Court Opinion

ID: 4533486
Source: CourtListenerOpinion
Date Created: 2020-05-12 14:08:38.360774+00
Date Added: 2024-06-11T12:32:51.221089
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE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 NOS. A-2903-18T4
                                                                    A-4443-18T4

H.C. EQUITIES, LP,

         Plaintiff-Appellant,

v.

COUNTY OF UNION, NEW
JERSEY, and UNION COUNTY
IMPROVEMENT AUTHORITY,

     Defendants-Respondents.
______________________________

                   Argued telephonically March 24, 2020 –
                   Decided May 12, 2020

                   Before Judges Fisher, Gilson and Rose.

                   On appeal from the Superior Court of New Jersey, Law
                   Division, Middlesex County, Docket No. L-2342-18.

                   A. Matthew Boxer argued the cause for appellant
                   (Lowenstein Sandler LLP, and Gruen & Goldstein,
                   attorneys; A. Matthew Boxer, Jarrett R. Schindler, and
                   Fred R. Gruen, on the briefs).

                   Thomas A. Abbate argued the cause for respondent
                   County of Union (DeCotiis, FitzPatrick, Cole & Giblin,
            LLP, attorneys; Thomas A. Abbate, of counsel and on
            the briefs; Gregory J. Hazley, on the brief).

            John F. Gillick argued for respondent Union County
            Improvement Authority (Rainone Coughlin Minchello,
            LLC, attorneys; John F. Gillick, on the brief).

PER CURIAM

      In these consolidated matters, H.C. Equities, L.P. (H.C.) appeals from two

orders granting defendants' motions to dismiss H.C.'s tort claims for failure to

send a timely notice as required by the New Jersey Tort Claims Act (TCA),

N.J.S.A. 59:1-1 to 12-3. H.C. also appeals from orders denying its cross-motion

for an extension to file the tort claims notice. H.C. argues that it substantially

complied with the TCA notice requirement by sending a series of letters to the

lawyers representing defendants.     We agree.    Accordingly, we reverse and

remand.

                                        I.

      We take the facts from the record developed on the motions to dismiss,

which included documents and certifications beyond the pleadings. While the

facts related to H.C.'s underlying claims are disputed, the material facts

concerning the tort claim notice are established by the record.

      These appeals arise from a long-standing landlord-tenant dispute between

H.C. and the County of Union (the County).         H.C. owns two buildings in

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Elizabeth, known as the Albender building and the Bank building (collectively

the Buildings). In 1998, H.C. leased the Buildings to the County for twenty-

five years. The County then allowed the judiciary to use those buildings as

offices for the probation department.

      In July 2012, the Albender building was damaged by a fire. Consequently,

the Albender building was vacated for several months and the County withheld

rent payments. In 2013, H.C. sued the County for breach of the lease and sought

damages for unpaid rent and late fees (the First Suit).

      While the First Suit was pending, the parties engaged in settlement

discussions. H.C. made a settlement offer proposing, among other things, a

twenty-year extension of the lease. The County did not accept H.C.'s offer.

Nevertheless, the parties continued to engage in settlement discussions.

      In April 2015, the First Suit was voluntarily dismissed without prejudice

so that the parties could continue settlement discussions. The dismissal order

stated that H.C. could reinstate the action and, if the action was reinstated, the

new trial date would be September 8, 2015.

      H.C. contends that the parties thereafter worked towards finalizing a

settlement on terms that H.C. had previously proposed. H.C. also asserts that

the County informed it that it wanted to conduct a study of its office space needs

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before formally agreeing to the settlement and the twenty-year lease extension.

The County, by contrast, contends that no agreement was reached. The County

also asserts that in 2015, it independently studied its office space needs.

According to the County, it retained the Union County Improvement Authority

(the Authority) to oversee the study.       The Authority, in turn, retained an

independent real estate firm, Colliers International (Colliers), to conduct the

study.

