ROOSTER BAR LLC. v. BOROUGH OF CLIFFSIDE PARK

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

ROOSTER BAR LLC., d/b/a

HENRY'S MARTINI LOUNGE,

HOVSEP KEBABJIAN, GEORGE

KEBABJIAN and HAROUT KEBABJIAN,

Plaintiffs-Appellants,

v.

BOROUGH OF CLIFFSIDE PARK,

BOROUGH OF CLIFFSIDE PARK

POLICE DEPARTMENT and ELLIS HAROLDSON,

Defendants-Respondents.

November 1, 2013

Submitted October 22, 2013 Decided

Before Judges Reisner and Carroll.

On appealfrom SuperiorCourt ofNew Jersey,

Law Division, BergenCounty, DocketNo.

L-9776-10.

Richard S. Mazawey, attorney for appellants.

Law Office of William E. Staehle, attorneys for respondents (Stephen C. Cahir, on the brief).

PER CURIAM

Plaintiffs, Hovsep Kebabjian (Hovsep)1, George Kebabjian (George), and Harout Kebabjian (Harout), appeal from the entry of summary judgment dismissing their complaint against defendants, Borough of Cliffside Park (Borough), Borough of Cliffside Park Police Department (CPPD), and Police Officer Ellis Haroldson (Haroldson). Because we agree that defendants were entitled to summary judgment as a matter of law, we affirm.

The facts and procedural history can be briefly summarized. On December 7, 2007, plaintiffs filed a tort claim notice pursuant to the Tort Claims Act (TCA), N.J.S.A. 59:1-1 to 12-3. Specifically, the claim form alleged that "Cliffside Park Police continually harassed claimants by stalking Henry's Martini Lounge, causing great economic harm to said business, including but not limited to a ticket given to the business on 9/15/07 for loud music, of which there was none."

On October 12, 2010, plaintiffs filed a complaint against defendants for damages, alleging intentional interference with economic advantage, harassment, and nuisance. In their complaint, plaintiffs represented that Hovsep and George were the owners of Rooster Bar LLC, d/b/a Henry's Martini Lounge (Henry's), a bar/lounge in the Borough, and that Hovsep was a manager there2. Henry's was also originally named as a plaintiff. The complaint alleged that beginning in 2007, members of the CPPD commenced a pattern of harassment and intimidation for the purpose of incapacitating plaintiffs' business. Specifically, plaintiffs claimed that the police issued the business baseless summonses, engaged in unjustified surveillance of the business, wrongly ordered the removal of patrons and/or stopped them after leaving the premises, and made unannounced and unauthorized visits to the establishment. Plaintiffs further contended that defendants' actions caused their business to close in June 2010, resulting in a loss in excess of $1 million.

On September 16, 2011, on defendants' motion, Judge Menelaos W. Toskos dismissed the complaint as to Henry's only, due to that entity's failure to comply with the pre-suit notification requirements of N.J.S.A. 59:8-8. Henry's has not appealed from that order. Summary judgment against the remaining plaintiffs was initially denied, without prejudice, pending the completion of discovery.

After discovery, defendants again moved for summary judgment3, primarily on the basis that plaintiffs' complaint was time barred under N.J.S.A. 59:8-8. Plaintiffs opposed the motion, and argued that application of the continuous tort theory preserved all the various claims they asserted, dating back to 2007.

After considering these arguments, Judge Toskos granted defendants' motion for summary judgment and dismissed the complaint. In his oral opinion, the judge concluded that (1) plaintiffs' allegation that the Borough maliciously and intentionally denied Henry's application for a liquor license transfer was barred by the immunity conferred upon a public entity under N.J.S.A. 59:2-5; and (2) of the fourteen occurrences of alleged wrongful conduct cited by plaintiffs, only four fell within the two-year statute of limitations period, and none of those four standing alone was sufficient to trigger the continuing tort theory. Also, although apparently not critical to his ruling, Judge Toskos indicated that plaintiffs had no competent proofs with respect to their alleged damages. No expert economic report had been provided, and the business tax returns for 2006-2010 showed a loss each year.

On appeal, plaintiffs argue that (1) genuine issues of material fact exist which preclude summary judgment; (2) the trial court erred in failing to interpret and apply the continuing tort theory in such a manner as to remove plaintiffs' claims from the bar of the statute of limitations; and (3) defendants were not entitled to immunity under the TCA for their numerous instances of willful interference, harassment, and misconduct.

In response, defendants argue that plaintiffs' tort claim notice was filed on December 7, 2007, and referenced continued harassment, including a summons issued to the business on September 15, 2007, for loud noise. However, plaintiffs' complaint was not filed until October 12, 2010, beyond the applicable two-year statute of limitations. With respect to the fourteen occurrences listed by plaintiffs as constituting continuing torts, the first ten occurred outside the two-year time bar. As to the remaining four, plaintiffs had not established any allegation after October 12, 2008 which could "stand on its own for the maintenance of a suit against defendants without any need to refer to defendants' prior conduct to establish liability," as found by the motion judge. Defendants further argue that the Borough is entitled to immunity under the TCA in connection with its denial of plaintiffs' application to transfer the liquor license. Finally, they dispute that George and Harout had any ownership interest in the business, and/or any basis for their claims of financial loss.

