Despite over 50 years of ownership and use as a social club, Sunset Beach Sportsmen’s Club, Inc., (the “Club”) located on Sunset and Higbee’s Beach in Cape May County, was recently dispossessed of the land. On June 15, 2022, the NJ Department of Environmental Protection (DEP) filed a summary dispossess action in Superior Court.

Prior to this action, in the 1990s, DEP sought to preserve Higbee Beach as a Wildlife Management Area (WMA) to protect the coastal wetlands, beachfront, dune, maritime forest, and disturbed lands that are critical migratory bird habitats. Through federal and state funding assistance, DEP purchased over 1,000 acres of Higbee Beach property, a portion of which remained subject to the Club’s tenancy, which included the sale of food and alcohol for social gatherings.

However, State regulations clearly prohibited the consumption, possession, or control of alcoholic beverages on WMAs without “written permission or other authorization” from DEP. When the Club’s lease expired, the parties attempted to confer on mutually acceptable terms, but no new lease was ever signed. Despite this, the Club continued to operate without a new lease for 20 years.

In affirming the trial court, the Appellate Division found that, based on the unambiguous contract language affording DEP two explicit options to terminate the lease, the Club was a holdover tenant. Thus, pursuant to the Summary Dispossess Act, N.J.S.A. 2A:18-53(a), DEP was properly awarded possession of the premises on which the Club was located.

The Court rejected the Club’s arguments that DEP’s reasons for termination were a mere pretext based on DEP’s historical tolerance of the Club’s activities and a similar lease that permits alcohol service on state lands. Overall, the Court concluded that DEP was entitled to judgment as a matter of law as the undisputed owner of the premises occupied by the Club and where the Club remained a holdover tenant for over twenty years.

This decision underscores the importance of unambiguous contract language and interpretation of the four corners, regardless of the history of occupation and use between the parties to the agreement.