South-Western Legal Studies in Business

Property Owners May Not Be Forced into Redevelopment
Description New Jersey high court held that a town violated the state constitution by planning to force property owners to sell their land for redevelopment. The owners had clear title and preferred the land be left vacant; as such it did not contribute blight, so could not be forced into development.
Topic Constitutional Law
Key Words Eminent Domain; Taking; Blighted Area; Redevelopment
C A S E   S U M M A R Y
Facts The Gallenthin family has owned a 63-acre piece of land in Paulsboro, New Jersey, since 1951. It is mostly vacant protected wetlands bordered by an industrial property, a river, and a street. The property was zoned as a marine industrial business park, which would permit commercial, light industrial, and other non-residential uses, but nothing had been placed on the property. A wild-growing reed is harvested from it, but that generates little income for the owners. The city hired a company to study how land in the town could be developed. The company recommended the Gallenthin parcel be tied into unused business property next to it to create a larger parcel for development. The BP and Dow companies were interested. The town declared that the Gallenthin property was “in need of redevelopment.” That designation would allow eminent domain to be used. The Gallenthins objected, but the lower courts held for the town, finding that it followed proper process. The Gallenthins appealed.

Reversed. The statute that allowed redevelopment of land that was in a stagnant condition did not give the town authority to redevelop the land simply because it was not in its highest valued use. Although the Blighted Areas Clause of the New Jersey constitution undoubtedly enlarges the legislature’s eminent domain power to take land for redevelopment purposes, the judiciary is the ultimate arbiter of constitutional issues. The concern with “stagnant” land is mostly about land tied up because of title problems. Blighted property generally means land that has deteriorated into a mess. The Gallenthin’s property is neither. It is vacant land that they prefer to keep, for now, in that condition. The town does not have the right to force redevelopment.

Citation Gallenthin Realty Development v. Borough of Paulsboro, 924 A.2d 447 (Sup. Ct., N.J., 2007)

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