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McNally v. Township of Teaneck

Decided: October 17, 1977.


For affirmance in part, reversal in part and remandment -- Chief Justice Hughes and Justices Mountain, Sullivan, Pashman, Clifford, Schreiber and Handler. Opposed -- None. The opinion of the court was delivered by Schreiber, J.


The Township of Teaneck, pursuant to N.J.S.A. 40:56-1, which authorizes a municipality to assess lands benefited by a local improvement, levied special assessments against 313 residential properties for reimbursement of the costs of paving streets and installing curbs. Owners of 74 properties appealed*fn1 asserting that the criteria used in determining the amounts of the assessments were improper. The Superior Court vacated the assessments and remanded the matter to the Township for reassessment. 132 N.J. Super. 442 (Law Div. 1975). On appeal the Appellate Division, while retaining jurisdiction, remanded the cause to the trial judge to reassess each property. The matter is before us by virtue of our having granted motions for leave to appeal by the plaintiff landowners and defendant Township.

The detailed facts are set forth in the trial court's decision. For purposes of this opinion a summary of the pertinent facts is in order.

In March 1971 the Township adopted an ordinance providing that new paving and new curbs would be installed on parts of eleven streets located in three residential areas. These were designated as local improvements, the cost to be assessed upon the lands in the vicinity of the improvement in accordance with N.J.S.A. 40:56-1 et seq. The ordinance also stated that the assessments "shall in each case be as nearly as may be in proportion to and not in excess of the peculiar benefit, advantage or increase in value which the respective lots and parcels of real estate shall be deemed to receive by reason of such improvement. The total amount of the assessments so levied shall not exceed the cost of said improvement. The portion of such cost which shall not be so assessed shall be paid by the Township as in the case of a general improvement which is to be paid for by general taxation."

Upon completion of the project the Township appointed three residents of the municipality as commissioners to assess property owners for such improvement. N.J.S.A. 40:56-22. The chairman, Norman F. Sirianni, had previously served on eight to ten assessment commissions. He was a businessman and was president of a company which mined and marketed industrial sand. Julian Jerome Case, a member of the bars of New York and New Jersey, had 35 years experience in the real estate field as an owner, attorney, and instructor in real estate assessments and taxation. James R. Wynn, who did not testify at the trial, was an attorney and an accountant.

The total project costs consisted of $331,280 for the street paving, $12,105 for the curbing, and 7% overhead. These costs were itemized by streets and were furnished to the commissioners by the Township Engineer, Milton Robbins. The respective street costs varied depending upon such factors as the soil condition and size of the street. The accuracy and reasonableness of these figures are not in dispute.

Proposed assessments were calculated on a front-foot basis, that is, the total cost on a particular street was divided by the total foot frontage and the resultant figure multiplied by the foot frontage of each property. Thereafter, each commissioner visually inspected the improvements and the properties. After having satisfied themselves that the improvements were properly installed, checking the layout of each property on the municipal tax map and considering whether any special circumstances existed, the commissioners compared the allocated cost per property with the increased value in the land. The commissioners met on numerous occasions and held two public meetings with the property owners, some of whom appeared and voiced their objections to the proposed assessments. The commissioners concluded that in each instance the cost of the improvement did not exceed the enhanced value of the property.

In September 1973 the commissioners submitted a report to the Township Council setting forth the proposed assessments

and including a map showing the real estate benefited. After holding a hearing at which some property owners appeared, the Council confirmed the assessments with two modifications. The front footage on one property which had been miscalculated was corrected and a street paving cost on one street was adjusted.

In their complaint the landowners asserted that the assessments were improper because "there was no attempt made to assess for the peculiar benefits" to each property as a result of the improvement. They sought the return of any monies which had been paid and a restraint to enjoin the Township from assessing the plaintiffs on any basis other than the peculiar benefits or increased value received. In the pretrial order the plaintiffs' factual and legal contentions were that the assessment commissioner did not attempt to identify precisely the peculiar benefit, advantage or increase in value which accrued to each property and that N.J.S.A. 40:56-27, which restricts each individual assessment to the benefit, advantage or increase in value received, had been violated.

At the trial Commissioners Sirianni and Case testified, along with two realty appraisal experts, one for each party. Additionally, the deposition of Commissioner Wynn was admitted into evidence. The trial judge rejected the plaintiffs' expert and accepted the testimony of the defendant's expert, Joseph W. Burek. We believe she was fully justified in so doing.

Mr. Burek had been in charge of the Teaneck revaluation in 1970 and was familiar with the streets involved before the improvement. He examined the properties after the improvements and considered all available sales data. He fixed the market value of each parcel and the dollar enhancement attributable to the paving and curbing. Based on this data with respect to 22 of the properties, he found that the assessments exceeded the pecuniary benefits in varying amounts and that they were equal to or less than the market value enhancement of the remaining 51 parcels. His findings are summarized

in an appendix attached to the trial judge's opinion. 132 N.J. ...

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