Shine Time, LLC v Town of Schodack

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Shine Time, LLC v Town of Schodack 2013 NY Slip Op 31110(U) April 1, 2013 Sup Ct, Rensselaer County Docket Number: 238051 Judge: George B. Ceresia Jr Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. [* 1] STATE OF NEW YOFX SUPEME COURT SHPME TIME, LLC, B COUNTY OF RENSSELAER W C. HART and ERIC J. HART, PlailltifE -against- THE TOWN OF SCHODACK and T ¬ ¬E COUNTY OF RENSSELDefmdants. AllPurposeTem Hon. George B. Ceresia, Jr., Supreme Court Jllstice Presiding RJI: 4 1-0226-12 Index No. 23885 1. Appearances: Wilson, Elsa, Moskowitz, Edelman & Dicker LLP Attorneys For Plaintiffs 677 Broadway Albany, NY 12207-2996 David L. Gmenberg, Esq. Attorneys For Defendant Town of Schodack 54 Second Street Troy, N 12180 Y Stephen A. Pechenik, Esq. Attorney For Defendant County of RensseIaer 1600 Seventh Avenue Troy, NY 12180 DECISIONIORDER George B. Ceresia, Jr., Justice Plaintiffs Brian C. Hart and Eric J. Hart are ownwa of real property having a street address of 1515 Columbia Turnpike, in the Town of S c t i h c k (the Town ), Rensselaer County. Plaintiff Shine Time, LLC ( Shine Time ) is a tenant of the premises and, since [* 2] 2003, has operated a car wash at that location. The premises is located within Town of Schodack Sewer District No. 6. I m u c h as the Town did not have its own waste water treatment facility for Sewer District No. 6, i 1998 it contracted with the Town of East n Greenbush to connect with its waste water treatment faciIity,l In 2002 Shine Time applied to the Town o f Schodack for a permit to connect to the Town sewer system (Sewer District No. 6). The application was granted, but required Shine T h e to pay a $5,000.00 sewer connection fee, which Shine Time paid. In.2007, purportdy pursuant to its agreementwith the Town of East Greenbush, the Town of Schodack issued bills for an additional sewer connection fee denominated Edt Greenbush Sewer IImkup Fees pursuant to Agreement dated the 24* day of July, 1898 . The bills went out to at least eight commercial property owners2. The bill issued to Shine Time was i the amount of $66,360.003.Notwithstanding n the issuance of the bills, officials for both Towns apparently continued to conduct negotiations concerning the sewer connection fees in the ensuing two years. In 2009 they ultimately agreed that the sewer connection fee to commercialpropertiesshould be reduced. As a consequence,the sewer connection fee for Shine Time was reduced from $66,360,00 to $35,000.0OP As a result ofthe foregoing, a sewercomectbn fee of $35,000.00appeared The original contract between the two Towns was entered into on July 24,1998. A subsqumt agreement was entered into on May 27,2004. qt is indicated that there were only a limiwd number of single family residential Units i the Sewer District, and that the sewer hookup fees for these property owners had already been n paid. 3Thebill was actually for $71,360.00, however Shine Time was given credit for the $5,000.00 payment it made i 2002. n 41tis indicated by the Town Supervisor ofthe Town of Schodack that the amounts invoiced were the actual amounts paid (or as the Town Supm-sorindicated, passed through ) 2 [* 3] on Shhe Time s 2010 Town and. County Tax bill. This mount was subsequently confirmed i a letter dated January 20,201 1 from the attorney for the Town of Schodack n to h e attorney for Shine Time. On October 13, 2011 the plaintiffs commenced the above-captioned action for injunctive and declaratory relief. Specifically, they seek a determinationthat the additional sewer connection fee (beyond the $5,000.00 paid itz 2002) is unlawful under Town Law 5 198 (I) (h) , and violates NY Constitution Art IX 5 2, as well as the procedural and substantivedue process clauses ofthe federal and state constitutions. They also allege that the sewer connection fee constitutes a taking under the federal and state constitutions and that the T o m of Schodack should be estopped from charging and enforcing the fee. Issue has beenjoined, and the plaintiffshave made a motion pursuant to CPLR 32 12 for s m a r y judgment and, pursuant to CPLR 3 124 and 3 126, to strike the answer ofthe defendant Town . , . of Schodack. The defendants oppose plaintiffs motion, Defendant Town of Schodack has cross-moved for summary judgment by reason of plaintiffs failure to compIy with the to the Town of East Greenbush, without