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State v. Sherwood Associates

October 27, 2008

STATE OF NEW JERSEY, BY THE COMMISSIONER OF TRANSPORTATION, PLAINTIFF-RESPONDENT,
v.
SHERWOOD ASSOCIATES, II, LLC, A LIMITED LIABILITY COMPANY OF NEW JERSEY, DEFENDANT-APPELLANT,
AND TOWNSHIP OF FREEHOLD, IN THE COUNTY OF MONMOUTH, A MUNICIPAL CORPORATION OF NEW JERSEY, DEFENDANT.



On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-3037-04.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted September 16, 2008

Before Judges Gilroy and Chambers.

This is a condemnation action. Defendant Sherwood Associates, II, LLC (Sherwood) appeals from the January 3, 2008 order of the Law Division entering final judgment and fixing the amount of just compensation to be paid by the State of New Jersey. On appeal, Sherwood challenges the trial court's order of June 18, 2007, barring the testimony of its real property appraiser pertaining "to damages to the remaining portion of Lot 30.02 caused by denial of access along Schanck Road." For reasons that follow, we affirm.

Prior to July 9, 2004, Sherwood owned a 15.2576 acre-tract of property known and designated as Block 71, Lots 19, 20, 21, 30.02, and 30.03, Freehold Township (the Property).*fn1 A vast portion of the Property is located on the west side of State Highway 9, south of the highway's intersection with Schanck Road. In the area of the Property, Highway 9 runs in a north/south direction and is divided by a cement barrier. Except for a paved access road that previously served a motor vehicle inspection station fronting Highway 9, the Property is vacant and is located primarily in the CMX-10 zone, which permits certain commercial and office uses on properties containing a minimum lot area of ten acres. A small portion of the Property is located in the CMX-3 zone, which also permits commercial and office uses but only requires a minimum lot area of three acres.

Access to the Property was provided by two public roadways. The primary access was from Highway 9, with 764 feet of Lots 19, 20, and 21 fronting the highway. A secondary access to the Property was from Schanck Road via Lot 30.02. That lot is approximately sixty feet in width and runs in a northerly direction to Schanck Road, across the back of Lot 21, as well as several other unrelated commercial properties fronting Highway 9. Lot 30.02 had frontage of 56 feet along Schanck Road. As described by Sherwood's real property appraiser, "[t]he access along Schanck Road primarily benefits the [P]roperty by allowing drivers to exit the site and access Route 9 [N]orth without the need of traveling south along Route 9 to the 'U-turn['] area south of Three Brooks Road, and over [one-half] mile south of the [Property]."

On July 9, 2004, the State filed a condemnation complaint seeking to acquire a fee-simple interest in 18,196 square feet of the Property, together with a slope easement along Schanck Road of 472 square feet. On July 23, 2004, the State filed a declaration of taking, acquiring the interests in the Property and depositing with the Clerk of the Court $73,700, the amount estimated by the State as just compensation for the acquisitions.

The purpose of the taking was not only to widen Highway 9, but also to improve the highway's intersection with Schanck Road. Accordingly, the taking affected two separate areas of the Property. As described by Sherwood's appraiser: "[t]he first area . . . contains a combined area of 6,468 square feet and is concentrated along the eastern portion of the site and adjacent to the existing Right-Of-Way along [Highway] 9. The purpose of this taking is to widen [Highway] 9." The second area "contains an area of 11,728 square feet." This area is: concentrated along the northern part of Lot 30.02 and is proposed to be used as part of "Ramp A" which will serve as a jug handle from Stonehurst Road [beginning to the east of the Property] to the intersection of [Highway] 9 & Schanck Road. After the tak[ing], access will be denied to Schanck Road. There will also be a slope easement adjacent to the new Right-Of-Way along Schanck Road containing 472 square feet.

Although a portion of the taking was concentrated along the Property's easterly line adjacent to Highway 9, that part of the taking neither reduced the Property's frontage on the highway, nor reduced its access to the highway. However, the opposite was true as to the second area of the taking along the northern portion of Lot 30.02. As a result of that taking, access to the Property from Schanck Road was denied. The entire taking reduced the Property area from 15.2576 acres to 14.84 acres, including the remaining portion of Lot 30.02 containing approximately .7059 acres. Therefore, the remainder after the taking, excluding the remaining portion of Lot 30.02, is 14.134 acres.

In discussing the remainder after taking, Sherwood's appraiser provided the following site comments in his report. As to the taking along the easterly line, "[i]n the after condition, the overall shape and characteristics of the

[P]roperty remain [fairly] similar to the conditions which existed prior to the taking . . . ." As to the taking of a portion of Lot 30.02, he stated:

The second taking along the Schanck Road frontage is for a jug handle. This portion of the taking will restrict the use of this area for an exit drive and limit the overall design flexibility of the remainder. The tak[ing] creates a .7059 acre remnant (part of Lot 30.02) which has no utility to the larger remainder after.

Concerning the highest and best use analysis of the remainder, the appraiser opined that the highest and best use of the remaining portions of Lots 19, 20, 21, and 30.03 (14.134 acres) was for commercial/office development in accordance with the current zoning regulations. As to the remaining portion of Lot 30.02 (.7059 acres), he opined that the highest and best use was as assemblage to the Freehold ...


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