         In January 2017, Colliers prepared a "Review Draft" of the study, which

was sent to a "working group" for review (the Draft Study). The Draft Study

discussed numerous buildings, including the "Albender/Bank Building." In

discussing the "Albender/Bank Building," the Draft Study noted certain

"[s]ubstantial disadvantages" concerning that building, including "a small and

inefficient floor plate, significant physical issues, and distance from the main

judiciary complex. Extensive use of office space for file storage [is] not cost

efficient."

         The Draft Study was not sent to H.C., but H.C. obtained a copy. On

February 22, 2017, counsel for H.C. sent a letter to counsel for the County and

the Authority. In that letter, H.C. objected to "incorrect factual assumptions" in

the Draft Study concerning the Buildings. H.C. requested that the study be

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withdrawn and not considered by the County. The letter went on to state that if

the Draft Study was not withdrawn, H.C. "will likely proceed with its original

claim in [the First Suit] and prosecute additional causes of action against the

appropriate parties including, but not limited to, tortious interference with the

settlement, tortious interference with contract, and tortious interference with

prospective economic advantage." In addition, the letter advised the County and

the Authority that H.C. was asserting a litigation hold and demanding that all

documents and materials concerning the dispute be preserved for litigation.

      On March 8, 2017, counsel for H.C. sent a second letter, addressed to

counsel for the Authority, and copying counsel for the County. That letter

iterated H.C.'s concern about "the skewed conclusions and false statements of

'fact'" in the Draft Study. The letter also stated that H.C. "wishes to avoid

litigation" but was prepared to "pursue those who sought to interfere with the

final execution of the 'settlement agreement'" and to "reinstate . . . its original

multimillion-dollar claims."

      The following day, on March 9, 2017, another lawyer for H.C. sent a third

letter to counsel for the County. That letter advised that counsel had been

retained "to pursue all available remedies in connection with [the County's

failure] to settle and arising out of the failure." In that regard, the letter stated:

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"we will shortly be filing a civil action on behalf of [H.C.] in the Superior Court

of New Jersey for injunctive relief and/or recover[y] [of] damages due [H.C.]

from Union County and County employees and others in connection with the

initial Settlement Agreement or its attempted frustration." Finally, the letter

iterated H.C.s demand for a litigation hold.

      On June 13, 2017, another attorney for H.C. sent the County a claim for

damages on a tort claim form. In terms of its claim for damages, H.C. asserted:

            As set forth in the addendum, attached hereto, claimant
            has suffered damages arising from tortious interference
            with contract, tortious interference with prospective
            economic gain, violations of 42 U.S.C. § 1983 and the
            N.J. Civil Rights Act, violations of the Equal Protection
            and Due Process Clauses of the United States
            Constitution, racketeering, conspiracy, defamation, and
            trade libel.

As referenced, the alleged claims were further detailed in a twelve-page

addendum attached to the tort claim notice.

      In September 2017, Colliers sent the County a "Real Estate Strategic Plan:

Programming Study for Probation" (the September 2017 Report). H.C. contends

that the September 2017 Report was a final version of the Draft Report issued

in January 2017. It also alleges that the September 2017 Report contained

inaccuracies and misrepresentations about H.C.'s Buildings.          The County

disputes H.C.'s characterizations of the September 2017 Report. The County

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                                        6
asserts that the September 2017 Report was a second and separate report, which

focused on the office space needs of the probation department.

      In April 2018, H.C. filed this action against the County and the Authority.

In its complaint, which it later amended, H.C. asserted seven causes of action:

(1) breach of lease against the County; (2) breach of the settlement agreement

against the County; (3) breach of the implied covenant of good faith and fair

dealing against the County; (4) trade libel against the Authority; (5) conspiracy

against the County and the Authority; (6) tortious interference with contract and

prospective economic advantage against fictitiously named defendants; and (7)

promissory estoppel against the County.

      In May and July 2018, the Authority and County separately moved to

dismiss H.C.'s complaint. Those motions were primarily focused on the lack of

substance of the asserted causes of action. The Authority raised the lack of tort

claim notice in its reply brief, and the County did not raise that issue in its initial

motion. In orders issued on August 15, 2018 and October 26, 2018, the trial

court denied both motions to dismiss without considering the tort claim notice

defense.

