On appeal from the Superior Court of New Jersey, Law Division, Ocean County, L-2456-95.
Judges Pressler, Kestin and Alley.
The opinion of the court was delivered by: Pressler, P.J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
This is an inverse condemnation case involving an alleged regulatory taking. Ultimately, and before entry of final judgment, defendant Department of Environmental Protection (DEP), by way of amelioration pursuant to the Freshwater Wetlands Protection Act (FWPA), N.J.S.A. 13:9B-1 to -30, and more particularly 13:9B-22b, accorded plaintiff Darwin R. Griffith all of the permits and approvals he required in order to develop his property in Little Egg Harbor Township, allowing him to construct a 26-foot road over wetlands and to subdivide the upland portion into forty-three sewered lots. The amelioration also included waiver by DEP of an $80,000 environmental mitigation expense chargeable to plaintiff and waiver of his application fees which would have amounted to an estimated $10,700. DEP now appeals from final judgments and orders of the Law Division, entered after the amelioration was effected, holding that prior to the amelioration, DEP had, by reason of its course of administrative action, temporarily taken the land of plaintiff Darwin R. Griffith; fixing damages for the temporary taking; and awarding plaintiff a counsel fee pursuant to N.J.S.A. 20:3-26c. We reverse both the temporary taking award and the counsel fee award.
This is the fourth time this matter has been before us, and our prior opinions, to which we hereafter refer, recite much of the factual and regulatory background. In sum, the sixty-three acre site, of which twenty-three acres are freshwater wetlands located in a residential zone, is within the Pinelands National Reserve but is not under the development jurisdiction of the Pinelands Commission. Plaintiff had been a part owner of the site as well as of additional acreage since 1966, but by reason of a partition action concluded in 1984, became the sole owner of this tract, then valued at about $100,000, as well as of several other parcels, two of which he sold shortly after the partition judgment for about one million dollars. Since the site was essentially landlocked, he also obtained, by the partition judgment, an access easement to a public road, Bridge Road, over a tract to the west of the site.
In 1987 plaintiff sought approval from the Army Corps of Engineers for construction of a 26-foot wide road over the wetland portion, leading from a different public road to the uplands portion for which, however, no development application was then being made. DEP advised the Corps that a 26-foot road would be consistent with the State's coastal management plan, provided first, that plaintiff could demonstrate that there was no feasible alternative access to the site, and second, that plaintiff would agree to compensatory environmental mitigation activities. The Army Corps of Engineers never rendered a final decision, apparently because of the adoption of the FWPA, effective in 1988, by which the State assumed the Army Corps' jurisdiction in this regard. See N.J.S.A. 13:9B-2. Plaintiff's dealings from that point on were with the DEP.
Various complications then arose during the processing of the Fresh Water Permit (FWP) application, one of the first filed under the then new FWPA. To begin with, DEP became aware of the presence of an endangered species, Pine Barrens tree frogs, on the site, resulting in a wetlands resource reclassification from "intermediate" to "exceptional," a classification which required a greater buffer or transition area. DEP also learned of the Bridge Road access easement, which it believed could provide feasible alternative access. Finally, there was no submitted development plan for the uplands site demonstrating a public need for the access road that was the subject of the permit application. Accordingly, in 1989 the permit was denied, and plaintiff appealed the denial by way of a contested hearing conducted by the Office of Administrative Law. As the administrative appeal process evolved, it was finally administratively determined that the Bridge Road access was not a feasible alternative because of title problems, and after a further hearing, the resource classification issue was also ultimately resolved in plaintiff's favor.
Finally, on June 25, 1992, the date fixed by the trial judge as the date of taking, DEP issued an FWP permitting the construction of the road but limiting its width to sixteen feet, essentially for the reason that absent a development plan for the uplands, a showing had not been made justifying a wider road. DEP, however, also granted plaintiff leave to seek a major modification of the permit in the future consistent with any later submitted development plan. The permit also required plaintiff to obtain a stream encroachment permit and to submit a mitigation plan in compensation for the environmental disturbance before construction of the road. A further administrative appeal followed, the permit was modified in accordance with plaintiff's request for relocation of the road, and a final decision was issued by DEP for the 16-foot road on May 25, 1994. Plaintiff then appealed to this court from the 16-foot limitation of the FWP and several of its other provisions.
