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In re Acquisition of Parcels 13A and X13B

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


July 20, 2010

IN THE MATTER OF THE ACQUISITION OF PARCELS 13A AND X13B, BLOCK #742.2, LOTS #3.02 AND 3.03, TOWNSHIP OF PISCATAWAY, MIDDLESEX COUNTY.

On appeal from a Final Agency Decision of the Department of Transportation.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued February 24, 2010

Before Judges Axelrad and Sapp-Peterson.

Petitioner, Walter Mamchur, Jr. (Mamchur), appeals the final administrative determination from the New Jersey Department of Transportation (DOT) awarding him $62,020 for replacement housing pursuant to the Uniform Transportation Replacement Housing and Relocation Act, N.J.S.A. 27:7-72 TO -88. We affirm.

Mamchur owned 2.63 acres, consisting of two contiguous lots located at 546 and 548 Metlars Lane in Piscataway (the property). Situated on the property were two one-and-one-half-story residences, as well as a garage, a coop and several other outbuildings. The property was originally a farm, and petitioner moved to the property in 1953. He resided at 548 Metlars Lane with his four dogs. He used all of the other buildings and grounds on the property except two rental units occupied by tenants who did not otherwise have use of the land or other buildings on the property.

On October 10, 2000, DOT commenced a condemnation action in Superior Court condemning the property as part of a Route 18 widening project in Piscataway Township (Township). DOT had previously attempted to acquire the property for $358,000, which petitioner rejected. Following a bench trial held in October 2004, Mamchur was awarded $740,000. The judge found that the Metlars Lane property contained five lots, each being slightly more than one-half acre. He further found that two of the five lots were improved with residences, one of which petitioner occupied as his dwelling that the judge valued at $235,000 ($90,000 for the land and $145,000 for the residence). Mamchur did not appeal the just compensation award judgment.

Prior to the condemnation trial, Mamchur had been removed from his property in December 2001 following the agency's condemnation. He initially obtained rental housing but, in January 2003, purchased a one-acre property in the Township located at 49 Justice Street. The purchase price for the property was $295,000.

Subsequent to the condemnation trial, Mamchur retained new counsel to represent him in connection with several outstanding legal issues, including assisting him in securing relocation assistance. In October 2006, counsel submitted a claim for relocation assistance to DOT on behalf of petitioner. The claim was initially denied based upon DOT's contention that Mamchur had signed a waiver of relocation assistance in March 2002. Although acknowledging that he signed the waiver, petitioner challenged the circumstances under which the document was signed and claimed that he was unaware that the waiver he executed related to relocation assistance.

In a letter to Mamchur's counsel dated February 22, 2007, Nicholas J. Monahan (Monahan), Jr., Director (Director), Division of Right-of-Way, advised that DOT had determined that there was "good cause" to waive the filing time requirement for relocation assistance and offered petitioner $62,020 as a replacement housing payment. Monahan explained how the replacement housing payment figure was reached:

As you are aware, the final judgment amounted to $740,000, which according to the Trial Report of Deputy Attorney General H. Edward Gable [Report], was based upon a highest [and] best use of the property for a five[-]lot subdivision. Each lot was ascribed a value of $90,000.00, for a total allocation of $450,000 to the land. This then left $290,000 attributable to the two dwellings, or $145,000.00 each, based upon similar ratios being applied by both Mr. Mamchur's and the State's appraiser at the time. Therefore, adjusting for the final judgment, a figure of $235,000.00 (dwelling $145,000 plus $90,000 homesite) would now be deducted from the original comparable listing, reflecting a revised supplement of $30,900.00. However, recognizing that Mr. Mamchur actually spent the sum of $295,000.00 for his replacement property, we have determined to use that figure as a basis, which then increases the supplement due to $60,000.00 In addition, based on our review of the uniform settlement statement prepared for the closing of the Justice Street property, Mr. Mamchur is entitled to receive an added amount of $2,020.00 to cover his title insurance, recording and survey costs. Therefore, in response to the appeal filed on behalf of your client, it is our determination that Mr. Mamchur should be paid a total of $62,020.00 in settlement of this matter.

