DAVID LERNER VS. CITY OF JERSEY CITY (L-5011-15, HUDSON COUNTY AND STATEWIDE) ( 2019 )

NOT FOR PUBLICATION WITHOUT THE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-1024-17T4
DAVID LERNER and
FERNANDO PICARIELLO,
Plaintiffs-Appellants,
v.
CITY OF JERSEY CITY and
STEVEN FULOP,
Defendants-Respondents.
____________________________
Submitted December 17, 2018 – Decided April 2, 2019
Before Judges Sumners and Mitterhoff.
On appeal from Superior Court of New Jersey, Law
Division, Hudson County, Docket No. L-5011-15.
Mandelbaum Salsburg, PC, attorneys for appellants
(Steven I. Adler and Jennifer E. Presti, on the brief).
Calcagni & Kanefsky, LLP, attorneys for respondent
Steven Fulop; Peter J. Baker, Corporation Counsel,
attorney for respondent City of Jersey City (Martin B.
Gandelman, Kevin J. Musiakiewicz and Scott W.
Carbone, Assistant Corporation Counsel, on the joint
brief).
PER CURIAM
This matter arises from the inability of plaintiffs David Lerner and
Fernando Picariello to obtain employment with defendant City of Jersey City
following their loss of employment with the Jersey City Parking Authority
(JCPA), which was dissolved by the administration of the newly elected Jersey
City Mayor, defendant Steven Fulop. Plaintiffs appeal the May 5, 2016 order
granting defendants' motion to dismiss their complaint which alleged political
patronage discrimination in violation of the New Jersey Civil Rights Act (CRA),
N.J.S.A. 10:6-1 to -2, and wrongful discharge in violation of public policy
pursuant to Pierce v. Ortho Pharm. Corp., 84 N.J. 58 (1980). Plaintiffs also
appeal the August 19, 2016 order denying their motion for reconsideration. We
affirm because we conclude that, as a matter of law, plaintiffs’ allegations did
not establish Pierce and tortious interference claims nor violations of the CRA.
I
In June 2013, Fulop was elected mayor defeating incumbent Jeremiah
Healy. Shortly thereafter, fulfilling one of his campaign promises, Fulop’s
administration applied to the New Jersey Civil Service Commission
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(Commission) to dissolve the JCPA 1 and have its employees absorbed as civil
service employees into Jersey City’s Department of Public Safety.
In the Commission’s Final Administration Action on August 1, 2014
(2014 FAA), the abolishment of the JCPA was approved. The Commission
further determined that eighty-six JCPA employees, who were employed with
the agency for at least one year before July 1, 2014, would be formally
reassigned to the Department of Public Safety. A month or two prior to the 2014
FAA, JCPA employees were notified of their new civil service job titles and
proposed positions with the Department of Public Safety, based upon a review
by the Commission’s Division of Classification and Personnel Management of
their prior job classifications and years of service with the JCPA.
Plaintiffs did not receive a similar welcoming notification. In a November
14, 2014 letter, Jersey City advised them that the JCPA would dissolve on
January 1, 2015, and they would not be offered positions with the Department
of Public Safety. Plaintiffs did not have written employment agreements with
the JCPA. At the time, Lerner, JCPA's Assistant CEO and Acting Director of
Enforcement, had twenty years of service with the agency. Picariello, with
1
JCPA, a non-civil service agency, was an autonomous Jersey City agency
created in 1949 pursuant to N.J.S.A. 40:11A-1 to enforce Title 39 violations and
Jersey City ordinances.
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about two years of less service, held the position of Acting Special Assistant-
Insurance. Plaintiffs' last workday was on or about December 21, 2014; they
were not provided any severance or advised of other job opportunities with the
Jersey City government.
Seeking relief from the Commission, plaintiffs challenged their
termination claiming civil service laws protected their employment with the
JCPA. In response, Jersey City asserted that "[d]ue to administrative issues,
including the [c]ity [c]ouncil's need to vote on a budget that would keep the
JCPA open, that absorption [of JCPA employees] did not occur until January 1,
2015" and that any references in the 2014 FAA to July 1, 2014, must be read as
January 1, 2015. As for plaintiffs, Jersey City noted that they never became
Jersey City employees because after a review of the JCPA employees' job
functions, it determined that plaintiffs' "job functions were duplicative of
positions already filled by permanent [Jersey City] employees."