any additional cLmnkup . Town Law 8 198 (1) (h)recites as follows: XI Sewer districts. Afkr a sewer district shaI! have been estabIished, the town board may: fl (h) establish, h m time to time, charges, fees or rates to be paid by the owners of real property within such district for the connection of house service lines or mains with such sewer system. Such comection charge may include any expense incurred for the purpose of providing service, whether such expense be incurred for construction within tfie property line or within the street lines. h addition, such connection charge may include a fee for the inspection of such connection, the expense of performing sewice i n relation thereto or for any other p i a l benefit received []. 3 [* 4] applicable statute of Iimitations. Turning first to the cross-motion,the statute of limitations applicable to an action for a declaratory judgment is six years (seeCPLR 213 [I]; Matter of Town of Olive v Cit, of New York, 63 AD3d 1.416-1418 /3rd Dept., 20091). However, in determining the limitations period to be applied in a declaratory judgment action, a court must look to the underlying claim and the nature of the relief sought and determine whether such claim could have been properly made in another form (Matter of CaDital Dist. Regional Off-track Betting Corn. v New York State Racing & Wanering Bd,, 97 AD3d 1044,1045 [3d Dept., 20121, citations omitted). Theapplicable limitations period is determined by examinring] the substance of [the] action to identify the relationship out of which the claim arises and the relief sought (see Kreamer v Town of Oxford, 91 AD3d 1157, 1 158- 1 159 [3d Dept., 20121, quotations omitted). It is we11 settled that an administrative determination becomes final and binding, and the applicabIe statute of limitations begins to run, when the administrative action has its impact upon a party and it is clear that the party is aggrieved thereby @ Matter of Edmead v McGuire, 67 NY2d 714,716; Matter of Biondo v State Bd. of Parole, 60 NY2d 832,834; Mundv v Nassau County Civ. Sen. Corn.,44 NY2d 352,357; Matter ofDuaan v Liman, 90 AD3d 1445,1446-1447 [3d Dept., 20111; Matter of Adarns v Carrion, 85 AD3d 1517, 1518 [3d Dept., 201 11; Matter of Ragi v Servis, 91 AD38 1169, 1179 [3d Dept., 20221; Matter of Matter of North Dock Tin Boat Assn.. Inc. VNGW State Off. of Gen. Sews., York 96 AD3d 1186, 1187 [3d Dept., 20 123). In other words, the statute of limitations does not commence to rununtil the aggrieved party is notified of an administrative determinationthat 4 [* 5] is unambiguous and certain in its effect & Matter of Edmead v McGuire, suDra, at 716; Singer v New York State and Local Employees Retirement System, 69 AD3d 1037,1038 [3rd Dept., 20101; Matter ofNew York State Radiolo&al Society v Wing, 244 AD2d 823, [3d Dept., 19971, mot for lv to app denied, 92 W Z d 802 [1998]). Finality does not occur until the administrative agency has arrived at a definitive position on the issue which inflicts actual concrete injury e, of Ward v Bennett, 79 NY2d 394, 400; Matter of Matter McDonaldv Board ofthe HudsonRiver-BlackRiver RewIatinaDistricS 86 AD3d 844,846 [3d Dept., 201 11). Requests for reconsideration do not, ordinarily, toil or revive the statute of limitations & Lubin v. Board of Educ. of City of New York, 60 NY2d 974; Matter of Yarbou& v Fmco, 95 NY2d 342, 347-348 [20003; Matter of P i m a Lakes Racing; Association. Inc. v State ofNew York Racing and Wagering Board, 34 AD3d 895,896-897 [3d Dept., 20061). Thestatute of limitations runs fiom the initial determination unIess the agency conducts a fresh and complete examination of the matter based on newly presented evidence c c and Wanerim Board, sup% at 897, quoting Matter of Quantum Health Resources v DeBuono, 273 AD2d 730,732 [2000],lv dismissed 95 NYZd 927 [ZOOO]). As the defendants point out, a case arising out of essentially the same set of facts was recently litigated. Spinney At Pond View, LLC v Town Board of Town of Schodack (Sup Ct., Rensselaer Co., Index No. 233644) involved st challenge to water and sewer charges hposed by the Town of Schodack, including sewer charges arising out of Town of Schodack Sewer District No. 6. In that case, the commercial property owners argued that 5 [* 6] the charges were excessive, lacked a rational basis and constituted an unconstitutional tax upon their properties. Supreme Court, in a decision-order dated Sept., 20,20 