Mamchur rejected the offer and the matter was transferred to the Office of Administrative Law as a contested case.

At the conclusion of the proceedings before the Administrative Law Judge (ALJ), where petitioner was represented by counsel, the ALJ subsequently issued an initial decision. The ALJ first found that the only portion of the $740,000 condemnation award that could be applied to the replacement housing payment calculation was the amount attributed to the displacement dwelling unit. Relying upon the trial court's determination that $235,000 represented the value of the residential property Mamchur actually occupied, the ALJ concluded that "only $235,000 is considered in calculating the replacement housing payment ($90,000 for the lot and $145,000 for the home)." The ALJ then determined that petitioner's $295,000 purchase of the Justice Street property was replacement housing. Based upon these figures, the ALJ concluded that Mamchur's "replacement home costs exceed[ed] the acquisition fee received by $62,020[,]" which "price differential is precisely the amount offered by the agency in settlement of the claim."

The ALJ affirmed DOT's calculation of relocation benefits to the petitioner and awarded him $62,020. The initial decision was filed with the Commissioner of the Department of Community Affairs (Commissioner). Because the Commissioner did not adopt, modify or reject the ALJ's initial decision within forty-five days and the time period during which the Commissioner could take action was not otherwise extended, the recommended decision became final in accordance with N.J.S.A. 52:14B-10(c). The present appeal followed.

On appeal petitioner contends:

POINT I.

JUDGE STEIN APPLIED AN INCORRECT STANDARD IN DETERMINING THE AMOUNT OF RELOCATION ASSISTANCE TO WHICH PLAINTIFF WAS ENTITLED.

POINT II.

ASSUMING ARGUENDO THAT JUDGE STEIN'S OPINION CAN BE READ AS FINDING THAT THE JUSTICE STREET PROPERTY WAS A "COMPARABLE REPLACEMENT" FOR THE METLARS LANE PROPERTY, THIS DETERMINATION WAS NOT SUPPORTED BY THE RECORD IN THIS MATTER AND SHOULD BE REVERSED.

POINT III.

JUDGE STEIN IMPROPERLY FAILED TO AWARD ANY COMPENSATION TO MR. MAMCHUR FOR THE OUT[-]OF[-]POCKET EXPENSES HE INCURRED IN CONNECTION WITH HIS DISPLACEMENT FROM THE METLARS LANE PROPERTY.

POINT IV.

JUDGE STEIN'S ANALYSIS IGNORED THE SIGNIFICANCE OF THE FACT THAT MR. MAMCHUR DID NOT RECEIVE ANY RELOCATION ASSISTANCE IN A TIMELY FASHION.

The scope of judicial review of a final agency determination is severely limited. In re Carter, 191 N.J. 474, 482 (2007); In re Musick, 143 N.J. 206, 216 (1996). We will not upset the determination of an administrative agency absent a showing that it was arbitrary, capricious or unreasonable; that it lacked fair support in the evidence; or that it violated legislative policies expressed or implied in the act governing the agency. In re Musick, supra, 143 N.J. at 216; Campbell v. Dep't of Civil Serv., 39 N.J. 556, 562 (1963); Boardwalk Regency Corp. v. N.J. Casino Control Comm'n, 352 N.J. Super. 285, 306 (App. Div.), certif. denied, l74 N.J. 366 (2002). We defer to the fact-finding of an ALJ, reached on sufficient credible evidence in the record, see Close v. Kordulak Bros., 44 N.J. 589, 599 (1965), and the expertise of the agency in interpreting its regulations, see R & R Mktg., L.L.C. v. Brown-Forman Corp., 158 N.J. 170, 175 (1999). We owe no such deference to an agency's interpretation of the law. In that regard, we apply a de novo standard of judicial review. In re Six Month Extension of N.J.A.C. 5:91-1 et seq., 372 N.J. Super. 61, 93 (App. Div. 2004), certif. denied, 182 N.J. 630 (2005) (citing Abbott v. Burke, 100 N.J. 269, 298-99 (1985); Application of Boardwalk Regency Corp. for a Casino License, 180 N.J. Super. 324, 333 (App. Div. 1981), modified on other grounds, 90 N.J. 361 (1982)).