It was not until 1993, that is, after the initial issuance of the restrictive FWP, that plaintiff finally initiated administrative proceedings in order to obtain approval of development of the uplands site under the Coastal Area Facility Review Act (CAFRA), N.J.S.A. 13:19-1 to -21. CAFRA was first enacted in 1973 for the purpose of protecting New Jersey's fragile coastal areas by providing development guidelines, to be administered by DEP, for any construction in the coastal area. See N.J.S.A. 13:19-2. Pursuant to plaintiff's request, a pre- application conference was held with DEP in June of 1993 at which plaintiff was advised, among other details, that in order for the site to be sewered for development, he would need an amendment to the Ocean County Water Quality Management Plan (WQM). Plaintiff was also advised several months later that the environmental mitigation required of him would probably have to be off-site rather than the less burdensome on-site mitigation earlier proposed.
In November 1993, plaintiff submitted his CAFRA application seeking approval for forty-four single-family residences. DEP's initial response to the submission was a pre- application conference clarification letter sent about a week later which raised various problems requiring resolution and which advised plaintiff that CAFRA had been amended that year by L. 1993, c. 190, to be effective the following year. The clarification letter, which was followed by a deficiency letter several weeks later, also advised plaintiff that consistent with the amendment, new implementing rules would further restrict development and that in order to maintain the benefit of the pre-amendment statute and rules, plaintiff's CAFRA application would have to be declared complete for final review prior to July 19, 1994, the effective date of the amendments.
In January 1994, plaintiff obtained preliminary approval of the required amendment of the WQM Plan from both Little Egg Harbor Township and Ocean County. DEP, however, in May 1994, disapproved the amendment because of its concern about the secondary impacts of extending sewer service to a limited growth area and there had been no showing that septic systems would not have been acceptable, thus obviating the need for sewers. In the meantime, DEP's consideration of the CAFRA application went forward, DEP reminding plaintiff of his need to complete the application before the new rules went into effect and requesting various categories of additional information. Plaintiff, however, refused to provide the requested information even after being warned by DEP in September 1994 that his CAFRA application under the original statute and regulations would be canceled if it was not timely forthcoming. Plaintiff nonetheless persisted in his refusal to provide the information, and on December 2, 1994, DEP canceled the CAFRA application for that reason but without prejudice to its resubmission under the new rules. During the following month, plaintiff unsuccessfully sought DEP's reconsideration of its WQM Plan, and on January 30, 1995, he appealed to this court from the CAFRA cancellation, the disapproval of the WQM Plan amendment, and DEP's mitigation requirements.
Although the two appeals were considered separately, we simultaneously issued both opinions on May 24, 1996. In the appeal under Docket Number A-2667-94T5, we affirmed the CAFRA application cancellation, rejecting plaintiff's argument that completion for review was the date on which it was deemed sufficiently complete to warrant a public hearing, such a hearing having been held here. We thus sustained DEP's contention that it had never declared the application complete and hence that plaintiff was not entitled to the benefit of the prior rules. We also held that DEP had acted properly in refusing to declare the application complete by reason of plaintiff's refusal to submit the required additional information. We further rejected plaintiff's challenge to DEP's denial of approval of the amendment to the WQM Plan for the reason that plaintiff had failed to exhaust his administrative relief. For the same reason, noting further the lack of finality of the Commissioner's decision, we rejected plaintiff's challenge to DEP's disapproval of his proposed on-site mitigation plan. Finally, we concluded that DEP had not unduly delayed its review of plaintiff's plans, at least up until the time the notice of appeal was filed. The appeal under Docket Number A-6024-93T2 involved the restrictive FWP. We concluded that DEP had been arbitrary in imposing the 16-foot restriction. It was our view that after plaintiff's submission of his CAFRA application on November 15, 1993, a date after initial issuance of the restricted permit but before completion of the administrative process, DEP should have taken into account the nature of the development of the uplands proposed therein and thus reconsidered its rationale that no plans had been disclosed indicating the need for a wider road. We also held that plaintiff should not have been required to apply for a major modification of the permit in the future since all of the relevant information was already known to DEP.
Accordingly, we remanded to DEP for issuance of a permit allowing a road up to thirty feet in width and having a five-year term of viability before expiration. We also noted, by footnote 7 of our opinion, that in view of our direction to DEP to issue a satisfactory permit, it was not necessary for us to comment on plaintiff's contention that the restrictive permit DEP had issued constituted a regulatory ...