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State v. P. & C. Realty Co.

Decided: December 4, 1972.

STATE OF NEW JERSEY, BY THE COMMISSIONER OF TRANSPORTATION, PLAINTIFF,
v.
P. & C. REALTY CO., INC., ET AL., DEFENDANTS



Crane, A.j.s.c.

Crane

This is a condemnation matter in which the State has taken a parcel of property and a building owned by defendant in Paterson, New Jersey. The building was used as a clothing factory and contained sewing and pressing machinery suitable for such a purpose. Defendant has brought this motion requesting the court to instruct the condemnation commissioners to award damages by evaluating the premises as a functional unit, including the machinery.

It has been stipulated that the machinery is the kind usually used in clothing manufacture, that it is not unique or complex, is movable and has in fact been moved to another location. The State concedes for the purposes of this motion that the building and the machinery as used prior to the condemnation did constitute a functional unit but it contends it has an option to pay for the machinery or moving expenses and it has announced its election to pay for moving expenses.

Counsel agree that the facts in this case are almost identical to those in the matter of Housing Authority of Clementon v. Myers , 115 N.J. Super. 467, 480 (App. Div. 1971). In that case it was held that where a condemnee

had removed machinery at his own expense from a building theretofore operated as a functional unit he was entitled to the value of the functional unit, including the machinery, or to the value of the land and building plus the expense of moving the machinery, at the option of the condemnor.

On behalf of the condemnee it is now argued that the option available to the condemnor under the Myers case is no longer available in view of the adoption of the Eminent Domain Act of 1971, N.J.S.A. 20:3-1 et seq. Specifically, it is argued that the term "property," as defined in N.J.S.A. 20:3-2(d), requires inclusion of the value of the machinery. In short, it is argued that the adoption of the statute has modified the rule of the Myers case in such a way as to deny the condemnor the option of paying for the value of the machinery or the cost of moving.

In order for the condemnee's point of view to prevail, the Court would have to find that the machinery in question fits within the definition of property found in N.J.S.A. 20:3-2(d):

"Property" means land, or any interest in land, and (1) any building, structure or other improvement imbedded or affixed to land, and any article so affixed or attached to such building, structure or improvement as to be an essential and integral part thereof, (2) any article affixed or attached to such property in such manner that it cannot be removed without material injury to itself or to the property, (3) any article so designed, constructed, or specially adapted to the purpose for which such property is used that (a) it is an essential accessory or part of such property; (b) it is not capable of use elsewhere; and (c) would lose substantially all its value if removed from such property.

First of all, the fact that the machinery has been removed militates against defendant's position. If the machinery was an "essential and integral part" it undoubtedly would not have been removed. The fact of its removal negates a conclusion that "it cannot be removed without material injury to itself or to the property." And its nature

and character as well as the fact of removal indicate it "is capable of use elsewhere," and that it would not "lose substantially all its value if removed." Consequently, the machinery has not been shown on the basis of the stipulation to come within the definition of property as set forth in N.J.S.A. 20:3-2(d).

The condemnee stresses the point that its plant operated as a "functional unit." The phrase seems to have first appeared in our case law in the opinion of the Supreme Court in State v. Gallant , 42 N.J. 583, 590 ...


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