      In October 2018, after H.C. amended its complaint, the Authority again

moved to dismiss the complaint. In that second motion, the Authority argued

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that H.C. had not filed a timely notice under the TCA. H.C. opposed the motion

and cross-moved for an extension to file the tort claim notice.

      On January 25, 2019, the trial court heard oral arguments on the

Authority's motion and H.C.'s cross-motion. The Court denied H.C.'s cross-

motion and granted the Authority's motion dismissing H.C.'s complaint against

the Authority with prejudice. The court explained the reasons for its ruling on

the record and issued an order that same day.

      The trial court determined that H.C.'s tort claims had accrued no later than

March 8, 2017, when counsel for H.C. sent counsel for the Authority a letter

identifying the claims. The court then found that the tort claim notice sent on

June 13, 2017, was sent five days beyond the TCA's ninety-day limit. Finally,

the court held that it could not grant an extension for H.C. to file a tort claim

notice because H.C. had filed its cross-motion in October 2018, more than one

year after the claim accrued on March 8, 2017. As permitted by Rule 2:2-3(a),

H.C. filed a notice appealing the January 25, 2019 order dismissing its complaint

against the Authority.

      In April 2019, the County moved to dismiss H.C.'s tort claims against it.

Like the Authority, the County argued that H.C. had failed to file a timely tort

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claim notice. H.C. opposed the motion and again cross-moved for an extension

of time to file a tort claim notice.

      On May 31, 2019, the trial court heard oral argument, denied H.C.'s cross-

motion, and granted the County's motion. That day, the court entered an order

dismissing with prejudice the conspiracy claim (count five) of H.C.'s complaint

and dismissing without prejudice the promissory estoppel claim (count seven)

of H.C.'s complaint. The court explained the reasons for its ruling on the record.

      Relying on its reasoning on the Authority's motion, the trial court found

that H.C.'s tort claims against the County had accrued on March 8, 2017. The

court then found that the notice sent on June 13, 2017, was five days la te. In

addition, the court found that the County had not waived the tort claim notice

defense.   Finally, the court denied H.C.'s cross-motion for an extension,

reasoning that the motion was brought beyond the one-year limitation period.

      Because H.C. had previously withdrawn its claim that there was a valid

settlement agreement (counts two and three), the only remaining claim against

the County was the claim for breach of the lease (count one). 1 H.C. thereafter

filed a separate appeal challenging the May 31, 2019 order. Again, H.C. had a

1
 The status of count six, which asserts claims against fictitious defendants, is
unclear.
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                                        9
right to file that appeal since it was appealing an order denying a motion to

extend the time to file a tort claim notice. R. 2:2-3(a)(3). We then granted

H.C.'s motion to consolidate the two appeals.

                                       II.

      On appeal, H.C. raises four arguments contending (1) the letters it sent in

February and March 2017 substantially complied with the TCA's notice

requirement; (2) the notice it sent in June 2017 was timely because the tort

claims had not accrued more than ninety days before that notice; (3) the County

and Authority waived the tort claim notice defense; and (4) H.C. was entitled to

an extension of time to file its tort claim notice. We conclude that the letters

sent in February and March 2017 substantially complied with the TCA notice

requirements. Accordingly, we reverse and remand on that basis. Given that

ruling, we need not address H.C.'s remaining arguments.

                                     A.

      The trial court's interpretation and application of the TCA to undisputed

facts is a legal determination that we review de novo. See Jones v. Morey's Pier,

Inc., 230 N.J. 142, 153 (2017); Parsons v. Mullica Twp. Bd. of Ed., 440 N.J.

Super. 79, 83 (App. Div. 2015) ("[O]ur review of the meaning of a statute is de

novo, and we owe no deference to the interpretative conclusions reached by the

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trial court . . . ." (internal quotations omitted)). Moreover, the motions were

filed as motions to dismiss H.C.'s tort claims.      Because certifications and

materials beyond the pleadings were submitted in support of the motions to

dismiss, we treat them as motions for summary judgment. R. 4:6-2.