Rule4:46-2(c) directs that summary judgment must be granted "if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment . . . as a matter of law." The appropriate inquiry must determine "'whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 533 (1995) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52, 106 S. Ct. 2505, 2512, 91 L. Ed. 2d 202, 214 (1986)). The court must review the evidence presented "in the light most favorable to the non-moving party." Id. at 540. On appeal, we review summary judgment orders de novo, utilizing the same standards applied by the trial courts. Estate of Hanges v. Metro. Prop. & Cas. Ins. Co., 202 N.J. 369, 374 (2010). Applying these principles, we agree that summary judgment was properly granted here.

The statute of limitations sets forth the period of time within which a party must initiate a lawsuit. Szczuvelek v. Harborside Healthcare Woods Edge, 182 N.J. 275, 281 (2005). The TCA governs claims against a public entity or public employee for money damages. Under N.J.S.A 59:8-8, such claims are barred if a notice of claim is not filed with the public entity within ninety days of the accrual of the claim or if suit is not filed within two years after the accrual. Kolczycki v. City of East Orange, 317 N.J. Super. 505, 516-17 (App. Div. 1999).

Here, the triggering event for the original notice of claim was the issuance of the summons for loud music on September 15, 2007. It is undisputed that this notice was filed on December 7, 2007, and referenced continued harassment by the CPPD, including the noise complaint. It is further undisputed that plaintiffs' complaint was not filed until October 12, 2010, beyond the two-year statute of limitations, thus barring the claims encompassed in the tort claim notice, and any other claims of misconduct accruing prior to October 12, 2008.

Plaintiffs maintain that the motion judge erred in not applying the continuing tort theory to avoid the harsh effect of a mechanical application of N.J.S.A. 59:8-8. The continuing tort doctrine, also known as the continuing violation theory, provides that when an individual is subjected to a continual, cumulative pattern of tortious conduct, the limitations period begins only when the wrongful action ceases. Wilson v. Wal-Mart Stores, 158 N.J. 263, 272 (1999). When a court finds that a continuing nuisance has been committed, the new tort is an alleged present failure to remove the nuisance, and [s]ince this failure occurs each day that [defendant] does not act, the [defendant's] alleged tortious inaction constitutes a continuous nuisance for which a cause of action accrues anew each day. Rapf v. Suffolk County, 755 F.2d 282, 292 (2d Cir. 1985). Essentially, courts in those cases impose a duty on the defendant to remove the nuisance. Russo Farms v. Vineland Bd. of Educ., 144 N.J. 84, 100 (1996).

In the present case, plaintiffs rely substantially on Russo, where the Court applied the continuing nuisance doctrine to preclude a statute of limitations defense. Id. at 104. In Russo, a group of landowners sought to recover damages caused by flooding from the grounds of a nearby public school. The Court held that the flooding of real property is a physical invasion which ordinarily sounds in trespass, and is also a nuisance if it is repeated or of long duration. Id. at 99. "When a court finds the existence of a continuing nuisance, it implicitly holds that the defendant is committing a new tort, including a new breach of duty, each day, triggering a new statute of limitations." Ibid. However, the Court reiterated that a wrongful act with consequential continuing damages is not a continuing tort and does not lengthen the statute of limitations. A new cause of action accrues only when the new injury results from a new breach of duty. Id. at 114 (citing Ricottilli v. Summersville Mem. Hosp., 425 S.E.2d 629, 632 (W. Va. 1992)).

More apposite is Kolczycki, supra, 317 N.J. Super. at 519, where plaintiffs asserted claims similar to those brought here. In Kolczycki, plaintiffs owned and operated a night club, and alleged that the actions of the city and its police employees amounted to tortious interference with economic advantage, causing their night club to close. Id. at 509. They contended that defendants engaged in a "systematic pattern of harassment" starting in January 1992, including making a recommendation to the Bureau of Alcohol Beverage Control in May 1992 not to renew plaintiffs' liquor license. Plaintiffs filed a tort claim notice on July 14, 1992, and a complaint on May 23, 1994. The "critical issue" was when plaintiffs' cause of action accrued. Id. at 516. We noted that acts of misconduct that allegedly began in January 1992 would be barred by the two-year statute of limitations under N.J.S.A. 59:8-8, unless there was conduct which occurred on or after May 22, 1992, which could "stand on its own for the maintenance of a suit against defendants without any need to refer to prior conduct of defendants to establish liability." Id. at 519-20.

