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New Jersey Housing and Mortgage Finance Agency v. Moses

Decided: February 20, 1987.


On appeal from Superior Court, Law Division, Essex County.

Antell, Brody and Long. The opinion of the court was delivered by Antell, P.J.A.D.


Plaintiff appeals from seven judgments variously dated March 21, March 26 and March 31, 1986 dismissing its complaints in condemnation. The cases present common questions of law and fact and on April 17, 1986 we consolidated the appeals for all purposes.

On October 4, 1984 plaintiff agreed to finance the purchase by New Community Manor Housing Corporation of a 3.3 acre tract of land on the corner of South Orange Avenue and Bergen Street in the City of Newark. The property was to be developed as a shopping center with most of the space therein to be leased to the Pathmark Corporation, a private business concern, as a supermarket. The proposed shopping center was to be located in the vicinity of New Community's redevelopment area. Ten housing developments financed by plaintiff were located

within one-half mile of the 3.3 acre site of the shopping center, and 93,600 people resided within one mile of the site.

Plaintiff determined that successful development of the shopping center required that the property first be acquired by the State, and condemnation was authorized in the event that acquisition of the properties could not be accomplished through voluntary sale. Efforts at negotiation having failed, these condemnation complaints with orders to show cause were filed against the seven property owners named herein in September 1985 and orders were sought authorizing the appointment of condemnation commissioners.

On January 28, 1986, the return date of the orders to show cause, the trial court delivered an oral opinion, after hearing argument, directing judgments dismissing the complaints. The court noted that the proposed condemnation involved the taking of property from one private owner and ultimately transferring it to another. It determined that such action did not lie within plaintiff's statutory power and, further, that the lack of legislated standards as to when such power could be exercised constitutionally precluded the use of such authority even if it could be discerned by implication. We disagree that the power to condemn for the purpose described above lay beyond plaintiff's statutory power or that the grant of power was unaccompanied by standards sufficiently clear and definite to sustain its constitutionality.

Plaintiff was created under the terms of the New Jersey Housing and Mortgage Finance Agency Law of 1983, N.J.S.A. 55:14K-1 et seq. The Legislature's purpose in enacting the law is explained in the first paragraph of the statement attached to the bill:

This bill merges the New Jersey Mortgage Finance Agency and the New Jersey Housing Finance Agency into a single agency to be known as the New Jersey Housing and Mortgage Finance Agency. The HFA was established in 1967 to assist in financing multi-family housing projects. The MFA was created in 1970 to assist in financing the purchase of single family housing. The new agency will combine these functions and is given a broader grant of authority for financing housing programs. The agency can pool loans, offer

incentives, develop cooperatives, organize subsidiary corporations, create a Housing Development Corporation, and issue taxable and nontaxable bonds. It may provide financing for operating, maintaining, constructing, acquiring, rehabilitating or improving various types of housing, ranging from single room occupancy housing to single family homes to multi-family dwellings.

[ Senate State Government, Federal and Interstate Relations and Veterans Affairs Committee Statement, Assembly, No. 3463, L. 1983, c. 530].

After setting forth its findings regarding the reduced availability of financing for housing, the Legislature declared that

(1) Assure the availability for both rental housing and owner-occupied housing of feasible construction and permanent financing for new housing construction, the conversion of non-residential structures to housing, the rehabilitation and improvement of existing housing, and the transfer of existing housing among owners;

(2) Stimulate the construction, rehabilitation and improvement of adequate and affordable housing in the State so as to increase the number of opportunities for adequate and affordable housing in the State for New Jersey residents, including particularly New Jersey residents of low and moderate income;

(3) Enhance the productive capacity of the private sector in meeting the housing needs of the residents of the State;

(4) Assist in the revitalization of the State's urban areas; and

(5) Respond to changing housing demographic and economic circumstances by the development of innovative ...

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