East Cape May Assocs. v. State, Dep't of Envtl. Prot

In East Cape May Assocs. v. State, Dep't of Envtl. Prot., 300 N.J. Super. 325, 693 A.2d 114 (App. Div. 1997), the Court reversed an order for summary judgment in favor of ECM which declared that there had been a regulatory taking of its property. The Court agreed with the trial court that the pertinent DEP regulations affecting ECM's property indicate that "unless those regulations are relaxed in significant respects, no application for any economically meaningful development of that property will be granted." Id. at 338, 693 A.2d 114. The Court added: If the property currently owned by East Cape May the 100-acre easterly tract represents the full extent of the property which we should consider to determine the taking issue, and if those regulations will not be relaxed pursuant to N.J.S.A. 13:9B-22b, the State's regulatory scheme so "excessively interferes with property rights and interests" that they leave East Cape May without "viable, economically-beneficial uses of its land" and therefore have effected a constitutional taking. See Gardner v. New Jersey Pinelands Comm'n, supra, 125 N.J. 193 at 210-16, 593 A.2d 251, and cases cited therein. Ibid. However, the Court remanded with direction that the trial court address the "denominator" argument raised by the State; that is, that the entire 200 acres owned by ECM or its principals, situate on both the east and west side of Pittsburgh Avenue, must be considered in determining whether there has been a taking. Id. at 353-54, 693 A.2d 114. The Court directed that, upon resolution of the "denominator" issue, "at the option of the DEP, an opportunity should be afforded it to work with East Cape May to formulate an acceptable development plan pursuant to N.J.S.A. 13:9B-22b." Id. at 354, 693 A.2d 114. In that respect we interpreted 22b as requiring "the DEP and the developer to confer about the realistic prospects for development whenever the agency has taken a position which, reasonably interpreted, would impose limits on the utilization of property so draconian that they would amount to a constitutional taking." Id. at 341, 693 A.2d 114. The Court examined the federal and state case law addressing the denominator issue, and developed the following list of ten, nonexclusive factual questions that "may affect the formulation of the rule for the definition of the 'property.'" Id. at 353-54, 693 A.2d 114. The Court said: Determining the takings denominator in the present case requires a much more complete factual record than now exits. What entities own or owned the property west of Pittsburgh Avenue? What part of it, if any, do those entities still retain? When did they build on it and when were any parts of it disposed of ? What is the relationship of East Cape May to the entities which own or owned the property west of Pittsburgh Avenue? When and for what consideration was the land on either side of Pittsburgh Avenue acquired? When, why and for what consideration was the property east of Pittsburgh Avenue transferred to its present ownership? What part of the property west of Pittsburgh Avenue was subject to wetlands controls or other governmental restrictions while it was owned by East Cape May's principals or transferors? What is the current municipal zoning of the property? Is there any difference in the zoning applicable to the land east and west of Pittsburgh Avenue? Was development restricted to the western tract in anticipation of the more stringent regulations applicable to the eastern part? The answers to all of these questions may affect the formulation of the rule for the definition of the "property" which is relevant to East Cape May's claim that its property has been deprived of all viable economic uses. Ibid.