      We review summary judgment decisions de novo using the same standard

governing the motion court's decision. RSI Bank v. Providence Mut. Fire Ins.

Co., 234 N.J. 459, 472 (2018) (citing Bhagat v. Bhagat, 217 N.J 22, 38 (2014)).

Under that standard, summary judgment will be granted when "the competent

evidential materials submitted by the parties," viewed in the light most favorable

to the non-moving party, shows that there are no "genuine issues of material

fact" and that "the moving party is entitled to summary judgment as a matter of

law." Grande v. St. Clare's Health Sys., 230 N.J. 1, 24 (2017) (quoting Bhagat,
217 N.J. at 38). If there are no genuine issues of fact, we then decide whether

the trial court's ruling on the law was correct. RSI Bank, 234 N.J. at 472

(citations omitted).

                                     B.

      The TCA governs when public entities are liable for a tort. Ben Elazar v.

Macrietta Cleaners, Inc., 230 N.J. 123, 133 (2007).        "As a prerequisite to

proceeding with a tort claim against a public entity, plaintiff must file a notice

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of claim within ninety days of the accrual of the cause of action." Ibid. (citing

N.J.S.A. 59:8-8). The plaintiff may file a late notice of claim within one year

of the accrual of claim, provided a court finds there is a showing of extraordinary

circumstances and the public entity has not been substantially prejudiced. Ibid.

(citing N.J.S.A. 59:8-9); see also O'Donnell v. N.J. Tpk. Auth., 236 N.J. 335,

345-47 (2019). The failure to file within ninety days, or within one year under

extraordinary circumstances, bars the claimant from bringing the tort claim

against the public entity. N.J.S.A. 59:8-8(a).

      The written notice must include the following information:

            (a) the name and post office address of the claimant;

            (b) the post-office address to which the person
            presenting the claim desires notice to be sent;

            (c) the date, place and other circumstances of the
            occurrence or transaction which gave rise to the claim
            asserted;

            (d) a general description of the injury, damage or loss
            incurred so far as it may be known at the time of
            presentation of the claim;

            (e) the name or names of the public entity, employee or
            employees causing the injury, damage, or loss, if
            known; and

            (f) the amount claimed as of the date of presentation of
            the claim, including the estimated amount of any
            perspective injury, damage, or loss, insofar as it may be

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            known at the time of the presentation of the claim,
            together with the basis of the computation of the
            amount claimed.

            [N.J.S.A. 59:8-4.]

      The notice must be signed, N.J.S.A. 59:8-5, and filed with the public

entity, N.J.S.A. 59:8-7. The notice need not be on the public entity's claim form

provided that the claimant sets forth the information required by the TCA.

Newberry v. Twp. of Pemberton, 319 N.J. Super. 671, 675 (App. Div. 1999).

The purpose of the notice is to allow the public entity to review and investigate

the claim, afford it the opportunity to settle the claim, allow it to correct the

conditions or practices that gave rise to the claim, and give it advance notice of

its potential liability. Velez v. City of Jersey City, 180 N.J. 284, 290 (2004);

Beauchamp v. Amedio, 164 N.J. 111, 121-22 (2000).

      In determining whether a writing constitutes sufficient notice under the

TCA, the doctrine of substantial compliance has been recognized. D.D. v. Univ.

of Med. & Dentistry of N.J., 213 N.J. 130, 159 (2013); Lebron v. Sanchez, 407
N.J. Super. 214, 216 (App. Div. 2009); Guerrero v. City of Newark, 216 N.J.

