Court Opinion

ID: 4502116
Source: CourtListenerOpinion
Date Created: 2020-01-28 15:06:41.068272+00
Date Added: 2024-06-11T15:04:09.450531
License: Public Domain

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                           APPROVAL OF THE APPELLATE DIVISION
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                                                     SUPERIOR COURT OF NEW JERSEY
                                                     APPELLATE DIVISION
                                                     DOCKET NO. A-4810-17T1

IN THE MATTER OF THE
FRANK SALAS AND JOAN
SALAS AMELIORATION
AUTHORIZATION AND WATER
QUALITY CERTIFICATE NO.
1506-02-0037.1 APL110001
CHALLENGED BY DONALD F.
BURKE AND THE ASSOCIATION
FOR GOVERNMENTAL
RESPONSIBILITY, ETHICS AND
TRANSPARENCY.
_______________________________

                Argued December 10, 2019 – Decided January 28, 2020

                Before Judges Yannotti, Hoffman and Firko.

                On appeal from the New Jersey Department of
                Environmental Protection.

                Donald F. Burke, Jr., argued the cause for appellants
                Donald F. Burke, Patricia F. Burke, Harry Sowell, Jody
                K. Sowell, Graham Starr, Helena Leonard, Nancy
                Bradshaw and the Association for Governmental
                Responsibility, Ethics and Transparency (Law Office
                of Donald F. Burke, attorneys; Donald F. Burke and
                Donald F. Burke, Jr., on the briefs).
            Ira E. Weiner argued the cause for respondents Frank
            and Joan Salas (Beattie Padovano, LLC, attorneys; Ira
            E. Weiner, of counsel and on the brief; Martin Richard
            Kafafian, on the brief).

            Gurbir S. Grewal, Attorney General, attorney for
            respondent New Jersey Department of Environmental
            Protection (Melissa H. Raksa, Assistant Attorney
            General, of counsel; Kathrine Motley Hunt, Deputy
            Attorney General, on the brief).

PER CURIAM

      Donald F. Burke, Patricia F. Burke, Harry Sowell, Jody K. Sowell,

Graham Starr, Helena Leonard, Nancy Bradshaw and the Association for

Governmental Responsibility, Ethics and Transparency (collectively, the

Association) appeal from a final determination of the Acting Commissioner of

the New Jersey Department of Environmental Protection (DEP) denying their

application for an adjudicatory hearing and rejecting a challenge to the

amelioration authorization and water quality certificate issued to Frank Salas

and Joan Salas (collectively, Salas). We affirm.

                                       I.

      We briefly summarize the relevant facts and procedural history of this

dispute. Salas owns about one half-acre of real property in Brick Township, and

in 2002, filed an application with the DEP pursuant to the Coastal Area Facility

Review Act (CAFRA), N.J.S.A. 13:19-1 to -21, for a general permit (GP), which

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would allow the construction of a single-family home and driveway on the

property. In December 2003, the DEP issued the GP, but required Salas to

obtain a permit pursuant to the Freshwater Wetlands Protection Act, (FWPA),

N.J.S.A. 13:9B-1 to -30, to allow the filling of wetlands on the property.

      In January 2004, Salas filed an administrative appeal challenging the

conditions the DEP placed on the GP. Salas also applied to the DEP for a letter

of interpretation (LOI) confirming the presence of freshwater wetlands or any

wetlands transition area on the property. 1 In March 2004, the DEP issued the

LOI, finding the property consisted of freshwater or tidal wetlands and an

associated transition area. Salas filed an administrative appeal challenging the

DEP's LOI determination.

      The DEP referred the administrative appeals to the Office of

Administrative Law (OAL) for a hearing before an Administrative Law Judge

(ALJ). In November 2005, the ALJ issued an initial decision on the appeals.

The ALJ concluded that the DEP's LOI determination was supported by the

record, and the conditions the DEP imposed on the GP were appropriate. On

1
  An LOI is the department's official determination of the presence or absence
of wetlands, State open waters, or transition areas; or the verification or
delineation of such wetlands, waters, or areas. N.J.A.C. 7:7A-3.1.
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December 29, 2005, the Commissioner of the DEP issued a final decision on the

appeals, adopting the ALJ's initial decision.

      In February 2008, Salas submitted an application to the DEP for a

freshwater wetlands individual permit. In October 2010, the DEP denied the

application. Salas filed an administrative appeal from that decision, and the

DEP referred the matter to the OAL for a hearing. Thereafter, Salas and the

DEP reached a settlement, which was memorialized in a stipulation executed in

December 2014.