1 1, rejected an affirative defense predicated on the statute of Iimitations. The Court further found that the sewer connection charges lacked a rational basis, i violation of Town Law 8 198 [I J n [h], and grantedplaintiffs motion for summary judgment (see Spinnev At Pond View, LLC v Town Board of Tom of Schodack [Sup. Ct., Rensselaer Co., Index No. 233644, unpubIished]). The order was appealed, and on October 18,2012 the Appellate Division reversed, findingthat the action was barred under the statute of limitations, and directedthat the complaint be dismissed. The Appellate Division found that the plainti ¬ ¬ s claim centered upon the overall assignment of benefit units and allocation of such units in computing the level of benefit to individual properties; and that such rate-fxhg or feesetting activities are properly viewed as quasi-1egisIative act[s] [], reviewable i the n context of a CPLR article 78 proceeding (Spinney At Pond View. LLC v Town Bd. of Town of Schodack, 99AD3d 1088 [3d Dept., 20121, at 1089). The Appellate Division further stated: TOthe extent that plaintiffs attempt tu couch their claims in constitutional terms, we note that [tlhe simple expedient of denominating the [instant] action [as]one for declaratory relief and characterizing the matter as one of constitutional . , . dimension does not cure pIaintiffs failure to comply with the four-month statute of limitations applicabIe to CPLR article 78 proceedings at 1089, quoting Marsh v New York State & Local Employees Retirement Sys., 291 AD2d at 714 [5] a, [internal quotation marks and citation omitted], and citing Matter of Town of Olive v City of New York, 63 AD3d at 2418, and Matter of Aubin v State of New York, 282 AD2d [919] at 921-922). 6 [* 7] The plaiintif ¬s acknowledge having received an invoice fiom the Town of Schodack for a sewer connection fee of $66,360.00 i March 2007. As noted, i January 2010 plaintiffs n n received a Town and County Tax bill which included a charge denominated sewer connection fee of $3s,O0O6. Plaintips 201 1and 2012 property tax bills contain the same chmge with addedpenaltie~.~ gravamen ofplaintiffs claim is that the sewer comedon The fee is unlawful by reason that it violates the provisions of Town Law 5 I98 (1) (h).Notably, the grounds for review under CPLR 7803 ( 3 ) include %hether a determination was [I affected by an error of law . In this instance, the error o f law is alleged to be a failure to adhere to Town Law 5 198 (1) (h). The challenge here is to the quasi-legislative act of assessment of a sewer connection fee which allegedly exceeds the Town s statutory authority. This, i the Court s view, is reviewable under CPLR Article 78 @g Spinney At n PondView,LLCvTownBd.ofTownofSchodack,99AD3d1088 [3dDept.,20123;Matter of Federation of MentaI HeaIth Centers hc.,275 AD2d 557,559-560 [3d Dept., ZOOO]). It is undisputed that the sewer connection fee was initially imposed in 2004 (as noted, it3. the amount of $66,360.00). It was imposed, once agah, as an assessment on plaintiffs 2010 Town and County tax bilI, however this time in the amount of $35,0OO,OO. It was at this poi114 at the very latest, that the determination became final and binding upon the pkthtiffs for purposes of accrual of the four month statute of limitations under CPLR 2 17. As such, the Court is of the view that the statute of limitations commenced to run at that 6The plaintiffs acknowledge this in paragraph 37 of their Second Amended Complaint. The 2012 the sewer connection fee now totals the sum of $49,750.19 With p e d t y . 7 [* 8] t h e . Under the circumstances, because the determination to impose the sewer connection fee could properly have been chalhged under CPLR Article 78,the Court finds that the instant action is untimely The Court must hasten to add that the Court is mindful of plaintiffs contention that this case is distinguishable fiom Spinney At Pond View. LLC v Town Board of Town of Schodack (m reason that the plaintiffs here are relying upon a theory of state law by preemption: that a municipality can only exercise those powers expressly conferred upon it by the state legislature (s Const Art IX NY 8 2 T[ [c] [SI). Plaintiff cites Kamhi v Yorktown (14 1 AD2d 607 [2d Dept., ISSS]) which held that a CPLR Article 78proceeding is not the proper vehicle to test the validity of a legislative enactment. In Penny LaneEast Hmpton. Inc. v County of Suffolk (191 AD2d 19,21-22 [2d