Measured against this standard, we reject all of petitioner's arguments. We are satisfied the ALJ's findings were adequately based on sufficient credible evidence in the record and supported by law. Close, supra, 44 N.J. at 599. We are also in accord with the ALJ's interpretation of the applicable legal principles.

The crux of petitioner's argument is that the replacement dwelling was never intended to be his permanent home. Rather, it was intended to "ameliorate the situation of living in a rented room without his dogs" until his litigation was resolved and he had the means thereafter to secure comparable housing. Citing N.J.A.C. 16:6-2.7(a)(1), respondent claims petitioner was only entitled to a replacement housing payment based upon the difference between the value of his former home, which the court determined to be $235,000, and his replacement home, purchased for $295,000. We agree.

First, petitioner, who was represented by counsel and fully litigated the condemnation, did not appeal the condemnation award. Nor is there any indication in the record before the ALJ that petitioner objected to DOT's representation to the ALJ, through the Report, of the Law Division judge's factual finding that the value of the displacement dwelling was $235,000. Further, following the issuance of the ALJ's initial decision, petitioner filed no exceptions. See N.J.S.A. 52:14B-10(c). Additionally, in petitioner's appellate brief, petitioner does not challenge the $235,000 value the trial court placed upon that portion of the Metlars Lane property where Mamchur actually resided. Rather, the brief clearly shows that this figure was accepted by Mamchur because he urges that once the matter is "remanded for a hearing to establish the cost of a 'comparable replacement' for the Metlars Lane property[,] [t]he $235,000.00 figure can then be subtracted from that amount to determine the proper amount of [petitioner's] relocation assistance payment."

It is not until DOT, in its responding brief, points out that petitioner "admits" that the trial court valued his dwelling at $235,000 and, as such, the displacement value of his dwelling was established at $235,000, that petitioner, for the first time, challenges this finding:

Equally important is the fact that [the ALJ] relied solely upon the determination of the Superior Court of New Jersey even though there was no opinion of the Superior Court submitted to . . . [the ALJ] and there is no provision within the regulatory criteria to simply use the Superior Court findings as a substitute for the findings necessary under N.J.A.C. 16:6-1.3(b). In fact, it appears that [the ALJ] simply relied upon the assertions of the Department of Transportation and considered a Trial Report of Deputy Attorney General H. Edward Gabler in reaching his conclusions concerning the "replacement property" value. . . . The Trial Report of Deputy Attorney General H. Edward Gabler was never submitted as evidence before [Judge Stein]. Moreover, there is nothing in the record to indicate that said Trial Report was submitted by affidavit or certification, or in any other manner for it to be considered "evidential."

Given this procedural and factual history, we are satisfied that principles of res judicata apply to preclude petitioner from challenging the ALJ's acceptance of the $235,000 as the value of Mamchur's displaced dwelling for purposes of determining a comparable replacement housing payment. The doctrine of res judicata precludes a party who has fully litigated an issue in an earlier proceeding from re-litigating the issue in a new proceeding. Roberts v. Goldner, 79 N.J. 82, 85 (1979). The principle of res judicata not only applies in courts of law, but applies equally in administrative proceedings, particularly as to findings of fact. Hackensack v. Winner, 162 N.J. Super. 1, 24 (App. Div. 1978), modified on other grounds, 82 N.J. 1 (1980). Extending the principle of res judicata to administrative proceedings serves the objective, administratively, of "prevent[ing] wasteful and unnecessary fragmentation of causes of action and duplication of proceedings." Id. at 25.

