Search Site
Menu
NJ Appellate Court Limits Reach of Suydam Rule in Condemnation Cases

In the bellwether case of Housing Authority of the City of New Brunswick v. Suydam Investors, L.L.C., 177 N.J. 2 (2003), the New Jersey Supreme Court crafted a Solomon-like rule when it came to valuating environmentally impacted properties in eminent domain proceedings. The “Suydam” rule, as it has come to be known, essentially states that (1) contaminated property should be valued as if it were remediated, and (2) that a hearing should be held to determine the reasonable costs of remediating the property. The remediation costs are then held by the court in escrow until the remediation is completed and an environmental cleanup cost recovery action is filed by the condemning party.

The issue brought raised in the recently decided case of Borough of Paulsboro v. Essex Chem. Corp., 2012 N.J. Super. LEXIS 119 (2012), was whether the Suydam rule applied on a property which contained a former landfill that was closed with the approval of the New Jersey Department of Environmental Protection (“NJDEP”). The Appellate Division held that the Suydam rule only applied in cases where a condemnee was subject to liability under New Jersey’s environmental statutes, such as the New Jersey Spill Compensation and Control Act. In this particular case, since the NJDEP approved the closure of the landfill, the condemnee (Essex Chemical Corporation, a wholly-owned subsidiary of the Dow Chemical Company) had no further liability. Therefore, the condemnor (the Borough of Paulsboro) was not entitled to an escrow of the condemned funds.

The Borough of Paulsboro argued that it needed to remediate the property to remove the landfill, and that this would cost nearly $60 million. However, the Appellate Division found that the removal of the landfill was not necessitated by any environmental statute and, in fact, the property was valued by both sides as one with an unusable area where the former landfill is located. Implicit in this decision is the idea that a condemnor’s development costs for an environmentally impaired site cannot be borne by the condemnee.

The attorneys at Lieberman & Blecher have represented many clients in Suydam rule hearings and have successfully argued that construction costs necessitated by a condemnor’s planned use of a site cannot be passed to the condemnee and cloaked with veil of remediation costs. The Appellate Division’s latest decision supports what our litigator’s have long believed to be most protective of condemnee rights.

Leave a Reply

Your email address will not be published. Required fields are marked *

Our Attorneys

Recent Twitter Posts

  • 44 acres of forest preserved in Byram. https://t.co/Or5pMiHxxE
    4 weeks ago
  • Federal Court Rules Gas Pipeline Company Can Start Taking Land. https://t.co/NSRzQjQYwh
    1 month ago
  • Ridgewood Water prepares to sue corporation over chemical contamination. https://t.co/n3R1PcF1Og
    1 month ago
  • Owners of rural NJ cabins still do not know if they can keep them. https://t.co/tKh1WqjZFS
    2 months ago

Recent Blog Posts

Terranova vs. General Electric Pension Trust: Clarifying (or complicating) defenses under the Spill Act

On January 4, 2019, the New Jersey Appellate Division handed down a decision in Terranova vs. General Electric Pension Trust, Docket No. A-5699-16T3 (hereinafter, “Terranova”). In Terranova, The New Jersey
Read More
Terranova vs. General Electric Pension Trust: Clarifying (or complicating) defenses under the Spill Act

A “New Day” in New Jersey Environmental Law and Enforcement: Environmental Justice and Natural Resource Damage Cases Take Flight Under New Administration Watch

By: Michael C. Kondrla, Esq.1 In August, Attorney General Gurbir S. Grewal and the Department of Environmental Protection (“DEP”) announced the filing of six lawsuits focused on contaminated properties, three of
Read More
A “New Day” in New Jersey Environmental Law and Enforcement: Environmental Justice and Natural Resource Damage Cases Take Flight Under New Administration Watch

NJ Supreme Court Sees Standing in Tax Lienholders to Challenge Municipal Approval

On August 2, 2018, New Jersey’s Supreme Court held that a holder of a municipal tax lien may have standing to challenge a local planning board’s approval for a neighboring
Read More
NJ Supreme Court Sees Standing in Tax Lienholders to Challenge Municipal Approval

The Downside to Higher Ground: Appellate Division affirms finding of a townhome owner’s negligence and responsibility for water damage to a below unit caused by a prolonged leaking washing machine hose

On August 1, 2018, the Superior Court of New Jersey, Appellate Division ruled in favor of plaintiff in the matter captioned Joseph S. D’Elia v. Joyce Campisi and Liberty Mutual
Read More
The Downside to Higher Ground: Appellate Division affirms finding of a townhome owner’s negligence and responsibility for water damage to a below unit caused by a prolonged leaking washing machine hose

In the media

  • Gulf Coast Town Center facing foreclosure

    Naples Daily News, September 16, 2015

    Wells Fargo filed a lawsuit Sept. 8 against an affiliate of CBL & Associates, the owners of the decadeold, 1.2 million-square-foot mall in south Fort Myers for a $190.9 million unpaid loan. The center has 94 stores on 204 acres, with such anchors as Super Target, Belk, Best Buy, Dick’s Sporting Goods, Marshalls and Costco...

    Read More
  • Town liable for private company's leaking underground tanks, court rules

    NJ.com Jul 26, 2017

    CRANFORD -- A couple that owned a businesses in town and became sick from leaking underground tanks owned by an adjacent business can sue the township for damages because the tanks were partially ...

    Read More
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
Contact Our Firm

Quick Contact Form