Gallenthin v. Kaur: a comparative analysis of how the New Jersey and New York courts approach judicial review of the exercise of eminent domain for redevelopment.

• Author: Chen, Ronald K.
• Position: Fordham Urban Law Journal Symposium

Introduction I. Judicial Review of Agency Determinations A. New Jersey's Approach 1. Gallenthin Realty v. Borough of Paulsboro B. New York's Approach II. The Elusive Definition of "Blight" III. Whither "Underutilization" and "Blight?" INTRODUCTION

The public controversy triggered by the United States Supreme Court's expansive decision in Kelo v. City of New London (1) put considerable political pressure on individual states to impose their own independent limits on the use of the power of eminent domain for purposes of redevelopment, in order to conform that power to commonly held notions regarding the inviolability of private property. Kelo held as a matter of federal constitutional doctrine that appropriating property for transfer to a private entity in order to encourage economic development or enhance tax revenues constituted a permissible "public use" under the Takings Clause of the Fifth Amendment. (2) But the Court emphasized that "nothing in our opinion precludes any State from placing further restrictions on its exercise of the takings power." (3) Observing that many states already impose "public use" requirements that are stricter than the federal baseline, the Court, in effect, invited the states to temper the breadth of its controversial decision with their own independent limitations. The pressure to identify independent state grounds for invalidating the use of eminent domain for redevelopment was therefore felt by both the legislative and judicial branches of state governments.

One such limitation that is grounded in the legal tradition of a number of states, including New York and New Jersey, is the principle that use of eminent domain for redevelopment should be restricted to areas that are considered "blighted." Elimination of blight through redevelopment projects has thus long been held by the courts to constitute a public benefit which satisfies the "public use" requirement of the Takings Clause. (4) Conversely, both before and after the Kelo decision, many states have required a showing of blight as a precondition to use of redevelopment powers, including eminent domain. (5) Especially after Kelo, several states have explored the concept of elimination of "blight" not only as a source of reaffirmation of a state's redevelopment authority, but at the same time as a potential limit on that same authority, which would protect areas deemed not to be blighted from condemnation for redevelopment.

New Jersey and New York have facially comparable constitutional and statutory provisions regarding use of condemnation to engage in redevelopment of blighted areas. Under the Blighted Areas Clause of the New Jersey Constitution: "The clearance, replanning, development or redevelopment of blighted areas shall be a public purpose and public use, for which private property may be taken or acquired. Municipal, public or private corporations may be authorized by law to undertake such clearance, replanning, development or redevelopment...." (6) The New York Constitution states, albeit in somewhat different language, that "the legislature may provide ... for the clearance, replanning, reconstruction and rehabilitation of substandard and unsanitary areas...." (7) Pursuant to their respective constitutional provisions, both states have, either by statute (8) or by case law, (9) attempted to further elucidate the meaning of "blight."

In two relatively recent decisions, the courts of last resort of both states have laid out their vision for the proper role of the judiciary in defining "blight," and thus also determined its effectiveness in limiting at least some objectionable uses of eminent domain for purposes of redevelopment. But despite the similar focus on the concept of blight, the two courts announced two very different approaches to judicial review of such determinations. In Gallenthin Realty Development, Inc. v. Borough of Paulsboro, (10) the New Jersey Supreme Court interpreted the New Jersey Constitution as imposing judicially enforceable limits on the legislative power to authorize condemnation for purposes of redevelopment, and thus strictly construed the New Jersey Local Redevelopment and Housing Law as not permitting designation of an undeveloped parcel of land as "in need of redevelopment," i.e., "blighted," (11) merely because the local planning board found that the land was "stagnant or not fully productive." Such an expansive definition of blight, the court found, would be beyond the powers delegated to the legislature by the state constitution. Moreover, while facially respectful of administrative expertise, the court also required that an agency determination of blight be supported by "substantial evidence," such that the agency must satisfy a vigorous threshold evidentiary requirement, not merely supported by "the net opinion of an expert," before being entitled to deference. (12)

