State by Commissioner of Transportation v. St. Mary’s Church Gloucester, 464 N.J. Super. 579 (App. Div. 2020). This appeal was about how to calculate interest on a portion of a just compensation award that resulted from proceedings for condemnation of certain real property owned by the defendant Church. The award exceeded the amount that had been deposited in court, as estimated compensation, prior to the condemnation proceedings, so the question was what interest rate applied to the unposted balance. The Appellate Division’s opinion today, written by Judge DeAlmeida, applied de novo review to the purely legal issue presented, one that arose from “conflicting statutes.”
N.J.S.A. 27:7-22 provides that if the amount of a condemnation award exceeds the amount of the sum deposited into court, the condemnee is entitled to “the difference between the amount of the deposit and the amount of the award, with interest at the rate of [six percent] per annum thereon from the date of the making of the deposit.” That was an exception to a provision in that same section that, in general, condemnations by the Commissioner of Transportation proceed “in the manner provided in chapter 1 of the title Eminent Domain,” N.J.S.A. 20:1-1 et seq.
In contrast, the later-adopted Eminent Domain Act of 1971 (“the Act”) states that all condemnations, without exception, are to be governed by the Act. The Act provides that unless the parties agree about interest, “the amount of such interest shall be fixed and determined by the court in a summary manner after final determination of compensation ….” Finally, the Act repeals “[a]ll acts and parts of act inconsistent with” the Act, and makes the Act applicable to all bodies “having the power of eminent domain exercisable within the State of New Jersey,” except as specifically exempted within the Act.
The Law Division applied N.J.S.A. 27:7-22, finding it “clear and unambiguous.” But Judge DeAlmeida held that the Act had repealed that statute. The Legislature had intended the Act to “cover the same subject addressed in N.J.S.A. 27:7-22 and to establish uniformity in condemnation.” Moreover, the earlier statute and the Act were “so clearly in conflict … that the two cannot stand together reasonably,” so the Act, “the newer statute[,] should supersede the prior one.” Finally, legislative history showed that the Legislature had considered adopting a fixed 6% rate for all condemnations but chose not to do so, instead leaving interest rates uniformly to “judicial discretion.”
The Law Division had also held that the interest award must be simple interest, relying on the “per annum” language of N.J.S.A. 27:7-22. That ruling too was reversed. Judge DeAlmeida left it to the trial court to decide whether simple or compound interest was the proper course. The case was remanded to a different judge for further proceedings, since the prior judge “had formed an opinion as to the amount of interest to award had it had the discretion to do so and [had stated] that a six percent rate was too high for current conditions.”