      The DEP and Salas agreed that the DEP would reconsider the application

of its regulatory standards to the subject property to address Salas's claim that

the application of those standards resulted in a taking of property without just

compensation. They agreed the subject property consists entirely of freshwater

and coastal wetlands and an associated transition area.

      The stipulation noted that Salas had revised the plans for the proposed

dwelling and driveway. Salas agreed to reduce the footprint of the dwelling to

.093 acres of the delineated wetlands, construct the dwelling on pilings, and use

pervious material for the driveway. Salas also agreed to make a contribution to

the Wetlands Mitigation Council or some other suitable entity.

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      The DEP and Salas stipulated that the DEP could not approve the revised

plan for the property under the applicable regulatory standards governing coastal

zone management and individual freshwater wetlands permits. The DEP agreed

to initiate reconsideration of the permit denial and authorization of the revised

plan, in accordance with N.J.A.C. 7:7A-17.1 (now N.J.A.C. 7:7A-13.1).2

      The rule, which was promulgated to implement N.J.S.A. 13:9:B-22(b),

provides that "[i]f the issuance, modification, or denial of an individual

freshwater   wetlands    permit   would     constitute   a   taking   without   just

compensation," the DEP may

             1. [c]ompensate the property owner for the lost value of
             the property;

             2. [c]ondemn the affected property pursuant to the
             Eminent Domain Act of 1971, N.J.S.A. 20:3-1 [to -50];
             and/or

             3. [r]econsider and modify its action or inaction
             concerning a permit so as to minimize the detrimental
             effect to the value of the property.

             [N.J.A.C. 7:7A-13.1(a).]

2
  The rule was codified at N.J.A.C. 7:7A-17.1, but re-codified with certain
changes at N.J.A.C. 7:7A-13.1, effective December 18, 2017. See 49 N.J.R.
834(a) (May 1, 2017); 49 N.J.R. 3849(a) (Dec. 18, 2017).
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      The DEP and Salas agreed that Salas would file a complaint in the trial

court against the DEP asserting an inverse condemnation claim. Within sixty

days after filing and service of the complaint, the DEP would publish notice of

its intent to reconsider the denial of the permit and application of its regulatory

standards to the subject property. The DEP would provide for a fifteen-day

public comment period, as required by its regulations.

      The stipulation also stated that within 180 days after publication of the

notice, the DEP would issue its written analysis of the applicable regulatory

standards, review the revised plan and Salas's proposed mitigation contribution,

and issue a final decision in the matter. Salas agreed to dismiss the

administrative appeal challenging the permit denial; however, Salas retained the

right to reinstate that appeal if the DEP did not issue an amelioration

authorization allowing implementation of the revised plan.

      In April 2016, Salas filed a complaint in the trial court against the DEP

asserting an inverse condemnation claim. In June 2016, the Burkes filed a

motion to intervene in that action. Later that month, the DEP published notice

of its intent to reconsider the denial of the permit and the application of its

regulatory standards to the Salas property.

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      The Association then filed a complaint in the trial court against the DEP,

various DEP employees, and Salas. In that action, the Association challenged

the DEP's decision to reconsider the denial of the Salas permit application. The

Association sought, among other relief, a declaratory judgment finding that

Salas had not established entitlement to the issuance of an amelioration

authorization under the FWPA and the DEP's regulation, or a determination that

the DEP's denial of the wetlands permit constituted a regulatory taking.

      In August 2016, the DEP filed a motion to dismiss the Association's

declaratory judgment action. The DEP argued that the Law Division did not

have subject matter jurisdiction to hear a challenge to its decision to reconsider

the permit denial. In September 2016, the Association filed a motion seeking to

enjoin the DEP's reconsideration of the permit denial. The trial court denied the

motion. In November 2016, the Association filed another motion in the trial

court seeking to enjoin the DEP from continuing the reconsideration process,

and a motion for summary judgment.

      On January 19, 2017, the DEP issued the amelioration authorization to

Salas. The agency permitted Salas to construct the dwelling and driveway on

the subject property, in accordance with the revised plan and other stated

conditions. Thereafter, the trial court denied Burke's motion to intervene in

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Salas's inverse condemnation action and denied the Association's motion for

summary judgment.

      In January 2017, the trial court granted the DEP's motion and dismissed

both actions with prejudice. The Association appealed and we affirmed the trial

court's orders. Salas v. State, Dep't of Envtl. Prot., A-2825-16 (App. Div. Sept.

