The New Jersey Superior Court Appellate Division ruled the state’s procedure for designating property as in need of redevelopment, and subject to taking by eminent domain, is constitutionally deficient because the notice of a potential designation does not apprise landowners of the risk of losing their property and the short time available to challenge the designation.
DeRose owns of a truck-tire repair business in Harrison, NJ located in a former factory building built in the early 1900s and located in the town’s industrial zone, in September 1997. For some years, the town’s industrial base had been fading away, with the concomitant impact on the tax base. The town embarked on an ambitious redevelopment program involving almost a third of its area. In April 1997, the town council directed the planning board to conduct a preliminary investigation to determine whether the area including DeRose’s property qualified as an area in need of redevelopment under the state’s Local Redevelopment and Housing Law (LRHL).
Acting on the recommendations of a planning consultant’s study, the planning board issued notice of a meeting on August 7th to determine whether the 250 acres near the banks of the Passaic River should be designated as a redevelopment area under the provisions of the LRHL. Notice of the meeting was sent to owners of record of the affected properties. At the time, DeRose did not yet own the property, though he did own another parcel of land in the designated area and thus received a copy of the notice. The notice did not inform property owners that a blight designation could lead to the taking of their property by eminent domain, nor did it mention that a person wishing to oppose the designation had to do so within 45 days. The LRHL does not specifically require additional individualized notice of a local government’s adoption of a designation. In fact, when the town council acted on the planning board’s recommendation that the area be designated as in need of redevelopment, the only notice of its September 4, 1997 action was the posting of its agenda. There was no attempt to notify individual property owners of the council’s resolution, which triggered the running of the 45-day period to challenge the designation. When the town ultimately moved to acquire DeRose’s property by eminent domain in June 2007, he raised the defense that the lack of individual notice of the blight designation violated his due process rights. The trial court rejected his argument, ruling it time-barred.
At its core, the appeals court said, due process requires adequate notice and an opportunity to be heard. A citizen must have a real chance to present his or her side of the case. A precondition to that real chance is adequate notice of what the government intends to do, the court declared. The LRHL lacks any individualized mechanism to fairly inform property owners that the blight designation operates as a conclusive finding of public purpose that will authorize the government to condemn their properties. It also fails to give any indication of the time limits for contesting the blight designation. Laypersons receiving such a notice cannot reasonably be expected to understand the drastic and permanent consequences of having their property included within an area designated for redevelopment, the court said. The LRHL’s notice provisions could be saved, however, by construing the law as giving a property owner the right to contest the blight designation until after the government moves to invoke its powers of eminent domain, the court continued. Thus, it said, a property owner generally preserves the right to challenge the validity of a designation that property is in need of redevelopment by raising it as a defense in an eminent domain proceeding. The only exception to that rule is where the municipality provides property owners with individual written notice that fairly alerts them that the property has been designated for redevelopment; the designation is a finding of public purpose and authorizes local government to take the property by eminent domain; and informs the owner of the time limit within which he or she may challenge the designation, the court declared.
Harrison Development Agency v. DeRose, 398 N.J. Super. 361, 942 A.2d 59 (2/28/200 
The opinion can be accessed at: http://www.state.nj.us/publicadvocate/public/pdf/HarrisonDecision_080225.pdf
Read more about this case on the New Jersey Eminent Domain Blog at: http://www.njeminentdomain.com/state-of-new-jersey-due-process-issue-in-three-redevelopment-cases-gives-notice-to-harrison.html
The Inverse Condemnation Blog also has a posting at: http://www.inversecondemnation.com/inversecondemnation/2008/03/well-what-do-yo.html
The brief from the New Jersey Public Advocate is available at: http://www.state.nj.us/publicadvocate/public/pdf/harrisonbrief010808.pdf
Special thanks to James Lawlor, Esq., editor of the Land Use Legal Report, for bringing this case to my attention, and for permission to use his abstract from the March 14, 2008 Report as the basis of this posting. For subscription information to the Land Use Legal Report, contact James Lawlor at landlaw@verizon.net.
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