BAY HEAD-MANTOLOKING LAND COMPANY VS. BEVERLY KONOPADA(L-3361-15, OCEAN COUNTY AND STATEWIDE) ( 2017 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R.1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4347-15T1
BAY HEAD-MANTOLOKING LAND
COMPANY,
Plaintiff-Appellant,
v.
BEVERLY KONOPADA, Clerk of
the Borough of Mantoloking,
Custodian of Records, and
THE BOROUGH OF MANTOLOKING,
Defendants-Respondents,
and
NEW JERSEY DEPARTMENT OF
ENVIRONMENTAL PROTECTION,
Defendant/Intervenor-
Respondent.
______________________________________
Argued August 1, 2017 – Decided August 14, 2017
Before Judges Sabatino, O'Connor and Whipple.
On appeal from Superior Court of New Jersey,
Law Division, Ocean County, Docket No. L-3361-
15.
Donald F. Burke argued the cause for
appellant.
Jill L. Thiemann argued the cause for
respondent Beverly Konopada, Clerk and Records
Custodian of the Borough of Mantoloking and
the Borough of Mantoloking (O'Malley, Surman
& Michelini, attorneys; Ms. Thiemann, on the
brief).
John P. Kuehne, Deputy Attorney General,
argued the cause for respondent New Jersey
Department of Environmental Protection
(Christopher S. Porrino, Attorney General,
attorney; Raymond R. Chance, III, Assistant
Attorney General, of counsel; Mr. Kuehne, on
the brief).
PER CURIAM
This appeal stems from the trial court's denial of plaintiff's
request for documents under the Open Public Records Act, N.J.S.A.
47:1A-1 to -6 ("OPRA"), and the common law. Plaintiff seeks copies
of draft appraisal reports furnished to the Borough of Mantoloking
("the Borough") in connection with anticipated eminent domain
litigation for certain beachfront properties located in the
municipality.
The Borough, in coordination with the Army Corp of Engineers
and the New Jersey Department of Environmental Protection ("DEP"),
is involved in a storm water fortification project to protect the
shoreline in the wake of Superstorm Sandy ("Sandy"). As part of
that project, the DEP needs to acquire easement rights for several
properties along the shoreline.
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In connection with the anticipated eminent domain cases, the
Borough and the DEP arranged for a certified real estate appraiser
to evaluate the properties, so that the governmental entities
could enter into good faith negotiations with the owners, as
required under the Eminent Domain Act, N.J.S.A. 20:3-1 to -50.
Nine draft appraisals for various parcels were generated. Five
of those drafts were finalized, and the appraisals were turned
over to the property owners to pursue negotiations. Four draft
appraisals for the other parcels were not initially disclosed.
However, after the Borough obtained finalized appraisals from a
different expert, the draft appraisals by the first expert were
turned over to the property owners along with the finalized ones.
Plaintiff, Bay Head-Mantoloking Land Company, LLC, filed the
present action after its request to obtain the four draft
appraisals was denied. The Borough and the DEP, which intervened
in the litigation, argued that the request for disclosure was
appropriately denied on two independent grounds: (1) the
deliberative process privilege for draft reports; and (2) the
attorney work product privilege. The trial court agreed with
defendants that these privileges pertained, and therefore the
requested draft appraisals did not have to be provided to
plaintiff, either under OPRA or under the common-law balancing
test.
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On appeal, plaintiff contends that none of the asserted
grounds for non-disclosure apply here as a matter of law, and that
plaintiff should have been provided with the draft appraisals.
For the reasons that follow, we affirm.
I.
On October 29, 2012, Superstorm Sandy first touched land in
New Jersey at Brigantine, with eighty miles-per-hour winds and
floodwaters that decimated large portions of the State's coast.
