COURT HOUSE – The state Department of Environmental Protection (DEP) is asking a Superior Court judge to dismiss a counterclaim the City of North Wildwood brought against the state agency, seeking $21 million in damages stemming from a dispute over how to handle storm protection on the seaside resort’s beaches.
The city responded in court by arguing they stated several valid claims, and the state didn’t meet the high burden to dismiss the city’s case at this stage.
For a detailed history of the litigation between the DEP and North Wildwood, click here to visit the Herald’s case file, available exclusively to Herald subscribers. It includes a timeline and summary of the events pertinent to the litigation and primary source documents, including correspondence, legal arguments, applications, and other records relevant in the case.
The Standard in Reviewing a Motion to Dismiss
When considering whether to dismiss the complaint, the complainant is entitled to every reasonable inference of fact, and with that in mind, the court will consider the legal sufficiency of the alleged facts and review the complaint “in depth and with liberality to ascertain whether the fundament of a cause of action may be gleaned even from an obscure statement of claim,” according to established precedent.
If the court decides the complaint states no basis for relief and discovery would not provide one, dismissal of the complaint is appropriate. In other words, the claim must be dismissed if there is no basis for relief under any set of facts that could be proven, consistent with the allegations in the complaint.
A complaint can also be dismissed if the court finds the allegations in the complaint are only conclusory without presenting sufficient facts to support a cause of action. A claim also should be tossed if it fails to articulate a legal basis entitling the claimant to relief.
DEP’s Argument to Dismiss the $21M Counterclaim
The DEP argues North Wildwood’s case should be dismissed with prejudice, meaning it cannot be brought again, for failing to articulate a legal basis for the relief the city is requesting.
In a 60-page brief, filed March 15 by Deputy Attorney General Dianna E. Shinn, the state argues the city fails to allege facts that, even if presumed true, support a cause of action “in all six counts of its Counterclaim.”
“This case is simple. The Court lacks jurisdiction over NWW’s counterclaims. NWW is attempting to circumvent the administrative review process and the Appellate Division’s exclusive jurisdiction to review final agency actions by attempting to attack the merits DEP’s decisions (sic) regarding both the October 2022 and February 2023 EA (emergency authorization) applications,” the brief continued.
The brief further argues the city “seldom cites a specific Constitutional, statutory, regulatory, or common law provision that would give rise to a cause of action, and DEP is left to speculate about what causes of action are being leveled against it. Additional discovery will also not provide a basis for relief for any of the counts.”
The DEP makes a seven-point argument for the court to dismiss the city’s counterclaim:
The city has improperly requested to allow a bulkhead to be constructed without a DEP permit.
The DEP did not breach the state aid agreement it had with the city and the claim by North Wildwood is premature.
North Wildwood fails to plead a factual basis to support its claim that the DEP has breached its obligations under the public trust doctrine.
The city inappropriately seeks an order of mandamus – a writ from a court to an inferior government official, ordering that official to properly fulfill their official duties or correct an abuse of discretion – in seeking to get the DEP to provide funding from the Shore Protection Fund.
North Wildwood failed to articulate a viable nuisance claim and lacks standing to bring such a claim because the state is immune from liabilitypursuant to the Tort Claims Act.
North Wildwood failed to articulate a viable claim that the DEP violated the APA (Administrative Procedure Act) and the court lacks jurisdiction to grant such relief.
The city has not exhausted its administrative remedies to challenge the $12.8 million in penalties the DEP issued to North Wildwood.
“DEP has worked andremains committed to working with NWW to confront any concerns regarding shore protection while also complying with the environmental laws of the State. Instead of constructively working with DEP to explore and implement non-structural solutions to their beachfront erosion, NWW filed multiple counterclaims seeking to nullify DEP’s statutory role in shore protection, avoid NWW’s own municipal responsibilities to maintain the beach, and dodge liability for past environmental violations,” the state argues. “As a result, DEP is compelled to file this motion to dismiss.”
