New Jersey v. Centennial Land & Development Corp.

The New Jersey AG, representing the state Department of Environmental Protection (DEP), brought action against a developer that purchased a dam and acreage surrounding a lake to build residential homes. The AG and DEP also brought action against the homeowners’ association, the holding company for stock in developer, and the company’s current and prior owner, seeking to enforce prior directives to effect repairs and maintenance of the dam as required by the Safe Dam Act. The Superior Court granted summary judgment for DEP, the developer and current owner appealed to the Superior Court, which upheld the trial court’s imposition of a $700,000 penalty against the developer, current owner, and prior owner; and $50,000 penalty against the homeowner’s association.

The defendant developer purchased the Centennial Lake Dam in 1971. The homeowner’s association, comprised of residents whose homes surround the lake, has existed since 1956. In 1978 the Army Corp of Engineers had identified the dam as a Class I “high hazard potential structure” in need of repairs. This conclusion became the basis of the 1979 DEP directive for dam repairs. The court rejected the developer’s contention that the homeowner’s association alone was responsible for repair and reconstruction of the dam. The court of appeal upheld the trial court’s conclusion that the developer had both legal title and actual control of the dam, and that therefore the developer was liable under the Dam Act. The homeowner association’s liability was based on their failure to perform updated studies of the dam after its own engineer issued recommendations in 2004, and failure to comply with DEP directives to perform studies and prepare plans and reports mandated by the Dam Act.

Citation: New Jersey v. Centennial Land & Development Corp., Devel, LLC, No. A-4708-13T2, 2016 WL 6134929 (2016)

Key documents:

• Decision