On August 21, 2015, the Commission issued a Final Administration
Action (2015 FAA) concluding that since Jersey City did not appoint plaintiffs
to positions, it was "without jurisdiction to review their claims." Plaintiffs did
not appeal that determination.
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Having previously served Jersey City with a tort claims notice under
N.J.S.A. 59:8-8, plaintiffs instead sought relief in the Law Division alleging
Pierce claims and violations of Article I, Paragraphs 5 and 6 of the New Jersey
Constitution under the CRA, on the basis that Jersey City and Fulop fired them
from the JCPA and refused to hire them to work for the municipal body solely
due to their support of Healy in the mayoral election.
In lieu of filing an answer to the complaint, defendants filed a Rule 4:6-
2(e) motion to dismiss the complaint. Plaintiffs cross-moved to amend their
complaint to add a count of tortious interference with their contractual relations
with the JCPA and their prospective economic advantage.
The motion judge granted defendants' motion to dismiss, placing his
reasons on the record. He ruled since plaintiffs had no legal right to their
positions with the abolished JCPA, and Jersey City never hired them as
determined by the Commission in its 2015 FAA, they could not establish claims
under Pierce or the CRA. Although the judge granted plaintiffs' motion to
amend their complaint to add a claim of tortious interference with regard to the
JCPA, he did not allow plaintiffs to add a claim of tortious interference against
Fulop. Noting plaintiffs were not employed by Jersey City, he determined, as a
matter of law, to the extent that Fulop interfered with plaintiffs' relationship, he
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did so as the mayor and as a representative of Jersey City, therefore, the tri-
partite relationship needed to establish a tortious interference claim could not be
formed. Printing Mart-Morristown v. Sharp Elecs. Corp., 116 N.J. 739, 752
(1989). Thereafter, the parties entered into a stipulation dismissing the
remaining portion of plaintiffs’ tortious interference claims against JCPA, which
disposed of the complaint's remaining claims and entitled plaintiffs to appeal as
of right.
II
Initially, plaintiffs argue the judge erred in relying on defendants'
submission of the 2015 FAA, which they did not mention or rely upon in their
complaint; thereby improperly converting the motion to dismiss to a summary
judgment motion. In doing so, plaintiffs maintain the judge failed to adhere to
guidelines governing summary judgment motions; making factual findings
without allowing them the ability to conduct discovery.
Defendants disagree. They contend the judge did not convert the motion
to dismiss to a summary judgment motion by relying upon the 2015 FAA
because he acted within his discretion under Rule 4:6-2 and its federal
counterpart a Fed. R. Civ. P. 12(b)(6) motion, to rely upon a document that is
"integral to . . . the complaint 'may be considered' without converting the motion
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[to dismiss] into one for summary judgment." In re Burlington Coat Factory
Sec. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997) (emphasis in the original).
Defendant also maintains that because the 2015 FAA is a public record that
prompted plaintiffs' claims, it was appropriate for the judge to rely upon it in
deciding the motion to dismiss. Banco Popular N. Am. v. Gandi, 184 N.J. 161,
183 (2005).
We look at the following principles to guide us. Appellate review of a
trial court's ruling on a motion to dismiss is de novo. Watson v. New Jersey
Dep't of Treasury, 453 N.J. Super. 42, 47 (App. Div. 2017). Since our "review
is plenary[,] . . . we owe no deference to the trial judge's conclusions." State v.
Cherry Hill Mitsubishi, 439 N.J. Super. 462, 467 (App. Div. 2015) (citation
omitted). In considering a motion under Rule 4:6-2(e), courts must accept the
facts asserted in the complaint and should accord the plaintiff all favorable
inferences. Watson, 453 N.J. Super. at 47. "A complaint should be dismissed
for failure to state a claim pursuant to Rule 4:6-2(e) only if 'the factual
allegations are palpably insufficient to support a claim upon which relief can be
granted.'" Frederick v. Smith, 416 N.J. Super. 594, 597 (App. Div. 2010)
(quoting Rieder v. State Dep't of Transp., 221 N.J. Super. 547, 552 (App. Div.
1987)). "This standard requires that 'the pleading be searched in depth and with
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liberality to determine whether a cause of action can be gleaned even from an
obscure statement.'" Ibid. (quoting Seidenberg v. Summit Bank, 348 N.J. Super.