Super. 66, 72 (App. Div. 1987). "[S]ubstantial complaince means that the notice

has been given in a way, which though technically defective, substantially

satisfies the purposes for which notices of claims are required." Lebron, 407

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13
N.J. Super. at 216 (quoting Lameiro v. West N.Y. Bd. of Educ., 136 N.J. Super.
585, 588 (Law Div. 1975)). It is an equitable doctrine used "to avoid the harsh

consequences that flow from technically inadequate actions that nonetheless

meet a statute's underlying purpose." Cty. of Hudson v. State Dept. of Corr.,

208 N.J. 1, 21 (2011) (quoting Galik v. Clara Maass Med. Ctr., 167 N.J. 341,

352 (2001)).

      Accordingly, the doctrine operates "to prevent barring legitimate claims

due to technical defects." Ibid. (quoting Lebron, 407 N.J. Super. at 215). "In

general, it rests on a demonstration that a party took 'a series of steps . . . to

comply with the statute involved,' and those steps achieved the statute's purpose,

as for example, providing notice." Id. at 22 (quoting Galik, 167 N.J. at 353-54).

"Even so, the doctrine can only apply if there is no prejudice to the other party

and if there is a reasonable explanation why there was not strict compliance with

the statute." Ibid. (citation omitted).

      Applying these legal principles, we conclude that the three letters sent in

February and March 2017 substantially complied with the notice requirements

of the TCA. The letters were sent by H.C.'s lawyers to lawyers representing the

County and the Authority. Accordingly, those letters identified the claimant –

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                                          14
H.C.; where notices to H.C. were to be sent – to H.C.'s counsel; and the public

entities causing the alleged injuries – the County and the Authority.

      The letters also described H.C.'s tort claims. The letters stated that the

Draft Report contained inaccurate information and contended that those

inaccuracies were injurious to H.C. The letters also complained that the County

and the Authority, together with others, were working against H.C. to undermine

the alleged settlement and cause H.C. damages. Accordingly, the attorneys

representing the County and the Authority were given sufficient notice of claims

of trade libel and conspiracy. In that regard, the letter dated February 2 2, 2017,

stated: "H.C. Equities will likely proceed with its original claims in the Superior

Court, prosecute additional causes of action against the appropriate parties

including, but not limited to, tortious interference with the settlement, tortious

interference with contract and tortious interference with prospective economic

advantage." In similar vein, the letter dated March 9, 2017, stated that the

lawyer for H.C. had been retained to "pursue all available remedies" and that

H.C. "will shortly be filing a civil action" against the County and others.

      The letters also provided sufficient notice of the amount of H.C.'s claim.

The letter dated March 8, 2017, referred to H.C.'s original claims in the First

Suit as involving millions of dollars. The letters of February 22, 2017 and March

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                                       15
9, 2017 made clear that if a settlement was not reached, those claims, plus

additional tort claims, would be filed.

      The letters also should be read in context. H.C. and the County had

previously been involved in the First Suit. Accordingly, when the letters were

sent in February and March 2017 to lawyers representing the County and the

Authority, the County and the Authority were on notice that H.C. would pursue

its legal claims. The lawyers for the County and the Authority also clearly had

the ability to communicate with the attorneys for H.C. to clarify any questions

they may have had concerning the intent of the letters.        Thus, there is no

prejudice to the County or the Authority.

      Just as importantly, the purposes of the TCA notice requirement were

satisfied. The County and the Authority had the opportunity to settle with H.C.

if they chose.   The County and the Authority also had the opportunity to

investigate the facts and prepare a defense against H.C.'s claims. Similarly, they

had a chance to correct the practice giving rise to the claims; that is, H.C. was

demanding the removal of the alleged inaccuracies in the Draft Report and the

completion of the settlement. Finally, the County and the Authority knew in

advance of a lawsuit that they faced claims for millions of dollars in alleged

damages. See Velez, 180 N.J. at 290; Beauchamp, 164 N.J. at 121-22.

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      Accordingly, we reverse the trial court's orders dated January 25, 2019

and May 31, 2019. We remand with direction that the claims dismissed in those

orders be reinstated. In remanding, we express no view on the ultimate validity

of H.C.'s tort claims. In that regard, we note that this dispute primarily arises

out of a landlord-tenant arrangement based on a lease.

      Reversed and remanded. We do not retain jurisdiction.

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