On appeal from the Superior Court of New Jersey, Law Division, Passaic County.
Seidman, Michels and Furman. The opinion of the court was delivered by Michels, J.A.D.
[175 NJSuper Page 387] Defendant State of New Jersey, by the Department of Transportation and the Commissioner of Transportation (hereinafter sometimes collectively referred to as the "State"), appeals and plaintiff Joseph L. Muscarelle, Inc. (hereinafter "Muscarelle") cross-appeals from a judgment of the Law Division (1) directing the State to institute condemnation proceedings to fix the compensation to be paid Muscarelle for the alleged compensable
taking of access rights to the latter's property; (2) fixing the valuation date of such taking and (3) awarding Muscarelle counsel fees and costs.
The facts essential to the resolution of this matter may be summarized as follows. Prior to 1975 Muscarelle was the owner of 10.375 acres of land located near the intersection of Routes 23 and 46 in the Township of Wayne, New Jersey. The property was near the Willowbrook Mall, located north of Route 46 and west of Route 23, and on its southerly side had approximately 800 feet of access permitted frontage along Route 46. However, the frontage served only westbound traffic since Route 46 was a divided highway in the area of this property. In September 1965 the State undertook a major highway construction project which provided for the realignment of the intersection of Routes 23 and 46 and new Interstate Route 80. On July 14, 1966, as part of the project, the State instituted a condemnation proceeding to acquire 1.712 acres of land along the northerly edge of Muscarelle's property needed for the construction of Route 80. In addition, the State sought to acquire a drainage easement along the easterly 430 feet of Muscarelle's 800 feet of frontage on Route 46. This drainage easement was necessitated by the proposed construction of a ramp which could connect Routes 80 and 23 with Route 46. This ramp was known and will hereinafter be referred to as "Ramp L." The proposed construction of Ramp L did not require the acquisition of any of Muscarelle's land because the ramp was to be built within the existing Route 46 right-of-way. Moreover, construction of Ramp L did not deny total access to Muscarelle's property along Route 46 since approximately half of Muscarelle's property fronted along the ramp and approximately half along Route 46.
As a result of the construction of Ramp L, ramp traffic would gradually merge with the Route 46 traffic and Route 46 traffic would have to weave across Ramp L traffic in order to approach the Muscarelle property. Muscarelle feared that this traffic flow would create a potentially hazardous situation for motorists attempting to enter its property from Route 46. Muscarelle therefore notified the State of this potential hazard and suggested
that a reconfiguration of the intersection be undertaken. In February 1966 Harvey W. Bingham, Jr., Muscarelle's chief engineer, conferred with an engineer from the Department of Transportation (Department) and reviewed the highway design. On June 27, 1966, shortly after the State instituted condemnation proceedings, Bingham submitted a suggested redesign of the ramp. By letter dated November 29, 1966 the Acting State Highway Commissioner notified Muscarelle that its proposed redesign of the ramp would create greater weaving problems than presently existed, pointing out that there was no denial of access to its property. The Acting Commissioner also informed Muscarelle that any further consideration of the latter's proposal was unnecessary, in effect, denying Muscarelle's request for access. Nonetheless, discussions continued between the State and Muscarelle until the condemnation hearing commenced on May 1, 1969. By that date the realignment of the highway interchange, including Ramp L, had been completed.
On May 1, 1969 the condemnation case was heard by the Commissioners. The State offered evidence to establish just compensation for the land taken plus damages to the remainder to be a total of $77,000, and Muscarelle offered proofs to establish just compensation to be a total of $290,324. Muscarelle's appraiser was of the opinion that by reason of the taking, the property would cease to be prime industrial and commercial land and would be best usable as farmland. In reaching this conclusion he noted the hazards that would be presented to cars entering the Muscarelle property from Route 46 by reason of the construction of Ramp L. Bingham also testified before the Commissioner as to potential traffic hazards created by the realignment of the intersection, particularly the construction of Ramp L, and was of the opinion that another ramp be located east of the property to provide a safe access. According to Bingham's testimony, the loss of access by the State's taking of the land "sterilizes" the property for commercial and industrial egress and ingress traffic.
At the conclusion of the condemnation hearing the Commissioners filed a report, dated May 7, 1969, awarding Muscarelle
compensation in the sum of $106,000. The State appealed the award to the Superior Court. While the appeal was pending and prior to trial, the State and Muscarelle continued discussions pertaining to the access problems created by the highway construction project. In fact, the trial was adjourned several times by the parties to enable them to continue their discussions. Eventually, the condemnation appeal was settled by the parties. A consent judgment, dated May 22, 1973, was entered in the Superior Court, directing the State to pay Muscarelle $106,000 "as full settlement of the condemnation proceedings"-the same sum originally awarded by the Commissioners. There was no agreement or understanding by the parties reserving from the operation or effect of that judgment any claim for damages arising out of the access problems.
Following the entry of the consent judgment meetings were still held between the representatives of the State and Muscarelle in an attempt to solve the access and traffic problems, but nothing was resolved. In early 1975 Muscarelle decided to construct a commercial office building to be known as "Wayne Interchange Plaza" on the property, and in late Fall of 1975 site plan work was commenced. On December 3, 1975 Muscarelle filed an application for access with the Department, seeking permission to construct an ingress driveway, connecting the westerly end of its property with Route 46 and an egress driveway, connecting its property with Ramp L. On December 30, 1975 the Department returned the application with a letter, suggesting that the plan be revised so ...