On appeal from Superior Court of New Jersey, Law Division, Cape May County, Docket No. L-257-02.
The opinion of the court was delivered by: Fuentes, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Cuff, Fuentes and Baxter.
Plaintiffs, Henry E. Raab and Clara V. Montagna, appeal from the summary judgment dismissal of their claims against defendant, Borough of Avalon ("the Borough"). Plaintiffs sought compensation for the physical taking of their property by the Borough, together with damages under 42 U.S.C.A. § 1983.
Plaintiffs' complaint concerned vacant oceanfront property that the parties stipulated is not capable of development, because it is situated directly between the Borough's dune line established in 1968, and the ocean high-water line. Plaintiffs contend that the trial court erred: (1) by failing to apply the doctrine of waiver to the Borough's statute of limitations defense; (2) granting summary judgment while discovery was still pending; (3) refusing to apply the limitation period for adverse possession of land to the facts of this case; and (4) by finding that plaintiffs' claim for imposition of an easement by necessity was time-barred. As an alternate theory of liability, plaintiffs also argued that the Borough's actions should be viewed as a continuous trespass, subject to judicial redress until such trespass ceases.
Thus, as framed by the parties, this appeal requires us to determine the applicable limitation period within which a private party must commence an action to challenge the taking of private property by a public entity, as an exercise of its police power, where the public entity's actions fail to comply with any of the statutory provisions governing the use of eminent domain. This precise question of law has not been directly addressed or reviewed in any published opinion of the courts of this State.
To answer this question, we first define the nature of the governmental action involved. Applying the definition of inverse condemnation articulated by our Supreme Court in Greenway Development Co. v. Borough of Paramus, 163 N.J. 546, 553 (2000), we now hold that the physical taking of real property by a governmental agency, without compliance with the statutory safeguards established by the Legislature for the lawful exercise of the power of eminent domain, constitutes an act of inverse condemnation.
We further hold that a cause of action against a governmental defendant to recover the value of the real property that was taken by inverse condemnation is governed by the provisions of N.J.S.A. 2A:14-1 -2, and must be filed within six years from the date of accrual, which is defined as the date the landowner becomes aware or, through the exercise of reasonable diligence, should have become aware, that he or she had been deprived of all reasonably beneficial use of the property. Russo Farms, Inc. v. Vineland Bd. of Educ., 280 N.J. Super. 320, 325 (App. Div. 1995), aff'd in part and rev'd in part on other grounds, 144 N.J. 84 (1996); Harisadan v. City of E. Orange, 187 N.J. Super. 65, 68-69 (App. Div. 1982).
In this context, we affirm the trial court's grant of summary judgment in favor of the municipal defendant because plaintiffs' inverse condemnation action was filed more than six years beyond its accrual date. Consequently, we reject all of plaintiffs' arguments, including those seeking to characterize the municipality's actions as a continuing trespass, otherwise subject to judicial redress until its cessation.
We will examine and discuss these issues in the following factual context.
This case concerns a piece of vacant beachfront property within the Borough of Avalon, situated at Block 76.03 (formerly Block 76C), and covering Lots 12, 14, 16, 18, 20, 64 and 107, as identified on the Borough's current tax map ("the property"). By the time this matter came before the trial court on May 13, 2005, the property no longer had direct access to 76th Street, and there was a forty-foot strip of land that was owned by the Borough and was located between the property and the end of 76th Street.
A sand dune also runs along the western edge of the strip, nearest to the street. Across the sand dune and the strip is a dirt walkway and boardwalk that the Borough uses as the public right-of-way from 76th Street, across the north end of the property, to the public beach. The walkway contained signs directing pedestrian traffic to the beach. It has existed for over forty years. The public beach surrounds the property on the east and south sides, and the ocean high-water line is east of the beach.
In August 1961, the Borough owned the property, which had direct access onto the dirt roadway of 76th Street. By Resolution No. 7033, the Borough formally proclaimed that the property was not needed for public use, and sold it to Tri-Guy Holding Company, Inc. ("Tri-Guy"), a New Jersey corporation, owned by Thomas Tufaro, plaintiff Henry Raab, and George Montagna, husband of plaintiff Clara Montagna. Tri-Guy bought the property for one dollar plus the transfer to the Borough of two other beachfront lots that it owned, and had once purchased from the Borough.
In March 1962, an Atlantic "Nor'easter" storm devastated much of the New Jersey coastline, including the Borough, which is situated on a barrier island. The storm obliterated the beach; washed the end of 76th Street into the ocean; and transformed the property into a tidal area of oceanfront.
As a result, the Borough passed various ordinances to protect and rebuild the shoreline. Resolution No. 62-102, dated August 15, 1962, declared that it was in the Borough's "best interests . . . to restore the sand dunes, vegetation and other protections [that] existed along the shore line." In pursuit of this goal, the Resolution authorized the municipal officials and their representatives to enter immediately upon property to be used as protective barriers to take control and possession thereof, and to do such acts as may be ...