Dept., 1993]),the plaintiff sought a declaration that a load law was preempted by state law. The Court can only point out that the chaIlenge here is not to enactment of a focal law, but rather to actions taken by Town officials which allegedly exceed the Town s authority under Town Law 5 198 (1) (h). %tably however, even if the statute of limitations was said to accrue as late as the receipt of the January 20,201 1 letter h m the attorney for the Town of Schodack which confirmed the $35,000.00sewer connection fee,the instant action, commenced in October 20 11, would still be untimely. without deciding the issue (which the Cowt does not reach), the Court observes that Town Law 4 198 (1) (h) recites that such connection charge may include a fee for-the inspection of such connection, the expense of performing service i relation thereto or for any other special n bsnejt received (emphasis supplied). The foregoing language is exceedingly broad. The defendants argument here is that the plaintiffs have received a significant benefit (access t the o East Greenbush sewage treatment kcility). Within the context of a timely CPLR Article 78 proceeding, the Court could have exmined whether the Town had formulated a sewer connBCtiox1fee having a rational basis predicated upon the expense of performing service in relation thereto or for any other special benefit received , as set forth in Town Law 198 (1) (h). 8 [* 9] The plaintiffs, as a part of their opposition to the cross-motion, place reliarice upon the continuing wrong doctrine, arguing that a new cause of action accrues each day the wrong continues. The Court has reviewed the cases cited by the plaintiffs (g HmPton Heights Dev. Corp. v City of Utica, 136 Misc2d 906, 912 [Supt. Ct., Oneida Co., 19871, involving application of an improperly adopted IocaI law, the issue being whether the City of Utica Water Board was Iawfully created; Amerada Hess Corp. v Acampora, 109 AD2d 719, 722 [Zd Dept., 19851, involving an unduly restrictive zoning ordinance, which precluded plaintiff from any reasonable use of its land; Capruso v Village of Kings P .78 t, AD3d 877,878-879 [2d Dept., 20 101, challenging use by the Village of dedicated park lands for a non-park purpose; MacEwen c Ciiy of New Rochelle, 149 Misc 251,254 [Sup. Ct., Westchester Co., 19331, holding that passage of an invalid zoning ordinance is a continuous invasion of plaintiff s property rights akin to a trespass; and Dowsey v Village of Kensington, 257 NY 22 I, 228 [193 I], a challenge to an unreasonably restrictive Village zoning ordinance). Because the plaintiffs here seek review of a fully completed, separate, discrete act the Court finds that the continuing wrong doctrine has 1 0application @ 1 Matter of Federation of Mental Health Centers Inc., 275 AD2d 557, supra, at 560). The plaintiffs also advance an argument predicated on the doctrine of estoppel. The general rule is that estoppel cannot be invoked against a governmental agency to prevent it from discharging its statutory duties (Matter of Schorr v New York City Department of Housing Preservation, 10 NY3d 776,779 [2008], quoting citations omitted) or to prevent it fiom performing a govemmentd function (see Matter of Village of Fleischmsmns, 77 AD3d 1146,1148- 1149 [3d Dept., 20 lo]; Matter of Pegasus Cleaning Corporation v Smith, 9 [* 10] 73 AD3d 1328,1330 13 Dept., 20101). Moreover, erroneous advice by a government employee does not constitute the type of unusual circumstmce[sj contemplated by the exception to this general rule f i v DaitAes, 68 AD3d 1591,1592 [3d Dept., 20091, quoting Notaro v Power Auth. of State of N.Y., 41 AD3d at 1320, quoting Matter of Grella v Hevesi, 3 8 AD3d 113 [3d Dept, 20071 at 1 17). Here, the Town, in including a sewer connection fee as a part of the tax assessment on plaintiffs property was clearly exercising what amounts to a governmental function. While the Court is aware that there have been some infrequent exceptions to the rule prohibiting estoppel against governmental agencies (see e.g., La Port0 v Village of Phihont, 39 NY2d 7 [1976], cited by the plaintiffs, involving the failure of the Village of Philmont to enforce its boundaries for a period of 80 years), the Court is of the view that this is not one of those exceedingly rare circumstances. For this reason, the Court finds that the doctrine o f estoppel has no application to the instant matter. In summary, the Court fmds that