Opinion ID: 1989717
Heading Depth: 1
Heading Rank: 3

Heading: Eisen

Text: The facts surrounding the valuation method in the Eisen matter are not of record. What is known is that defendant, Sandra Eisen, was the owner of property in Hudson County acquired by eminent domain by the New Jersey Department of Transportation (NJDOT). State, by Comm'r of Transp. v. Eisen, No. L-1238-01 (Law Div.2001). At some point in the case, the reservation of rights issue raised by NJT in Goldman and Cat in the Hat also was raised by NJDOT in Eisen. However, there, the trial court included in the condemnation judgment a reservation of rights provision identical to the provision in NJT's proposed orders, including the preclusion of res judicata, collateral estoppel and the entire controversy defenses. That trial court held: [A]bsent such a clause, the availability of the [preclusionary] defense[s] would require the State as a prophylactic measure to engage in far more extensive, intrusive, and costly preinspection activities in order to minimize the risks of being precluded from filing the claim in the future. I'm not convinced that sound policy under both the Condemnation Act, and the Spill Act would require the placing of that burden on the State. As a consequence, I'm satisfied that it is appropriate for the condemning authority to include these reservations of rights in all cases as a prophylactic matter. All condemnees appealed [2] and in July 2002, the Appellate Division affirmed in Eisen and reversed in Goldman and Cat in the Hat. New Jersey Transit Corp. v. Cat in the Hat, 353 N.J.Super. 364, 378, 803 A. 2d 114 (2002). In so doing, Judge Cuff, writing for the panel stated: As our review of the Spill Act demonstrates, the Legislature has not only imposed liability for cleanup and removal costs on property owners who have discharged hazardous substances which have contaminated soil or water but also strictly limited the defenses which a property owner may assert in defense of a claim for cleanup and removal costs. N.J.S.A. 58:10-23.11g-d(1)(4). Furthermore, just compensation for property acquired by a public entity is determined by reference to the highest and best use of the property. The State's practice of appraising the property as if any contamination has been remediated is consistent with this rule. Nevertheless, defendants argue that they should be able to raise the preclusionary defenses of res judicata, collateral estoppel, and the entire controversy doctrine. They contend that their inability to raise these defenses leaves them exposed to claims for an indeterminate period into the future, that NJT and NJDOT have had ample opportunity to investigate the site, and by implication that they may have to pay twice for the existence of contaminants on this site. The latter concern, however, is predicated on the assumption that the existence of contamination is reflected in the just compensation paid to the property owner. Interestingly, no court in this State has ruled that the existence of contamination or hazardous substances on the site is a relevant factor for consideration by a jury in setting just compensation. The State also asserts that its valuation of the property assumes the property has been remediated. It will, however, withhold the estimated cost of removal and cleanup from the property owner. Defendants' position threatens not only the immunity conferred by the Legislature on acquiring public entities but also runs counter to the legislative intent to impose strict liability on those who are responsible for soil and water contamination. In the end, defendants' arguments are no more than a thinly veiled attempt to enhance their position over other owners of contaminated property solely due to the fact that their property was taken by a public entity for a public purpose. In effect, they seek to have the final condemnation judgment act as a bar to an after-discovered contamination claim. We discern no intent by the Legislature to immunize a property owner from the costs of cleanup and removal of hazardous substances on their property solely due to the fact that a public entity has acquired their property for a public purpose. In fact, such a result flies in the face of a statutory scheme which imposes liability on a public entity for cleanup and removal costs only to situations in which the public entity is responsible for the contamination. [ Id. at 376-78, 803 A. 2d 114 (footnote omitted).] All condemnees petitioned for certification. We granted the petitions, 175 N.J. 80, 812 A. 2d 1111 (2002), and now affirm.