243, 250 (App. Div. 2007)).
Generally, when the trial court has considered matters outside the
pleadings, the motion to dismiss on the failure to state a claim becomes one for
summary judgment. See R. 4:6-2. Our Supreme Court has nevertheless stated
that, "[i]n evaluating motions to dismiss, courts consider 'allegations in the
complaint, exhibits attached to the complaint, matters of public record, and
documents that form the basis of a claim.'" Banco Popular N. Am, 184 N.J. at
183 (emphasis added.) (quoting Lum v. Bank of Am., 361 F.3d 217, 221 n.3 (3d
Cir. 2004)). "The purpose of this rule is to avoid the situation where a plaintiff
with a legally deficient claim that is based on a particular document can avoid
dismissal of that claim by failing to attach the relied upon document." Lum, 361
F.3d at 221 n.3; see also In re Burlington Coat Factory Sec. Litig., 114 F.3d at
1426 ("the primary problem raised by looking to documents outside the
complaint – lack of notice to the plaintiff – is dissipated 'where plaintiff has
actual notice . . . and has relied upon these documents in framing the
complaint.'"). Thus, in reviewing a motion under Rule 4:6-2(e), a court may
consider documents referred to in the complaint, matters of public record, or
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documents explicitly relied on in the complaint, without converting the motion
to dismiss into one for summary judgment. See N.J. Citizen Action, Inc. v. Cnty.
of Bergen, 391 N.J. Super. 596, 605 (App. Div. 2007).
Here, the motion judge properly applied the standards of Rule 4:6-2(e).
Although plaintiffs may not have expressly cited the 2015 FAA in their
complaint, the allegations therein challenge the facts and determinations in the
2015 FAA, of which plaintiffs were aware. As the determinations of the 2015
FAA were legal in nature, it was within the discretion of the motion judge to
take judicial notice of the 2015 FAA, whether requested or not. N.J.R.E. 201(a),
(c).
There is no question the 2015 FAA – a public record – denied plaintiffs
their right to pursue claims against defendants because it determined they were
never employed by Jersey City. Thus, the 2015 FAA was integral to plaintiffs'
complaint because it adjudicated the motion judge's analysis of their right to
pursue Pierce or CRA claims.
Pierce Claims
A Pierce claim is based upon our Supreme Court's recognition "that an
[at-will] employee has a cause of action for wrongful discharge when the
discharge is contrary to a clear mandate of public policy." Pierce, 84 N.J. at 72.
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"The sources of public policy include legislation; administrative rules,
regulations or decisions; and judicial decisions." Ibid.Because plaintiffs were never employed by Jersey City, as determined by
the 2015 FAA that went unappealed, we thus agree with the motion judge that
they do not have a cause of action under Pierce against Jersey City. And, since
a Pierce claim only lies against an employer, not individual employees, the claim
was properly dismissed as to Fulop. See O'Lone v. New Jersey Dep't of Corr.,
313 N.J. Super. 249, 256 (App. Div. 1998).
There is an additional basis to dismiss the Pierce claims against
defendants. As defendants contend, plaintiffs' claims are more aligned with a
failure to hire claim. Plaintiffs' allege in their complaint that "defendants'
decision not to hire them as Jersey City employees was against public policy."
However, the failure to hire is not a cause of action that is recognized under
Pierce. See Sabatino v. Saint Aloysius Parish, 288 N.J. Super. 233, 240 (App.
Div. 1996) (holding that school's failure to hire the principal of a parochial
school, did not state a claim under Pierce).
We further conclude there is no merit to plaintiffs' contention that even if
they were not technically hired by Jersey City, the municipality effectively
terminated their employment and they should still be able to pursue their Pierce
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claims. Granted their positions with the JCPA were terminated, as were all of
the agency's positions when the 2014 FAA approved Jersey City's application to
abolish the JCPA for fiscal efficiency purposes. However, as the judge found,
plaintiffs had no right to employment with the JCPA because it ceased to exist
as of January 1, 2015. The decision not to hire plaintiffs was within the
defendants' discretionary authority protected by the TCA under N.J.S.A. 59:2-3
and N.J.S.A. 59:3-2. Jersey City explained that plaintiffs were not hired because
before the JCPA was absorbed, a review of the JCPA employees' job functions
determined that plaintiffs' positions were duplicative of positions performed by
permanent Jersey City employees and they were therefore not offered
employment with Jersey City.
