Long Branch homeowners, joined by their attorneys and supporters, rallied outside a state courthouse in Trenton on May 14 to save their homes from being taken through eminent domain. LONG BRANCH - After listening to three hours of arguments last week, a panel of three judges is expected to issue a ruling on whether the city of Long Branch should be permitted to condemn an oceanfront neighborhood.

It was standing room only in the Richard J. Hughes Justice Complex in Trenton on May 14 where attorneys representing a group of Long Branch homeowners asked for a dismissal of a Superior Court ruling that permits the use of eminent domain to acquire properties in the three-street MTOTSA (Marine Terrace, Ocean Terrace, Seaview Avenue) neighborhood for a private redevelopment project.

"We are seeking that this court dismiss the condemnation complaints outright," said Institute for Justice (IJ) attorney Scott Bullock, who is representing a group of 17 homeowners as co-counsel in the appeal.

"At a minimum, there should be a plenary hearing to allow us to challenge the redevelopment," he said.

Bullock was joined by attorneys Peter H. Wegener of Bathgate Wegener and Wolf, and William J. Ward of Carlin & Ward, on the side of the homeowners.

Arguing for the city at the appeal was Long Branch City Attorney James Aaron of Ansell Zaro Grimm &Aaron, and attorney Paul V. Fernicola of Bowe & Fernicola.

Aaron defended the city's action to condemn the Beachfront North, Phase II redevelopment zone, which has come to be known as MTOTSA.

"People were saying, 'My God, help this area. Redevelop this area,' " Aaron said about the condition of theMTOTSAneighborhood at the time it was designated in need of redevelopment in 1996.

"There was no development happening [inMTOTSA]," he said. "There was no private individual saying redevelopment is here and now we are going to develop our own properties."

Attorneys for both sides argued the case in the state appeals court before Judges Joseph F. Lisa, Paulette Sapp-Peterson and Richard Newman.

There is no time line for the panel of judges to return a decision in the case, Bullock said, adding that it could be in a couple of weeks or a couple of months.

Bullock explained that at the time the ruling is issued, depending on how the panel of judges rule, either side in the case can petition the New Jersey Supreme Court to hear the case.

Public Advocate Ronald Chen appeared in the courtroom the day of the appeal. Chen's office filed an amicus curia, or friend of the court, brief on behalf of the property owners urging that the appellate division reverse the decision of the trial court outright or reverse and remand the matter for a full and fair hearing to resolve the facts.

"The evidence the city of Long Branch produced simply does not amount to substantial evidence of blight," Chen said after the arguments were heard. "Our concern is that the evidence the city produced as evidence of blight, chipping paint or loose gutters, means that almost every house in the state could fall within the definition and none of us would be protected.

"I think that the court was clearly very prepared," Chen said. "No lawyer will predict an outcome, but I am pleased and I think the condemnation complaints should be dismissed or at least a remand.

"The property owners have not been given the opportunity to develop a full record," Chen added.

Ward said after the arguments that he believes the judges will grant a reversal of Superior Court Judge Lawrence M. Lawson's decision.

"I think and would hope they would grant a dismissal of the condemnation complaints," Ward said.

The homeowners are appealing Lawson's June 2006 ruling that gave the city the go-ahead to use eminent domain to acquire the properties in the MTOTSA neighborhood to fulfill the city's redevelopment plan.

The attorneys for the MTOTSA homeowners argued during the appeal that there have been several "landmark" court decisions in the state that have been decided in favor of property owners.

One such case includes the state Supreme Court decision in the Gallenthin Realty Development Inc. case, where the court found that the town of Paulsboro failed to prove that the land was blighted.

The decision in the Gallenthin case said that a lack of productivity is not enough to declare an area blighted, according to Bullock.

"The trial court [for MTOTSA] recited the procedural steps taken," Bullock said. "It never actually examined the evidence.

"The court did not permit the property owners to have discovery or a plenary hearing," he said.

Lisa questioned Bullock, "What, in a remand proceeding, would you hope to do?"