In contrast, in Kaur v. New York State Urban Development Corp., (13) the New York Court of Appeals adopted a highly deferential approach to judicial review over the exercise of redevelopment power. In authorizing a controversial use of condemnation power to permit redevelopment and expansion by Columbia University in the Manhattanville section of West Harlem in Manhattan, the court characterized the determinations of "blight" and "public purpose" to be judgments largely committed to the legislature, and, in language hinting at separation of powers concerns, countenanced judicial intervention "only where there is no room for reasonable difference of opinion as to whether an area is blighted." (14) Under that standard, judicial review is so deferential that, as a practical matter, courts may be removed from any meaningful role in curtailing arguably overreaching use of eminent domain for redevelopment.

This Article will attempt to explore two credible explanations for the divergent results between the neighboring states. First, in Part II, it will explore the long tradition, ultimately grounded in the New Jersey Constitution, of meaningful judicial review of administrative agency determinations. Under the "action in lieu of prerogative writs" procedure created under Article VI, Section 5, Paragraph 4 of the state constitution, the New Jersey judiciary exercise the power by which the Crown, acting through its courts, historically exercised control over inferior courts and public authorities throughout the kingdom. While the analogous procedure under New York law, a CPLR Article 78 proceeding, (15) was likewise intended to emulate the traditional writs of certiorari, mandamus, and prohibition, and provide for judicial review over official or agency action, the scope of that review, as evidenced by the Kaur decision, is comparatively narrow.

In Part III, this Article discusses whether a second basis for the difference between Gallenthin and Kaur might lie in the diligence with which the respective courts and legislatures are willing to approach the task of defining "blight," such that it can be reduced to a judicially manageable standard. While the use of a poetic metaphor in legal terminology presents some undeniable interpretive challenges, the New Jersey courts appear to be more willing to explore the historical understanding and provenance of the term, stemming from the first urban renewal efforts in the late 1930s and 1940s, and the New Jersey Legislature has undertaken to define the conditions that establish blight in greater detail. In contrast, the relevant New York statutes are phrased at a level of generality that essentially begs the question of what constitutes blight.

Lastly, this Article concludes that the deferential attitude adopted by the New York courts toward legislative or agency determinations of blight runs the risk of leaving misuse of the malleable concept of "underutilization" without any meaningful remedy. The notion that an area can be deemed blighted because some prospective future use might become more economically productive would quickly degenerate into the rationale accepted by Kelo--but presumably rejected by those states that interpose their own requirement of blight--that stimulating general economic development can justify appropriating private property for redevelopment without a showing that the area to be condemned itself presents any danger to the public health, safety, and welfare. Under those circumstances there would appear to be little utility for maintaining the independent requirement of blight at all.

1. JUDICIAL REVIEW OF AGENCY DETERMINATIONS

   1. New Jersey's Approach

      Judicial review of federal administrative agency decisions, as well as agency decisions in many states, is a legislatively created mechanism pursuant to the Administrative Procedures Act (16) (APA) or analogous state statutes, and thus is also largely subject to legislatively created limits. (17) In contrast, "[i]n New Jersey, judicial review of administrative agency determinations has the support of a special constitutional provision ... which largely immunizes it from legislative curbs." (18) Thus, New Jersey "is conscious of itself as the jurisdiction in which judicial review has been most freely available with the least encumbrance of technical apparatus." (19) Indeed, occasional attempts by the New Jersey Legislature to curtail access to judicial review of agency action by imposing procedural barriers, such as a limitations period, have been firmly rebuffed. (20)

      The actual text of the New Jersey Constitution that created this peculiar New Jersey guarantee of judicial review of agency action is at first inspection somewhat enigmatic: "Prerogative writs are superseded and, in lieu thereof, review, hearing and relief shall be afforded in the Superior Court, on terms and in the manner provided by rules of the Supreme Court, as of right, except in criminal causes where such review shall be discretionary." (21) Although it "superseded" the traditional writ procedure and created the new action...