CRA Claims
Plaintiffs claimed that violations of their constitutional rights under the
CRA are based upon their assertion that defendants abolished their positions
with the JCPA and denied them employment with Jersey City due to their
decision not to back Fulop's election campaign.
The CRA provides in pertinent part that:
Any person who has been deprived of . . . any
substantive rights, privileges or immunities secured by
the Constitution or laws of this State, or whose exercise
or enjoyment of those substantive rights, privileges or
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immunities has been interfered with or attempted to be
interfered with, by threats, intimidation or coercion by
a person acting under color of law, may bring a civil
action for damages and for injunctive or other
appropriate relief.
[N.J.S.A. 10:6-2(c) (emphasis added).]
The CRA thus provides a cause of action to any person who has been
deprived of any rights under either the federal or state constitutions by a
"person" acting under color of law. N.J.S.A. 10:6-2(c). The CRA, modeled
after the Federal Civil Rights Act, 42 U.S.C. § 1983, provides "a remedy for the
violation of substantive rights found in our State Constitution and laws." Brown
v. State, 442 N.J. Super. 406, 425 (App. Div. 2015) (quoting Tumpson v. Farina,
218 N.J. 450, 474 (2014)).
To support plaintiffs' theory of "revenge" and "political reprisal,"
Picariello alleges that Fulop refused to speak to him after Fulop asked him who
he supported for mayor and he replied Healy. Lerner alleges that Fulop knew
he was politically active as a ward coordinator, and provided financial support
to Healy's campaign. Finally, as an alternative to dismissing their complaint
with prejudice, plaintiffs argue the judge should have allowed them to amend
their complaint to allege threats, intimidation or coercion by Fulop. Lederman
v. Prudential Life Ins., 385 N.J. Super. 324. 349 (App. Div. 2006) (complaint
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should not be dismissed if an actionable theory may be articulated by
amendment of the complaint).
For essentially the same reasons that we determined the Pierce claims
were correctly dismissed, we conclude the CRA claims were appropriately
dismissed. Plaintiffs could not establish a violation of CRA because they had
no statutory right to continued employment nor a substantive due process claim
when a decision was made to fire or hire them. We agree with defendants that
Filgueiras v. Newark Pub. Sch., 426 N.J. Super. 449, 468 (App. Div. 2012) is
instructive. In determining whether the trial judge should have granted the
defendants' motion for judgment notwithstanding the verdict to dismiss
plaintiffs' CRA substantive due process claim, this court explained in Filgueiras
that:
"[A]n employee hired at will has no protected interest
in his employment and may not prevail on a claim that
his or her discharge constituted a violation of property
rights." Morgan v. Union County Bd. of Chosen
Freeholders, 268 N.J. Super. 337, 355 (App.Div.1993)
(citing Bd. of Regents v. Roth, 408 U.S. 564, 578
(1972)). In Nicholas v. Pa. State Univ., 227 F.3d 133,
142 (3d Cir. 2000), the court went further by
concluding that "tenured public employment is [not] a
fundamental property interest entitled to substantive
due process protection."
[426 N.J. Super. at 469-470 (alterations in original).]
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These principles apply here to the at-will employed plaintiffs, who enjoy
no statutory or contractual term of appointment. Stated simply, plaintiffs do not
have a protected property interest in continued employment at JCPA. Likewise,
as the Commission held, plaintiffs were never employed by Jersey City; thus,
they have no claim under the CRA against the municipality and its mayor for
not being appointed to positions. We further conclude there was no basis to
allow plaintiffs to amend their complaint to allege that defendants interfered
with any of plaintiffs' substantive rights by way of "threats, intimidation, or
coercion." Since plaintiffs had no right to employment at the JCPA nor right to
employment with Jersey City, an amendment to the complaint would have been
futile because the amended claims would have failed. See Notte v. Merchs. Mut.
Ins. Co., 185 N.J. 490, 501 (2006).
Tortious Interference Claims
Plaintiffs argue that Fulop's tortious interference satisfied the tri-partite
relationship needed to sustain their claim that he tortiously interfered with their
prospective economic advantage when they were not hired by Jersey City.
Cappiello v. Ragen Precision Industries, Inc., 192 N.J. Super. 523 (App. Div.
