By Nicholas F. Talvacchia, Benjamin Ojserkis, and Zach Matik
The New Jersey Supreme Court has clarified an important limit on municipal eminent domain authority: a municipality may not condemn private property solely to transfer it to a developer in exchange for different land that will be devoted to a public use.
In Township of Jackson v. Getzel Bee, LLC, the unanimous Court held that neither the Local Lands and Buildings Law nor the Eminent Domain Act authorized Jackson Township to condemn two privately owned lots for that type of exchange. Although the developer’s property would be preserved as open space, the condemned lots would be transferred to the developer without restrictions requiring a public use.
The Township’s objective—preserving open space—was a recognized public purpose. The problem was the method chosen to achieve it.
What Happened
Jackson Township adopted a series of ordinances to acquire two privately owned parcels through eminent domain. The Township intended to transfer those parcels to a private developer. In exchange, the developer would convey different property to the Township for preservation as open space.
The condemned parcels were not part of the land to be preserved. After the exchange, the developer could use them for any lawful purpose.
The trial court permitted the condemnations to proceed, but the Appellate Division reversed. The Supreme Court affirmed and, because counsel represented that the exchange had already occurred, remanded the matter to the trial court to determine appropriate equitable relief. The Court did not decide what form that relief should take.
Why the Court Rejected the Condemnation
The Court’s decision centered on the distinction between a project’s overall public benefit and the legal requirements governing the specific property being condemned.
The Court distinguished this transaction from cases in which condemned property was transferred to a private party as part of an integrated plan or through a transfer that itself advanced a public purpose.
The Local Lands and Buildings Law permits a municipality to exchange land it owns for other property desired for public use. It does not authorize a municipality to condemn privately owned land merely to place that property into an exchange. The Eminent Domain Act similarly authorizes the taking of private property for a public purpose, not the use of one owner’s land as consideration for acquiring different property.
Here, the condemned lots functioned only as “currency” for a public benefit that would occur elsewhere. The lots were not restricted for open-space use, and their transfer to the developer did not itself further the Township’s stated public purpose.
The Court also concluded that the Township failed to “turn square corners” in its dealings with the property owners. Its ordinances and communications did not consistently explain the intended transaction, and the Court described the Township’s asserted public purpose as, at times, “vague, inaccurate, and pretextual.”
What This Means for Developers
For developers working with municipalities on redevelopment projects, land exchanges, or public-private transactions, the decision highlights several important considerations:
- A public benefit alone may not be enough. A municipality’s broader goal—such as preserving open space or advancing redevelopment—does not automatically validate the use of eminent domain.
- The transaction structure matters. Developers should understand how municipal partners are acquiring and transferring property and whether the legal authority supports the proposed arrangement.
- Documentation and transparency are critical. Ordinances, agreements, notices, and other transaction documents should accurately describe the purpose of the acquisition and intended disposition of the property.
Municipal involvement does not eliminate due diligence. Developers should evaluate whether the governmental steps supporting a project are legally sound before relying on a proposed land swap or condemnation strategy.
Practical Takeaways for Municipalities and Developers
The decision does not prevent municipalities from condemning property for open-space preservation or prohibit every condemnation involving a later transfer to a private party.
It does require the condemnation to rest on statutory authority and the public-use requirement to be satisfied with respect to the property being condemned. A public benefit occurring on different property did not satisfy that requirement here, where the condemned land merely served as consideration in the exchange.
Before pursuing a condemnation-based land exchange, municipalities should carefully evaluate their statutory authority and ensure that ordinances, notices, agreements, and court filings accurately describe both the purpose of the taking and the intended disposition of the property.
Property owners facing condemnation should examine not only the government’s stated objective, but also what the municipality plans to do with the particular property after acquiring it.
For developers, Township of Jackson serves as a reminder that projects involving municipal partners require careful attention not only to the development opportunity itself, but also to the legal framework supporting the transaction.
Township of Jackson reinforces a straightforward principle: a valid public objective does not authorize every method of achieving it. Eminent domain must be exercised within statutory limits and with candor and fairness.
Our Land Use Department is available to advise developers on land use, redevelopment, zoning, and municipal matters to help identify and address potential legal challenges before they impact a project.
Contact Nicholas Talvacchia, Esq. at (609) 572-7544, ntalvacchia@cooperlevenson.com or Benjamin Ojserkis, Esq. at (609) 572-7550, bojserkis@cooperlevenson.com
The content of this post should not be construed as legal advice. You should consult a lawyer concerning your particular situation and any specific legal question you may have.