## Facts

- A New Jersey municipality participated in a shore-protection project constructing a continuous dune line along an oceanfront barrier island.
- Owners of an oceanfront residential lot had a panoramic ocean view from their home.
- The municipality condemned an easement over a portion of the owners’ property to build a dune approximately 22 feet high, occupying more than 3,000 square feet (over 25% of the lot).
- The dune obstructed the ocean view, which the owners claimed reduced the property’s market value.
- The municipality contended the dune also increased the remaining property’s value by providing significant protection from storms and flooding.
- The trial court allowed evidence of view loss but excluded evidence of storm-protection benefits on the ground that such benefits were “general” to the community rather than “special” to the property.
- A jury awarded the owners $375,000 as just compensation; the intermediate appellate court affirmed.

## Issues

1. In a partial-taking eminent domain case, must just compensation account for all reasonably calculable, non-speculative benefits and detriments from the public project affecting the remaining property’s market value?
2. May a court categorically exclude evidence of protective benefits as “general benefits” when those benefits directly affect the remainder’s value?

## Decision

- The Supreme Court of New Jersey reversed and remanded for a new trial on just compensation.
- The court held that valuation must consider all relevant, reasonably calculable, non-conjectural factors that either decrease or increase the remaining property’s market value.
- The trial court erred by barring evidence of storm-protection benefits solely because similar benefits extended to other properties.
- The proper measure is a before-and-after fair market value analysis that permits the factfinder to weigh both view loss and storm-protection gains to the remainder.

## Legal Principles

- In partial takings, just compensation is generally the difference between the fair market value of the whole property before the taking and the fair market value of the remainder after the taking, accounting for the taking’s impacts.
- The factfinder should consider any non-speculative, reasonably quantifiable project-related benefits and detriments that a rational buyer and seller would price into the remainder.
- A rigid “general benefits” versus “special benefits” exclusion is not controlling when it prevents consideration of measurable benefits that affect the remainder’s market value.
- Speculative or conjectural asserted benefits may still be excluded; only reasonably calculable impacts on the property’s value are admissible for offset.

## Conclusion

The court required that just compensation for a partial taking be determined by a market-based before-and-after valuation that includes all reasonably calculable, non-speculative benefits and harms from the project to the remaining property, and it ordered a new trial because the jury was not allowed to consider the dune’s storm-protection benefit.


Borough of Harvey Cedars v. Karan, 214 N.J. 384 (2013)