1984). Plaintiffs rely upon Printing Mart-Morristown, where the Court held that
a cause of action for tortious interference regarding contracts cannot be directed
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against a defendant who is a party to a contract, and this rule extends to agents
of a corporation. 116 N.J. at 752-53. In addition, acts committed by an agent
outside the scope of his employment or agency may satisfy the tripartite
relationship required for a tortious interference claim. See Silvestre v. Bell
Atlantic Corp., 973 F.Supp. 475, 486 (D.N.J. 1997).
These principles apply here, according to plaintiffs, because Fulop was an
agent of Jersey City, who as alleged in their complaint "wanted Jersey City to
absorb the JCPA so that he could fire those JCPA employees that had not
supported his campaign and appoint people who had supported him." In
addition, plaintiffs contends their complaint also alleged that because Fulop's
actions were taken for his own personal and political gain, he was an outsider to
the transaction, and thereby a third party "interloper" sufficient to form the
tripartite relationship. Furthermore, plaintiffs argue that by acting for his own
"personal motives," "beyond his authority" or "not in good faith in the [City's]
interest," Fulop can be found liable. As for Jersey City, plaintiffs contend it
may be vicariously liable for the tortious interferences by ratifying Fulop's
unlawful actions. See Cappiello, 192 N.J. Super. at 530-31. We are
unpersuaded.
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To establish a prima facie claim of tortious interference, a plaintiff must
establish four criteria. One, a complaint must allege facts that show some
protectable right – a prospective economic or contractual relationship. Printing
Mart-Morristown, 116 N.J. at 752. Although the right need not equate with that
found in an enforceable contract, there must be allegations of fact giving rise to
some "reasonable expectation of economic advantage." Harris v. Perl, 41 N.J.
455, 462 (1964). A complaint therefore, must demonstrate that a plaintiff was
in "pursuit" of business. Printing Mart-Morristown, 116 N.J. at 752.
Two, the complaint must allege facts claiming that the interference was
done intentionally and with "malice." Kopp, Inc. v. United Technologies, Inc.,
223 N.J. Super. 548, 559 (App. Div. 1988). Malice is defined to mean that the
"harm was inflicted intentionally and without justification or excuse." Rainier's
Dairies v. Raritan Valley Farms, Inc., 19 N.J. 552, 563 (1955).
Three, the complaint must allege facts leading to the conclusion that the
interference caused the loss of the prospective gain. Printing Mart-Morristown,
116 N.J. at 752-53. A plaintiff must show that "if there had been no
interference[,] there was a reasonable probability that the victim of the
interference would have received the anticipated economic benefits." Leslie
Blau Co. v. Alfieri, 157 N.J. Super. 173, 185-86 (App. Div. 1978).
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Four, the complaint must allege that the injury caused damage. Norwood
Easthill Assocs. v. Norwood Easthill Watch, 222 N.J. Super. 378, 384 (App.
Div. 1988).
Plaintiffs' complaint does not establish a prima-facie claim of tortious
interference because they can only satisfy the first and fourth requirements .
Their complaint alleges they were initially told their abolished JCPA positions
would be absorbed by Jersey City to allow them continued employment, thus
they had a reasonable expectation of economic advantage. And, since they did
not obtain jobs with Jersey City, they incurred damages of lost wages. Plaintiffs'
complaint, however, does not satisfy the second and third requirements because
it failed to allege facts that led to the conclusion that had it not been for Fulop's
alleged intentional interference, they would have received the anticipated
economic benefits.
In addition, on a motion to amend under Rule 4:9-1 it is within the "sound
discretion" of the judge to deny a motion if such amendment would be futile.
See Bustamante v. Borough of Paramus, 413 N.J. Super. 276, 298 (App. Div.
2010). As the judge had already determined plaintiffs were never employed by
Jersey City, we conclude it was reasonable for him to deny plaintiffs' request to
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amend the complaint to add a tortious interference claim against defendants
because it would have been a futile claim.
Because we conclude that the motion judge did not err in dismissing
plaintiffs' complaint, he properly exercised his discretion in denying plaintiffs '
motion for reconsideration. R. 4:49-2; Palombi v. Palombi, 414 N.J. Super. 274,
288 (App. Div. 2010).
To the extent we have not addressed arguments herein, we find them to be
without sufficient merit to warrant discussion in a written opinion. R. 2:11-
3(e)(1)(E).
Affirmed.
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