NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-5422-12T3

HERBERT WREDEN and KAREN WREDEN,

Plaintiffs-Appellants, APPROVED FOR PUBLICATION

June 17, 2014 v. APPELLATE DIVISION

TOWNSHIP OF LAFAYETTE,

Defendant-Respondent,

and

SNOOK'S EXCAVATING, INC., and FINELLI CONSULTING ENGINEERS, INC.,

Defendants. ______________________________________

Argued June 4, 2014 – Decided June 17, 2014

Before Judges Fuentes, Fasciale and Haas.

On appeal from the Superior Court of New Jersey, Law Division, Sussex County, Docket No. L-460-11.

Lisa Nichole Roskos argued the cause for appellants (Andrew M. Wubbenhorst, LLC, attorneys; Ms. Roskos, on the briefs).

Roy E. Kurnos argued the cause for respondent (Belsole and Kurnos, LLC, attorneys; Mr. Kurnos, on the brief).

The opinion of the court was delivered by

HAAS, J.A.D. Plaintiffs appeal from a February 8, 2012 Law Division

order dismissing their complaint against defendant Township of

Lafayette (the Township), and the court's April 23, 2012 order

denying their motion to amend their complaint to add an inverse

condemnation claim against the Township. We reverse and remand.

We discern the following facts from the face of plaintiffs'

June 28, 2011 complaint, giving plaintiffs the benefit of all

reasonable factual inferences. Printing Mart-Morristown v.

Sharp Elecs. Corp.,

(1989). Plaintiffs own

property in the Township, where they maintain their home, and a

"horse barn and fields for grazing and other uses relating to

the boarding of horses." In 2007, the Township contracted with

defendants Finelli Consulting Engineers, Inc. (Finelli) and

Snook's Excavating, Inc. (Snook's) "to design and construct a

retaining wall and provide water drainage along [a road]

adjacent to Plaintiffs' property." Plaintiffs alleged

[t]he storm water drainage from the roadway and adjacent properties was designed in such a way as to direct water to come onto Plaintiffs' property, causing flooding conditions about Plaintiffs' land and structures, onto Plaintiffs' septic field, and in such a manner so as to cause damage to Plaintiffs' property and inhibit Plaintiffs' use of same.

Plaintiffs asserted "[t]he retaining wall designed and

constructed by Defendants was defectively engineered and built,

2 A-5422-12T3 lacked appropriate foundation and support, [and] included

defective materials and workmanship."

On January 28, 2008, plaintiffs served a Notice of Tort

Claim upon the Township. In pertinent part, the notice stated:

C. The date, place and other circumstances of the occurrence which gave rise to the claim asserted is that the Township of Lafayette Road Department on or about November 12, 2007 undertook the construction of a retaining wall and drainage structures within the right of way of [a road], adjacent to the Claimant's property . . ., which increase the volume of stormwater runoff and further concentrate and accelerate the flow of stormwater runoff from [the road] onto the Claimant's property without the benefit of an easement or legal right to so discharge stormwater runoff onto the Claimant's property.

D. A general description of the injury, damage or loss incurred so far is the unauthorized diversion of stormwater runoff by means of drainage structures onto the Claimant's property causing stormwater related damage and flooding of Claimant's property and attendant loss of property value due to the highly unsightly structures constructed by the Township.

. . . .

F. The amount of the claim as of the date of this Notice is unknown, however, the claim is for a continuing trespass on Claimant's property and damage to Claimant's property by the unlawful diversion of stormwater runoff as described in Subparagraphs C and D above.

[(Emphasis added).]

3 A-5422-12T3 In 2009, the retaining wall "collapsed onto Plaintiffs'

property sending large blocks of concrete tumbling onto

Plaintiffs' property and causing an unstable and unsafe roadway

frontage . . . in front of Plaintiffs' property." Plaintiffs

alleged "[t]he conditions caused by Defendants' actions and/or

omissions continue[] to the present, including the collapsed

wall onto [their] property, continued runoff and discharge of

water from [the road] onto Plaintiffs' property resulting in

flooding and interference with Plaintiffs' use of their

property."

On June 28, 2011, plaintiffs filed their original four-

count complaint against the Township, Finelli and Snook's.

Plaintiffs sought compensatory damages and injunctive relief

relating to the alleged damage to their property due to the

construction and collapse of the retaining wall, as well as

damage from the Township's drainage systems that directed water

onto their property.

