City of Elizabeth Ordered to Pay Motel Owner from Environmental Escrow

The City of Elizabeth was recently ordered by New Jersey Superior Court Judge Kathryn A. Brock to permit the release of more than $350,000 to the former owner of a motel seized under eminent domain.   The monies had been held in a  Superior Court escrow account to provide funding for environmental cleanup of the property.

The City acquired the Saxony Motel, a 35-room, family-owned business on Atlantic Street in Elizabeth, by filing an eminent domain action in January, 2008.  The City offered $1.8 million for the property, but claimed that approximately $800,000 of the monies offered needed to remain in the court escrow account to provide monies to pay for the cleanup of the property, which the City claimed was contaminated by leaking oil tanks or spillage from a gas station next door.

The Van Ness family, which owned the property before the taking, was unaware of any contamination on the property during its ownership and operation of motel for over 50 years.  The Van Ness’s appraiser has valued the property at $2.5 million.  Elizabeth officials indicated that the property was taken to build a recycling facility.

Read more about this decision in an article by Julie O’Connor from The Star-Ledger. 

In this case, McKirdy & Riskin’s Anthony Della Pelle represents the property owner, The Saxony Motel and the Van Ness family, as special condemnation counsel .  Now that the City has been ordered to allow the release of the environmental escrow, the owner is hopeful that the issue of just compensation for taking of the property will proceed to a jury trial later this year.