BASF CORPORATION v. THE ESTATE OF DONALD W JONES, SR.

NOT FOR PUBLICATION WITHOUT THE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-2592-15T1



BASF CORPORATION, COLUMBIAN
CHEMICALS COMPANY, GLENN
SPRINGS HOLDINGS, INC.,
SHELL OIL COMPANY, TREXTRON,
INC., and TRANE US, INC.,
f/k/a TRANE, INC., f/k/a
AMERICAN STANDARD, INC.,

        Plaintiffs-Respondents

v.

THE ESTATE OF DONALD W.
JONES, SR., JONES INDUSTRIAL
SERVICE COMPANY, a/k/a JIS
INDUSTRIAL SERVICE CO., a/k/a
J.I.S. CO., DONALD W. JONES,
JR., and ALBERT JONES,

        Defendants-Appellants,

and

DONNA JONES and RAYMOND R.
WISS, ESQ.,

     Defendants.
_______________________________

              Argued November 27, 2017 - Decided February 1, 2018

              Before Judges Accurso, O'Connor and Vernoia.
          On appeal from Superior Court of New Jersey,
          Chancery Division, Middlesex County, Docket
          No. C-000203-14.

          R.S. Gasiorowski argued the cause for
          appellants (Gasiorowski & Holobinko,
          attorneys; R.S. Gasiorowski, on the brief).

          Irvin M. Freilich argued the cause for
          respondents (Gibbons PC, attorneys; Irvin M.
          Freilich, Shawn M. LaTourette, and David J.
          Miller, on the brief).

PER CURIAM

     Defendants Jones Industrial Service Company (JIS), the

Estate of Donald W. Jones, Sr., Donald W. Jones, Jr., and Albert

Jones1 appeal from a 2016 final judgment in favor of plaintiffs,

BASF Corporation, Columbian Chemicals Company, Glenn Springs

Holdings, Inc., Shell Oil Company, Textron, Inc. and Trane US,

Inc., enforcing the parties' 2009 federal court settlement.

Defendants claim:

          THE TRIAL COURT'S SUMMARY RULING — DENYING
          THE DEFENDANTS THE PAYMENT OF THE $718,000
          CONSIDERATION IN THE ESCROW DEED WHILE
          MANDATING THE DEFENDANTS VACATE AND DEED
          THEIR BUSINESS PROPERTY — WAS PROCEDURALLY
          INVALID AND SUBSTANTIVELY IN ERROR.

          THE COURT'S SUPPLEMENTAL ORDER REQUIRING THE
          DEFENDANTS' EXECUTION OF AN AMENDED DEED

1
   Raymond R. Wiss, Esq. is not a party to this appeal. The
claims against Mr. Wiss, who was made a defendant solely in his
role as escrow agent, were dismissed with prejudice by the trial
judge, whose order has not been appealed. Ms. Jones filed a
notice of appeal, but has failed to pursue it, and we ordered
her brief suppressed.

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            STATING THE CONSIDERATION AS $1.00, AND AN
            AFFIDAVIT OF CONSIDERATION STATING THE SAME,
            WOULD REQUIRE THE EXECUTION OF INACCURATE
            DOCUMENTS IN VIOLATION OF LAW.

            THERE WERE ISSUES OF EQUITABLE FRAUD AND
            MISREPRESENTATION IN THE INDUCEMENT OF THE
            2009 [SETTLEMENT AGREEMENT] THAT WERE
            ERRONEOUSLY DECIDED ON DISPUTED FACTS IN A
            SUMMARY PROCEEDING AND WITHOUT PROPER
            HEARING/TRIAL.

            THE INACCURATE 2012 DEED NOTICE PREPARED BY
            PLAINTIFFS AND EXECUTED BY J.I.S. (DONALD
            JONES) WAS INVALID AND PROVIDES A FURTHER
            BASIS FOR A PLENARY HEARING AND POSSIBLE
            RESCISSION OF THE SETTLEMENT AGREEMENT.

            THE TRIAL COURT FOLLOWED A DEFICIENT AND
            IMPROPER SUMMARY PROCESS WHICH RESULTED IN
            ERRONEOUS AND UNSUPPORTED FINDINGS AND A
            DENIAL OF DEFENDANTS' RIGHTS TO DUE PROCESS
            AND A PLENARY HEARING.

Because our review of this record convinces us Judge McCormick

was correct in finding that all of defendants' various claims

for disavowing their 2009 federal court settlement are utterly

without merit and properly addressed in a summary proceeding, we

affirm.