According to a certification by the DEP manager of coastal
engineering, the coastal areas spared by Sandy were those with
engineered beaches and dunes that had been built to the Army Corps
of Engineers standards, whereas towns without such protections
"fared much worse . . . suffering significant, and often extreme
damage." Of particular import to this case, the DEP manager noted
that Sandy overran Mantoloking Borough and adjacent Brick
Township, and thereby "carved new inlets through the Barnegat
Peninsula landmass, connecting ocean and bay in new places and
cleaving the towns into several islands isolated from the
mainland."
Towns in the northern portion of Ocean County generally did
not replenish those beaches and dunes in the wake of Sandy.
Unfortunately, on January 23, 2016, Winter Storm Jonas furthered
damaged the coastline. That second storm caused Brick Township
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to suffer elevation losses from ten to fifteen feet and narrowed
the beach's width by ninety to one hundred feet. In the Borough
of Mantoloking, the elevation losses were seven to eight feet and
a beach narrowing of 100 feet.
In response to this storm damage, the federal government
allocated funding under the Disaster Relief Appropriations Act of
2013, Pub. L. No. 113-2, to "construct a system of engineered
beaches and dunes across the New Jersey coast." As the state
agency involved in that effort, the DEP was tasked to engineer
beach and dune projects, and secure easements from private
landowners when those easements could not be voluntarily acquired.1
To advance these objectives, the DEP formulated what is known
as the "Manasquan Inlet to Barnegat Inlet Hurricane and Storm
Damage Reduction Project" ("the Project"). The Project sought to
construct fourteen miles of dunes and berm from Berkeley Township,
near Island Beach State Park, northward to Point Pleasant. The
Project encompasses nine municipalities, including Mantoloking and
Brick.
If the DEP could not voluntarily secure a property owner's
participation, the agency was to acquire the necessary easements
1
The authority of the DEP to engage in eminent domain proceedings
to secure these easements was recently upheld by this court. See
Dep't of Envtl. Prot. v. N. Beach 1003, ___ N.J. Super. ___, ___
(App. Div. 2017) (slip op. at 13).
5 A-4347-15T1
through one of three ways: (1) the Eminent Domain Act, N.J.S.A.
20:3-1; (2) the Disaster Control Act, N.J.S.A. App. A:9-51.5; or
(3) N.J.S.A. 12:3-64. Toward these ends, Governor Christie issued
Executive Order No. 140 (Sept. 25, 2013) ("EO 140"), and directed
the DEP and the Attorney's General Office "to coordinate those
legal proceedings necessary" to achieve the State's shore
protection goals.
Within the Borough, the DEP needed to acquire 264 properties
for the storm water fortification project. The Borough and the
DEP jointly conducted outreach and acquired 244 of the needed
parcels through voluntary transfers by their owners. That left
twenty outstanding parcels owned by nine separate property owners
– including the plaintiff2 in this case. According to a submission
to the trial court from the Deputy Attorney General who has
overseen legal aspects of the Project, five of the nine properties
at issue here were vacant, and the other four contained structures.
According to a certification from the Borough's outside
counsel, he recommended to the Borough that they hire, while
"acting in concert with" the DEP, a real estate valuation expert,
2
We note there is some dispute, not adjudicated by the trial court
or properly before this court, as to whether plaintiff is a true
owner of property within the scope of the beach restoration
project.
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Richard E. Hall, MAI, CRE3 to appraise the properties. The DEP
also engaged John J. Curley, Esq. to serve as special counsel to
oversee the land acquisitions in the Borough.
On August 20, 2013, the Borough passed a resolution
authorizing a contract with Hall to appraise properties related
to the Project. In the resolution, Hall was directed to value
potential property costs, anticipating that an expert would be
required "in the legal proceedings which are initiated to acquire
easements." The Borough unanimously approved the contract.4
The DEP and Curley provided guidance and oversight to Hall
in conjunction with his appraisal services. Although the Borough
paid Hall directly for his services, it did so with the
understanding that the DEP would reimburse it. Along with his
professional services contract, Hall signed a "Common Interest and
Confidentiality Agreement" with both the DEP and Borough.
