Daily Development for Monday, August 16, 2004
by: Patrick A. Randolph, Jr.
Elmer F. Pierson Professor of Law
UMKC School of Law
Of Counsel: Blackwell Sanders Peper Martin Kansas City, Missouri dirt@umkc.edu

PUBLIC TRUST DOCTRINE; BEACH ACCESS: Under New Jersey version of Public Trust Doctrine, private owner of beach land must provide unimpeded access to the public from both inland properties and adjacent beach properties, and must permit “intermittent recreational activity,” including “rest and relaxation” on the dry sand related to swimming activities, all without charge, but may levy a charge to more significant users sufficient to cover the cost of services such as lifeguard and beach maintenance.

Raleigh Avenue Beach Assoc. v. Atlantis Beach Club, Inc., 851 A. 2d 19 (N.J. App. 2004)

Atlantis is the successor to a real estate development company that obtained a substantial grant of beach property from the State of New Jersey in 1904. In 1984, the New Jersey Supreme Court determined that lands adjacent to the ocean were subject to a public trust, and private owners of these lands were required to provide reasonable access rights of the public to use enjoy the ocean waters. This case is further interpretation and application of that doctrine.

Atlantis’ property is sandy beach bordered on the east by the Atlantic Ocean and on the west by a bulkhead separating its property from several condominium projects. A public street bisects the condominium projects from the west and has its eastern terminus at the bulkhead. A boardwalk parallels the public road, on the public right of way. It crosses over the bulkhead and continues across the dunes, on Atlantis’ property. This boardwalk is a public way until it reaches the bulkhead, but thereafter it is owned and maintained by Atlantis.

Atlantis originally acquired the sandy property, apparently, with the thought of developing it in some way, but has never done so (the court does not indicate why.) For years, it permitted the public free access from the public street and from the adjacent beach to the north. The property just south of Atlantis property, apparently, is not suitable for beach recreation.

In 1996, Atlantis began to restrict access to the dry sand that it owned and sold “beach tags,” to those who wished to use its property or to cross over its property to reach the ocean. The price of the tags has gone up over the years, and at the time of trial it was selling a package of a minimum of eight tags for season access for $700 or a lifetime membership for $10,000. For this fee, Atlantis no only provided access but also lifeguard services and maintenance of the beach area and the boardwalk.

The condominium dwellers on the west side of the bulkhead bordering Atlantis’ property had alternative access to the beach through an adjacent beachside development to the north (which charged much more modest fees), but to reach that access they would have to walk as far as eight blocks, or one half mile. A group of them asked the court to compel Atlantis to provide free access to the ocean across its property and to reduce the charges for those who used the property for other than access.

The trial court provided some relief, but the neighbors appealed, seeking broader rights, and got them from the Court of Appeals. Under the ruling of the Court of Appeals, the denial of access to the water across Atlantis property was an unreasonable breach of the public’s rights. Atlantis is required to provide such access free of charge. Further, if Atlantis provides lifeguard services, it is required to provide those services to anyone using the water, whether or not they entered the water from Atlantis’ property and whether or not they are paying for services.

The court ruled that Atlantis has no right to restrict the public from using the dry sand beach area for reasons other than access. It is providing no services, such as cabanas or other facilities, that justify any privacy for its customers.

Atlantis argued that providing beach services is the only beneficial use it can make of its land, and that restricting access is the only reasonable means of collecting charges for these services. Here is the court’s discussion of this issue:
“[Local government] does not provide any beach services nor does it own or maintain beaches along the Atlantic Ocean within its borders. Residents and non-residents wishing to use ocean waterfront in [this area] have no other option but to use beaches that are privately held. The public’s intermittent recreational enjoyment of the dry sand area in connection with the use of the foreshore and ocean would not prevent Atlantis’ members, who remain on its dry sand areas, from enjoying the services provided. . . . [T]here are no cabanas, changing facilities, or improvements necessitating further accommodation to the privacy of Atlantis’ members. [citation omitted]. Atlantis does not offer nor does the record establish any facts or reason as supporting the conclusion that the public’s intermittent recreational use of the upland sand would interfere with or otherwise prevent it from servicing its members. Instead, Atlantis maintains that it is entitled to use its land to generate pro fit by providing an exclusive place for its paying clientele. Exclusivity is not a valid reason for limiting use or access. We are satisfied that Atlantis’ attempts to limit access to, and use of, its upland sand are hostile to the public trust doctrine . . . “

The court went on to conclude that Atlantis could charge fees for services it provided on its land. It seems clear that it could not charge such fees to persons merely seeking access to the ocean across its land, and the opinion is quite vague as to persons making “intermittent recreational use” of the land. It concluded that the state regulatory agency with authority to regulate beach use had authority to pass on the reasonableness of Atlantis’ fees. Notwithstanding its acknowledgment of the administrative authority of the state agency, the court decided that it still would rule on the outside limits on the fees. Here is the discussion of that point:
“Beach use fees cannot limit those members of the public seeking access to, or use of, the ocean and foreshore nor can the limit, under the circumstances here, use of the upland sand for either passage or intermittent recreation connected with use of the ocean.

Fees must be ‘no greater than that which is required to operate and maintain the facility and must not discriminate between residents and non-residents’ [quoting from an administrative code section]. Moreover, there should be a daily, weekly, monthly and seasonal see available. . . . Atlantis’ current fee structure, requiring a minimum seasonal payment of $700 for up to eight household members . . . is exclusionary. Limiting access by placing an unreasonable economic burden on the public undermines the objectives of the public trust doctrine to the same extent as any physical barrier. . . All members of th e public who use the waterfront are entitled to use Atlantis’ adjacent upland sand for extended periods and must be afforded a fair opportunity to pay a reasonable single-person fee.”

The court held that Atlantis could charge fees sufficient to compensate it in a reasonable fashion for provision of services, but not for access to the land itself.
Comment 1: Note that the court migrated from stating that Atlantis was required to provide access and “intermittent recreational activity” to concluding that it in fact that it had to permit any person to occupy the beach at any time without charge for the use. Atlantis is allowed only to charge for services, not for occupancy. It appears that no charge can be levied at all with respect to “intermittent recreational use,” but what the difference is between this use and the use of the beach area for which Atlantis is required to charge is a mystery to the editor, and likely will be equally mysterious to Atlantis and those whom it might try to charge. The editor suspects that in fact no charge will be possible as a practical matter.

Comment 2: Although the editor is hardly steeped in the lore of New Jersey administrative law, it does seem unusual for the court to “predecide” so many issues that apparently are based entirely on the individual situation, on not on any general overriding policy, when the state has entrusted that decision initially to an administrative agency.

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