North Wildwood’s Counter Argument
In response to the DEP’s motion to dismiss, the city filed a brief in opposition, in addition to a cross motion for leave to file a second amended counterclaim.
According to the 47-page brief filed April 21 by Anthony S. Bocchi, an attorney for the city, the proposed second amended counterclaim does not add any new counts but adds additional facts in support of multiple claims already made in the city’s first amended counterclaim.
“These additional facts further buttress the legal and factual basis for these claims,” North Wildwood’s lawyers write in the brief.
The city argues it should be given leave to file a new amended counterclaim “in light of the generous standard governing the amendment of pleadings and in light of the fact that NJDEP has not even answered North Wildwood’s Counterclaim…. A trial date has not been fixed. No depositions have occurred. Document discovery has not been produced.”
The city also makes its legal arguments in opposition to the motion to dismiss. The city argues the motion to dismiss should be denied because:
The DEP has failed to satisfy the stringent standard governing a court’s determination of a motion to dismiss for failure to state a claim.
In count two of the counterclaim, alleging breach of contract, the city unquestionably states a claim.
In count three of the counterclaim, alleging DEP’s violation of the public trust doctrine, the city unquestionably states a claim.
In count four of the counterclaim, seeking declaratory and mandamus relief in connection with some of DEP’s ministerial and non-discretionary statutory obligations, North Wildwood unquestionably states a claim.
In count five, alleging that the hazardous conditions of certain public beaches constitute a nuisance that was caused by the DEP’s neglect of its lawful obligations, the city unquestionably states a claim.
In count six, alleging that the DEP’s failure to adopt certain regulations governing the use of state aid on shore protection projects constitutes a violation of the Administrative Procedure Act, North Wildwood unquestionably states a claim capable of being known.
In support of its argument that the counterclaim against the DEP should not be dismissed, North Wildwood points out that they should get the benefit of all inferences that can be drawn in the city’s favor, citing precedent.
North Wildwood also argues the Supreme Court has made clear that a motion such as the DEP’s to dismiss should be granted “in only the rarest of instances” and without prejudice to file a new pleading.
“Even a cursory review of the face of the pleading discloses that the Counterclaim has stated the essential elements of well-established and cognizable claims under New Jersey law,” North Wildwood’s lawyers wrote in their filings.
DEP’S Letter to the Court in Response
In a letter to Judge Michael J. Blee, dated April 26, Shinn, the lawyer representing the DEP, requested the court hold the city’s motion to file a second amended counterclaim in abeyance, or, in other words, suspend considering it, until the DEP’s motion to dismiss the previously existing counterclaim is decided.
Shinn told the judge the motion is prejudicial to the DEP and procedurally improper under the court rules.
North Wildwood’s “failure to include these alleged facts in its first amended counterclaim should not be rewarded now. These alleged facts were well known to NWW previously, and nothing prevented it from raising these alleged facts earlier in the litigation,” the letter states.
Shinn goes on to write that the city “argues the new alleged facts do not change the substantive nature of each of the previously pled counterclaims. However, that argument falls flat because even a cursory review reveals that they clearly do. For example, new proposed counterclaim two is completely redrafted.”
Shinn requested of the judge that things proceed as scheduled with oral argument on the motion to dismiss May 22, but that the motion to bring a new amended claim not be a factor in that proceeding.
What’s Next?
So far, there has been no response to the state’s April 26 letter filed in the case by North Wildwood or the judge.
A hearing is still set for May 22 to decide on the motion. In her letter, the deputy attorney general suggested the state would be amenable to a status conference to discuss the issues and how the judge would like to proceed.
According to the current scheduling order, the DEP must submit its reply brief to North Wildwood’s opposition to the motion to dismiss by May 1, but Shinn asked the judge for an extra week in the letter.
To reach the reporter, Shay Roddy, email sroddy@cmcherald.com or call 609-886-8600, ext. 142.