According to the trial court's recitation of the facts in its
oral ruling, plaintiff owns property needed to complete the
Project, although not the specific parcels associated with the
3
These professional accreditations indicate that Hall is a member
of the Appraisal Institute ("MAI") and also is a commercial real
estate broker ("CRE").
4
None of the parties argue that these professional services
contracts required public bidding. See N.J.S.A. 40A:11-
5(1)(a)(i)(outlining an exception under Local Public Contracts Law
to include contracts for professional services).
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OPRA requests in this case. On October 6, 2015, plaintiff's
attorney e-mailed a document request to the custodian of records
for the Borough, and also to a member of the law firm serving as
the Borough's outside counsel.
Plaintiff's attorney sought "all appraisals whether final,
draft or preliminary as well as the authorization to pay for such
appraisals." Plaintiff requested the records under OPRA, the
common law, and unspecified provisions under the New Jersey
Constitution. Specifically, he requested appraisals for the nine
properties as to which the owners had declined to deed their
properties voluntarily to the Borough: 1071, 1121, 1215, 1217,
1513, 1067, and 1021 Ocean Avenue, and 965 and 991 East Avenue.
The Borough's outside counsel responded to plaintiff's
request via email on October 19, 2015. Counsel included several
attachments, which included: (1) minutes of the Borough Council
meetings appointing Hall as the appraiser and later authorizing
payment to him for services he rendered, and (2) the agreement
between Hall and the Borough.5
5
It is unclear whether this agreement is separate from the Common
Interest Agreement mutually executed among Hall, the DEP, and the
Borough.
8 A-4347-15T1
The Borough's outside counsel withheld the draft appraisals
sought by plaintiff for the following reasons, as expressed in her
email:
The requested appraisals are not being
provided. They are protected by the Attorney-
Client privilege as the work has been
performed under the direction of the NJ DEP's
Counsel in anticipation of imminent
condemnation litigation. These appraisals are
work product covered by the Common Interest
Agreement attached. These appraisals were
prepared so as to allow the State of New Jersey
to tender an offer to the property owners and
negotiate in "good faith" as the law requires.
As of this date the appraisals have been
completed and are under review by the NJ DEP.
Offer letters will be mailed to the subject
property owners in the immediate future. Not
only are these appraisal[s] exempt under
N.J.S.A. 47:1A-1.1(7), but disclosure of these
appraisals may jeopardize the future "good
faith" negotiations or result in one or both
parties suffering potential injury, including
financial injury. Upon balancing the
interests of the subject property owners as
well as the Borough and the State of New Jersey
who will be the parties to said "good faith"
negotiations against any requirement of
disclosure under [OPRA], the Borough and the
State of New Jersey have concluded that the
public interest in confidentiality of these
appraisals outweighs any private interest to
right of access under OPRA.
Although outside counsel wrote in her email that she would
attach the Common Interest agreements between the State and the
Borough and the one signed by Hall, she actually withheld both of
them. Outside counsel characterized the Common Interest
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agreements as work product and therefore privileged under OPRA.
Lastly, outside counsel declined to release the requested draft
appraisals under the common law.
After the Borough denied the document request, plaintiff
brought the present lawsuit in the Law Division in December 2015.6
In plaintiff's two-count complaint, it asked the Law Division to
order the Borough to provide plaintiff with the nine appraisals,
either under OPRA or the common law right of access.
On December 3, 2015, the Borough's outside counsel sent
plaintiff final appraisals for the five vacant properties that had
been initially requested in plaintiff's OPRA application.7 As to
those properties, the DEP had sent offer letters to the owners,
engaged in good faith negotiations, and had commenced eminent
domain litigation to acquire them. With respect to these disclosed
appraisals, Hall wrote that he drafted them for the State as his
client, but they were also for the DEP and Borough. 8 Hall
6
According to the DEP's motion to intervene, plaintiff submitted
an identical OPRA request to the DEP, and that state agency denied
access, citing the same privileges as the Borough. For reasons
that are unclear, plaintiff only named the Borough as a defendant
in its OPRA complaint.