Here, as noted earlier, the ALJ accepted, without objection from petitioner, respondent's counsel's representation, that the trial court valued Mamchur's actual dwelling at $235,000. Petitioner did not object to this representation during the proceeding, despite being aware in advance of the proceeding and, as early as February 2007, DOT was utilizing $235,000 as the value of the displaced dwelling in calculating petitioner's replacement housing payment. Nor did petitioner, after the ALJ issued the initial decision, file an exception challenging the ALJ's adoption of this figure. N.J.S.A. 52:14B-10(c). Under these circumstances, petitioner is precluded from challenging the ALJ's utilization of the $235,000 figure.

Once the ALJ accepted $235,000 as the value of the displaced dwelling, he then looked to N.J.S.A. 27:7-75(a)(1) to arrive at the appropriate payment. This statute provides in pertinent part: "(a) Whenever a program or project to be undertaken by an agency will result in the displacement of any person, the agency shall provide for the payment to the displaced person of: (1) Actual reasonable expenses in moving himself, his family, business, farm operation, or other personal property[.]" Ibid. The regulations implementing this statute provide:

If the displacement dwelling unit was part of a property that contained another dwelling unit and/or space used for non-residential purposes, and/or is located on a lot larger than typical for residential purposes, only that portion of the acquisition payment which is actually attributable to the displacement dwelling unit shall be considered its acquisition cost when computing the price differential

[N.J.A.C. 16:6-2.7(e)(emphasis added).]

Petitioner claims the newly purchased property was not comparable replacement housing in a number of respects: (1) the property was one acre rather than the 2.63 acres he previously owned; (2) the new property did not have additional buildings on it; (3) the new property was located in a zone where property values were less; (4) the property adjacent to his former property had over 500 acres of undeveloped land where his dogs could walk, while the new property was in a more densely populated location -- over twelve dwelling units per acre; (5) his former property had a basement, while his new home was a bi-level, requiring he and his dogs to climb more than twenty times the number of stairs he previously climbed, and one of his dogs could not climb the stairs at all; (6) the electrical service in his new home is only 100 amps, which is insufficient to support his welding machine; (7) he previously had 4500 square feet of storage, work and studio space and none in the new home; and (8) he was able to garage his historic Buick, van and utility trailer at his old location but uses his current garage for storage.

Even accepting all of these contentions as true, a "comparable replacement dwelling need not possess every feature of the displacement dwelling" as long as "the principal features must be present[.]" N.J.A.C. 16:6-1.3(b)(2). Those principal features contemplate "decent, safe, and sanitary" conditions that meet applicable housing and occupancy codes, N.J.A.C. 16:6-1.3(b)(2), rather than the intangibles which petitioner presents as relevant to determining whether he obtained comparable housing.

The ALJ was presented with the two relevant facts required to determine replacement housing, namely, the cost of the replacement dwelling, $295,000, and the value of the displaced dwelling, $235,000 along with ancillary closing costs of $2,020. From these undisputed facts, we are satisfied that the ALJ properly followed the statutory requirements for arriving at the amount of the replacement payment.

The remaining arguments advanced that the ALJ failed to award petitioner any out-of-pocket expenses incurred in connection with his displacement from the Metlars Lane property and failed to provide him with relocation assistance in a "timely fashion" are without sufficient merit to warrant discussion in a written opinion beyond noting that petitioner failed to submit proof of such expenses to the Director or to the ALJ. R. 2:11-3(e)(1)(E). Additionally, petitioner failed to formally file his claim for relocation assistance until five years later. After initially denying the claim as untimely, see N.J.A.C. 16:6-1.6(d), the claim was accepted and an offer extended in February 2007, within four months following the informal submission of petitioner's claim for relocation assistance and less than a month following the submission of his formal claim.

Affirmed.

20100720

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