 1970.) As the referendum date was later fixed for November 3, 1970, Taylor's attorney and a township commissioner requested a further two-month extension, and the Council granted it on October 14, 1970, but, according to its minutes, expressly "without prejudice to delivery of the grant and to have it reviewed by the Commissioner and the Attorney General; and the validity of the grant be referred to the Attorney General's office for an opinion." (Emphasis added.)
On November 3, 1970 the referendum failed of passage and on the same day the Commissioner informed Mrs. Taylor by letter that the application was denied. She filed an appeal to this court December 17, 1970, and was informed on May 4, 1971 that at its January 27, 1971 meeting, upon
the basis of the Commissioner's action, the Council had voted to cancel the application and forfeit the filing and preparation fees paid by the applicant.
On this appeal appellant argues (1) she entered into an agreement with the State and is entitled to specific performance thereof; (2) respondents have no power to annul the grant; (3) respondents are barred by equitable estoppel, and (4) refusal to deliver the grant and its cancellation are arbitrary and capricious and in violation of appellant's state and federal constitutional rights.
For a comprehensive discussion of the nature and history of the State's interest in riparian lands and of the development of the common and statutory law concerning transfer of such interests by the State see Bailey v. Driscoll , 34 N.J. Super. 228 (App. Div. 1955, per Hall, J.A.D.) affirmed in part and reversed in part in 19 N.J. 363 (1955). The Appellate Division opinion in that case, without disapproval in that of the Supreme Court, establishes that action or inaction by the designated agencies and officers of the State in respect of grants of its riparian interests is not reviewable in terms of alleged abuse of discretion but solely on the basis of whether their action is within or without the bounds of the pertinent statutory limitations. 34 N.J. Super. at 253. "Of course, the Council is entrusted with complete discretion as to whether it will convey anything and, if so, at what price * * *." Ibid. Since, moreover, the statute provides that no such grant shall be effective "except when approved and signed by the Governor and the Commissioner * * *," N.J.S.A. 13:1B-13; and see N.J.S.A. 13:1A-29, it is clear that the "complete discretion" of the Council is subject additionally to the equally comprehensive discretionary approval of the Chief ...