Eagle Realty of Nj, LLC v. 111 Kero Holdings, LLC ( 2024 )

NOT FOR PUBLICATION WITHOUT THE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-0587-22
EAGLE REALTY OF NJ, LLC,
Plaintiff-Appellant,
v.
111 KERO HOLDINGS, LLC, and
BPREP 111 KERO ROAD, LLC,
Defendants-Respondents.
______________________________
Argued October 11, 2023 – Decided January 16, 2024
Before Judges Sumners and Rose.
On appeal from the Superior Court of New Jersey,
Chancery Division, Bergen County, Docket No.
C-000198-21.
Malcolm J. McPherson argued the cause for appellant.
Kenneth K. Lehn argued the cause for respondents
(Winne, Banta, Basralian & Kahn, PC, attorneys;
Kenneth K. Lehn, on the brief).
PER CURIAM
Plaintiff Eagle Realty of NJ, LLC appeals the Chancery Division order
granting summary judgment to defendants 111 Kero Holdings, LLC and BPREP
111 Kero Road, LLC. Plaintiff sought injunctive relief and removal of a curb,
guardrail, and fence separating the parties' commercial properties, and alleged a
claim of bad faith against Kero Holdings regarding an attempt to settle a
previously dismissed similar action. We affirm because we conclude there are
no genuine issues of material fact precluding dismissal of plaintiff's complaint
as a matter of law.
The following facts are viewed in the light most favorable to plaintiff as
the non-moving party. Polzo v. County of Essex, 209 N.J. 51, 56 n.1 (2012)
(citing Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523 (1995)). In
November 2018, plaintiff and Kero Holdings were owners of commercial
properties and buildings in Carlstadt, sharing a property line of about 100 feet
long with loading docks at the rear of plaintiff's property, which was occupied
by Beta Industries, Inc. Due to drainage, flooding, and hazardous conditions
along the property lines, the New Jersey Sports and Exposition Authority
(NJSEA) issued a "Non-Compliance Warning" to the parties. Plaintiff declined
Kero Holdings' request to cooperatively remediate the problem, claiming it was
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caused by modifications made by another neighboring property owner. NJSEA
found no "evidence to support [plaintiff's] claim."
Following a plan approved by the NJSEA, Kero Holdings resolved the
problem without plaintiff's assistance. Along the joint property line, Kero
Holdings constructed a one-foot-high curb with a guardrail, erected security
fencing to separate the properties, and built a filtered drain into the curb to
channel and redirect the surface water into a sump pump. The improvements,
however, prevented tractor trailers from backing into or exiting from the loading
docks at the rear of plaintiff's property because the vehicles could no longer
drive onto the adjacent Kero Holdings' property.1
According to plaintiff, after purchasing the property in 1977, tractor
trailers had more than thirty years of continuous access to its loading docks,
thereby giving plaintiff a prescriptive easement, which Kero Holdings'
improvements curtailed. Plaintiff acknowledged there was no written or oral
agreement allowing tractor trailers to enter onto Kero Holdings' property to
access plaintiff's loading docks. Instead, plaintiff "took it for granted" it could
do so indefinitely.
1
Although Kero Holdings no longer owns the property, for convenience we
refer to the property as "Kero Holdings' property."
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This action was filed after plaintiff's initial Chancery Division suit against
Kero Holdings seeking injunctive relief and removal of the improvements was
dismissed. Following the close of discovery, the parties advised the court they
had negotiated a non-binding letter of intent to settle the matter "subject to
preparation and execution of . . . transactional documents; primarily a [l]icense
to permit access to each other's property for tractor trailers seeking access to
loading docks" and other terms. After the parties could not agree upon a written
settlement agreement, they both unsuccessfully moved to enforce terms they
believed were binding and sought attorney fees.
The court determined the parties did not have a meeting of the minds
regarding the material terms of a settlement. The court's order did not expressly
dismiss plaintiff's complaint, but effectively did so without prejudice, stating:
"The parties are directed to file a new action wherein claims regarding a
purported settlement can be raised. The parties shall serve and file pleadings in
such new action within forty-five (45) days of this [o]rder." . The order was
not appealed.
Plaintiff complied with the court's order by filing this action, seeking the
same relief as its initial action, and adding BPREP 111 Kero Road, the new
owner of Kero Holdings' property, as a defendant. Plaintiff also added a claim
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of bad faith against Kero Holdings for failing to formalize the settlement of the
initial action.
In response, defendants sent a Rule 1:4-8 frivolous claim letter to
plaintiff's counsel demanding dismissal of the action because there was no basis
in law for the claims. The letter contended plaintiff's managing member's sworn
statements and deposition testimony in the initial action indicated plaintiff's
access to Kero Holdings' property was "a revocable license[,] not a prescriptive
easement."
Plaintiff did not dismiss its complaint, but the trial court eventually did so
by granting defendants' summary judgment motion dismissing the complaint
with prejudice. The court, however, denied defendants' request for Rule 1:4-8
sanctions. The court explained its reasoning in a written decision. Plaintiff's
appeal followed.
