A New Jersey appellate court has ruled against the Casino Reinvestment Development Authority in an eminent domain case involving an Atlantic City homeowner, ending a five-year legal battle and stifling the state agency’s broad condemnation powers.
In an opinion Friday, three appellate judges upheld a 2016 decision by Atlantic County Superior Court Assignment Judge Julio Mendez, who found that the CRDA’s attempt to take the South Inlet home of Charles and Lucinda Birnbaum was an abuse of power.
“We respect the court’s decision,” a spokesperson for CRDA said Friday.
“This is a complete vindication for Charlie and for everything he’s argued throughout this case,” said Robert McNamara, an attorney for the Birnbaums. “The Casino Reinvestment Development Authority’s notion in this case was that they could take Charlie’s home for any reason, or for no reason, and that nobody could stop them. And what the appellate court said today is that simply isn’t true.”
McNamara said the decision Friday would “put a stop to rampant land speculation by the CRDA” and by any other public entity in New Jersey.
The three-story home on Oriental Avenue has been in Birnbaum’s family since 1969. Charles Birnbaum took ownership of the property in 1987. Since the late ‘90s, Birnbuam has rented out the top two stories and used the first floor as a base of operations for his piano tuning business.
“This home has been so special to our family, and the fact that it’s standing and still here is enormously important,” Birnbaum said in a statement released by the Institute for Justice, for which McNamara is a senior attorney. “I’m grateful for the outcome, and I’m grateful for having been able to fight for so long.”
In June 2013, CRDA attempted to buy the Birnbuam property for $238,500 as part of the authority’s South Inlet Mixed Use Development Project. When Birnbaum refused, CRDA filed a complaint seeking a judgment that the authority had duly exercised its power of eminent domain, the ability of government to take private property for public use.
In November 2014, Mendez granted the CRDA’s application to use eminent domain. But the Birnbaums filed a motion for reconsideration based on significant changes to the core principle of the CRDA’s plan, namely that Revel Casino Hotel, a primary driver of the proposed development plan, had closed and that certain funding sources for the authority were being redirected by legislation in Trenton.
In 2015, Mendez reconsidered his decision and gave the CRDA a 180-day window to demonstrate a precise plan for what the authority wanted to do with Birnbaum’s property. CRDA presented a conceptual idea but lacked a viable plan that was “likely to occur within the foreseeable future,” Mendez wrote before concluding the authority was “banking land in the hopes of attracting a developer at some future point in time.”
Mendez found the proposed use of eminent domain was unjustified.
“CRDA never had a plan for this home other than knocking it down and then thinking really hard about what they might want to put there instead,” said Dan Alban, senior attorney with the Institute for Justice. “If that reasoning was enough to let them take this home, it would be enough to let them take literally any home they wanted, for any reason or for none.”