Finelli and Snook's filed answers to the complaint.

However, the Township responded by filing a motion to dismiss

the complaint for failure to state a cause of action pursuant to

Rule 4:6-2(e). The Township submitted two certifications in

support of its motion. A Township Committee member certified

that he authorized Finelli, the Township's engineer, "to develop

4 A-5422-12T3 plans to stabilize" the road adjacent to plaintiffs' property,

and that he later met with Finelli and Snook's "to discuss

proposed drainage improvements to" the roadway. The Committee

member stated he reported his "findings and discussions"

concerning the project to the Township Committee and that, "with

the full authority of the Township Committee[,]" he approved the

plan prepared by Finelli for construction of the project. The

second certification was prepared by the Township Clerk, who

stated that plaintiffs' January 28, 2008 notice of tort claim

was the only such notice they submitted. Plaintiffs opposed the

Township's motion.

After hearing oral argument, the judge entered an order on

February 8, 2012 granting the Township's motion and dismissing

plaintiffs' claims against the Township. In an accompanying

written statement of reasons, the judge summarized the

allegations set forth in plaintiffs' complaint, but also

reviewed the certifications submitted by the Township.

Although the judge acknowledged that plaintiffs were

alleging a continuing tort by the Township, he stated that

"[t]he Court makes no determination on whether the actions

complained of by the Plaintiffs constitute a continuing tort."

Thus, the judge made no findings of fact concerning whether

defendants' actions constituted a continuing tort, or when

5 A-5422-12T3 plaintiffs' cause of action for their alleged continuing tort

accrued.

Instead, the judge noted that, under N.J.S.A. 59:8-8b,

claims against a public entity are barred if the plaintiff has

not "file[d] suit in an appropriate court of law" and "[t]wo

years have elapsed since the accrual of the claim[.]" The judge

focused solely on the date plaintiffs filed their notice of

claim, January 28, 2008, and found that, because plaintiffs did

not file their complaint until over three years later on June

28, 2011, "any claims which the Plaintiffs could have brought

under the 2008 Notice have since expired."

At the same time, the judge's opinion states that "any tort

claims accruing against [the Township] prior to June [28], 2009

[are] barred by N.J.S.A. []59:8-8b and must be dismissed."

Thus, it appears the judge intended that plaintiffs could

proceed with any claims against the Township that arose during

the two-year period preceding the filing of their complaint on

June 28, 2011. However, the judge did not address plaintiffs'

contention that they suffered damage to their property and

septic field from the continuous flooding caused by the project

during this period. Instead, the judge focused solely upon the

collapse of the retaining wall in 2009. Stating that this

incident constituted "a new tort" and required the filing of "a

6 A-5422-12T3 new notice" of tort claim, the judge ruled that plaintiffs were

barred from seeking damages for this incident under N.J.S.A.

59:8-8a because they did not file such a notice within ninety

days of the wall's collapse onto their property.

Relying upon the Township Committee member's certification

concerning the approval of the design plan for the project, the

judge also found that the Township was entitled to plan or

design immunity under N.J.S.A. 59:4-6.

Plaintiffs' litigation continued against Finelli and

Snook's. During the course of discovery, plaintiffs learned

that a portion of the retaining wall and drainage system had

actually been constructed on their property. Thus, plaintiffs

filed a motion to file an amended complaint. In count five of

the amended complaint, plaintiffs asserted that Finelli and

Snook's "entered onto [their] property without authorization" in

order to construct the project. In count six, plaintiffs raised

an inverse condemnation claim against the Township.

In an April 23, 2012 order, the judge granted plaintiffs'

motion to file an amended complaint against Finelli and Snook's,

but denied the motion as to the Township. In a written

statement of reasons, the judge stated that the February 8, 2012

order was a "final judgment" in favor of the Township; the

inverse condemnation claim raised by plaintiffs arose "out of

7 A-5422-12T3 the same series of events addressed in" that order; and the

Township had been "provid[ed] . . . with an expectation of

finality." Therefore, the judge concluded that plaintiffs'

motion to amend their complaint as to the Township was barred by

the entire controversy doctrine.1 This appeal followed.

On appeal, plaintiffs contend the judge erred in finding

that (1) their claims against the Township for a continuing tort

were barred by N.J.S.A. 59:8-8b; (2) they were required to file

a new notice of tort claim in order to seek damages for the

collapse of the retaining wall onto their property; (3) the

Township was entitled to plan or design immunity under N.J.S.A.