Our review of a summary judgment order is de novo, applying the same
standard as the trial court, Conforti v. County of Ocean, 255 N.J. 142, 162
(2023). Summary judgment should only be granted where "there is no genuine
issue as to any material fact challenged and that the moving party is entitled to
a judgment or order as a matter of law." Branch v. Cream-O-Land Dairy, 244
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N.J. 567, 582 (2021) (quoting R. 4:46-2(c)). Applying these principles, we
conclude summary judgment was proper.
We initially point out that plaintiff contends there are genuine issues of
material fact barring summary judgment. Yet, our review of plaintiff's merits
and reply briefs leads us to conclude plaintiff failed to cite any genuine issues
of material facts precluding summary judgment. We are therefore left to only
address plaintiff's contentions it possessed a prescriptive easement and its bad
faith claims were sufficient.
Plaintiff contends the record established it had a prescriptive easement for
over thirty years, allowing tractor trailers access to its property by driving onto
Kero Holdings' property. The easement was violated when Kero Holdings'
remediation of poor draining and flooding on the parties' properties prevented
tractor trailers from accessing plaintiff's property.
"To establish an easement by prescription, a claimant must show a use
which is adverse or hostile, exclusive, continuous, uninterrupted, visible and
notorious for a period of [thirty] years." Mandia v. Applegate, 310 N.J. Super.
435, 443-44 (App. Div. 1998) (citing Baker v. Normanoch Ass'n, 25 N.J. 407,
419 (1957)). "The proponent of the easement must establish the elements by the
preponderance of the evidence." Yellen v. Kassin, 416 N.J. Super. 113, 120
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(App. Div. 2010) (citing Patton v. N. Jersey Dist. Water Supply Comm'n, 93
N.J. 180, 187 (1983)). Under the principle of "tacking," successors-in-interest
may establish the requisite statutory period if "each owner who acquires title
. . . satisf[ies] all the elements." Stump v. Whibco, 314 N.J. Super. 560, 568
(App. Div. 1998) (citation omitted).
Despite plaintiff's use of Kero Holdings' property for over thirty years,
plaintiff does not satisfy the other requirements establishing a prescriptive
easement. The court correctly found the sworn statements and deposition
testimony of plaintiff's managing member plainly show that plaintiff's use of
Kero Holdings' property was neither adverse nor hostile. Plaintiff does not rely
on a written easement agreement, instead contending it had "permission" that
was "admittedly tacit" from Kero Holdings, and its predecessors, to go onto their
property to access plaintiff's loading docks. This is insufficient. There are no
facts indicating, even slightly, that plaintiff's use of the property was hostile or
adverse. There is also no evidence that plaintiff's use of Kero Holdings' property
was exclusive, precluding Kero Holdings or its successor in interest BPREP 111
Kero Road use of the property. Kero Holdings had the unfettered right to
remediate the draining and flooding issues by the making the improvements on
its property even though it precluded tractor trailers access to plaintiff's
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property. Summary judgment dismissal of plaintiff's prescriptive easement
claim was appropriate.
As for the bad faith claim, plaintiff argues Kero Holdings "had no
intention to abide by the terms of the [l]etter of [i]ntent[,] . . . act[ing] in bad
faith by refusing to remove or lower the concrete curb separating the parties[']
properties, failing to maintain and repair the sump pump and drain[,] and
knowingly causing additional flooding onto [p]laintiff's property." The
argument falls flat. The court correctly dismissed the claim because it
"previously determined that there was no meeting of the minds with respect to
any alleged settlement" agreement, and "[d]efendants could not have violated
[an agreement] or acted in bad faith" to settle the initial matter. Because the
prior order dismissing the initial action was not appealed, plaintiff cannot revisit
that ruling in the current action.
Although not expressly stated by the court, res judicata and collateral
estoppel bar plaintiff's bad faith claim. The doctrine of "[r]es judicata prevents
relitigation of a controversy between the parties." Brookshire Equities, LLC v.
Montaquiza, 346 N.J. Super. 310, 318 (App. Div. 2002) (citing Selective Ins.
Co. v. McAllister, 327 N.J. Super. 168, 172 (App. Div. 2000)). "[F]or res
judicata to apply, there must be (1) a final judgment by a court of competent
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jurisdiction, (2) identity of issues, (3) identity of parties, and (4) identity of the
cause of action." Id. at 318-19 (citing McAllister, 327 N.J. Super. at 172-73).
All these elements were satisfied by the court's order denying motions by
plaintiff and Kero Holdings to enforce certain terms of the non-binding letter of
intent to settle the initial action.
For the same reasons, collateral estoppel applies. Collateral estoppel
arises "[w]hen an issue of fact or law is actually litigated and determined by a
valid and final judgment, and the determination is essential to the judgment."
Winters v. N. Hudson Reg'l Fire & Rescue, 212 N.J. 67, 85 (2012) (alteration in
original) (quoting Restatement (Second) of Judgments § 27 (Am. Law Inst.
1982)). The party against whom the doctrine is asserted must have been a party
to the earlier proceeding. Ibid. Plaintiff's motion to enforce a settlement was
denied because there was no binding agreement to settle.
To the extent we have not specifically addressed any of plaintiff's
arguments, we conclude they lack sufficient merit to warrant discussion in a
written opinion. R. 2:11-3(e)(1)(E).
Affirmed.
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