7
Thiemann sent Burke copies of the following property appraisals:
1215, 1121, and 1021 Ocean Avenue and 965 and 991 East Avenue.
8
Although the DEP is an entity of the State, Hall nonetheless
framed his client relationship in this manner.
10 A-4347-15T1
characterized the reports as documents to be used "to assist the
clients and intended users in real property acquisition
negotiations in a Federal Project and/or determination of the fair
market value of the property rights proposed to be conveyed" that
are necessary for the Project.
Although the disclosures did not specify the precise amount
of property proposed to be taken, for each parcel Hall was asked
to quantify the value of a twenty-foot-wide easement running north-
to-south along each property's eastern ocean-side border. His
market value appraisals for the five parcels ranged from $3,150
to $12,285.
According to the Deputy Attorney General, as of December 23,
2015, the appraisals for the four remaining parcels were then in
draft form "and remain subject to further review and revisions."
The Deputy Attorney General represented that once they were
finalized, the appraisals and corresponding offer letters would
be sent to the property owners.
In its answer to plaintiff's complaint, the Borough similarly
represented that it would release the remaining four property
appraisals "immediately . . . once they are final, approved and
released to the respective property owners whose interests are
being valued." The Borough also asserted that it was bound by the
Common Interest Agreement with the DEP, which "expressly
11 A-4347-15T1
prohibit[ed] the release of the requested appraisals[.]" The
Borough asserted that the Common Interest Agreement itself was
privileged, and would only supply the trial court with a copy
under seal for an in camera review.
The day before oral argument in the Law Division on
plaintiff's application, the Deputy Attorney General wrote the
court with a factual update. He reported that Hall had been
released 9 from his contract to finish the four outstanding
appraisals in this case. In his place, the Borough hired a
different appraiser, Jeffrey Otteau, to provide appraisals for the
same four parcels. The Deputy Attorney General indicated that
Otteau's appraisals "after completion, shall be used by the State
in evaluating offer letters for the four property owners with whom
the State has yet to enter good faith negotiations in accordance
with the Eminent Domain Act." He added that, "[i]f the parties
arrive at an impasse during negotiations, the Otteau appraisals
shall be used in any condemnation action against the property
owners."
That same day, plaintiff's counsel wrote the Borough's
attorney, requesting that the Borough release Hall's four
9
The letter did not disclose whether the DEP or the Borough had
taken the action to release Hall from his contract, or why he was
released.
12 A-4347-15T1
appraisals because the claim of exemption no longer applied. In
a response letter that same day, the Borough denied plaintiff's
request. The Borough maintained its position that Hall's draft
appraisals were exempt from plaintiff's requests under the
deliberative process privilege.
The matter was argued before Assignment Judge Marlene Lynch
Ford. After considering those arguments, Judge Ford immediately
issued an oral ruling, rejecting plaintiff's requests and adopting
the multiple grounds collectively invoked by the Borough and the
DEP supporting their non-disclosure of the draft appraisals.
First, with respect to the deliberative process privilege,
Judge Ford noted that the privilege's purpose is to "permit the
government to withhold documents that reflect advisory opinions,
recommendations, and deliberations comprising part of the process
by which governmental decisions and policies are formulated." The
judge found it was "clear" that the documents requested here "were
part of a pre-decisional and deliberative process relative to the
acquisition of certain interest and property[.]" The judge noted
the governmental decision to be made concerned the market amount
to pay a property owner for the subject property. She reasoned
that the appraisal was part of that decision-making process.
Judge Ford further noted that the appraisals' draft nature
inherently reflected that Hall's appraisals were not final. She
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reasoned that to require defendants to disclose them at this point
would "prematurely disclose the views of the agency." Although
the judge stated she was "sensitive" to plaintiff's OPRA concerns,
she concluded that "the undisputed facts are fairly clear that
this was prepared for the purpose of engaging in" eminent domain
negotiations.