59:4-6; and (4) their inverse condemnation claim was barred by

the entire controversy doctrine. We agree with each of

plaintiffs' contentions.

We review a grant of a motion to dismiss a complaint for

failure to state a cause of action de novo, applying the same

standard under Rule 4:6-2(e) that governed the motion court.

See Frederick v. Smith,

(App. Div.

2010), certif. denied,

(2011). A trial court

should grant the dismissal "in only the rarest of instances."

Printing Mart-Morristown, supra,

. Such review

1 Plaintiffs settled their claims against Finelli and Snook's and a final order of disposition dismissing the matter was filed on June 12, 2013.

8 A-5422-12T3 "is limited to examining the legal sufficiency of the facts

alleged on the face of the complaint[,]" and, in determining

whether dismissal under Rule 4:6-2(e) is warranted, the court

should not concern itself with plaintiffs' ability to prove

their allegations.

. If "the fundament of a cause of

action may be gleaned even from an obscure statement of claim,"

then the complaint should survive this preliminary stage. Craig

v. Suburban Cablevision, Inc.,

(1995). "The

examination of a complaint's allegations of fact required by the

aforestated principles should be one that is at once painstaking

and undertaken with a generous and hospitable approach."

Printing Mart-Morristown, supra,

.

Applying these principles to the present case, we conclude

the judge erred in finding that plaintiffs' complaint was barred

by the two-year statute of limitations set forth in N.J.S.A.

59:8-8b. Plaintiffs clearly alleged a continuing tort on the

part of the Township. Yet, the judge specifically declined to

make any "determination on whether the actions complained of by

the Plaintiffs constitute a continuing tort." As discussed

below, such a determination was absolutely critical to a proper

resolution of this matter.

The "continuing tort doctrine," also known as the

"continuing violation doctrine," provides that when an

9 A-5422-12T3 individual is subjected to a "continual, cumulative pattern of

tortious conduct," the statute of limitations period begins only

when the wrongful action ceases. Wilson v. Wal-Mart Stores,

(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

Cnty.,

(2d Cir. 1985). "Essentially, courts

in those cases impose a duty on the defendant to remove the

nuisance." Russo Farms, Inc. v. Vineland Bd. of Educ.,

(1996).

In the present case, plaintiffs rely substantially on Russo

Farms, where the Court applied the continuing nuisance doctrine

to preclude a statute of limitations defense.

.

In that case, 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."

. When a court finds the existence of a continuing

nuisance, "it implicitly holds that the defendant is committing

10 A-5422-12T3 a new tort, including a new breach of duty, each day, triggering

a new statute of limitations."

As the Court explained in Russo Farms, whether the

continuing tort doctrine applies directly affects the two-year

statute of limitations for filing an action against a public

entity under N.J.S.A. 59:8-8b.

. In that case,

the plaintiffs filed a notice of tort claim against the public

entity on August 24, 1987, but did not file their complaint

until July 18, 1990.

. Because the continuing tort

doctrine applied, the Court found that only those claims

mentioned in the notice of claim that had accrued against the

public entity prior to July 18, 1988, the first day of the two-

year period that ran before the filing of the plaintiffs'

complaint, would be barred under N.J.S.A. 59:8-8b.

.

However, the claims that continuously accrued each day during

that two-year period could proceed.

In the present case, the judge made no determination as to

the applicability of the continuing tort doctrine, even though

that theory provided the underpinning for plaintiffs' entire

complaint. Instead, he mistakenly found that because more than

two years had passed since the filing of plaintiffs' notice of

tort claim on January 28, 2008, all of the claims set forth in

the notice, including the continuing torts plainly alleged

11 A-5422-12T3 therein, had "expired." Contrary to the judge's ruling, the

date on which a notice of claim is filed does not mark the

accrual date for a cause of action in a continuing tort case.

Kolczycki v. City of E. Orange,

(App.

Div. 1999) (citing Russo Farms, supra,

).

Indeed, in Russo Farms, the Court permitted the plaintiffs to

proceed with their claims against the public entity for damages

sustained during the two-year period preceding the filing of

their complaint, even though their notice of tort claim had been

filed almost three years before their complaint. Russo Farms,

supra,

. Because the judge did not address

the applicability of the continuing tort doctrine in this case

or its impact on the accrual date of plaintiffs' cause of

action, we are constrained to reverse and remand for further

proceedings. We direct the judge to make detailed findings of

fact and conclusions of law concerning the date of accrual of

plaintiffs' claims and the applicability of the continuing tort

doctrine in any future motion involving N.J.S.A. 59:8-8b.