the action was untimely commenced, and concludes that the cross-motion must be granted. As a part of the foregoing, for the reasons enunciated by the Appellate Division i SDinney At Pond View, LLC v The Town of Schodack (99 n AD3d 1099, supra, 1089- logo), the Court finds that inclusion of allegations that plaintiffs constitutional.rights have been violated does not operate to change the result. Turning to plainti ¬fs motion pursuant to CPLR 3126, on January 24, 2012 the plaintiffs served the following demands upon the defendant Turn of Schodack: demand for interrogatories;notice for discovery and inspection; and combined discovery demands. By letters dated March 8,20 12 and April 26,20 I2 phintiffs counsel requested said defendant [* 11] serve responses to the demands. At a status conference held with the Court on May 17, 2012, defendant s counsel requested, and the Court approved, an extensionto July 14,2012 to comply with plaintiffs discovery demands. The Court held another status conference on September 11,2012, during which defendant s counsel conceded that he had not complied with plaintiffs discovery demands. The COW dwected defendant s attorney to comply by September 28,2012. Defense counsel failed to do so, but belatedly (on October 4,2012) sewed a response to the demand for interrogatories, without responding to any other o f the demands. The attorney for the Town of Schodack concedes that the Town failed to comply with ail outstanding discovery demands, but indicates that he has belatedly done so simubneously with the seMce of the cross-motion here. Where a party fails to comply with a discovery mder, CPLR 3 126 authorizes the court to fashion an appropriate remedy, the nature and degree of which are matters entrusted to the court s sound discretion 11 (see Mary Imogene Bassett Hospital v C,gmonDesim, Inc 9 97 AD3d 103O,1032-1033 [3d Dept., 20 121, citations omitted). As set forth above, the 2 Town of Schodack has, concededly, failed to comply with several court directives. While the Town s conduct is not excusable, pIaintiEs have failed to demonstrate how ox in what respect they have been prejudiced. In fact, it appears that they were able to muster sufficient documentation to make the instant motion for summary judgment in the absence of the Town s discovery responses. The Town s actions, although dilatory to the extreme, do not appear to be wilful. In the Court s view, the plaintiffs have not demonstrated that they are entitled to the ultimate sanction, dismissal of the Town s answer. Under the circumstances the Court finds that appropriate remedy is a monetary sanction against the Town in the sum I1 [* 12] of $500.OO. In view of all of the foregoing, the Court finds that plaintiffs motion for summary judgment must be denied, and the action dismissed as to the Town of Schodack. Accordingly, it is ORDERED, that the motion of the plahtiff for summary judgment is denied; and it is further ORDERED, tkat the motion of the plaintiff for relief pursuant to CPLR 3 124 and CPLR 3 126 is granted to the limited extent that the Court directs the Town of Schodack to pay the plaintiffs the s u m of $500.00 within thirty (30) days; and it is M e r ORDERED, that the cross-motion of the defendant Town of Schodack is granted; and it is further ORDERED, that the action be md hereby is dismissed as to the Town of Schodack. This shall constitute the decision and order of the Court. The original decisiodorder is returned to the attorney for the Town of Schodack. All other papers are being delivered to the Supreme Court Clerk for delivery to the County Clerk or directly to the County Clerk far filing. The signing of this decisiodorder and delivery of this decisiodorder does not constitute entry or filing under CPLR Rule 2220. Counsel is not relieved from the applicable provisions of that rule respecting filing, entry and notice of entry. Dated: h, April 1,2013 Troy, New Yo& -George B. Ceresia, Jr, Supreme Court Justice 12 [* 13] Papers Considered: 1. 2. 3. 4. Notice of Motion dated October 24,ZO 12, Supporting Papers and Exhibits Affidavit of Patrick McGovern, sworn to October 19,2012 and Exhibits Notice of Cross-Motion datedNovember 29,2012, Supporting Papers and Exhibits Affmatim in Opposition of Stephen A. Pechenik, Esq., dated November 29,2012 5. Reply Affirmatiori of Benjamin F. Neidl, Esq., dated December 13,2012 13

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