As an alternative basis for rejecting plaintiff's complaint,
the judge ruled that the draft appraisals were "certainly part"
of the work-product doctrine of the attorney-client privilege.
Judge Ford observed that if the negotiations failed, the only way
the DEP would be able to acquire the property would be through
litigation. To support such litigation, the government had the
subject documents prepared by an expert appraiser in advance. The
judge was not persuaded that it made any material difference that
the Borough, and not its counsel, had hired the expert.
Third, the judge rejected plaintiff's claim of a common law
right of access. In this regard, the judge determined that the
negotiation process for eminent domain should be "cloaked within
some degree of confidentiality," so as to protect both the DEP and
the private property owners' interests.
Another factor that guided the trial court was whether the
document had factual data "as opposed to evaluative reports."
Here, the judge found that the draft appraisals were evaluative,
14 A-4347-15T1
consisting of the appraiser's opinion. She concluded this factor
outweighed plaintiff's interest in obtaining access.
In sum, the judge concluded that the government's interest
in having "fair and meaningful eminent domain negotiations" would
be impeded if draft appraisals had to be released to third parties,
such as plaintiff, who were not part of the direct negotiations.
In a two-page corresponding order issued on April 25, 2016,
Judge Ford denied plaintiff's request for the draft appraisals
under both OPRA and the common law. She did, however, order the
defendants to provide a "Vaughn Index" describing the withheld
records.
This appeal followed.
II.
Plaintiff contends that the trial court erred in denying its
request for disclosure under both OPRA and the common law.
Although plaintiff acknowledges the public policies that generally
shield consultations with expert witnesses in connection with
pending or anticipated litigation, it argues that the particular
circumstances here call for a limited exception to those policies
of confidentiality, because no litigation was pending or imminent
when the draft appraisals were generated. Plaintiff further argues
that the context of pre-suit eminent domain negotiations under
Title 20 also distinguishes the present matter from situations in
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which experts are consulted or retained by the government in the
ordinary course of civil or criminal litigation.
In addition, plaintiff asserts that the draft appraisals were
not pre-decisional, nor were they documents created for the
"dominant" purpose of assisting the government in matters of
policy, and thus the deliberative process privilege does not
pertain.
Lastly, plaintiff argues that, apart from its asserted
statutory rights as a requestor under OPRA, it had a predominating
interest under the common law to have been supplied with the
documents when they were sought. Plaintiff consequently seeks
reversal of the trial court's decision or, at a minimum, an order
remanding this matter directing in camera review by the trial
court.
Having fully considered the parties' arguments, we affirm the
trial court's rejection of plaintiff's access claims,
substantially for the reasons soundly expressed in Judge Ford's
April 8, 2016 bench opinion. On the whole, we agree with
defendants and the trial court that both the work product and
deliberative process privileges apply here. We add only a few
amplifying comments.
With respect to the work product analysis, plaintiff's heavy
reliance on this court's opinion in Tractenberg v. Township of
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West Orange, 416 N.J. Super. 354 (App. Div. 2010) is unavailing.
The factual context in Tractenberg involved a situation in which
a municipality had obtained real estate appraisals for vacant
property the governing body was considering purchasing to preserve
open space. Id. at 362. After those appraisals were generated,
lengthy debate about the township's possible acquisition of the
land took place for over two years, without any decision or action.
Id. at 379. By that point, the township still had not initiated
negotiations to purchase the land, nor were such negotiations
"probable any time in the near future." Ibid. In that setting,
we concluded in Tractenberg that "the mere potential for future
negotiations, without a strong showing that negotiations [were]
probable," negated the township's assertion of privilege under
OPRA. Ibid. Here, by contrast, when the nine draft appraisals
were all generated, future eminent domain litigation was far more
likely, especially given the federal and State imperatives of the
Superstorm Sandy restoration project. Hence, Tractenberg is not
on point.