25, 2018) (slip op. at 3-9).

      In February 2017, the Association requested an adjudicatory hearing to

challenge the DEP's amelioration authorization and issuance of the water quality

certificate. The Acting Commissioner issued a final decision dated May 10,

2018, which denied the request for an adjudicatory hearing and rejected the

Association's challenge to the amelioration determination and certificate. This

appeal followed.

      On appeal, the Association argues: (1) the DEP's action violated N.J.S.A.

13:9B-22(b) because a court never determined that the DEP's initial denial of

the Salas permit constitutes a taking of property without just compensation ; (2)

the record does not support the DEP's determination that it faced a litigation risk

in the Salas inverse condemnation action; and (3) the DEP's final decision must

be reversed and the matter remanded for an adjudicatory hearing.

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                                        II.

      We first consider the Association's contention that the DEP's action was

inconsistent with N.J.S.A. 13:9B-22(b), which provides that:

            [i]f the court determines that the issuance,
            modification, or denial of a freshwater wetlands permit
            by the [DEP] pursuant to this act constitutes a taking of
            property without just compensation, the court shall give
            the department the option of compensating the property
            owner for the full amount of the lost value, condemning
            the affected property pursuant to the provisions of the
            "Eminent Domain Act of 1971," [N.J.S.A. 20:3-1 to -
            50], or modifying its action or inaction concerning the
            property so as to minimize the detrimental effect to the
            value of the property.

      The Association argues that before the DEP may exercise its authority

under the statute, a court first must determine the denial of the permit constitutes

a taking of property without just compensation. We disagree.

      In East Cape May Associates v. State, Dep't of Envtl. Prot., 300 N.J.

Super. 325, 328, the plaintiff was the owner of about 100 acres of undeveloped

land in Cape May, which consisted mostly of freshwater wetlands of

"exceptional resource value." The plaintiff wanted to develop the property for

residential use, and the DEP had denied the prior owner's application for a

development permit under CAFRA. Id. at 329. The plaintiff thereafter acquired

the property and filed a complaint in the Law Division, alleging that the DEP's

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                                         9
denial of the permit application effected a regulatory taking of its property in

violation of the Fifth and Fourteenth Amendments to the United States

Constitution. Id. at 334.

      The trial court granted the plaintiff's motion for summary judgment,

finding that there had been a regulatory taking of the plaintiff's property. Id. at

335. The court rejected the DEP's contention that a taking had not occurred

because the State had not yet availed itself of the opportunity under N.J.S.A.

13:9B-22(b) to reconsider the permit denial. Ibid. The court determined that

even if the DEP exercised its authority under the statute, there had already been

a temporary taking. Ibid.

      The DEP appealed and we reversed.           Id. at 354. We held that no

compensable taking had occurred. Id. at 340. We stated that

            [o]ne purpose of N.J.S.A. 13:9B-22b is obviously to
            avoid exposing the State to the risk of having to acquire
            property by the exercise of the power of eminent
            domain whenever an application for a development
            permit is denied. We are obligated to construe the
            statute to effectuate that purpose. It can and should be
            effectuated by interpreting the statute to mean that the
            administrative process leading to the issuance or denial
            of a development permit is not complete until the State
            has had the opportunity to decide whether the
            application of the regulations to a particular property
            should be relaxed pursuant to N.J.S.A. 13:9B-22b to
            avoid a taking. Constitutional considerations require us
            to construe the statute to also serve another purpose.

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                                       10
            The regulatory scheme governing properties like that at
            issue in the present case is extremely comprehensive
            and complex. It entrusts a very expansive discretion to
            the DEP.      To require a developer to submit a
            multiplicity of successive applications in order to
            attempt to divine, without administrative guidance,
            what, if any, development of its property will be
            permitted would be inconsistent with due process of
            law. . . .

            [Ibid.]

      We therefore interpreted the relevant section of N.J.S.A. 13:9B-22(b) to

read, "If the court [or the DEP] determines that the issuance, modification, or

denial of a freshwater wetlands permit by the department pursuant to this act

would constitute a taking of property without just compensation, the court shall

give the department the option of" compensating the owner, condemning the

property, or modifying its action concerning the property. Id. at 341.

      We said that "the statute requires the DEP and the developer to confer

about the realistic prospects for development" when the agency has taken a

position that would limit the use of property in a manner that would constitute a

constitutional taking. Ibid. We stated that N.J.S.A. 13:9B-22(b) "contemplates

and requires this mutual effort and administrative guidance," which is part of

the administrative process envisioned by the applicable regulatory scheme. Ibid.