    JIS operated a hazardous waste landfill in South Brunswick

from 1955 until 1980, when the State succeeded in closing it

down.     See In re Jones Indus. Serv. Co. Landfill, 
110 N.J. 101

(1988).    In 1983 the United States Environmental Protection

Agency designated the property a Superfund site.     Plaintiffs,

generators or transporters of hazardous waste dumped at the

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landfill on plaintiffs' property, were pursued by regulators,

including New Jersey's Department of Environmental Protection,

to remediate the site.

    In 2006, plaintiffs sued JIS, its directors and

shareholders, the individual defendants, in federal court in New

Jersey to recover their remediation costs under the

Comprehensive Environmental Response, Compensation and Liability

Act (CERCLA) and the New Jersey Spill Compensation and Control

Act (Spill Act).   After prolonged negotiations, during which

both sides were represented by experienced counsel, the parties

settled that suit in 2009 by entering into a thirty-four page

settlement agreement and a stipulation and consent order for

settlement.

    Warranting they were without sufficient assets to pay their

share of response costs, defendants agreed to transfer the

property to plaintiffs in exchange for plaintiffs' agreement to

dismiss the CERCLA action and assume all responsibility for the

past and future costs necessary to remediate the landfill.

Because defendants needed time to pay down an outstanding

mortgage on the property and move their business operations

elsewhere, the parties agreed to a December 31, 2011 closing

date, which defendants had the right to extend one year.

Defendants agreed to pay all real estate taxes until closing,

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and plaintiffs agreed to assume responsibility for the realty

transfer fee.    Defendants promised to transfer the property on

the closing date unencumbered by liens or mortgages and free of

debris, and they agreed to secure those obligations by executing

a note secured by a mortgage on other property and confessions

of judgment to be held in escrow, along with an executed deed,

pending the closing date.    Finally, plaintiffs were permitted

ninety days to inspect the property for contamination not

previously identified by the EPA or DEP, which, if found, would

permit them to void the agreement.

       As counsel for plaintiffs would later certify to the trial

court, plaintiffs retained real estate counsel to advise them on

the transfer of the property.    Noting there was no consideration

listed in the draft deed, plaintiffs' real estate counsel

advised plaintiffs the county clerk would not record a deed

without a consideration listed because of the realty transfer

fee.   Based on his advice, plaintiffs inserted the property's

assessed value, $718,000, as the consideration stated in the

deed, and it was signed by Donald Jones, Jr., president of JIS,

and placed in escrow.

       Following execution of the settlement documents, plaintiffs

immediately retained an environmental consulting firm to inspect

the property.    The firm produced a Phase II Environmental Site

                                 5                          A-2592-15T1
Assessment Report concluding there was approximately 2600 cubic

yards of buried waste material beyond the nine-acre area capped

in 2001.   Notwithstanding this additional contamination,

plaintiffs elected to proceed with the transaction.   In 2010,

the EPA advised plaintiffs it would require the recording of a

deed notice, informing of the existence of the landfill cap.      In

January 2012, Donald Jones, Jr. executed the deed notice drafted

by plaintiffs, and it was recorded and approved by DEP.

    Defendants refused to transfer the property to plaintiffs

on the extended closing date, claiming they had been unable to

find an alternate site for their operations.   When all efforts

to persuade defendants to perform were exhausted, plaintiffs

finally filed suit in federal court in 2014 to enforce the

settlement.   After the federal court declined to hear the action

on the ground that its jurisdiction had expired, plaintiffs

instituted this action in Superior Court.

    Plaintiffs filed a verified complaint in the Chancery

Division for specific performance of the settlement agreement,

and shortly thereafter moved to proceed summarily pursuant to R.

4:67(1)(b).   Defendants cross-moved to vacate the settlement

agreement, claiming the federal court never inquired into the

fairness of the settlement, that the state court should

"determine whether the Spill Act's contribution provisions and

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New Jersey law militate in favor of a determination that the

defendants have paid in excess of their equitable share, and

that the forfeiture of their property would be inequitable,"

that plaintiffs made material misrepresentations in forming the

settlement agreement and inducing defendants' consent thereto,

that the federal court judge threatened defendants with an

adverse ruling if they did not agree to settle, and that the

court should conduct a plenary hearing on the voluntariness of

the settlement following discovery.

    Based on the nature of the arguments defendants raised to

vacate the settlement agreement, Judge McCormick determined

comity demanded the federal court be permitted the opportunity

to determine whether it would assume jurisdiction of defendants'

motion to vacate the settlement.    Accordingly, the judge

instructed defendants to seek a hearing in federal court.