In the present case, Judge Toskos recognized the existence of the continuing tort theory, applied it, and correctly concluded that plaintiffs' proofs were insufficient to establish it as an exception to the bar of the statute of limitations. In opposing defendants' summary judgment motion, Harout submitted a certification detailing fourteen instances of defendants' alleged continuing misconduct. The first nine of these took place between December 2006 and September 2007, clearly outside the two-year limitations period. The tenth allegedly occurred at some unspecified time in 2008, so that plaintiffs were unable to demonstrate that it occurred within two years of the filing of the complaint, i.e., prior to October 12, 2008.

The judge then went on to consider the remaining four acts of alleged harassment as detailed by Harout. First, in April/May 2009, CPPD officer Joe Biasco remained parked in front of the establishment from 3:00am to 5:00pm, and during that time, ordered a patron to leave, causing her anxiety, fear and distress. Next, on August 15, 2009, five police officers were dispatched to Henry's "due to erroneous reports of a knife fight." Neither of these incidents implicated defendant Haroldson, whose last claimed involvement occurred in February 1, 2007, also well outside the limitations period. Viewed most favorably to plaintiffs, we conclude, as did the motion judge, that standing alone, without reference to defendants' prior conduct, these acts are insufficient to establish liability.

Pursuant to N.J.S.A. 59:3-3, "[a] public employee is not liable if he acts in good faith in the execution or enforcement of any law." However, N.J.S.A. 59:3-14(a), the public employee immunity exception, limits the good faith provision and provides, "[n]othing in this act shall exonerate a public employee from liability if it is established that his conduct was outside the scope of his employment or constituted . . . willful misconduct." Clarke v. Township of Mount Laurel, 357 N.J. Super. 362, 368 (App. Div. 2003).

The "guiding principle" of the TCA is that "immunity from tort liability is the general rule and liability is the exception." Polzo v. Cnty. of Essex, 196 N.J. 569, 578 (2008) (internal quotation marks and citations omitted). In enacting the TCA, the New Jersey Legislature "carefully outlined a design of broad immunity and limited liability, and declared that it is 'the public policy of this State that public entities shall only be liable for their negligence within the limitations of this [A]ct and in accordance with the fair and uniform principles established herein.'" Marcinczyk v. State of New Jersey Police Training Comm'n, 203 N.J. 586, 595 (2010) (citing N.J.S.A. 59:1-2).

With respect to the first incident, it is reasonable for an officer to patrol outside a bar at closing time so as to observe patrons leaving and prevent them from driving while intoxicated. As to the second incident, it is clear that, faced with a report of a fight in which a knife was involved, the police had a duty to respond and investigate it. Neither Biasco nor any of the other officers involved in these two occurrences were named as individual defendants in this action. Moreover, to the extent that they performed basic police activities, they are entitled to good faith immunity under N.J.S.A. 59:3-3. If their misconduct was willful, as plaintiffs contend, the public entities are immune from liability. N.J.S.A. 59:2-10.

The final two wrongful acts that Harout alleged in his certification fell within the two-year limitations period, were that sometime in 2009 he was informed by two individuals that unnamed members of the CPPD had advised them to stay away from Henry's. There is no indication when these alleged warnings occurred, nor did these individuals submit supporting certifications. Thus to the extent, if at all, that these reported conversations may separately qualify as actual incidents, they are at best double hearsay and not competent evidence. See R. 1:6-6 (requiring sworn affidavits or certifications based upon personal knowledge); see also Jeter v. Stevenson, 284 N.J. Super. 229, 233 (App. Div. 1995).

Plaintiffs further sought to impose liability on the Borough for arbitrarily denying their zoning permit application, which sought a place-to-place liquor license transfer to the second floor of the premises. We deem this contention meritless. In his certification, Harout represented that this denial occurred in March 2007, again outside the two-year limitations period. In any event, the Borough is shielded by immunity since under the TCA, "a public entity is not liable for an injury caused by the . . . failure or refusal to issue . . . any permit [or] license . . . where the public entity or public employee is authorized by law to determine whether or not such authorization should be issued . . . ." N.J.S.A. 59:2-5.

Finally, we reject plaintiffs' argument that summary judgment was inappropriate due to the presence of disputed issues of material fact. Even viewing these facts in the light most favorable to plaintiffs, the events complained of either occurred outside the limitations period, or are insufficient as a matter of law to overcome the statutory immunity afforded defendants under the TCA.

1 We refer to the individual plaintiffs by their first names in order to avoid any confusion, since they all share the same surname. In so doing, we intend no disrespect to the parties.

2 During pre-trial discovery it was revealed that while George owned the property where Henry's operated, he had no ownership interest in the business. Harout was also not an owner, but simply an employee of Henry's.

3 An intervening summary judgment motion filed by defendants was denied on procedural grounds on June 12, 2012, without prejudice to the substantive issues presented.