We held that, "Until the developer has sought and obtained the requisite

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guidance from the DEP, or the DEP has failed or refused to provide it, no

permanent taking has occurred." Ibid.

      We added that if in the end, the developer is allowed reasonable utilization

of its property, it would not necessarily be entitled to compensation for the delay

between the initial denial of the application and issuance of the permit. Id. at

342. The delay incident to the permit process "is a burden inherent in the

ownership of property and not a constitutional taking." Ibid. (citations omitted).

We stated that a property owner might be entitled to compensation if the

application process is "unduly protracted." Id. at 342-43.

      We addressed this issue again in Griffith v. State, Dep't of Envtl. Prot.,

340 N.J. Super. 596 (App. Div. 2001). In that case, the plaintiff was the owner

of certain property, which included freshwater wetlands.          Id. at 600. The

plaintiff filed an application with the DEP seeking a freshwater wetlands permit

that would allow construction of a twenty-six-foot wide access road over the

wetlands portion of the property. Ibid.

      The DEP initially issued a permit allowing construction of the road but

limited it to a width of sixteen feet. Id. at 602. The plaintiff then sought a permit

pursuant to CAFRA, which would allow development of the upland property.

Ibid. The DEP cancelled the CAFRA application, finding that it had never

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declared the application complete and the plaintiff was not entitled to the benefit

of rules in effect before amendments to CAFRA were enacted and new rules

adopted. Id. at 603-04.

      The plaintiff appealed from the DEP's final decisions. Id. at 603. We

affirmed the decision regarding the CAFRA permit, but held that the imposition

of the sixteen-foot restriction on the road was arbitrary. Id. at 604. Thereafter,

the DEP invited the plaintiff to submit another CAFRA application. Id. at 605.

      The plaintiff chose instead to continue an inverse condemnation action it

had previously filed. Ibid. Before the entry of final judgment in that case, the

DEP exercised its authority under N.J.S.A. 13:9B-22(b) and granted the plaintiff

all of the approvals necessary to construct the twenty-six-foot road and

subdivide the upland portion of the property to allow residential development.

Id. at 600. The trial court held, however, that prior to the amelioration decision,

the DEP had effected a temporary taking of the property. Ibid.

      We reversed the trial court's order and reaffirmed our decision in East

Cape May. Id. at 608-09. We held that amelioration under N.J.S.A. 13:9B-

22(b) is part of the administrative permitting process, and the process is not

complete until the DEP has had the opportunity to determine whether the

application of regulations to any particular property should be relaxed. Id. at

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608 (quoting East Cape May, 300 N.J. Super. at 340). We also held there had

been no unreasonable delay on the part of the DEP in granting the approval

required to construct the road and develop the property. Id. at 608-09.

      Thus, there is no merit whatsoever to the Association's contention that

N.J.S.A. 13:9B-22(b) requires a court to determine that the DEP's action has

effected a taking of property without just compensation before the agency can

exercise its power of amelioration. We therefore conclude that the DEP may

initiate the amelioration process if it reasonably finds that application of its

regulatory standards may result in the taking of property without ju st

compensation. As held in East Cape May and Griffith, N.J.S.A. 13:9B-22(b)

does not require a court to find that the DEP's regulatory action had effected a

compensable taking before the DEP can exercise its power of amelioration under

the statute.

                                      III.

      The Association next argues there is insufficient evidence in the record to

show the DEP faced a "litigation risk" in the Salas inverse condemnation action.

The Association contends the DEP could not reasonably assume its regulation

of the Salas property would result in a regulatory taking. The Association

contends the DEP's decision is inconsistent with its earlier determination that

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                                      14
Salas did not have a reasonable, investment-backed expectation in developing

the property.

      We note that the scope of our review of the factual findings of an

administrative agency is limited. We must defer to the agency's findings of fact

if they could reasonably have been reached on sufficient credible evidence in

the record. In re Young, 202 N.J. 50, 70-71 (2010) (citations omitted). We also

must accord significant weight to the agency's expertise where, as in this case,

such expertise is relevant. Circus Liquors, Inc. v. Middletown Twp., 199 N.J.
1, 10 (2009); In re Stream Encroachment Permit, 402 N.J. Super. 587, 597 (App.

Div. 2008).