    After the federal court again declined jurisdiction, the

matter returned to Judge McCormick.   In a clear and

comprehensive opinion from the bench on June 18, 2015, Judge

McCormick denied defendants' motion to void the settlement

agreement.   The judge found the motion, made well over five

years after execution of the agreement, grossly out of time

under R. 4:50-1, and that defendants' claims of

misrepresentation were all known to them at the time they signed

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the documents, leaving them no excuse for the delay.   Finding

"no reason why the complete resolution of this matter cannot be

accomplished in short order," the judge granted plaintiffs'

motion to proceed summarily.

    Over five more hearing dates, a number of which were

required to address defendants' various motions for

reconsideration, Judge McCormick addressed, often more than

once, each one of defendants' several claims that plaintiffs had

failed to comply with the settlement agreement, making

enforcement inequitable.   Judge McCormick found the terms of the

settlement agreement were clear and unambiguous, that the

agreement was valid and enforceable in accordance with its terms

and that defendants had not presented competent evidence of any

failure to perform by plaintiffs.

    As to defendants' argument that they were to be paid the

$718,000 recited in the deed, Judge McCormick found "it did not

even rise to the level of specious."   Plaintiffs presented

affidavits by the lawyers involved in the drafting of the

documents explaining the $718,000 figure was inserted into the

deed for purposes of the realty transfer fee only, and did not

represent monies to be paid to defendants.   Judge McCormick

noted defendants failed to counter those proofs with their own

affidavits.   Instead she found it "instructive that all

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defendants can present in support of their argument are hyper-

technical legal and evidence arguments with no certification

from any parties or attorneys involved in the . . . drafting and

finalization of the settlement agreement and/or the deed."

Because defendants failed to counter plaintiffs' proofs with any

"contrary evidence creating [a] question of fact," Judge

McCormick found no evidence to support defendants' claim for the

$718,000 and no reason to conduct a plenary hearing on the

issue.

    As for the deed notice, Judge McCormick found no factual

basis for defendants' claim that the notice prepared by

plaintiffs and signed in 2012 by Donald Jones, Jr., was in any

way inaccurate.   More important, the judge found, relying on a

2015 letter from the DEP, that the DEP and EPA were aware of the

2600 cubic yards of contaminated soil outside the confines of

the capped landfill, which plaintiffs discovered after execution

of the settlement agreement.   Judge McCormick concluded from the

proofs, "supported by adequate certifications" that

         plaintiffs or their designee have two
         options with respect to this contaminated
         soil; they can put it under the landfill cap
         or they can remove it.

              If they put it under the landfill cap
         the deed notice at that time will have to be
         amended. However, if they decide to remove
         the contaminated soil, or perhaps deal with

                                9                          A-2592-15T1
         in a — in a different way . . . the deed
         notice would not have to be amended. And
         the DEP is willing to wait until the
         property transfer and probably further
         investigation with a final decision by the
         plaintiffs or their assignee as to what is
         going to be done with the 2600 hundred cubic
         yards of contaminated soil and then the deed
         notice.

              So, there is absolutely no reason at
         the present time any requirement, necessity
         or otherwise, to change the deed notice or
         amend it or to modify it.

We agree with the trial court that the competent evidence in the

record does not support defendants' claim that plaintiffs'

filing of the deed notice constituted a breach of their

obligations under the settlement agreement.   Because defendants

failed to put any material fact on this issue in issue, we agree

with Judge McCormick that no plenary hearing was required and

the issue was properly resolved in a summary proceeding.      See R.

4:67-5; Tractenberg v. Twp. of W. Orange, 
416 N.J. Super. 354,

365 (App. Div. 2010).

    Finally, we reject defendants' claim that the court erred

in reforming the deed to reflect the actual consideration set

forth in the settlement agreement.   Defendants objected to

signing and filing an affidavit of consideration reflecting the

$718,000 when they had not received that sum.   The court

responded to their objection by ordering that the deed and


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affidavit of consideration accurately reflect the actual

consideration set forth in the settlement agreement.    We see no

error, much less reversible error, in the court's response to

defendants' concerns about the accurate reporting of the

consideration received.

    Our review of this record leaves us with no doubt that

Judge McCormick appropriately enforced the parties' 2009

settlement agreement in a summary proceeding pursuant to R.

4:67-2(b), and that defendants' claims to the contrary are

utterly without merit.    R. 2:11-3(e)(1)(E).   We accordingly

affirm substantially for the reasons expressed in Judge

McCormick's several opinions from the bench enforcing the

agreement.

    Affirmed.




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