We also disagree with the judge's conclusion that, even if

plaintiffs were able to assert claims against the Township for

the two-year period prior to the filing of their complaint on

June 28, 2011, the only tort that occurred during that period

was the collapse of the retaining wall. The judge also

12 A-5422-12T3 mistakenly ruled that, because plaintiffs failed to file a

second notice of claim for this "new tort" within ninety days of

the wall's collapse, plaintiffs' claims concerning it were

barred by N.J.S.A. 59:8-8a.

Plaintiffs alleged in their complaint that the flooding

caused by the project continued throughout the entire two-year

period prior to the filing of their complaint, independent of

the wall's collapse sometime in 2009. Thus, contrary to the

judge's conclusion, plaintiffs' claims during this period were

certainly not limited to the collapse of the retaining wall.

Moreover, a new notice of claim was not required

specifically for the wall collapse. As the Court observed in

Beauchamp v. Amedio, "the 'notice of claim' referred to in

N.J.S.A. 59:8-8 is really a misnomer. A person need not have or

even contemplate filing a claim in order to trigger the notice

provision. It is more properly denominated as a notice of

injury or loss." Beauchamp v. Amedio,

(2000).

Plaintiffs' January 28, 2008 notice of claim clearly advised the

Township that they were alleging damages due to the flooding

caused by "the construction of a retaining wall and drainage

structures" adjacent to their property. Under these

circumstances, the eventual collapse of the wall was merely a

continuation of the tort plaintiffs had already described,

13 A-5422-12T3 rather than "a new tort" that needed to be raised independently.

Therefore, we conclude the judge erred by barring plaintiffs

from seeking damages caused by the wall's collapse during the

two-year period prior to the filing of their complaint.

We also agree with plaintiffs' argument that the judge

erred in finding that the Township was entitled to plan or

design immunity under N.J.S.A. 59:4-6. In making this finding,

the judge relied upon the certification of the Township

Committee member concerning his approval of Finelli's plans for

the project. However, on a motion to dismiss under Rule 4:6-

2(e), a judge is not permitted to look outside of the parties'

pleadings. If a judge relies on matters outside the pleadings,

a Rule 4:6-2(e) motion is automatically converted into a Rule

4:46 summary judgment motion. Pressler & Verniero, Current N.J.

Court Rules, comment 4.1.2. on R. 4:6-2 (2014); see also Roa v.

Roa,

(2010). The judge did not, however,

grant the Township summary judgment. Rather, he dismissed the

complaint for failure to state a claim upon which relief can be

granted. Thus, we reverse the judge's conclusion that the

Township was entitled to plan or design immunity at this point

in the proceedings.2

2 Discovery had not been completed at the time the judge considered the Township's motion.

14 A-5422-12T3 Finally, we conclude the judge mistakenly exercised his

discretion in denying plaintiffs' motion to amend their

complaint to include an inverse condemnation claim against the

Township. The judge found that this new allegation was barred

by the entire controversy doctrine. We disagree.

The entire controversy doctrine

requires a litigant to present all aspects of a controversy in one legal proceeding. It is intended to be applied to prevent a party from voluntarily electing to hold back a related component of the controversy in the first proceeding by precluding it from being raised in a subsequent proceeding thereafter.

[Hobart Bros. Co. v. Nat'l Union Fire Ins. Co.,

(App. Div.) (citations and internal quotation marks omitted), certif. denied,

(2002).]

This doctrine does not support the denial of plaintiffs' motion

to amend their complaint. At the time the motion was filed, the

matter was not final as to all parties and all issues.

Plaintiffs' claims against Finelli and Snook's remained

unresolved. Thus, contrary to the judge's finding, no "final

judgment" had been entered. Therefore, in order to comply with

the entire controversy doctrine, plaintiffs were required to

seek to amend their complaint to add the new inverse

condemnation claim against the Township after its existence was

revealed during discovery in the still-ongoing litigation. If

15 A-5422-12T3 plaintiffs had not done so, the doctrine would have barred them

from raising it in a subsequent proceeding. Therefore, on

remand the plaintiffs shall be given the opportunity to file

their amended complaint against the Township.

Reversed and remanded for further proceedings consistent

with this opinion. We do not retain jurisdiction.

16 A-5422-12T3