Defendants' assertion of the work product privilege is also
bolstered by the policies reflected in Rule 4:10-2(d)(1), which
was specifically amended in 2002 on the recommendation of the
Civil Practice Committee so as to insulate draft expert reports
as well as related oral and written communication between the
17 A-4347-15T1
attorney and the expert. See Pressler & Verniero, Current N.J.
Court Rules, comment 5.2.1 on R. 4:10-2(d)(1) (2016); see also
Adler v. Shelton, 343 N.J. Super. 511, 530 (Law Div. 2001) (noting
the importance of protecting communications between an attorney
and a hired expert from disclosure in discovery). The same
principles apply here in the context of adversarial proceedings
and negotiations that were anticipated between the government as
condemnor and the individual private property owners as
condemnees. Given that beach restoration would be completed under
federal and State oversight, the acquisitions are hardly
conjectural.
We further agree that the deliberative process privilege
provides an independent justification for the withholding of the
draft appraisals. The draft nature of Mr. Hall's expert appraisal
is undisputed. The drafts are also clearly pre-decisional, as
they were generated before both (1) a decision by the government
to rely upon (or reject) the expert's work in eminent domain
negotiations and litigation, and (2) future decisions by the
government agencies in response to any counter-proposals that
might be made by the individual property owners. See Ciesla v.
N.J. Dept. of Health & Sr. Servs. 429 N.J. Super. 127, 135 (App.
Div. 2012) (applying the deliberative process privilege to draft
reports supplied to the Department of Health to aid in deciding,
18 A-4347-15T1
as a regulator, whether to authorize the acquisition of a hospital
by another hospital). Although the property acquisition and
valuation context here is arguably less policy-laden than that
involved in Ciesla, the same kinds of institutional concerns to
promote unimpeded internal governmental deliberations nonetheless
apply.
We further concur with the trial court and defendants that
plaintiff has not made the "greater showing" required under the
common law balancing test to compel disclosure independent of
OPRA. See N. Jersey Media Grp., Inc. v. Twp. of Lyndhurst, ___
N.J. ___, ___ (2017) (slip op. at 45). At best, plaintiff is a
mere bystander to the other property acquisitions. State v. Town
of Morristown, 129 N.J. 279, 287-90 (1992). Moreover, plaintiff
could have sought to intervene in one or more of the other eminent
domain actions (which it apparently attempted, but then withdrew)
if it felt its proprietary interests were sufficiently implicated.
If and when defendants attempt to obtain plaintiff's own parcel,
we presume that competing appraisal reports specific to that
property are likely to be exchanged, analyzed, and, if necessary,
litigated.
Lastly, we must point out that during the oral argument on
the appeal, counsel for both defendants represented that if
plaintiff renews its request to have the draft reports provided,
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they will now furnish Hall's appraisals without objection, given
that the drafts have been supplied to the individual property
owners during the pendency of this appeal. In essence, the live
controversy that existed at the time of the trial court ruled is
now moot (although for independent reasons, and not as the result
of plaintiff's efforts).10 Consequently, there is no need for a
remand or any further proceedings. "[O]ur courts normally will
not entertain cases where a controversy no longer exists and the
disputed issues have become moot." DeVesa v. Dorsey, 134 N.J.
420, 428 (1993).
Affirmed, without prejudice to plaintiff presenting a renewed
request to defendants to obtain the draft appraisals, which they
have represented they will supply.
10
We note that defendants' present willingness to supply plaintiff
with the draft appraisals was not clearly expressed in their briefs
on appeal, which stated that the drafts had been supplied to the
other property owners, without indicating whether any conditions
on further dissemination pertained. The DEP's brief contains a
footnote stating that the DEP "alerted Appellant's counsel when
the remaining appraisals became available" but does not clarify
to whom they became available. We lament that this apparent
misunderstanding among counsel resulted in this court hearing an
appeal over a dispute that evidently could have been resolved much
sooner.
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