By JOSH DAWSEY
New Jersey Gov. Chris Christie's plan to build protective sand dunes along the state's battered shoreline scored a significant victory Monday when the state's highest court threw out a six-figure settlement won by a couple who said a similar measure had lowered their home value.
In its unanimous decision, the state Supreme Court said dunes also add value—such as offering a buffer against ocean onslaughts—which must be considered in determining how much the state should compensate homeowners for their land. The ruling reversed a $375,000 award won by a Harvey Cedars couple, Harvey and Phyllis Karan, and sent it back to the lower court for reconsideration.
Homeowners up and down the Jersey Shore had been waiting for the decision. Many are considering whether to sign waivers, called "easements," to allow the Christie administration to build dunes on their land. The plan is part of a $1 billion attempt to shield the shore against destructive storms like Sandy.
State officials have argued that compensating everyone at rates similar to what the Karans received would make the effort cost-prohibitive.
"Engineered dune systems paid for with public dollars benefit everyone, including holdouts who selfishly refuse to provide easements to protect not just their own homes but the homes and businesses inland of them as well," said Michael Drewniak, a spokesman for Mr. Christie, a Republican.
Peter Wegener, an attorney for the couple, said the Karans were disappointed but not surprised at the outcome and planned to continue the case.
"There was a great deal of pressure put on the court by state politicians, and that apparently had an impact on the result that was reached," Mr. Wegener said. "The storm caused a great deal of damage to property along the oceanfront, and this opinion causes a great deal of damage."
The state sought easements from tens of thousands of property owners and vowed to secure them all. But some homeowners fear they will lose valuable ocean views; others don't want government encroaching on private property. The state couldn't say Monday how many people have declined to sign waivers. The number was about 2,000 two months ago.
The Karans had been offered $300 by officials in Harvey Cedars after 22-foot dunes were built in front of their home in 2010. After they won $375,000, the borough appealed, saying such settlements would bankrupt its coffers and that dunes could drive up property values.
"If you had to pay that kind of money, you'd probably never do anything," said Harvey Cedars Mayor Jonathan Oldham.
It was unclear exactly how courts would assess the benefit of protective measures. Still, Peter Reinhart, director of the Kislak Real Estate Institute at Monmouth University, said the decision was a clear win for beach towns and would change negotiations for those still waiting to sign easements.
"I wouldn't be surprised if it's close to offsetting the [ocean] view loss with protection from storms," he said. "You're going to pay a lot more after Sandy for a home that's protected."
Direct link: http://online.wsj.com/article/SB10001424127887324507404578593923894354416.html?