      In her final decision, the Acting Commissioner considered whether Salas's

investment in the property was reasonable and reflected reasonable expectations,

as required by N.J.A.C. 7:7A-17.1(c)(1) (now N.J.A.C. 7:7A-13.1(c)(1)). The

Acting Commissioner noted that Salas purchased the subject property in January

2002. At that time, the property was zoned for residential use, had access to

potable water and an existing sewer line, and was "an infill lot" surrounded by

single-family dwellings.

      The Acting Commissioner observed that before purchasing the property,

Salas hired consultants to survey the site and develop a plan for a single-family

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                                      15
home. The survey and design plan indicated that a portion of the property

contained uplands and was developable. The survey and design plan

incorporated a prior survey undertaken by the prior owner of the property, which

had been part of a prior owner's application to the DEP for an LOI.

      The DEP issued the LOI in 1991, which found that extensive portions of

the property consisted of freshwater wetlands with intermediate resource value

and associated transition areas. The Salases asserted, however, they never saw

the LOI. Moreover, the LOI expired in 1996. When the property was purchased,

Salas understood there was no current LOI for the subject property.

      The Acting Commissioner found that Salas's intent to develop the property

with a single-family dwelling and the actions taken to do so were reasonable and

consistent with the information available at the time. That information included

access of the property to utilities, the character of the neighborhood, and the

land-survey information that Salas's consultants had obtained.

      The Acting Commissioner further found there was a litigation risk to the

DEP from Salas's takings complaint. The Acting Commissioner commented that

if the DEP did not reconsider its denial of a permit to construct a dwelling on

the property, "Salas would have been left with no beneficial economically viable

use of the [p]roperty."

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      We are convinced there is sufficient credible evidence in the record to

support the Acting Commissioner's finding that when the property was

purchased, Salas had reasonable, investment-back expectations a single-family

dwelling could be constructed on the property. There is also sufficient credible

evidence in the record to support the Acting Commissioner's finding that the

DEP faced a litigation risk from the Salas's takings complaint.

      We reject the Association's contention that the DEP was in some sense

bound by its earlier decision on the permit application. That earlier decision

was subject to reconsideration as part of the amelioration process under N.J.S.A.

13:9B-22(b).

      We also reject the Association's contention that the 1991 LOI placed Salas

on notice that use of the property could be limited by the DEP's regulatory

standards. As we have explained, the LOI expired before Salas purchased the

lot and there was no LOI in effect when the property was purchased in 1992.

Thus, the 1991 LOI did not preclude Salas from having reasonable investment -

backed expectations that a single-family home could be constructed on the

property.

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      We have considered the Association's other contentions regarding the

DEP's amelioration decision. We conclude the Association's arguments lack

sufficient merit to warrant discussion. R. 2:11-3(3)(1)(E).

                                       IV.

      The Association also argues that the matter should be remanded to the

DEP for an adjudicatory hearing on its objections to the amelioration

authorization. Again, we disagree. Here, the Acting Commissioner correctly

found that the Association did not have a right to an adjudicatory hearing.

      The FWPA confers the right to an adjudicatory hearing on the property

owner whose application for a permit is denied. In re Freshwater Wetlands

Statewide Gen. Permits, 185 N.J. 452, 463 (2006) (citing N.J.S.A. 13:9B-20).

The FWPA "does not bestow a similar right to an abutting landowner who wants

to prevent the issuance of such a permit." Ibid. Furthermore, "[w]ithout a

statutory right to a trial-type hearing, the objectors must show that they have a

'particularized property interest sufficient to require a hearing on constitutional

. . . grounds.'" Id. at 463-64 (citing N.J.S.A. 52:14B-3.1, -3.2).

      The Burkes own a neighboring residential lot and the other members of

the Association own dwellings in the general area of the subject property. Such

generalized property rights are insufficient to establish standing for an

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adjudicatory hearing to contest the grant of a permit. See In re Amico/Tunnel

Carwash, 371 N.J. Super. 199, 211 (App. Div. 2004); Spalt v. State, Dep't of

Envtl. Prot., 237 N.J. Super. 206, 212 (App. Div. 1989); Normandy Beach

Improvement Ass'n v. Comm'r, 193 N.J. Super. 57, 60-61 (App. Div. 1983).

      Therefore, the Acting Commissioner correctly determined that the

Association was not entitled to an adjudicatory hearing on their objections to the

agency's amelioration determination and water quality certificate.            The

Association's arguments on this issue lack sufficient merit to warrant further

discussion. R. 2:11-3(e)(1)(E).

      Affirmed.

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