Bullock said, "The courts must hear evidence in order to determine whether the takings are [necessary to complete] the redevelopment plan. The only way to do this is by hearing evidence."

The three judges questioned why the homeowners are stepping forward to fight the plan now, when the MTOTSA neighborhood was declared an area in need of redevelopment and listed in a redevelopment zone in 1996.

"There were public hearings and we have all these years gone by," Sapp-Peterson said, "when you consider the time frame that has elapsed since 1996.

"It is not a question of can they," she said, "Under the particular facts here, it is, is it appropriate?"

Wegener argued that the city's initial plan from 1996 called for residential infill in the MTOTSA neighborhood and that the city changed the plan several years later to condemn the neighborhood to make way for a luxury, private redevelopment project.

"The plan said that the amount of relocation required to implement the redevelopment plan is expected to be moderate at most and infill is being encouraged," Wegener said. "Residential infill here means that the project would fill in the vacant areas."

Lisa said, "So you are saying that [the city] wouldn't have said this if they didn't intend to leave people in their homes."

Aaron argued that the city never changed the redevelopment plan and said that the plan always called for planned and infill residential.

"Clearly from the beginning there has been two ways to develop this area," Aaron said. "Knowing all of this and being a part of the process, did any of the property owners come forward and say 'define infill?' "

Fernicola, also defending the city's plan to condemn the MTOTSA neighborhood, said that there were 25 acres of vacant land in the area and 15 of the acres had been vacant for over 10 years.

"Property owners made the determination to hold the land in a vacant position rather than make the improvements," Fernicola said.

He added that there is an area of land, north of the MTOTSA neighborhood, where a segment of properties was excluded from the redevelopment plan.

"Clearly there was decision-making and discretion," Fernicola said, explaining that the redevelopment study was not "rubber-stamped."

Fernicola further credited the construction of the four-lane Ocean Boulevard as a factor that contributed to a decline in the MTOTSA neighborhood.

"When they built Ocean Boulevard, the flow of traffic continued down Ocean Boulevard, rather than utilizing Ocean Avenue," Fernicola said. "The construction of Ocean Boulevard isolated this area, creating the remoteness of this area and lack of means of access."

Lisa questioned, "Does that make it inaccessible?

For residential redevelopment, isn't this a plus?" Lisa added.

Fernicola further supported the city's plan that declared the MTOTSA area in need of redevelopment, citing that from 1990 through 1995, the five years prior to the adoption of the redevelopment plan, there were 4,775 building permits obtained in Long Branch.

Only two of the 4,775 permits were obtained for residences within the city's redevelopment zone, according to Fernicola.

Aaron told the courtroom that the city entered into good-faith negations with the property owners and it was the property owners who failed to enter into negotiations.

"The negotiations can take anywhere from two weeks, four weeks, one year, up to and beyond a year," Aaron said.

"We have these property owners who say 'No, our property is not for sale' and instead they ask us to answer these questions," he said, adding, "You can't negotiate by yourself."

Wegener said that the property owners never had an opportunity to discuss issues surrounding the condemnation of their properties.

"Our clients wanted to know how it came to be that you are taking their properties," Wegener said. "The property owners might be interested in more than how much you are offering them.

"At a minimum, good-faith negotiations require that they address those issues," Wegener added.

Attorneys from both sides also disagreed about possible conflicts of interest that may have existed during the redevelopment process.

Attorneys representing the homeowners charge that several conflicts of interest may have existed, including that council members and Aaron hold stock in Monmouth Community Bank, which is the bank that extended a loan of credit to the developers of the redevelopment zone.

"There is obvious conflicts here," Ward said. "We really wanted to take depositions on that issue."

Aaron said no such conflict existed.

"You have a developer's agreement entered in 2000," Aaron said. "There was a mortgage contingency clause.

"There is not a shred of evidence that a member of council said we are going to approve you sometime in the future and you will borrow money from the Monmouth Community Bank," Aaron said.